In September the La Teja refinery will shut down completely. During a period of four months -minimum-, Ancap will carry out a technical stop to replace part of the main equipment of that industry, as reported The Observer in the middle of April.
In addition, the company’s projected cash flow for 2023 shows the need for additional funds. This implies taking on financial debt to meet projected working capital needs.
Because?
During the four months that the technical maintenance stop lasts the entity must import fuels to replace the lack of its own production (about 600 thousand cubic meters) that is expected to be stored in Terminal del Este in José Ignacio
The purchase of imported refined products is financed at a 30-day termunlike the purchases made from crude suppliers and which are usually financed with a 90-day term.
This situation generates an increase in working capital needs to cover the loss of days of financing with suppliers, which is estimated at around US$ 237 million.
Refining margin and PPI difference
Also, in all that time of technical stoppage the refining margin obtained by processing crude oil will be lostsome US$ 180 million that will not enter the company boxas their authorities have handled.
On the other hand, taking into account that the Import Parity Prices (PPI) They have been determined by valuing the purchase costs of the different derivatives at values lower than those that Ancap has accessed in the market, “The entity must also finance the losses associated with that extra cost”says the resolution to which you agreed The Observer.
The company requires for its daily operational a minimum box of around the cost of 1.25 million barrels, which at US$89 per barrel, is about US$111 million.
The resolution
In that context The company’s Board of Directors approved the taking of financial debt for up to US$ 300 million. This financing will be used “to the extent that the evolution of the macroeconomic variables that impact the company and future price adjustments to the public warrant it.”
This means that several calls could be made to obtain the funds and their execution could be in tranches until the aforementioned limit is reached. The adjudications must be with prior authorization from the Executive Power.
Changes at the heart of the refinery
One of the main jobs at the La Teja refinery will be the replacement of cracking reactor top cap. It is estimated that at the peak of the technical shutdown there will be some 2,000 people working, both national and foreign contractors
Among other works that will be carried out are the inspection of refractories with foreign technicians, mechanical decoking and inspection of furnace tubes, replacement of furnace tubes, and change of catalysts in diesel and gasoline isomerization and desulfurization units.
In addition, reconditioning and fine-tuning of towers, reactors, pumps, compressors and special equipment will be carried out; maintenance and inspection for eddy currents in heat exchangers, and work in industrial painting, including the torch. The cost of new equipment and maintenance work is estimated at about US$77 million.
