The MPR is in a unique position – it is one of the major industries in Belarus, and it is essentially the water utility for two urban centres. The Refinery with its move to a Joint Stock Company has been diligent in modernizing its facility with the injection of capital, and its associated ISO certifications. The Plant does have an environmental policy, which makes it unique among numerous facilities reviewed under the Dnieper River Basin SAP. While many processes have been modernized, the Plant still discharges, through its Refinery and water treatment operations, a range of contaminants to the water course. This part of the Basin is in an environmentally sensitive swamp area that is a significant recharge area for the main River stream. Based on preliminary screening of Hot Spots on economic criteria for Phase 1, among candidate sites in Belarus, Among the candidate sites evaluated, based on the economics screening methodology, MPR was determined to: - Have an average cost of treatment for drinking water higher than the national average cost of treatment of drinking water. - Rank 5th in required level investment to meet EU water standards. - Based on Macroeconomic criteria, make a substantial contribution to the national economy in terms of export and foreign exchange earning ability and a major regional employer; and - Makes a substantial contribution to regional industrial employment. The Mozyr Petroleum Refinery can lay claim to the following (as identified from their promotional materials). - 25 years on the market of petroleum products with motor gasolines, jet, diesel and fuel oil and oil bitumen. - Motor fuels with improved environmental characteristics. - 6 years of operation in the composition of the first Russian-Belarussian Oil-and-Gas Company “Slavneft”. Main shareholders of Joint Stock Company “Mozyr Oil Refinery” are: - The Government of the Republic of Belarus – 42,7% of shares - Oil-and-Gas Company “Slavneft” – 42,5% of shares - Employees of the Oil Refinery – 14,5% of shares - Location of the Oil Refinery and railway communications allows to deliver petroleum products to any point of the Republic of Belarus within 4 days. - Convenient geographical location of the Oil Refinery, proximity to oil and products pipelines, a branched network of railway and motor highways make our products accessible to the customers in Russia, Ukraine, Moldova, Hungary, Romania, Poland, Slovakia, the Czech Republic, Latvia, Lithuania. - Continuous improvement of processes and products improves the quality of products as demanded by the world market and the laws on environmental protection. The infusion of capital from Slavneft has proved vital in modernizing the facility. Beyond modernizing the facility and the adoption of cleaner production technology, the plan is more competitive in the international market and is quite professional in its sales and marketing efforts. In discussions with plant staff, it was learned that the plant has a website (in English: www.mnpz.by/en) and that there is an international sales force. Mozyr Oil Refinery is located in the south of the Republic of Belarus in Gomel Region. Traditional markets for the Refinery were the northern provinces of Ukraine, western provinces of Russia and the south of Belarus, Poland and the Czech Republic (please see map). EXPORT MARKETS Russia Ukraine Moldova Romania Slovakia Poland Latvia Lithuania Estonia Hungary Czech Republic Petroleum products are shipped to East-European customers (table above) by pipeline. The crude oil arrives at the Refinery via two oil pipelines: the Russian crude oil via the oil pipeline “Druzhba” and the Belarussian crude from the Rechitsa deposits. In addition, the refinery accepts hydrocarbon-containing raw materials by railway. The products of Mozyr Oil Refinery are noted for their high quality: - Low content of sulphur compounds in jet and diesel fuels; - Absence of tetraethyl lead in motive fuel (gasoline); - High calorific value of fuel oils. A full list of products are identified in the table below. PRODUCTION OF J.S.C. “MOZYR OIL REFINERY” FUELS - Automotive fuel (gasoline) - Jet fuel - Diesel fuel - Fuel oil - Heating oil OIL ASPHALTS - Road asphalts - Roofing asphalts - Building asphalts GASES - Household fuel gases - Normal butane fraction OTHER PRODUCTS - Vacuum gasoil - Hydrotreated vacuum gasoil - Technical sulphur - Burning oil - Gasoline – feedstock for pyrolysis - Aromatics concentrate In 1994, the central plant’s laboratory