Citgo Petroleum posts first profit in seven quarters
Citgo Petroleum reported a slim, second-quarter profit, its first in seven quarters, as higher fuel exports helped offset weak margins and the impact of a fuel pipeline shutdown.
Earnings at the U.S. refining arm of Venezuela's state oil company Petroleos de Venezuela have been under pressure since it lost access to Venezuelan oil due to U.S. sanctions. Citgo is also battling possible seizure by creditors seeking to collect on unpaid debts incurred by PDVSA and Venezuela.
The eighth-largest U.S. refiner posted a $3 million profit, its first since the third quarter of 2019, for the three months ended June 30 as exports rose and the utilization rate at its plant in Lemont, Illinois hit 97%. It suffered a $5 million net loss in the second quarter a year ago.
"Given the multiple challenges we have faced during 2020 and the first half of 2021, this return to profitability is particularly satisfying," Citgo Chief Executive Carlos Jordá said in a statement. Citgo fell deep into the red last year as the COVID-19 pandemic slashed demand for motor fuel.
In May, it reduced production at its 418,000 barrel per day (bpd) Lake Charles, Louisiana, refinery, the largest of its three facilities, after the Colonial fuel pipeline was taken out of commission for a week following a cyberattack.
Total refinery throughput was 732,000 bpd, from 575,000 bpd a year earlier. Exports rose to 130,000 bpd, from 87,000 bpd a year earlier. However, its Corpus Christi, Texas plant ran at a weak 78% utilization rate, hurt by operational and third-party outages.
A planned overhaul at Corpus Christi will be pushed back to the first quarter of next year, helping reduce expenses and lift production this year.
"Citgo is well-positioned to benefit from a strengthening economy and demand for our products as we move into the second half of 2021," said Jorda.
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