crude oil refinery business plan pdf

Crude Oil Refinery Business Plan [Sample Template]

By: Author Tony Martins Ajaero

Home » Business Plans » Oil & Gas Sector

Are you about starting a crude oil refinery? If YES, here is a complete sample crude oil refinery business plan template & feasibility report you can use for FREE .

Okay, so we have considered all the requirements for starting a crude oil refinery . We also took it further by analyzing and drafting a sample crude oil marketing plan template backed up by actionable guerrilla marketing ideas for crude oil refineries. So let’s proceed to the business planning section.

Crude oil is also popularly called black gold and is indeed a major source of income for countries where they have deposit of crude oil in commercial quantities.

As a matter of fact, players in the crude oil or oil and gas industry are known to generate massive income year in year out. This is so because all over the world people depend on products from this industry in order to operate their machines and automobiles et al.

It is important to state that if you are tinkering with starting a crude oil refinery, even if it is on a small scale, you must be ready to cough out a huge start – capital. Crude oil refinery business is indeed a highly capital intensive  trade which is why in most cases, investors with same or similar business ideology pool their cash together to be able to set up their own crude oil refinery business.

If you are interested in starting a crude oil refinery business, then you have got to brace up to follow through the somewhat challenging processes required to fulfill you dream.

You should equally be ready to go through the bureaucracy needed before you can acquire your license and permit and also source for funds et al. Below is a sample crude oil refinery business plan that will help you successfully launch your own business;

A Sample Crude Oil Refinery Business Plan Template

1. industry overview.

The crude oil refinery industry is indeed strategic industry and players in this industry refine crude oil into petroleum products. Basically, petroleum refining involves one or more of the following activities: fractionation, straight distillation of crude oil and cracking.

A close study of the industry shows that establishments in the crude oil refinery industry experienced volatile conditions over the last five years. Rising crude oil prices powered revenue growth as refiners have passed costs down the distribution line.

Over the last five years, profit has steadily recovered in line with improving demand, while low domestic oil prices further bolstered margins. Going forward, profit is expected to rise marginally, though it remains below historic levels.

The Crude Oil Refinery Industry is a thriving sector of the economy of the united states, United Arab Emirates, Russia, Venezuela, Nigeria, Angola, Canada, Saudi Arabia and Kuwait. Statistics has it that in the United States of America alone, The Crude Oil Refinery Industry generates a whooping sum of well over $369 billion annually from more than 135 registered and licensed crude oil refineries.

The industry is responsible for the employment of well over 58,230 people. Experts project the industry to grow at a -14.2 percent annual rate. Chevron, Exxon Mobil, Shell, Phillips 66 and Marathon Petroleum Corporation are the leaders in The Crude Oil Refinery Industry, they have the lion share of the available market in the industry.

For aspiring entrepreneurs who are considering starting a crude oil refinery business whether on a small scale or in a large scale should ensure that he or she conducts a thorough and exhaustive market survey and feasibility studies so as to get it right.

The truth is that, this type of business do pretty well when it is strategically positioned. Any location that is close to oil wells is ideal for such business. Over and above, crude oil refinery business is indeed a profitable business venture and it is open to any aspiring entrepreneur to come in and establish his or her business as long as they have the finance and expertise.

2. Executive Summary

Seven Seas Oil & Gas, Inc. is a small scale but standard and licensed crude oil refinery business that will be based in Juneau – Alaska, United States. Although we intend starting out on a small scale, but that will not in any way stop us from maximizing our potential in the international crude oil industry.

We hope to grow the business so as to start exporting refined crude oil products from the United States to other countries of the world. Our business goal as a standard and licensed crude oil refinery business is to become one of the leading oil and gas companies.

Our business activities will involve; gasoline production, kerosene production, distillate fuel oil (diesel fuel) production, aviation fuel production, residual fuel oil production, lubricant production, producing aliphatic and aromatic chemicals as byproducts, diesel fuel oil, jet fuel, liquefied petroleum gases, residual fuel oil, other refined petroleum products.

