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Russia: Refineries need boost to handle sour crude

03rd June 2013

Russia’s downstream sector requires a much needed upgrade in equipment to process crudes with a "critical" sulphur content which exceeds 2 per cent

Russia: Refineries need boost to handle sour crude
The majority of Russia's refineries handle crudes with a sulphur content of 1.7 per cent, which Transneft considers “critical values”

Russia’s refining sector needs a multi-million dollar revamping across the country so as to handle crude with higher concentrations of sulphur, Russia & CIS Business and Financial Newswire quoted the director of the Russian energy ministry’s oil and gas refining department Mikhail Gryaznov as saying.

"This is a global trend. Oil quality is declining throughout the world. What is happening in the western direction is inevitable,” Gryaznov told reporters.  “The main way to solve this issue is to increase sour crude refining within Russia. All refineries must be ready to take sour crude, the necessary equipment should be prepared, and companies that have announced plans to refine sour crude must implement these plans," he said said.

Gryaznov highlighted that alternative equipment and catalysts are needed to refine crudes with a sulphur content which exceeds 2 per cent. Russian refineries are currently processing crude with a sulphur content of up to 2 per cent.  Refineries need some USD 100m per per cent of mass fraction of sulphur, experts say.

Gryaznov’s statements follow similar warnings from state-owned national pipeline company Transneft. Over the past two years sulphur concentration in Russia’s oil export blend has average between 1.3-1.5 per cent, while the majority of its refineries handle crudes with sulphur content of 1.7 per cent, which Transneft considers “critical values”.

“The figures have reached a critical threshold, that is, the maximum value beyond which the production processes of refining make it impossible to produce petroleum products of commercial value without reconstructing and modernizing technological processes," Transneft's deputy vice president Igor Katsal said in April.

Russian President Vladimir Putin said in 2010 that the country’s oil industry would need some USD 280bn in investment in the next ten years, particularly its oil refining facilities, so as to curb estimates that oil extraction levels in Russia could fall 20 per cent by 2020.