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Shale-Oil Boom Spurs Refining Binge
Higher U.S. Crude Production Has Valero, Marathon Increasing Capacity
By Ben Lefebvre
March 2, 2014 7:19 p.m. ET
U.S. refiners haven’t built a major new fuel-processing plant since 1976, in part because of environmental regulations. But a flood of oil from Texas, Oklahoma and North Dakota has companies rushing to expand existing plants and build small new processors around the country.
Valero Energy Corp. , Marathon Petroleum Corp. and other refiners are engineering ways to expand fuel-making capacity at their aging plants without the cost of building entirely new refineries to take advantage of the increase in light sweet crude flowing from U.S. wells.
The gasoline, diesel and other fuels they are producing can either be burned in the U.S. or sold around the world because they aren’t subject to the export ban Congress imposed on crude in the early 1970s.
American refiners are set to add at least 400,000 barrels of oil-refining capacity a day to existing plants between now and 2018, according to information compiled by The Wall Street Journal and the consulting firm IHS. That is the fuel-making equivalent of constructing a new, large-scale refinery.
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100k bpd per year sounds at or below the average expansion for the last decade or so.