April 24 (Bloomberg) -- Abu Dhabi will continue importing gasoline for at least a year to meet domestic demand until a new $10 billion refinery begins producing the fuel 12 months from now, officials with the state oil company said.
“We’re balanced on most products, except for gasoline,” said Sultan Al Mehairi, marketing and refining director at Abu Dhabi National Oil Co. “That’s the focus of our new refinery.”
Persian Gulf crude exporters, including Saudi Arabia, Iraq and the United Arab Emirates, buy refined fuels like gasoline and diesel to meet local demand when they don’t have sufficient capacity themselves. The countries are expanding refinery operations to satisfy that demand and cut imports.
Adnoc, as the oil producer in the largest U.A.E. sheikhdom is known, will continue importing about six to eight cargoes each quarter until the refinery reaches full capacity, Al Mehairi said at a conference in Abu Dhabi yesterday. Purchases could be less than that depending on demand, he said.
The company is doubling capacity at the 400,000 barrel-a-day Ruwais facility, its largest, and expects to bring the unit online by March, Ahmed Abdulla, chief operating officer at Adnoc’s refining arm, said. The refinery expansion will cost more than $10 billion, Abdulla said. Al Mehairi and Abdulla both spoke at the Middle East Petroleum and Gas Conference.
Gasoline production from the new units will start in April or May next year and will double output to 5.3 million metric tons a year, Abdulla said. The new plant will include a 127,100 barrel-a-day residue fluid catalytic cracker, a plant that makes the transport fuel and chemical products, he said. Ruwais is set to reach full capacity by August 2014.
Until then Adnoc will continue importing for its own branded service stations, as well as retail outlets run by Emirates General Petroleum Corp., Al Mehairi said. Adnoc said last year it would begin supplying filling stations run by federally owned Emarat, as Emirates General is known.
Adnoc doesn’t buy fuel for Emarat stations in Dubai or for Dubai’s government-owned refiner Emirates National Oil Co., known as ENOC, he said. Both ENOC and Emarat have been losing money on gasoline sales because retail prices fixed by the government don’t cover the cost of purchasing the fuel on the open market, the companies have said. ENOC runs a condensate refinery in Dubai’s Jebel Ali port that produces mainly naphtha and Emarat has no refining capacity.
Abu Dhabi’s fuel imports last quarter also helped make up for lost supply during a 30-day halt at the company’s smaller refinery near the city of Abu Dhabi, Al Mehairi said.
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