7. Feasibility of construction of the refinery

May 20th, 2010

A Russian company focused on mining addressed us with a following problem. A prospective Far Eastern project used the large amount of machinery working on diesel and kerosene.

The company had to organize fuel transportation from afar, and that situation influenced the total project’s cost. Was it possible to construct a fuel-production plant within reasonable vicinity from the consumer, on the base of the nearest oil and gas fields?

We assessed the possibility and feasibility of construction. The assessment helped to answer the following questions:

  • What were real fuel requirements of the company?
  • How much would the change of a fuel supplier cost?
  • Which fields could be taken as a base for construction of the refinery?
  • Who owned those fields?
  • What were infrastructural conditions (gas pipelines, roads, etc)?
  • A typical refinery produces a lot of black oil with no possibilities for its use. Was it possible to eliminate production of black oil?
  • Who manufactured the equipment which could be installed at that field?

As a result, the reasonable cost of construction of the refinery was calculated.