Petroleos Mexicanos (Pemex)’s new 340,000 bbl/d Dos Bocas Olmeca refinery is unlikely to start until late 2023 or early 2024, according to an Industrial Info Resources (IIR) alert.

Located in Tabasco, Mexico, the Olmeca refinery is one of President Andres Manuel Lopez Obrador’s flagship projects to support the development of state-owned Pemex. The previous start of production was planned for July 2023.

Pemex is starting auxiliary services before starting up processing units, pushing its first crude run to late 2023.

Start of production at the refinery will boost Pemex’s downstream sector and decrease imports of refined products, another one of President Obrador’s goals. Pemex is also expanding its downstream sector abroad with its acquisition of Shell’s majority stake in the 340,000 bbl/d Deer Park refinery in Texas last year.

"When the refinery is fully operational it will not only help reduce refined product imports but also decrease the amount of sour crude available for export,” said IIR Energy's Hillary Stevenson, senior director of energy market intelligence. “The Olmeca refinery will consume Maya crude, decreasing the volumes available to export to the U.S., which may strengthen the value of other Canadian and Venezuela sour grades.”

Mexico’s current total downstream capacity is 1.64 MMbbl/d, with its six refineries increasing to 52% total capacity this year from last year’s 50% and 43% in 2021.