was accredited for undertaking certification testing of products, used and produced during oil processing. In 1995 the Refinery along with BelOGP certified the main types of products: fuels and bitumen. With its low production costs, favourable market situation (great demand for heating oil at local markets) and convenient geographical location regarding export sales markets, staff have indicated that the financial situation of the Refinery is stable. Over recent years, the necessary introduction into the world market subjected the organization to the effects of crude oil demands and price increases and required a more economical and effective processing approach. An increase of oil refining depth (maximization of raw material usage) is a prerequisite for the profitable work of the enterprise. As indicated by Plant staff, little analysis has been conducted on the environmental benefits of new processes, however, they indicated that they are committed to the deploying the cleanest possible technologies, as cleaner processes are ultimately better for business and more profitable. With the major upgrades undertaken, as identified by the facility, the results of the realization of the first and the second planned stages of rehabillitation/upgrade are: - Increasing the extraction of light petroleum products; - Developing a flexible approach to the production of gasoline, kerosene and diesel cuts; - Commissioning of the local steam-and-gas turbine power station and a 40 atmosphere steam boiler which allowed the reduction of the purchase of power resources; - Providing unleaded A-92 and A1-95 gasolines output on the basis of catalytic reforming with the continuous catalyst regeneration. Also, obtaining of permission for production of the Normal-80, Regular-91, Premium-95 and Super-98 gasolines; - Increasing the production of high-octane gasoline products (output amounts up to 56% of the total motive gasolines fuels production); - Receiving ecologically safe diesel fuel with sulphur content less than 0.035%; - Commissioning of the installation for hydrogen concentration provided hydrogen for operation of hydrogenation processes; - Increasing the yield of diesel fuel and heating oil; - Preparing feedstock – hydrotreated vacuum gasoil – for catalytic cracking process; and - Constructing “acidic water” steaming off unit. Additional upgrades are planned. - The construction of the vis-breaking unit is being carried out at the third planned stage of rehabillitation/upgrade. In production the vis-breaking unit is closely connected with the hydroconversion complex and is required for processing of vacuum refining residue into standard fuel oil. - The implementation of the fourth planned stage of rehabilitation/upgrade, construction of the catalytic cracking complex, will allow the refinery to achieve an average European oil residue use of 83-84% and to allow the possibility to further develop the production scheme of the Refinery. By separate Russian and Belarussian crude oil processing and utilization of blend of hydrotreated vacuum gasoil of Russian crude oil and fuel oil of Belarussian crude oil as feedstock the yield of gasoline will rise by 3% and will amount to 28,45% for oil and the yield of fuel oil will drop up to 25,4%. A full outline of planned investments for the Refinery is identified below. Table 5.4.1. Schedule of the construction of new investment structures within the plan for expansion of Mozyrsky Petroleum Refinery by 2008 Facility 2003 2004 2005 2006 2007 2008 Total million USD Benzol generation facilities $0.5 $13.5 $6.0 $20.0 Izomerization section of the plant LK-6U #1 $0.1 $4.1 $1.8 $6.0 Facilities of hydrodesulphurization of gasoline of catalytic cracking Selective hydrogeneration $0.1 $2.0 $3.0 $1.9 $7.0 Hydrogen generation $0.1 $5.0 $10.0 $4.9 $20.0 Alkylation unit $14.6 $23.5 $12.0 $1.5 $51.6 Vacuum distillation unit $0.5 $10.5 $9.0 $20.0 Facilities of hydrodesulphurization and dearomatization of diesel oil including hydrogen generation $5.0 $40.0 $15.0 $60.0 Reconstruction of the section 300-1 LK-6U #2 for the process of vacuum gas oil hydroconversion $6.0 $2.0 $2.0 $10.0 Facilities of deep distillation of heavy residual stock Development of business plan and identification of technology in 2004 Refinery structures, including trestle of automated loading of tank cars, modernization of gasoline mixing, STB, power-generating facilities $0.5 4,0 $6.0 $2.0 $2.0 $14.5 TOTAL $15.4 $49.1 $47.3 $34.3 $44.0 $19.0 $209.1