Austrian energy company OMV discovers chloride impurities in Azeri crude oil shipments.
In a recent development, the Austrian energy group OMV discovered organic chloride contamination in Azeri crude cargoes intended for delivery to its oil refineries. This contamination has the potential to cause significant risks, as seen in previous incidents involving OMV and Eni with Azeri crude.
Organic chlorides, commonly used in the oil industry for cleaning oil wells and accelerating the flow of crude, can pose risks to refinery equipment when present in large concentrations. These risks include pipeline and refinery equipment corrosion, operational disruptions, price volatility, and long-term infrastructure damage.
The contamination, which exceeded acceptable limits (above about 6 ppm), led to the halt of crude loadings at the Ceyhan terminal due to corrosive contamination detected in storage tanks. This contamination forced major European refiners, including Austria's OMV and Italy's Eni, to seek alternative crude supplies to avoid processing the tainted oil.
BTC pipeline operators declared force majeure, suspended shipments, and faced infrastructure risks due to corrosive organochlorine compounds damaging pipelines and refinery equipment. To manage the contamination, Orlen Unipetrol in the Czech Republic stored the contaminated crude separately and planned to blend it gradually with other batches in precise proportions to lower the organic chloride concentration safely before refining.
The contamination, which was discovered last week, caused several days' delays to loadings from Turkey's BTC Ceyhan terminal. The price differentials for Azeri BTC crude cargoes reached a four-year low due to the contamination. However, the contaminated crude did not reach OMV's refineries, and there was no disruption of its refining operations or of its supply of fuel to the market.
In response, OMV worked to secure alternative crude from other sources to ensure continuity and security of fuels supply. Meanwhile, it remains unclear what actions Eni is taking to address the contamination in its own systems.
The article was written by Robert Harvey in London.
The discovery of organic chloride contamination in Azeri crude cargoes has made an impact on the oil-and-gas industry, as it forced major European refiners, including Austria's OMV and Italy's Eni, to seek alternative crude supplies due to the potential risks to refinery equipment and operational disruptions (such as pipeline corrosion, refinery equipment damage, price volatility, and long-term infrastructure damage). The contamination in question, which led to the halt of crude loadings at the Ceyhan terminal and trading volatility for Azeri BTC crude cargoes, is a concern also to the finance sector, as the price differentials reached a four-year low due to the contamination and the uncertainty it brought to market fuels supply.
