Oil refineries question...

[UA_Iron]

Say you and a group of investors gets together and builds a private oil refinery of which oil is converted to gasoline...

is this possible? or would you get blackballed out of the market because you'd be increasing supply within the US (something oil companies would not approve of)?

Is it economically feasible? Oil seems to be such a hot commidity that it could potentially be very profitable.

Or is this just a silly idea? Admittedly I'm not a business major.

 

[Lestat]

i don't know.

but if its possible, EF should open up one.

 

[MattTheSkywalker]

Your question is like saying "Wouldn't it be a good idea to build and launch a satellite?"

Yes. yes it would.

But the barriers to entry are fairly predictable.

 

[manny78]

Say you and a group of investors gets together and builds a private oil refinery of which oil is converted to gasoline...

is this possible? or would you get blackballed out of the market because you'd be increasing supply within the US (something oil companies would not approve of)?

Is it economically feasible? Oil seems to be such a hot commidity that it could potentially be very profitable.

Or is this just a silly idea? Admittedly I'm not a business major.

it's possible and actually Virgin and Wal-Mart are both thinking about building their own refineries (Virgin's would be in Canada and WM in the US). Typical refinerie cost around 1-3 billions $. Not at everyone's reach.

 

[UA_Iron]

it's possible and actually Virgin and Wal-Mart are both thinking about building their own refineries (Virgin's would be in Canada and WM in the US). Typical refinerie cost around 1-3 billions $. Not at everyone's reach.

what makes them cost so much? you pay for the engineering right?

what if I had an engineering firm at my disposal?

 

[MattTheSkywalker]

what makes them cost so much? you pay for the engineering right?

what if I had an engineering firm at my disposal?

Engineering would be an eight figure undertaking.

The real cost is construction. Not too many contractors do this shit - I laugh when people say "Halliburton got this contract without any bids". Who the fuck is going to compete? Bechtel maybe...but these are highly skilled construction jobs.

Other costs include insurance (good luck trying to beat down AIG on price; no one else is going to cover it) through the construction and then operations.

Plan on activating it? It's going to cost you too.

And just for good measure we can throw in the cost of actually getting it legally approved, and whatever lobbying that would require.

Let me know when it's open.

 

[UA_Iron]

The red tape killed this idea... one of the many failures of big bureaucracies.

I wonder if mexico would be willing to have a US refinery. Of course I dont know how much they would want or what import laws/taxes are.

 

[spongebob]

some say the number one problem with building a new refinery from the ground up is the environmental regs. not impossible but not economically feasible. instead oil refineries have just upgraded to try and keep up with demand.

as far as the 1 to 3 billion. without looking it up i would say that would get you the bare minimum entry level, if that.

to refine gasoline, you also end up with about seven other products or by-products. these require further processing by ohter units and even the gasoline requires further processing.

my plant has about 32 units to handle this. ofcourse that is large.

then you need trained personnel, process techs, maintenance, process engineers, lab personnel, etc etc etc....

the intinial investment would be staggering.

as far as some numbers. we have half our plant shut down do to some major problems. and just this site is still making about 1.5million a day in profit.
$$$

 

[spongebob]

it's possible and actually Virgin and Wal-Mart are both thinking about building their own refineries (Virgin's would be in Canada and WM in the US). Typical refinerie cost around 1-3 billions $. Not at everyone's reach.

if wal-mart runs the refinery anything like they do thier stores you can bet they'll be killing some folks.