Arabia’s Abqaiq is processing 2m bbl/day of crude – Aramco

HOUSTON (ICIS)–The Abqaiq crude processing plant is running at 2m bbl/day, and it should recover from recent drone attacks by the end of September, the CEO of Aramco said on Tuesday in a statement.

The image provided by the US government and DigitalGlobe and annotated by the source, shows damage to the infrastructure at Saudi Aramco’s Khuirais oilfield in Buqyaq, Saudi Arabia. (Source: Uncredited/AP/Shutterstock)

Abqaiq is the world’s single largest crude-processing plant. It and the Khurais oilfield were attacked by drones, for which Houthi rebels in nearby Yemen claimed responsibility. The plants supply oil to Saudi Arabia’s three main petrochemical sites.

Refineries have been shut down, which feed petrochemical sites at Jubail to the east of Saudi Arabia, plus Rabigh and Yanbu on the west coast, which are connected by an oil and natural gas liquids pipeline across the country.

The update on the Abqaiq plant was given by Aramco CEO Amin Nasser during a news conference. He was there with Abdulaziz bin Salman, Saudi Arabia’s minister of energy.

Bloomberg quoted the minister as saying that oil output should reach 11m bbl/day by the end of September. It should reach 12m bbl/day by the end of November.

Neither the report by Bloomberg nor the statement from Aramco addressed the status of liquefied petroleum gas (LPG).

While Saudi Arabia is not the world’s largest LPG exporter, it still ships a relatively large amount of the material.

China has relied on Arabia for about 10% of all of its imports of liquefied propane since the start of 2018, according to Chinese customs data. China uses imported material to supply feedstock to its fleet of propane dehydrogenation (PDH) units.

Senior LPG analyst Yan Wang said the outage could cause a short-term rise in China’s LPG import costs. Nonetheless, PDH units should run normally as long as they remain profitable, Wang said, quoting a producer source.

She said the effect of Aramco’s outage will resemble those from the trade dispute with the US. In both cases, trade flows needed time to rebalance.

The effects of the outage in Saudi Arabia could ripple through China and disrupt other parts of the world, which have increasingly relied on LPG as a feedstock for crackers.

The magnitude of the effects will depend on how quickly Aramco can repair its LPG infrastructure.

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