Kuwait Petroleum Corporation (KPC) may reduce spot exports of high sulphur gasoil for the next few months while the fate of a fire-hit secondary unit at its Shuaiba refinery is being decided, industry sources told Reuters on Monday.
A heavy oil cracking unit at the 200,000 barrels-per-day (bpd) refinery suffered severe damage when fire broke out at the plant in August. According to Reuters’ sources spot supplies have been disrupted since then.
"The unit is 'gone' and so there are no excess volumes from there," one of the sources said. "(KPC) is just meeting its term commitment,” they added.
Officials at KPC are now considering whether the unit should be brought back online, a process that could take up to three weeks, a source said adding that the unit would likely need months before it is fully operational again.
"There has not been a decision if it would be brought back or not," the second source said.
The full impact of the unit's shutdown on the company’s oil product exports will become more clear by next month but spot gasoil exports will be reduced, said another source.
KPC last exported a cargo of high sulphur gasoil on the 1st and 2nd of September and has not offered any cargo in the spot market for October-loading so far, traders told Reuters.
The company’s exports of high sulphur gasoil average between 40,000 to 65,000 tonnes a month. But volumes usually drop during the summer period when demand for the fuel for power generation peaks due to increased air-conditioning use.