Tesoro to produce xylene on US West Coast for export to Asia

08:51 AM | July 22, 2014 | Natasha Alperowicz

Tesoro (San Antonio) says it plans to produce petrochemical feedstock in its US west coast refining system. The company intends to gather intermediate feedstock, primarily reformate, from its West Coast refining system for xylene extraction at Anacortes, WA. The initial investment, estimated to be around $400 million, is designed to recover up to 15,000 bbl/day of mixed xylene, which will mainly be exported to Asia for use in polyester fibers and films. The new facilities are expected to start up in 2017, subject to permitting and the approval process. A final investment decision is expected by year-end 2014.
  
The global xylene market is growing about 5–7%/year, primarily driven by demand in Asia, the company says. Tesoro is well positioned as a supplier based on existing logistics and operating cost advantages. "This attractive diversification of Tesoro's product mix supports our goals of enhancing our gross margin and investing in high return capital projects," says Greg Goff, Tesoro's president and CEO.
 
Tesoro, through its subsidiaries, operates six refineries in the western United States with a combined capacity of over 850,000 bbl/day and ownership in a logistics business.