Exxon said it spent $2 billion to overhaul its Beaumont refinery in Texas, already among the largest in the country. File photo by ExxonMobil
March 16 (UPI) -- Announcing the largest domestic refinery overhaul since 2012, ExxonMobil said Thursday it started operations from the expanded segment of its Beaumont refinery in Texas, already among the largest in the nation.
Exxon said it spent $2 billion to add 250,000 barrels per day to the processing capacity at the Texas plant, bringing the total to 650,000 bpd.
"The new crude unit enables us to produce even more transportation fuels at a time when demand is surging," said Karen McKee, the president of ExxonMobil product solutions division.
The Energy Department expects gasoline demand to average 8.9 million bpd, a 2.3% upward revision from its forecast from February. A decline in expected miles traveled was offset by lackluster fuel efficiency for current vehicles on the road.
Beaumont is connected by pipelines to Exxon's operations in the Permian shale basin spread out over Texas and New Mexico. The facility processes that crude into diesel, gasoline and jet fuel. At around 5.5 million barrels of oil production per day, the Permian basin accounts for about 60% of total inland oil production in the United States.
Expecting the start of operations from the Beaumont expansion, the Energy Department will have a trickle-down impact on the economy by way of lower retail gasoline prices.
"We expect that rising gasoline inventories, along with falling crude oil prices, will gradually decrease gasoline prices throughout the forecast period," its latest monthly market report read. "We forecast retail gasoline prices to average near $3.20 per gallon in the fourth quarter of 2023, down more than 30 cents per gallon from 4Q22."
Exxon's fourth-quarter production of 3.8 million oil-equivalent barrels matched year-ago levels and was just 2.8%, or about 100,000 barrels, more than third-quarter levels. Exxon said much of its growth came from the Permian shale basin in the southern United States and offshore Guyana, where it operates alongside U.S.-based Hess Corp.