Progressing six key downstream investments

ExxonMobil is investing $9 billion in six major Downstream projects that leverage our integrated manufacturing footprint, scale, and proprietary process and catalyst technology to grow earnings and improve competitiveness.

Report April 2, 2019

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Progressing six key downstream investments

Key refinery projects

Beaumont hydrofiner

ExxonMobil started operations of a new hydrofiner in 2018 at the integrated Beaumont, Texas, facility. This unit employs proprietary catalyst systems that minimize octane loss while removing impurities, enabling cost-effective production of 45,000 barrels per day of higher-value products and compliance with Tier 3 gasoline sulfur requirements.

The new hydrofiner at the integrated Beaumont site further enhances the competitiveness of our U.S. Gulf Coast refineries.

Antwerp delayed coker

ExxonMobil completed a new delayed coker unit in 2018 at the Antwerp, Belgium, refinery. This new 50,000-barrel-per-day unit upgrades lower-value residual products into higher-value, low-sulfur diesel to meet growing demand for cleaner transportation fuels throughout Europe. This investment also enables us to meet the anticipated growth in demand for lower-sulfur fuels to comply with new standards implemented by the International Maritime Organization. The unit will utilize feed streams from our refineries and third parties in Europe, enhancing the integration and competitiveness of our European circuit. ExxonMobil invested $2 billion over the past decade in the Antwerp refinery, making the facility one of the most modern and efficient in the world.

A world leader with 430 kbd in coking capacity

Rotterdam hydrocracker

At our integrated Rotterdam, Netherlands, facility, we recently started up a new hydrocracker unit that utilizes proprietary process and catalyst technology to upgrade lower-value vacuum gas oil into additional volumes of higher-value, ultra-low-sulfur diesel and ExxonMobil’s EHC Group II basestocks. The premium Group II basestocks will supply European, African, and Middle Eastern base oil and lubricant industries.

This investment will make the Rotterdam facility Europe’s largest high-quality lubricant plant and one of Europe’s most competitive refineries. It also doubles the earnings capacity of the site. ExxonMobil is the only global producer of both Group I and Group II basestocks, with significant manufacturing assets now strategically located on three continents, enabling consistent, reliable global supply.

Fawley hydrofiner

We are investing in a new hydrofiner and hydrogen plant at our Fawley refinery in the United Kingdom to upgrade 38,000 barrels per day of high-sulfur distillates into finished diesel. The project will also improve crude processing capability and upgrade fuel oil to cleaner products. The project further increases integration between our European assets by improving logistics capabilities to export streams from Fawley, providing us more molecule value optimization opportunities. The new hydrofiner is planned to start operations in 2021.

scale

Downstream profitability

With changes in the International Maritime Organization’s marine fuel specifications in 2020, we are leveraging proprietary process and catalyst technologies to upgrade nearly 200,000 barrels per day of fuel oil to higher-value fuels and lubricant products by the year 2025.

Beaumont light-crude expansion

At our integrated Beaumont, Texas, facility, we are constructing a 250,000-barrel-per-day grassroots crude distillation unit designed to process additional U.S. light crude oil. This project will convert 95 percent of crude oil into high-value products or chemical feed streams and is planned to start up in 2022.

The investment is significantly advantaged, as it leverages existing site infrastructure, is located close to the regional crude storage hub in Nederland, Texas, and is integrated with other plants on the U.S. Gulf Coast. As a result, the project is expected to deliver strong financial performance with a cost below an industry grassroots project.

Singapore residual upgrade

We are advancing a multibillion-dollar project at our integrated Singapore facility that will apply proprietary process and catalyst technologies to upgrade lower-value fuel oil and steam-cracked tar into cleaner, higher-value products, including high-quality Group II light and heavy lube basestocks. The advanced technology will also allow ExxonMobil to introduce a new, unique high-viscosity Group II basestock into the marketplace. By introducing higher-value basestocks in larger volumes, we can meet the needs of an expanding customer base seeking to satisfy more stringent industry requirements to deliver reduced emissions and improved fuel economy.

