Modular 60,000 barrels oil refinery is the way to go

Dear Editor,

Presently we import all of our refined petroleum products from crude oil such as motor gasoline, diesel, kerosene, fuel oil, jet fuel ,avgas, lubricants and bitumen. Crude oil production for the country will begin in 2020 and without a national refinery, we will continue to be exporters of raw materials and importers of manufactured goods which will be the  same as in the colonial era. To break this backwards economic cycle,  the need to refine the black gold becomes  only logical.

Presently the production of refineries in the Caribbean does not fulfill the needs of the consumers in the region and with the imminent closure of Petrotrin  this will only compound  the problem of fuel security. Our next neighbouring refinery which is Staatsolie in Suriname refines approximately 20,000 barrels per day which basically serves their daily consumption. Other refineries such as Isla in Curacao, St Croix etc are small, old and creaking. Our short and long- term fuel security lies in the construction of a 60,000 barrels modular refinery which will guarantee our daily supply of refined petroleum products.

A national refinery that will process 60,000 barrels of crude oil per day will basically cover our daily consumption plus products for export. Our average daily consumption is approximately 10,000 barrels of motor gasoline, 15,000 to 20,000 barrels of diesel with  less than point three percent sulfur or the Ultra Low Sulfur Diesel, 3,000 barrels of domestic kerosene, 3,000 Barrels of Jet A1 Kerosene and 10,000 barrels of HFO. The remaining 17,000 barrels of products can be exported to the region. Also, byproducts of the refinery such as bitumen will come in handy for the Road and Belt Project, the sulfur can be processed as Sulphuric Acid or as powdered Sulfur used to make matches which we can do locally.

The base oil for lubricants can also be produced which will enable us to manufacture our own lubricants. These are some of the spinoffs from the refinery that will open up a whole new area of investment for the private sector.

The establishment of a refinery will require its own generating plant as well as an international certified laboratory to test and verify each batch of product. The generating plant is vital for reliable and stable power to prevent any shutdown during production. The generating plant  can be built with excess power which can be sold to the national grid. Staatsolie in Suriname has this type of arrangement. A certified lab testing each batch will present an opportunity for our technicians to be trained to work in this lab.

Having a refinery in Guyana will present the opportunity for the University of Guyana to open a Faculty for Petroleum Production Engineers. I have personally witnessed the growth of Staatsolie local personnel at their refinery where when it was started the expatriates were about eighty percent and the locals twenty percent. Today it is totally the reverse with proud Surinamese running the refinery with over eighty percent of their own nationals.

Shipping will also see a boost. Oil tankers with low draft that can carry about 60,000 barrels will be needed to bring the crude oil from the Exxon Platform to the refinery and clean vessels will be needed to supply refined products to the oil majors and the region. This will present the opportunity for charterers, brokers, Insurance Agents and owners of oil tankers to participate in the trade.

A national modular 60,000 barrels refinery is the way to go. It will be a win-win situation.

Yours faithfully,

Reggie Bhagwandin

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