SOURCE: Industrial Info Resources

June 30, 2008 08:01 ET

The Arrival of Summer Presents Challenges for the Petroleum Refining Industry, a Feature of "Industry Today" on Industrialinfo.com

SUGAR LAND, TX--(Marketwire - June 30, 2008) - Researched by Industrial Info Resources (Sugar Land, Texas) -- The summer season generally brings with it higher demand for transportation fuels, which serves the Petroleum Refining Industry well, although the season also holds the potential for costly hurricanes. This summer, refiners have to worry not only about the weather, but also about the extreme cost of crude oil and the consumers that are increasingly changing their driving habits to reduce fuel consumption. Before the summer months arrived, consumer demand and consumption of transportation fuels had dropped in comparison with last year's demand.

The effect of reduced demand, a shortage in labor and the resulting depressed margins has influenced the delay of many planned turnarounds for the summer of this year. Currently, Industrial Info is tracking an estimated 145 unit or refinery turnarounds that are planned to take place during the summer of 2008. This is a 10% decrease in turnaround activity compared to 2007. Many refinery owners, hoping for better margins, have delayed major turnarounds until the summer 2009.

Summer weather patterns, specifically hurricanes, greatly influence refinery operations in the coastal regions of the U.S. A direct hit from a hurricane in the Gulf Coast region has the potential to disrupt offshore drilling operations as well as a large number of the 33 operating petroleum refineries located in the region that process an estimated 7.6 million barrels daily. The impact of a hurricane passing through Texas or Louisiana would be tremendous, creating complicated supply-and-demand problems.

In the U.S., there are a number of multi-billion dollar refinery expansions planned or underway, as well as grassroot construction of refineries. Some of these expansions are expected to provide new capacity by the 2010 or 2011 timeframe, alleviating some of the supply-side pressure. These expansions have their own set of challenges, including the extremely long lead delivery times for key components of the project. Coke drums and other specialty items can require as much as 32 to 36 months of delivery time, partly because of a backlog in the few shops capable of fabricating these critical and complicated pieces of equipment.

Join Chris Paschall, VP Petroleum Refining of Industrial Info Resources, along with Steve Table, the host of "Industry Today," for an informative look at expectations for this industry during the coming months. Click Here to listen to the Webcast or any of the more than 280 previous "Industry Today" webcasts covering topics important to industry spending, including trends, outlooks, and focus segments on specific industries.


Industrial Info Resources (IIR) is a marketing information service specializing in industrial process, energy and financial related markets with products and services ranging from industry news, analytics, forecasting, plant and project databases, as well as multimedia services. For more information, send inquiries to refininggroup@industrialinfo.com or visit us online at www.industrialinfo.com.

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