We have been able to secure permits from all relevant departments in the State of Alaska to run the business. Seven Seas Oil & Gas, Inc. is set to build a highly profitable crude oil refinery business which is why we have put plans in place for continuous training of all our staff members at regular interval.

No doubt the demand for refined crude oil products is not going to plummet any time soon, which is why we have put plans in place to continue to explore all available market for our products. In the nearest future, we will ensure that we create a wide range of distribution channels across the United States and on a global scale. With that, we know we will be able to maximize profits in our business.

Seven Seas Oil & Gas, Inc. will at all times demonstrate her commitment to sustainability, both individually and as a firm, by actively participating in our communities and integrating sustainable business practices wherever possible. We will ensure that we hold ourselves accountable to the highest standards by meeting our customers’ needs precisely and completely.

We will cultivate a working environment that provides a human, sustainable approach to earning a living, and living in our world, for our partners, employees and for our customers.

Seven Seas Oil & Gas, Inc. is a family business that is owned by Mr. Andrew Coppersmiths and his immediate family members.  Mr. Coppersmiths has a B.Sc. in Petroleum Engineering from A & M University, Texas. He has well over 10 years of hands on experience in the oil and gas industry, working for some of the leading brand in the United States.

Although the business is launching out as a family owned business but there is a plan to invite other investors who has same investment ideology in other to grow the business.

3. Our Products and Services

Our intention of starting Seven Seas Oil & Gas, Inc. is to make profits from the crude oil refinery industry cum oil and gas industry and we will do all that is permitted by the law in the US to achieve our corporate aim and ambition. Below are some of our products offering;

• Gasoline production
• Kerosene production
• Distillate fuel oil (diesel fuel) production
• Aviation fuel production
• Residual fuel oil production
• Lubricant production
• Producing aliphatic and aromatic chemicals as byproducts
• Diesel fuel oil
• Liquefied petroleum gases
• Residual fuel oil
• Other refined petroleum products

4. Our Mission and Vision Statement

• Our vision as a crude oil refinery business is to build a highly profitable business that will have a strong global presence like companies such as Chevron , Shell and Exxon Mobile et al.
• Our mission is to establish a standard and world class crude oil refinery business that in our own capacity will favorably compete with leaders in the industry. We want to build a crude oil refinery business that will be listed amongst the top 20brands in the United States of America.

Our Business Structure

Ordinarily, we would have succeeded in running our small scale crude oil refinery business with few employees, but as part of our plan to build a top flight crude oil refinery business in Juneau – Alaska, we have perfected plans to get it right from the onset which is why we are going the extra mile to ensure that we have competent employees to occupy all the available positions in our company.

The picture of the kind of crude oil refinery business we intend building and the business goals we want to achieve is what have informed the amount we are ready to spend to ensure that we build a business with dedicated workforce and a robust distribution network that cut across the United States of America, and the global market.

In view of that, we have decided to hire qualified and competent hands to occupy the following positions at Seven Seas Oil & Gas, Inc.;

• Chief Executive Officer (President)

Crude Oil Refinery Manager / Petroleum Engineer

Human Resources and Admin Manager

• Sales and Marketing Officer
• Accountants / Cashiers

Crude Oil Refinery Machine Operators

• Tanker Drivers/Crude Oil Products Wholesale Distributors
• Customer Service Executives

5. Job Roles and Responsibilities

Chief Executive Officer – CEO (President):

• Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results; developing incentives; developing a climate for offering information and opinions; providing educational opportunities.
• Creates, communicates, and implements the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
• Responsible for fixing prices and signing business deals
• Responsible for providing direction for the business
• Responsible for signing checks and documents on behalf of the company
• Evaluates the success of the organization
• Responsible for overseeing the smooth running of the refinery
• Makes sure that quality is maintained at all times
• Maps out strategy that will lead to efficiency amongst workers in the refinery
• Responsible for training, evaluation and assessment of the workforce
• Ensures operation of equipment by completing preventive maintenance requirements; calling for repairs.
• Ensures that the refinery meets the expected safety and health standard at all times.
• Responsible for overseeing the smooth running of HR and administrative tasks for the organization
• Updates job knowledge by participating in educational opportunities; reading professional publications; maintaining personal networks; participating in professional organizations.
• Enhances department and organization reputation by accepting ownership for accomplishing new and different requests; exploring opportunities to add value to job accomplishments.
• Defines job positions for recruitment and managing interviewing process
• Carries out staff induction for new team members
• Responsible for training, evaluation and assessment of employees
• Oversees the smooth running of the daily business activities.

Sales and Marketing Manager

• Manages external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
• Models demographic information and analyze the volumes of transactional data generated by customer purchases
• Identifies, prioritize, and reach out to new partners, and business opportunities et al
• Responsible for supervising implementation, advocate for the customer’s needs, and communicate with customers
• Develops, executes and evaluates new plans for expanding increase sales
• Documents all customer contact and information
• Represents the company in strategic meetings
• Helps to increase sales and growth for the company
• Responsible for operating crude oil refinery machines
• Actively involved in gasoline production, kerosene production, distillate fuel oil (diesel fuel) production, aviation fuel production, residual fuel oil production, lubricant production, producing aliphatic and aromatic chemicals as byproducts, diesel fuel oil, jet fuel, liquefied petroleum gases, residual fuel oil, and other refined petroleum products for the company.
• Handles any other duty as assigned by the palm oil processing plant manager

Accountant / Cashier

• Responsible for preparing financial reports, budgets, and financial statements for the organization
• Provides managements with financial analyses, development budgets, and accounting reports; analyzes financial feasibility for the most complex proposed projects; conducts market research to forecast trends and business conditions.
• Responsible for financial forecasting and risks analysis.
• Performs cash management, general ledger accounting, and financial reporting
• Responsible for developing and managing financial systems and policies
• Responsible for administering payrolls
• Ensures compliance with taxation legislation
• Handles all financial transactions for the organization
• Serves as internal auditor for the organization

Tanker Drivers / Crude Oil Products Wholesale Distributors

• Assists in loading and unloading crude oil products
• Maintains a logbook of their driving activities to ensure compliance with federal regulations governing the rest and work periods for operators.
• Keeps a record of vehicle inspections and make sure the truck is equipped with safety equipment
• Assists the transport and logistics manager in planning their route according to a delivery schedule.
• Local-delivery drivers may be required to sell products and businesses on their route, obtain signatures from recipients and collect cash.
• Transports petroleum products over land to and from the refinery to retail and distribution centers
• Inspects vehicles for mechanical items and safety issues and perform preventative maintenance
• Complies with truck driving rules and regulations (size, weight, route designations, parking, break periods etc.) as well as with company policies and procedures
• Collects and verify delivery instructions
• Reports defects, accidents or violations

Client Service Executive

• Ensures that all contacts with customer (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
• Through interaction with customers on the phone, uses every opportunity to build client’s interest in the company’s products and services
• Manages administrative duties assigned by the store manager in an effective and timely manner
• Consistently stays abreast of any new information on Delta Palm Oil Ventures products, promotional campaigns etc. to ensure accurate and helpful information is supplied to customers when they make enquiries

6. SWOT Analysis

Due to our drive for excellence when it comes to running a small scale but standard crude oil refinery business, we were able to engage some of the finest business consultants in the United States to look through our business concept and together we were able to critically examine the prospect of the business and to access ourselves to be sure we have what it takes to run a small scale but standard crude oil refinery business that can compete favorably in the oil and gas industry.

In view of that, we were able to take stock of our strengths, our weakness, our opportunities and also the threats that we are likely going to be exposed to in the United States and also in other parts of the world that we intend selling our crude oil products.

