ExxonMobil will postpone the startup of its Beaumont refinery expansion in Texas as the company faces low petroleum product demand and cash-saving measures amid the coronavirus pandemic, Bloomberg reported, citing sources familiar with the matter. The expansion project was previously targeted to start up by 2022, but it was delayed to 2023.
The project will increase Beaumont’s daily refining capacity to 619,000 bpd, making it the largest refinery in the US, surpassing Saudi Aramco’s 607,000 bpd Motiva refinery in Port Arthur, Texas. The expansion is aimed to provide a new outlet for Exxon’s growing upstream production in the Permian Basin. However, the COVID-19 pandemic has ravaged oil demand and forced the oil giant to reduce its 2020 capex.
Despite the startup delay, Exxon continues the construction of the complex’s new unit and supporting infrastructure. The sources added that the construction pace would accelerate in January 2021. The expansion will add new units to process light, low-sulfur crude. Before the Permian boom, US Gulf Coast refineries were primarily processing heavy, high-sulfur grade from Venezuela and Canada.
