Peru seals deal for Talara refinery upgrade

State-owned Petroperu has let a lump-sum turnkey contract to Tecnicas Reunidas (TR) for the long-planned modernization and upgrade project of its 60,000-b/d Talara refinery at Piura, 1,200 km north of Lima.

TR will provide execution of design and detailed engineering, procurement of all equipment and materials, and construction as well as start-up assistance of the crude processing units for the Talara refinery’s modernization, which is slated to be completed within 55 months, TR said.

The $2.7 billion contract represents the largest refining turnkey project world-wide awarded to a single contractor, TR added.

The project’s objective is to equip the refinery to produce diesel and gasoline fuels conforming to new Peruvian environmental requirements of a maximum sulfur content of 50 ppm at competitive prices as well as increase the plant’s ability to process heavy crudes to improve operational flexibility, according to TR.

Specifically, TR’s scope of work will involve:

• The expansion and modification of existing process units, including the refinery’s primary distillation unit, catalytic cracking complex, and vacuum distillation unit.

• The construction of processing units, which include a diesel hydrotreater, both cracked naphtha and naphtha hydrotreaters, a vacuum distillation unit, flexicoker, naphtha catalytic reforming unit, amine unit, and cogeneration units.

• The expansion and upgrade of the utilities and off-sites installations.

Once completed, the project will enable the refinery to have minimal emissions, generate its own electricity, and maintain on-site operations for desalination of seawater and purification to avoid altering aquifers in the area, TR said.

The contract award follows a legislative mandate enacted by Peruvian President Ollanta Humala Tasso in December 2013 that called for a long-planned modernization and upgrade of the Talara refinery to be completed by 2017 on the grounds of public necessity and national interest (OGJ Online, Dec. 19, 2013).

Following completion of the modernization $3.5 billion project, which is slated to run from 2014 to 2017, crude oil processing capacity at Talara will rise to 95,000 b/d from its current capacity of 60,000 b/d, according to Humala.

A series of previous attempts by the Peruvian government to modernize the Talara refinery faced a series of delays due to allegations of political corruption in the bidding process (OGJ Online, Oct. 13, 2008; Jan. 28, 2008; May 5, 2003).

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