Aster reduces diesel production at Singapore Bukom refinery sources say
Three sources familiar with the situation said that Singapore's Aster Energy and Chemicals has reduced diesel production at its Bukom Refinery this month. This is driving up premiums for 10ppm low sulphur diesel.
Aster has reduced operations at its hydrocracker and hydrodesulphurisation units amid a lack of hydrogen supply from its reformer unit, they said.
Hydrocrackers typically break down heavier oil feedstock into lighter products such as diesel, while hydrodesulphurisation units remove sulphur from refined fuels.
One of the sources, and a third source, added that this production issue may affect 60,000-100,000. metric tons (447,00-745,000 barrels).
Multiple sources confirmed that the disruption in Bukom's diesel supplies has been a major factor driving spot premiums on industrial fuels since late last Thursday.
According to data from traders, there were a number of robust buying inquiries on the trading window from traders, including Glencore. Glencore is a company that partly owns the Bukom refinery and receives its products.
A company spokesperson stated in an email that "our refinery is currently operating at planned rates", adding that operations continue as normal.
Bukom refinery is capable of processing up to 237,000 barrels (bpd).
One of the sources stated that these production problems are expected to continue until the end November.
Aster's cracker for naphtha at the Bukom facility is likely to close until the first quarter of next year. This was revealed in a letter to customers. Two other sources who have direct knowledge of this matter say that the cracker will likely restart in either February or March. In August, the company declared a force majeure for petrochemical supply.
A spokesperson for Aster said: "On our ethylene Cracker, we continue our engagement with our customers as we progress on the recovery work for Q1 2020," Aster's spokeswoman said. (Reporting and editing by Trixie Yap, Florence Tan; Saad Sayeed).
(source: Reuters)
