Marathon CEO: Venezuelan oil sanctions not a big hit for U.S. refiners

[thackney]

Marathon CEO: Venezuelan oil sanctions not a big hit for U.S. refiners
https://www.chron.com/business/energy/article/Marathon-CEO-Venezuelan-oil-sanctions-not-a-big-13686321.php
March 14, 2019

The U.S. refining industry has been resilient in the wake of sanctions against Venezuelan oil and the sanctions aren't significantly affecting operations at the nation's biggest refiner, Marathon Petroleum Corp. its chief executive said at IHS Markit's CERAWeek in Houston.

Sanctions were "an overnight decision but we saw this coming a long time ago," said Gary Heminger CEO of Ohio-based Marathon Petroleum.

Heminger said the company buys millions of barrels a crude every day, and only a small portion of that was Venezuelan crude prior to the sanctions. In part, that's because dwindling oil production has forced Venezuela to send crude to other countries where it has contractual or debt obligations and in part because pricing for the Venezuelan crude has decreased its appeal for Marathon's refineries, which who capable of swapping out the crude for other heavy options.

"We're fully optimizing all of our coking and hydrocracking capacity on the Gulf Coast," with Mexican, Canadian and other heavy crude, Heminger he said. Marathon Petroleum has 16 refineries, including one in Galveston Bay and Garyville on the Gulf Coast....

[IsailedawayfromFR]

From article
In North America, the refining industry has invested $150 billion over the past decade or so in preparation for lower sulfur fuels.

Wow, no wonder why refiners are so adamant on protecting the investments they have made in handling these low grade crudes.

I bet since they made these huge costs for environmental reasons, they will support any environmental initiative related to them.  Can't have any companies who did not take it on the chin already to escape.

Reminds me of dealing with Shell in Australia.  Shell had made a company commitment to provide sequestering of all CO2 in its projects, a cost increase in gas projects of up to +20%.  Shell lobbied hard for the Australian government to require all companies to adopt the same commitments.

Very self-serving of Shell to keep themselves from being non-competitive from its own policies.