"In recent years, Russian refinery industry has achieved substantil success. First, the domestic market has been put on full supply with its own gasoilne and class 5 diesel fuel. For comparison: in 2011 the share of class 5 fuel in the structure of gasoline consumption was just two percent and the share of diesel was 17 percent. Second, the processing depth has been increased. While in 2011 the mean value was 70.6 percent, in 2017, according to the data made available by the Federal Statistics Service, it was 81 percent. The Ministry of Economic Development gave a higher value of 81.3 percent," Victoria Gimadi, the Head of the Department for the Fuel and Energy Sector of the Analytical Center told a Rossiyskaya Gazeta correspondent.
In 2011-2017 Russian companies did a big job on refinery modernization
According to the expert, positive results are due to the current industry modernization. For the seven years, more than RUB 2.1 trillion was invested in the industry (in 2011 prices). For this purpose, quadripartite agreements were signed between companies, the Federal Antimonopoly Service, the Federal Technical Supervision Service (Rostekhnadzor) and Federal Agency for Technical Regulation and Metrology (Rosstandart). In 2011 (and several times later) customs and tariff regulation was corrected which primarily aimed at increasing the processing depth, the analyst noted.
Oil processing depth is different in different countries, Ms. Gimadi explained. According to the data provided by the International Energy Agency (IEA), in the USA already in 2015 it exceeded 97 percent, in Canada it was close to 95 percent, in Great Britain and Germany – about 92 percent, in Italy – about 90 percent. "These are the indicators to be oriented at," the expert believes. In the draft Energy Strategy for the period until 2035 (prepared by the Ministry of Energy of the Russian Federation), the targets of oil depth processing are set at a comparable level: 90-91 percent by 2021-2035.
Ms. Gimadi noted that in 2011-2017 Russian companies did a big job on refinery modernization but they still were behind schedule. Currently, 78 installations have been upgraded, another 49 remain. "The main problems and limitations include deterioration of macroeconomic conditions (primarily oil price decrease) and conditions of foreign financing attraction if compared with the previous ones," the expert told. "The project conditions were also influenced by adjustments of the tax manoeuvre parameters in the oil industry."
It should be recalled that a round table "Whether Russia needs new incentives to retrofit its oil refineries?" was recently held at the Analytical Center.
Source: Rossiyskaya Gazeta