Ashland Refinery Expansion, Garyville, Louisiana, USA

In January 2007 Marathon Oil received final approval from the Louisiana Department of Environmental Quality (LDEQ) for a $3.2bn, 180,000bpd expansion of the Garyville refinery. On completion this project will provide an increase of 7.5 million gallons of transportation fuel a day for the US domestic market.

Marathon is planning to begin construction in mid-2007 with the start of operations scheduled for the fourth quarter of 2009. The expansion of capacity will require an additional 180 to 200 new full-time employees at the refinery and 50 to 70 new full-time contract employees.

Ashland refinery in Garyville first began operations in 1977 and is the most-recently constructed refinery in the US. The approval process for the refinery expansion first began in March 2006 when the initial design and engineering phase began.

DEVELOPMENT

The expansion project aims to increase capacity at the refinery because the US demand for fuel and other petroleum products is increasing. The Garyville refinery can currently process 245,000 barrels of crude oil a day and the expansion will increase the capacity to 425,000 barrels a day. Marathon's total refining capacity will be raised from 974,000bpd to 1,154,000bpd (a seven-refinery system). Marathon has stated that they are essentially building a new refinery next door to the original one.

The original refinery will not stop operating during the expansion, which will form an important part of the Louisiana economy (the State provides over 25% of the total US fuel supply). Louisiana is a strategic location with many miles of network and pipelines and multiple transportation systems that gets crude oil to the refinery and the finished product to the US market.

In addition to the installation of a new crude and vacuum distillation unit, expansion plans call for the construction of infrastructure and other process units with the following design capacities: a 44,000bpd delayed coker, a 70,000bpd heavy gas oil hydrocracker, a 65,000bpd reformer and a 47,000bpd kerosene hydrotreater. The expansion will also include the installation of additional sulphur recovery capacity.

These new facilities will incorporate the latest safety and environmental control technologies at the refinery, which is the first and only refinery to be included in the US EPA's elite National Environmental Performance Track (NEPT).

Marathon's Garyville refinery was also one of the first refineries to achieve OSHA's Voluntary Protection Program (VPP) Star designation.

REFINERY CONSTRUCTION

Fluor were awarded the Front-End Engineering and Design (FEED) contract for the expansion. When the expansion project is fully underway it will create between 2,000 and 4,000 construction jobs at the refinery. Fluor Corporation of Irving, Texas (Fluor Energy & Chemicals Group) has been hired as the project management firm for the expansion.

Other companies involved in the project include Chicago Bridge & Iron Company of the Woodlands, Texas, and Baton Rouge, Louisiana-based Shaw Stone & Webster. These three companies will be providing engineering and procurement services for the project.

Others companies participating in the expansion include Performance Contractors and Turner Industries for steel erection and mechanical work; Industrial Specialty Contractors and Excel Contractors for electrical and instrumentation work; Cajun Constructors Inc and James Construction Group for site work, pile driving and concrete foundations.

ADDITIONAL CONTRACTORS

Dresser-Rand Group Inc also has a $63m contract to supply compression equipment for the planned expansion. The order was placed in October 2006 to supply critical compression equipment, including six DATUM turbo-compressor trains and eight reciprocating compressor units along with their drivers.

Additionally, it is expected that installation, commissioning and start-up services will be added to bring the total contract to $68m.

The equipment will be used to increase production of ultra-clean fuels, including gasoline and distillate.

Flowserve Corporation has also received an order for $49m for 400 pumps, seals and a hydraulic decoking system for the expansion. Flowserve is the primary supplier for pump products for the project, and every pump also includes one or more Flowserve mechanical seals. The Flowserve pumps are all built in accordance with American Petroleum Institute (API-610) standards.

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