6 key refinery projects improve competitiveness

The Singapore refinery upgrade project will also result in additional production of clean fuels with lower sulfur content, including high-quality ExxonMobil marine fuels that comply with the upcoming International Maritime Organization’s 0.5 percent sulfur restrictions.

This project, fully integrated with the chemical facilities in Singapore, is anticipated to start up in 2023, and will utilize existing site infrastructure and proprietary technology to move the site’s refining competitiveness into the top quartile worldwide. It also improves the competitiveness of the site’s unique crude cracker, utilizing proprietary technology, making it the lowest supply cost of any liquids cracker in Asia.

Logistics investments

With continued growth in Permian crude oil and natural gas production, we plan to invest more than $2 billion in logistics to support the integrated value chain from the wellhead in the Permian Basin to refinery and chemical manufacturing assets on the U.S. Gulf Coast.

Average refinery capacity 75% larger than industry

In 2017, ExxonMobil acquired a crude oil terminal in Wink, Texas, that is strategically positioned to store and transport Permian crude oil and condensate from the Delaware Basin near the Texas-New Mexico border to U.S. Gulf Coast refineries and marine export terminals. We plan to expand the Wink terminal and add key infrastructure that will allow us to efficiently move ExxonMobil and third-party production from the Delaware and Midland basins, and the Central Basin Platform in the Permian, to ExxonMobil’s operations and other market destinations.

Another example of a strategic investment in logistics is the Edmonton Rail Terminal in Canada, owned in partnership with a third-party midstream company. The terminal provides an additional outlet for crude oil produced in Western Canada. With constrained industry logistics, we have realized significant earnings through utilization of this strategic investment.

These examples of advantaged investments, in addition to a broader portfolio of logistics assets, enable the transportation of equity crude oil and natural gas production, protect crude oil quality, and create advantages for our refining and chemical assets through additional feed flexibility.

Other facility and logistics improvements

In addition to major projects, we are progressing hundreds of smaller improvement projects to optimize the value of every molecule moved through our value chains. Manufacturing units at every plant are compared to global benchmarking data to identify opportunity areas. Integrated teams then prioritize the opportunities and advance projects to progressively increase the efficiency of our existing plants and increase the yield of higher-value products. Project returns are improved by leveraging integration with Upstream and Chemical businesses while deploying proprietary technologies to maximize long-term shareholder value.

Business teams also monitor the markets in which we compete to ensure we have access to advantaged logistics. We identify and execute logistics improvement projects related to feedstocks entering our manufacturing sites, intermediates moving between our integrated complexes, and finished products destined for markets. Projects include the addition of small pipeline connections to increase flexibility and the construction of new terminals to serve customers better. For example, at our Singapore refinery, small logistics projects associated with lube basestock storage, crude inventory expansion, and chemical plant interfaces are improving site competitiveness.

functional excellence

Optimizing our base assets

We utilize a structured process with teams of global experts in operations, maintenance, engineering, and technology to identify opportunities to improve existing manufacturing asset competitiveness and profitability. These teams identify opportunities and solutions, generally with minimal capital investment, resulting in advantaged returns.

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Technology

Technology has led to the development of industry-advantaged assets, processes, products, and applications. We invest in fundamental science and research, leading to advances in existing processes and products, as well as new discoveries. This allows us to meet the evolving needs of society, lower operating and project costs, and develop higher-value processes and products.

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Scale

The size and breadth of our business provides a critical foundation for long-term success. It enables investments in the development of advanced technologies by leveraging benefits across a large base of operations. Facilities and businesses operated consistently around the globe accelerate experience and learning – replicating innovations, improving effectiveness, and driving down cost. Our size allows us to pursue a wide range of value-accretive investments across the commodity price cycle – specifically taking advantage of counter-cyclical opportunities.

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Strong business fundamentals underpin investments

Our view of global energy and product demand and supply through 2040 informs long-term strategies and investments.

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Integration

We maximize value across the entire value chain, ensuring the whole is greater than the sum of the parts. The different sectors we serve and products we make provide further diversification, helping to mitigate the impact of commodity price cycles. Our integrated business provides additional scale, allows us to share support organizations and facility infrastructure, and capture synergies in organizational capabilities and competencies.

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