EnergyLocal NewsExxon’s Beaumont Petroleum Refinery Expansion Nears Completion, Will Elevate Output by 65%

The project has been in the works since 2019 and financing was preserved despite the pandemic's economic downturn.
9 hours ago
https://thetexan.news/wp-content/uploads/2023/01/ExxonMobil-Beaumont-Refinery-Oil-and-Gas-1280x853.jpg
Exxon Mobil, one of the world’s largest oil and gas companies, has expanded the capacity of its Beaumont petroleum refinery at an estimated cost of $2 billion.

The Beaumont facility’s expansion will add 250,000 barrels (bbl) of refinement production per day, moving it from the eighth-largest refinery in the country to the second. With the addition, the Exxon facility will have a daily output just shy of 620,000 bbl. Exxon will now own three of the top six American facilities in terms of output.

The new output will be aimed toward the refined petroleum products market, a mix of multiple different fuels. Its capacity is the equivalent of creating a new medium-sized refining plant.

We have said for quite some time that we anticipate the new unit will start up during the first quarter [of 2023],” a spokesman for Exxon Mobil told The Texan.

That remains our plan. Construction of the new crude unit is completed. We have initiated startup procedures and commissioning is underway. We maintained investments in the refinery expansion even through the lows of the pandemic.”

The Texan Tumbler

The expansion has been in the works since 2019.

There hasn’t been a new large-scale refinery built in the U.S. in decades; the last was in 1976 in Indiana. Additions to existing plants, like this one by Exxon, have occurred, but the lack of substantial growth has caused a recent bottleneck of the nation’s fuel at the refinement stage.

In addition to a returned demand for gasoline after the COVID-19 pandemic and subsequent government shutdowns, federal regulations have not only made it difficult to build new large-scale capacity but also created competition for the stagnant refinery output.

The Renewable Fuel Standard, a federal rule that encourages biofuel development, has caused existing capacity to be repurposed for products like ethanol.

Additionally, the International Maritime Organization switched its fuel requirement from bunker oil to diesel, leading to more demand for the existing diesel supply.

Great news for our mighty oil [and] gas industry,” Gov. Greg Abbott said on Twitter of Exxon’s news. “Oil production is expected to reach a new high in 2023 thanks to hardworking Texans. Texas energy powers the world.”

House Speaker Dade Phelan (R-Beaumont) followed that, touting the endeavor and adding, “Expansions like these wouldn’t be possible without great economic development tools that make TX more competitive.”

Phelan has stated and restated his intent this session to revive the recently-expired Chapter 313 property tax abatement program by which oil and gas companies could receive exemptions for manufacturing-type operations. But as the program expired at the end of 2022, those incentives are no longer currently obtainable.

The Legislature declined to renew the program in 2021 largely because of what its opponents saw as a lack of transparency and negligence. The vast majority of abatements handed out have been granted to renewable energy companies such as wind or solar farms.

The additional output will put some downward pressure on gasoline and diesel prices at the pump across the country — once it gets up and running.

###

Disclosure: Unlike almost every other media outlet, The Texan is not beholden to any special interests, does not apply for any type of state or federal funding, and relies exclusively on its readers for financial support. If you’d like to become one of the people we’re financially accountable to, click here to subscribe.

Get “KB's Hot Take”

A free bi-weekly commentary on current events by Konni Burton.

Brad Johnson

Brad Johnson is a senior reporter for The Texan and an Ohio native who graduated from the University of Cincinnati in 2017. He is an avid sports fan who most enjoys watching his favorite teams continue their title drought throughout his cognizant lifetime. In his free time, you may find Brad quoting Monty Python productions and trying to calculate the airspeed velocity of an unladen swallow.