Here is a of what we got from the critically conducted SWOT Analysis Seven Seas Oil & Gas, Inc.;

Our strength lies in the fact that our refinery is strategically located in an oil and gas drilling area. We have state of the art crude oil refinery facility and equipment that has positioned us to meet the demand of petroleum products within our capacity even if the demand tripled overnight or if we have a massive order to meet and emergency need.

Another factor that counts to our advantage is the background of our Chief Executive Office; he has a robust experience in the oil and gas industry and also a pretty good academic qualification to match the experience acquired which has placed her amongst the top flight oil and gas experts.

We are not ignoring the fact that our team of highly qualified and dedicated workers will also serve as strength for our organization

We do not take for granted the fact that we have weaknesses. In fact, the reality that we are setting up a small scale crude oil refinery business in a city with other smaller and larger crude oil refinery businesses might likely pose a challenge for us in breaking into the already saturated market.

In essence our chosen location might be our weakness. But nevertheless, we have plans to launch out with a big bang. We know with that, we will be able to create a positive impression and we have a proper handle when it comes to building on already gather momentum.

• Opportunities:

The opportunities available to us are unlimited. Loads of people make use of petroleum products on a daily basis and all what we are going to do to push our push our products to them is already perfected. Juneau – Alaska is just ideal for crude oil refinery business because there are loads of oil wells in the State.

The threat that is likely going to confront us is the fact that we are competing with already established crude oil refinery businesses in United States and also there are other entrepreneurs who are likely going to launch similar business within the location of our business. Of course, they will compete with us in winning over the available market.

Another threat that we are likely going to face is unfavorable government policies and economic downturn. Usually economic downturn affects purchasing / spending powers and unfavorable government policies can hinder our free – flow of exporting crude oil products to other countries of the world.

7. MARKET ANALYSIS

• Market Trends

It is common trend in the crude oil refinery industry to find crude oil processing companies positioning their business in locations and communities where they can easily have access to fresh and cheap palm kernels.

If you make the mistake of positioning this type of business in a location where you would have to travel a distance before you can access crude oil, then you would have to struggle to make profits and maintain your overhead and logistics. Because a good chunk of your expenditure will go into transportation of the crude oil

So also another trend in this line of business is that most registered and well organized crude oil refinery companies look beyond the market within their locations; they are involved in exporting petroleum products to countries that do not have crude oil.

It is indeed a brisk business if you can secure reliable international client. Besides there is always a ready market for petroleum products all across the globe.

Lastly, in the bid to stay afloat and continue to make profits from this line of business, most standard and large scale crude oil refinery businesses tend to work hard to ensure that they own their crude oil wells. So also it is highly profitable to position this type of business in developing countries with crude oil in commercial quantities and fewer standard crude oil refineries.

Countries like Nigeria , Angola and Sao Tome and Principe readily come to mind if you can successfully secure the required license for such business.

8. Our Target Market

When it comes to retailing petroleum products, there is indeed a wide range of available customers. In essence, our target market can’t be restricted to just a group of people, but all those who make use of any of the following gasoline, kerosene, distillate fuel oil (diesel fuel), aviation fuel, residual fuel oil, lubricant, aliphatic and aromatic chemicals, diesel fuel oil, jet fuel, liquefied petroleum gases, residual fuel oil, other refined petroleum products..

One thing is certain; there are no restrictions to the demographic and psychographics composition of the target market for petroleum products in the world. This goes to show that the target market for petroleum products is wide and far reaching, you can create your own make niche yourself to serve a specific purpose.

