Ergon plans to invest $78 million to expand its Newell, W.Va., subsidiary refinery to process growing regional crude oil production from the Marcellus and Utica shale areas. The expansion is also expected to enable a modest boost in specialty oil production from the sites paraffinic base oil plant.
According to a company statement, the expansion will add capacity in the Newell refinery processing units and supporting infrastructure. The Marcellus and Utica shale is located in West Virginia, Ohio, Pennsylvania and New York.
The Newell sites base oil plant has a capacity of 1,900 barrels per day of Group I and 2,900 b/d of Group II. This expansion will allow for modest gains in specialty oil production, which includes base oils and process oils, Ergon Spokesman Jim Temple told Lube Report.
In a statement, Ergon said the majority of the projects will be completed during 2013s second quarter, with the balance continuing into 2014.
This expansion will provide our customers with even greater reliability, higher quality fuels and an improved customer experience, said Don Davis, president of Ergon – West Virginia.
In September, Ergon Inc. announced it would invest $147 million to expand its Vicksburg, Miss., refining operations as well as facilities in West Virginia and Ohio. That included adding more storage tanks and infrastructure at the Newell lube refinery and expanding the logistical capabilities of Ergons midstream companies, including Ergon – West Virginia.
Ergon Refining, Inc. is the world’s largest producer of naphthenic specialty oils. It supplies base, process and electrical insulating oils to customers around the globe. It is a wholly owned subsidiary of Ergon, Inc.