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Monday, June 24 2019 @ 01:28 PM UTC

Occidental Panama refinery verdict unlikely this yr

Foreign Direct Investment PANAMA CITY, Aug 2 (Reuters) - A final assessment of Occidental Petroleum Corp's proposed $7 billion oil refining project in Panama is unlikely to be completed before the end of this year, the company said on Thursday. A $20 million feasibility study into building a refinery capable of processing 350,000 barrels of crude oil a day will not be finished for "several months" and is unlikely to be ready this year, Occidental spokesman Richard Klein told Reuters in a telephone interview. In May this year, Occidental along with Qatar Petroleum and the Panamanian government signed an agreement to develop the project that which would produce oil for the Panamanian, regional and U.S. markets. If completed, the project will help address the shortfall in U.S. refining capacity, a problem highlighted by Hurricane Katrina in 2005, but which continues to underpin oil prices. (more)

The proposed refinery is expected to be located at Puerto Armuelles, on Panama's Pacific coast and close to the border with Costa Rica.

Panama's deputy minister for trade, Manuel Jose Paredes, said he was sure the project would go ahead.

He said this and other projects under consideration could help Panama "play an important role as an energy center for the region."

He confirmed a consortium led by Spain's Tecnicas Reunidas S.A. had put forward proposals to build a multibillion dollar pipeline that would traverse the isthmus from Panama City to the Atlantic port of Colon, although he said the project was in the early stages. (Reporting by Andrew Beatty in Panama City)

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