State-owned Abu Dhabi National Oil Co (ADNOC) has started production from its crude and secondary units at the newly expanded Ruwais refinery, industry sources said on Thursday.
The majority of supply from the enlarged refinery is expected to meet rising domestic demand, with the rest likely to be shipped to Europe, traders said.
The refinery has started production at the crude unit and a hydrotreater and is producing oil products such as gasoil, jet fuel and naphtha, one of the sources said.
“The units are running smoothly and there are no issues right now, but it will take a while to evaluate,” the source said.
It will likely start production at its gasoline-making residual fluid catalytic cracker (RFCC) unit next month, the source added.
No further details were available on when the refinery would start exports of the oil products, but traders estimated that it could happen in the first half of this year.
The oil being produced is likely going into storage, the sources said. The specification of the oil products being produced were not clear.
The expansion is expected to more than double the capacity of the refinery from 415,000 barrels-per-day (bpd)and will process Abu Dhabi’s Murban crude oil.
Once fully commissioned, the expanded refinery is expected to produce an additional eight million tonnes a year of diesel and four million tonnes a year of jet fuel. The refinery currently produces five million tonnes a year of diesel and six million tonnes a year of jet fuel.
Ruwais’ expansion comes at a time when new refining capacity from the Middle East, including two new refineries in Saudi Arabia, are pressuring Asian diesel margins as Asian barrels to the west are displaced, traders said.