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by thematt 1559 days ago
Lighter oils get used for gasoline, diesel, and aviation fuels. Heavy oils get used for plastics, petrochemicals, and road surfacing.

I wish there was an easy answer to your refinery question. They're all different, but there are three basic types of refineries:

The simplest is a topping plant, which is basically just a distillation unit. The output you get is basically whatever the natural yield of the oil is. These refineries can typically only process light crudes.

The next level refinery is a cracking refinery. These take the gas oil output from the distillation and breaks it down further using high temperature, pressure, and catalysts. This allows for the breakdown of slightly heavier crudes.

The final level is a coking refinery. This takes all the residual fuel and "cracks" it into a lighter product. This increases the yield of higher value gasoline, which allows a refinery to take in cheaper heavier crudes.

Building a new refinery is a 5+ year process that costs about $7-10 billion. I'm not sure what upgrading an existing one costs, but it's somewhere in that ballpark. Keep in mind that a large influence on the type of refinery is their geographic location. They're built to accept the type of oil that flows in the pipelines.

1 comments

Would they also be built to produce the type of products needed by the local-ish market?

So one in Europe will have a higher fraction of diesel (used in most trucks, some cars, and some trains) compared to the USA (trucks and almost all cars use petrol).

(Compare: https://www.statista.com/statistics/189410/us-gasoline-and-d... - https://www.racfoundation.org/data/volume-petrol-diesel-cons... -- the ratio is very roughly reversed.)

Yes, to a certain extent. But refined products get piped all over, so it isn't a very tight coupling. Delta Airlines bought their own refinery for jet fuel. It didn't work out too well, but it was still interesting.

https://www.nytimes.com/2020/08/10/business/energy-environme...