The cost of a new refinery depends on a great many variables, such as: where the refinery is located, what the local environmental regulations require, the crude oil processing rate (i.e., barrels per day or metric tonnes per year), the type of crude oil being processed, the products to be produced, etc.

As a very rough estimate, a large modern refinery processing about 200,000 to 500,000 barrels/day (12,500,000 to 25,000,000 metric tonnes/year) would cost about $8,000/barrel to $10,000/barrel. Since designing and building such a refinery (plus obtaining the necessary permits) might take about 3-5 years, inflation might increase those costs quite a bit during that time.

The best way of obtaining a realistic price is to pay a major refinery engineering and construction company to perform a cost study. Such a study would cost at least about $1,000,000 or more.

Milton Beychok
(Visit me at www.air-dispersion.com)
.

Then it would appear that 18,425.00 USD per barrel of production would not be far off for next year's commencement of less than 100,000 Barrel a day production facility. Your opinion?

financeconsultant:

Your $18,425 per BSD (barrels per onstream day) seems somewhat high to me, even for a 100,000 BSD refinery project to be started next year. But as I said before, it depends on a number of variables, not the least of which is location. Also, it would depend on how much future inflation there will be especially if your estimate is  based on major equipment deliveries and payments 3-4 years hence.

Milton Beychok
(Visit me at www.air-dispersion.com)
.