: Venezuela refinery producing no gasolineCARACAS ;July 16, 2009 — A Venezuelan oil union leader said Wednesday that the nation’s aging El Palito refinery is producing no gasoline as efforts to upgrade fall weeks behind schedule.
A union leader at the refinery, Robert Gonzalez, said the refinery’s fluid catalytic cracking unit has not been restarted since it shut down for maintenance on March 5. The unit cracks heavy oil molecules into lighter structures, and has the capacity to produce 20 percent of the country’s gasoline, or 54,000 barrels.
It was not immediately clear why the upgrade, which aimed to increase onsite gasoline production by 11 percent, had been delayed beyond the expected 70 days.
Calls to El Palito went unanswered on Wednesday, and a spokesman for state-run Petroleos de Venezuela SA, or PDVSA, could not immediately confirm or deny the report.
Analysts suggest PDVSA, which spent $39.5 billion on oil and oil products last year, could have increased imports to help keep the local market supplied during the upgrade.
El Palito, just west of Caracas, can process 136,000 barrels of heavy Venezuelan crude a day and supplies gasoline to 10 of the country’s 23 states. Venezuela’s Paraguana refining complex, in the western state of Falcon, processes nearly seven times that.
Despite a 50 percent jump in net income last year, PDVSA borrowed $3.5 billion from Japanese investors to finance refinery upgrades.
In April, Japan agreed to invest another $33.5 billion in Venezuelan energy projects, including $1.5 billion to refurbish its refineries.
