Planned and announced refinery projects will bring global crude distillation unit (CDU) capacity by 2020 to 115.2 million metric barrels a day (mmbd), representing a growth of approximately 16.5% compared to the current capacity of 98.9mmbd, according to a report by GlobalData.
Titled 'H2 2016 Global Capacity and Capital Expenditure Outlook for Refineries', the report forecasts that refinery operators in China and Nigeria, which have most of the planned CDU capacity in the next four years, will spend $84 billion to add 3.16mmbd of capacity in total.
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The biggest region in terms of planned capital expenditure over the forecast period is Asia, with 14 countries in the continent planning to spend $144.9 billion to add a total capacity of 4.47mmbd, which is expected to increase further if new constructions are announced.
GlobalData’s oil and gas analyst Ben Xu sees incremental oil demand to be the main reason behind the huge investment in Asian refineries.
Saudi Aramco, for instance, has recently announced its refinery expansion plans in Asia and a negotiation with China National Petroleum Corporation (CNPC) to construct a refinery in China.
Africa, the Middle East and the former Soviet Union follow Asia, with their planned investments estimated to be $105.4 billion, $80.2 billion and $36.5 billion respectively.
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By GlobalDataAfrica will add a CDU capacity of 3.4mmbd over the forecast period, while eight countries in the Middle East plan to add a combined capacity of 3.7mmbd.
The report also states that Nakhodka, Okporoma, Shanghai II, Pengerang, Merapoh, Lagos I and Al-Zour are some of the biggest refinery expansions in terms of capacity and capital expenditure, planned by 2020.
