Refinery Operations - Market and Customers - Shipping Division
Corporate Citizenship - Culture of Excellence

 

Corporate Structure

As can be seen from the corporate structure depicted below, Petrojam Limited, in addition to the Refinery, consists of three other companies or profit centres. The functions of these are described in the following sections. Organizational chart

Petrojam Limited is staffed by approximately 180 employees, distributed throughout the departments of Refinery Production, Logistics and Marketing,Technical Services, Maintenance and Reliability, Finance and Accounting, Human Resources and Development, and Safety and Environment. The Petrojam staff handles the operations of all its subsidiary companies.

REFINERY OPERATIONS

 

Refinery Configuration

The Petrojam refinery is a 36,000 barrel per day hydroskimming refinery, built by Esso in 1963. Approximately 45-50% of its production from crude oil is heavy fuel oil (HFO). A full range of domestic, transportation and industrial petroleum products is produced, including asphalt for road construction, as shown below.

 

All gasoline produced is unleaded; leaded gasoline production was phased out in 2000 in keeping with the Government’s commitment to improving the quality of the environment. Two octane grades of unleaded gasoline are currently produced: 90 R+M/2, and 87 R+M/2. MTBE is used as an octane enhancer.

The HFO produced by the refinery is 3.0 wt% sulphur; in addition 2.2 wt% sulphur HFO is imported to meet the specific requirements of some of the independent power producing companies.

A small portion of the Turbo fuel produced is sold as kerosene.

At present, the refinery operates with a crude unit capacity utilization of about 78%, limited by the capacity of the naphtha/reformer section which produces gasoline. This mis-match of production capability and market demand causes underutilization in other product units; this issue is addressed with the development of the refinery upgrade project, discussed in greater detail in Section 3.0.

The refinery’s production is therefore supplemented as necessary to meet local demand, by finished products imported mainly from Trinidad and Tobago. Approximately 40% of all products supplied by Petrojam are imported.

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 Market and Customers

The Jamaican petroleum industry has been completely deregulated; since 1960 the retail market has been open to local marketing companies (LMCs), about nine of which have joined the market once controlled solely by the multinational marketing companies, (MNCs), Shell, Texaco and Esso. In 1993 import deregulation was introduced, this broke the refinery’s monopoly on this aspect of the industry.  The MNC’s have taken full advantage of this opening, proving to be a source of competition for Petrojam.

 For the fiscal year 2004/5 the Petrojam refinery supplied approximately 12.16 million barrels of petroleum products to the local market. This represents just under 85% of the total 14.16 million barrels of the country’s non-bauxite petroleum fuel requirements. The other 15% was imported into the country by the Multinational Marketing Companies. Petrojam therefore operates in an environment whereby its largest customers are also its main competitors.

 In addition to selling directly to retail marketing companies, Petrojam, for strategic reasons, markets some of its products directly into the local market to the larger commercial entities and the utility companies. This market has been growing at a rate of approximately 2.4% per annum for the last 5 years.

Increasing emphasis on exports since 2001/02 has resulted in higher volumes of products being exported.  Exports in 2004/5 amounted to approximately 2.25 million barrels, worth some US$114 million. Of the 2.25 million barrels of exports approximately 25% or 562,000,000 barrels were sold as bunker fuels.

The table below shows the products supplied by the refinery in the last fiscal year, and the major customers:

PRODUCT

ANNUAL SALES BARRELS

(2004/05)

MAJOR LOCAL CUSTOMERS

EXPORT
LPG 747,000 IGL, Shell, Petcom None

GASOLINE 3,057,000 All Retail Marketing Companies To Regional Traders

TURBO FUEL  1,290.000 JARS, Texaco, Esso , Petcom

None
KEROSENE 36,700 Petcom None
AUTO DIESEL 3,391,000

All Retail Marketing Companies

Directly to Power companies via Petrojam Marketing

 		As Bunkers, and to the Bauxite Companies
HEAVY FUEL OIL (3.0 wt%) 5,013,624 Power Companies via Petrojam Marketing As Bunkers, and to Int’l traders
HEAVY FUEL OIL (2.2 wt%) 1,180,018 Power Companies via Petrojam Marketing None
ASPHALT 198,584 Petcom To Int’l traders
Total 13,094,803   Approx 9% of Total Sales

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SHIPPING DIVISION

The Shipping Division is a profit centre of Petrojam Limited. It operates three vessels:

The Sichem Navigator– a 45,000 barrel clean product tanker used mainly for transporting clean products from Kingston, Jamaica to the other ports in the island. 

The Petrojam Barge Number 1 - a 20, 000 barrel dirty product tanker used for transporting bunker fuel to our customers.

The Petrojam Barge and Tug Negril, used mainly for making Round Island deliveries of HFO supplies for the power producing companies.

Corporate Structure - Refinery Operations - Market and Customers
Corporate Citizenship - Culture of Excellence

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