Pemex poised to import first test cargo of WTI in swap with U.S.
Mexican national oil company Pemex is focused on importing U.S. West Texas Intermediate (WTI) crude as part of a historic oil swap with the United States, a top company executive said on Friday.
Pemex said earlier this week it had received a year-long license from the United States to import U.S. light crude in exchange for exports of Mexico’s heavier crude oil.
The swap will mark the first time in decades that Mexico’s aging refineries, designed decades ago to run lighter crudes, will process foreign oil.
It also marks a milestone in loosening a contentious U.S. ban on exporting domestic oil dating back to the 1970s Arab oil embargo.
The license allows Pemex’s commercial arm, P.M.I. Comercio Internacional, to import U.S. light crude to process in its refineries from October, capped at 75,000 barrels per day (bpd).
Jose Manuel Carrera, Pemex’s director of corporate partnerships and new business, said in an interview that he expects the first shipment to arrive before the end of the year and at a volume of between 200,000 and 300,000 barrels.
“The crude we like best, that we’re most enthusiastic about, is WTI,” Carrera said.
The first shipment will be used to test compatibility with Pemex’s domestic refining system, he said, and the tests should conclude by the first quarter of next year but could happen sooner.
“What we’ve already evaluated is that running WTI gives Pemex a major advantage to improve the performance of our refineries,” he said.
Running a lighter crude mix should allow Pemex to produce more higher-value fuels like gasoline and diesel, and less fuel oil, which Mexico no longer uses as the main input to generate electricity.
West Texas Intermediate is a light, sweet blend of crude and the main benchmark for U.S. crude oil prices.
Carrera, who formerly led Pemex’s commercial arm, said he does not anticipate any significant additional investment needed to modify distillation towers in preparation for the lighter crude mix.
Carrera said Pemex has analyzed other crude grades, but declined to name them.
“We’ve evaluated others but our favorite right now is West Texas Intermediate because it has chemical properties that we really like,” he said.
Pemex has previously said that the first refineries to receive the shipments of light U.S. crude will be its Tula and Salamanca plants.
Carrera declined to name any U.S. companies involved in the swap.
Copyright: Premian Shale
