ARG Breaks Ground on $20M Hydrotreater


BRADFORD, Pa. – American Refining Group broke ground Friday on a new hydrogenation unit during the celebration of the base oil and fuel refinerys 125th anniversary. At a cost of nearly $20 million, the new unit will upgrade two base stocks and will allow the refinery to produce ultra low sulfur diesel fuel.

The company will hydrotreat medium neutral base oils and bright stocks, President and COO Harvey L. Golubock told Lube Report. ARG will install two reactors, one for lubricant base stocks and the other for fuels.

Base oil quality will be significantly improved, said Golubock, so well have a wider end-use market, and well [also] be able to use the stocks internally.

The new unit is designed to treat 3,500 barrels per day of product, including fuels, distillates and lubricants. The hydrotreater is expected to be onstream by the end of 2007. ARG currently has the capacity to refine 2,400 barrels per day of lubricant base stocks, of which 2,100 are Group I and 300 are Group II.

Founded in 1881, the Bradford refinery is the oldest continuously operating refinery in the United States, and the only remaining refinery exclusively processing Pennsylvania-grade crude oil. American Refining Group acquired the facility from Witco Corp. in 1997. As Chairman, CEO and owner Harry R. Halloran Jr. and Golubock delighted in reminding the impressive turnout of customers, suppliers, employees, officials and townspeople who joined the celebration, all the pundits predicted the business would fail.

It was written off as an economically viable refinery 10 years ago, Halloran said. When Witco sold its lubricants business off in pieces in 1996 – including the Kendall brand – to Sunoco and others, leaving the Bradford refinery with no lubricants business and no lubricant brand, 150 companies looked at it, but nobody wanted it, he said.

This refinery is very important to the region and to the crude producers, Halloran continued. Weve improved the refinery with isomerization and now the hydrogenation unit. We have a good sales and marketing group for Brad Penn accounts, from a zero start. Its the little refinery that could.

After the hydrogenation unit is in place, Halloran said the company plans to improve its dewaxing capability. And well expand our tanks and warehouses, and go back to the 45-million-gallons-per-year [lube production] of the Kendall days, he predicted. Its great to be a profitable refinery making a significant contribution to the area and the producers.

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