Shell and Saudi Aramco’s joint venture losing US$1 million daily

After celebrating a US$10 billion expansion project which made their joint-venture refinery the largest in the U.S., Royal Dutch Shell PLC and Saudi Arabian Oil Company (Saudi Aramco), Saudi Arabia’s national oil company, are losing an estimated US$1 million daily due to mechanical failure at the new sections of the joint venture, Motiva Enterprises LLC refinery in Port Arthur, Texas.
The new facilities could be closed for several months, bringing down the refinery’s capacity to process crude back to its pre-expansion level of about 275,000 barrels a day from 600,000 barrels a day.
The shutdown is adding costs to a project that is years behind schedule, and more than US$3 million over budget. It has also driven up gasoline prices during the summer season, when demand for fuel is at its peak.
Shell and Saudi Aramco have expanded the refinery to make it one of the largest in the world and the facility was designed to be a hub for fuel production for U.S. drivers and Latin American economies. Motiva Spokeswoman Emily Oberton said the company is investigating the cause, as well as the extent of the mechanical problem.
“We will resume normal operations as soon as it is appropriate to do so,” she added. (June 14, 2012)