HOUSTON -- Two months after Hurricane Katrina raised myriad concerns over refining costs and capacity, two oil companies -- ConocoPhillips and Motiva Enterprises -- are making plans to expand their refining capacity in coming years.
Motiva Enterprises LLC, a joint venture between Shell Oil Co. and Saudi Refining Inc., has selected KBR to provide conceptualization, planning and early design services for a major refinery expansion being considered in the United States. This 325,000 barrel per day (BPD) capacity increase will be designed to process heavy [image-nocss] sour crudes. KBR is the engineering, construction and services subsidiary of Halliburton.
Our business plan is dedicated to improving our asset portfolio through capital investment to further strengthen and extend our core assets, said Bill Welte, Motiva president and CEO.
Motiva Enterprises LLC owns and operates refineries capable of refining approximately 780,000 barrels per day, a distribution system including ownership interests in 47 product terminals, and a marketing network that supports more than 9,000 branded gasoline stations in the Eastern and Southern United States.
As one of the first major U. S. refinery expansion projects in 30 years, this strategic initiative is part of Motiva's plan announced in September 2005 to increase refining capacity at one or more of its petroleum product refineries.
Meanwhile, ConocoPhillips said it sees spending between $4 billion and $5 billion over the next five years to increase capacity at its U.S. refineries. The company, which previously said it planned to boost capacity at nine of its 12 U.S. refineries, said it expects to spend money on the project from 2006 to 2011.
In terms of output, the company said it expects the investments overall to yield the equivalent of adding a world-scale refinery to its U.S. system. Conoco said it is also pursuing opportunities to grow its refining capacity outside of the United States.
Our strong reinvestment rate will continue in 2006, where we have earmarked an estimated $12 billion in investment activity, said company chairman and CEO Jim Mulva. This will fund our efforts to improve our access to worldwide exploration and production resources and increasing our refining capacity and capabilities.
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