OPEC Downstream Capacity: Existing and Projected

While overcapacity in the refining sector persists globally, the prospect for demand increases in developing countries is attracting investor interest in building new capacity. This is particularly apparent in Asia, followed by the Middle East and Latin America where incentives from demand increases are combined with an emerging trend among crude producers to refine heavier crudes domestically. Indeed, a recent review of existing refinery projects indicates that around 7.5 mb/d of new distillation capacity will be added to the global refining sector over the period of 2011-2015, of which almost 50% will materialize in the Asia-Pacific and another 30% in the Middle East and Latin America.

A significant number of these new investments will occur in OPEC Member Countries. By 2015, compared to the refining capacity available at the end of 2010, the assessed investments result in 2 mb/d of additional capacity. This includes around 1.7 mb/d of additional distillation capacity and 0.3 mb/d in condensate plants within the national borders. Thus, by 2015, OPEC Member Countries have over 11 mb/d of downstream capacity. Moreover, substantial investments are also underway as part of equity shares in refineries outside of national borders.

It should be noted, however, that capacity additions are far from being equally distributed over time, as underscored in this detailed graph.