Wedoany.com Report-Nov 1, Taiwan’s petrochemical industry imported record amounts of Russian naphtha in October, snapping up fresh supplies being churned out by an oil refinery thousands of miles away.
The island nation imported almost 114,000 barrels a day of Russian naphtha last month, representing 66% of its total imports of the feedstock for the month, data from energy analytics firm Kpler show. The hike — to an all-time high — consolidates Russia’s ranking as the top supplier to Taiwan, a position previously held by the United Arab Emirates.
The October surge is mainly driven by a recent startup of a third condensate splitter at Novatek PJSC’s Ust-Luga refinery, said Viktor Katona, the lead crude analyst at Kpler. So far this year, Taiwan was the destination for as much as 78% of all Novatek’s monthly naphtha exports from the Baltic Sea port, Kpler’s figures show.
Russian fuel producers have been expanding presence in Asia and Latin America after western countries and their allies, earlier the main consumers of Russia’s oil products, banned the imports from early 2023 in response to the invasion of Ukraine.
Ust-Luga Expansion
Novatek’s Ust-Luga refinery processes condensate, a very light type of oil. It brought a third splitter online in mid-August allowing for increased naphtha flows, Katona said.
As a result, in the second half of August and early September, the plant raised its processing runs to a historic high of more than 195,000 barrels a day, compared to around 140,000 barrels a day in previous months, industry data seen by Bloomberg show.
That ramp up move coincided with a jump in Russian naphtha exports to Taiwan. It takes roughly 60 days for the Ust-Luga cargoes to reach the Asian country.
Shortly after the third splitter came online, Novatek started maintenance at at least one of the original units, which temporarily cut the plant’s runs, the industry data seen by Bloomberg shows.
“Novatek’s Ust-Luga facility has yet to see a month when all three splitters are running at full capacity,” Katona said. “Once that happens in December or January, Russian flows to Taiwan could easily stay above 100 thousand barrels per day on a sustainable basis.”
Novatek didn’t respond to a Bloomberg request for a comment on the maintenance schedule and production levels at its Ust-Luga refinery.
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