Motiva Enterprises said Thursday it will connect its refineries in Norco and Convent to create the Louisiana Refining System.
The first step will be to build a Maurepas pipeline system — three pipelines that will connect the refineries and link the existing LOCAP terminal in St. James to Norco. The pipeline system will cost $500 million to build and is expected to be complete sometime in the fourth quarter of 2016.
Once the pipelines are completed, Motiva plans to idle the fluid catalytic cracker at its Convent refinery. The hydrocracker unit at Norco will be reconfigured to process 30,000 barrels per day of additional gas oil into high-quality diesel.
The cost of the work and the timetable for construction were not disclosed. Motiva said the Louisiana Refining System is expected to generate $350 million of annual benefits before interest, taxes, depreciation and amortization.
Dan Romasko, president and CEO of Motiva, said the Louisiana Refining System would have a crude capacity of more than 500,000 barrels per day, making it one of the five largest North American refineries. The Norco refinery began production in 1920; it has a capacity of 235,000 barrels a day. The Convent refinery was built in 1967; it has a capacity of 230,000 barrels a day.
“The Louisiana integration strategy is an exciting opportunity for Motiva to unlock significant value for our owners,” Romasko said.
The Maurepas pipeline system, which will consist of a 34-mile pipeline connecting LOCAP to Norco, and 35- and 34-mile pipelines connecting Norco and Convent, will be built, owned and operated by affiliates of SemGroup Corp., a publicly traded midstream service company. The pipelines between the two refineries will optimize both plants’ conversion units and improve logistics efficiency, alleviate dock congestion and allow additional product exports, Motiva said.
“Through the implementation of these projects, we are creating a world-scale, integrated refining system that leverages the best aspects of our two Louisiana refineries in Convent and Norco,” Romasko said.
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