Natural gas prices are soaring…
Russia's natural gas reserves will…
Motiva Enterprises, owned by Saudi Aramco, is considering a relaunch of a previously halted expansion of its Port Arthur refinery with a petrochemical unit in 2023, Bloomberg reports, citing sources with knowledge of the plans.
Motiva became the sole owner of the largest refinery in the United States, the 630,000-bpd refinery in Port Arthur, after Saudi Aramco and Royal Dutch Shell split up their joint venture in 2017.
While Bloomberg reported that Motiva Enterprises is now looking to revive plans for a petrochemicals unit at the refinery, which were suspended in 2019, The Wall Street Journal reported separately on Monday that Motiva suspended the plans for expansion of US$6.6 billion, according to people with knowledge of the plans cited by the Journal. Saudi Aramco’s capital budget for this year, estimated at US$35 billion, will be almost exclusively spent on the Saudi oil giant ramping up its crude oil and natural gas production, the sources told the Journal.
The suspension of the Texas expansion plans doesn’t mean that the Saudi-owned Motiva has definitely dropped the project. It could revisit it again, but not for at least a year, according to the Journal’s sources.
Bloomberg’s sources, for their part, say that Motiva is considering reactivating part of that project, minus an ethane cracker, which was estimated to take most of the US$6.6 billion expansion cost—at around US$4.7 billion.
Motiva thinks that it no longer needs an ethane cracker, Bloomberg’s sources said.
Motiva declined to comment on the reports, telling both Bloomberg and the WSJ that it does not comment on market rumors and speculation.
Saudi Aramco has had to reset priorities in its capital expenditures after it went public at the end of 2019 and saw its revenues and profits slide in 2020 due to the oil price and oil demand crash. The $75-billion annual dividend to shareholders – the majority of which is the Kingdom of Saudi Arabia – which Aramco pledges to pay also weighs on its flexibility to finance new projects.
By Tsvetana Paraskova for Oilprice.com
More Top Reads From Oilprice.com:
Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.