WILLEMSTAD--Operator “Petroleos de Venezuela” PDVSA is in the process of partially restarting the Isla refinery in Curaçao after delivering a token volume of heavy crude last month.
One distillation unit and one thermal cracker will be put back into function over the next couple of days. An Isla spokesman of PDVSA declined to comment on the expected duration of the operations and crude supply from Venezuela.
“Our plan is to operate the refinery in 2019 as we have for the past 30 years,” the spokesman said, asserting that misinformation and bias had distorted the public´s understanding of Isla’s challenges. He attributed last year´s operational issues to problems with the separate Curaçao Refinery Utilities (CRU) power plant that services Isla, but acknowledged that crude supply was “not optimum”.
A senior executive close to management suggested the restart is more of a “public relations” effort by PDVSA, rather than a sustained revival of long-stalled operations. The state-run oil company of the neighbouring South American country delivered 200,000 barrels of Tía Juana Heavy crude (TJP) to the refinery on the island in December, a volume that is equivalent to about one week of refining operations, the executive added.
The partial restart comes on the eve of the expected signing this month of a preliminary agreement with Saudi Arabia's US refining arm Motiva by government-owned Isla holding “Refineria di Kòrsou” to take over after PDVSA’s lease contract expires at the end of this year. Motiva has not commented so far.
However, Venezuelan officials have indicated an interest in retaining access to the Bullenbaai deep-water oil transhipment and storage facility that is part of the lease, because it’s a key part of the company’s logistical network in the Dutch Caribbean.
The holding last month selected Motiva as the preferred bidder to manage and operate Isla after PDVSA’s lease expires, with a possible so-called early step-in option to jumpstart operations.
The Isla spokesman said the refinery talks are taking place directly with PDVSA rather than the local Isla management and declined to comment.
The century-old refinery has a nameplate capacity of 335,000 barrels per day but operated normally at around 220,000. The facility was mostly idle last year amid the feedstock deficit and the CRU’s issues that have now mostly been resolved.
PDVSA´s Dutch Caribbean assets grabbed headlines in May 2018 when ConocoPhillips imposed a series of prejudgment attachments on them in an effort to collect a $2-billion arbitration debt. The company reached a settlement with ConocoPhillips in August, effectively reopening the Dutch Caribbean corridor.
However, individual PDVSA crude cargoes and vessels continue to be targeted by creditors in the Dutch Caribbean jurisdiction.
The partial restart of Isla contrasts with PDVSA’s loss or abandonment of other regional assets. This week, Jamaica´s government said it would take over the Venezuelan company’s 49-per-cent stake in its 35,000 barrels-per-day refinery.
PDVSA also lost its stake in Cuba´s 65,000 barrels-per-day Cienfuegos refinery, but continues to supply around 50,000 barrels per day to the facility.