In view of that, we have conducted our market research and we have ideas of what our target market would be expecting from us. We are in business to engage in retailing and wholesale distribution cum exporting of petroleum products to the following groups of people;

• Cars cum automobile owners
• Generators cum plant owners
• Corporate organization
• Households who make use of petroleum products
• Industries that depends on raw materials from crude oil manufacturing industries to produce their products
• Restaurants and canteens that make use of petroleum products
• The shipping industries
• The aviation industry

Our Competitive Advantage

First and foremost, the fact that anybody or group of investors with good financial standings and business interest in the oil and gas sector can decide to start a crude oil refinery business means that the business is open to all and sundry hence it is expected that there will be high – level competition in the industry.

There is hardly any crude oil producing communities that you wouldn’t find several crude oil refineries business especially on a small scale level.

As a small scale but standard crude oil refinery business, we know that gaining a competitive edge requires a detailed analysis of the demographics of the surrounding area and the nature of existing competitors. And even if you are successful at first, new competitors could enter your market at any time to steal your regular customers. Hence we will not hesitate to adopt successful and workable strategies from our competitors.

We are going to be one of the very few small scales but standard crude oil refineries in Juneau – Alaska that will also engage in wholesale distribution of petroleum products all across the United States of America and also export petroleum products to other countries of the world.

Another competitive advantage that we have is the vast experience of our management team, we have people on board who are highly experienced and understands how to grow business from the scratch to becoming a national phenomenon, especially businesses in the oil and gas sector.

Our large and robust distribution network and of course our excellent customer service culture will definitely count as a strong strength for the business. One thing is certain, we will ensure that in future, we own our crude oil well and grow big to favorable compete with leaders in the industry. With that our brand will be well communicated and accepted nationally.

Lastly, our employees will be well taken care of, and their welfare package will be among the best within our category (startups small scale but standard crude refinery companies) in the industry, meaning that they will be more than willing to build the business with us and help deliver our set goals and achieve all our aims and objectives.

We will also give good working conditions and commissions to freelance sales agents that we will recruit from time to time.

9. SALES AND MARKETING STRATEGY

• Sources of Income

Seven Seas Oil & Gas, Inc. is established with the aim of maximizing profits in the crude oil refinery industry cum oil and gas industry both in the United States of America and throughout the world.

We are going to go all the way to ensure that we do all it takes to sell our petroleum products both in retail and wholesale to a wide range of customers who make use of petroleum products. Seven Seas Oil & Gas, Inc. will generate income by simply selling the following petroleum products;

• Distillate fuel oil (diesel fuel)
• Aviation fuel
• aliphatic and aromatic chemicals as byproducts

10. Sales Forecast

One thing is certain when it comes to crude oil refinery business, if your business is centrally positioned and easily accessible, you will always attract customers cum sales and that will sure translate to increase in revenue generation for the business.

We are well positioned to take on the available market in the United States of America and every other country of the world where we intend exporting our petroleum products to and we are quite optimistic that we will meet our set target of generating enough income / profits from the first six month of operations and grow the business and our clientele base.

We have been able to critically examine the crude oil refinery industry cum oil and gas industry and we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. The sales projection is based on information gathered on the field and some assumptions that are peculiar to similar startups in Juneau – Alaska, United States.

Below are the sales projection for Seven Seas Oil & Gas, Inc., it is based on the location of our business and other factors as it relates to small scale and medium scale crude oil refinery company start – ups in the United States;

• First Fiscal Year-: $2Million
• Second Fiscal Year-: $5Million
• Third Fiscal Year-: $10Million

N.B : This projection is done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and there won’t be any major competitor offering same petroleum product and customer care services as we do within same location. Please note that the above projection might be lower and at the same time it might be higher.

• Marketing Strategy and Sales Strategy

Before choosing a location to launch Seven Seas Oil & Gas, Inc., we conduct a thorough market survey and feasibility studies in order for us to be able to be able to penetrate the available market in Nigeria and the international market.

We have detailed information and data that we were able to utilize to structure our business to attract the numbers of customers we want to attract per time and also for to compete with other small scale but standard crude oil refinery companies.

We hired experts who have a good understanding of the crude oil refinery industry cum oil and gas industry to help us develop marketing strategies that will help us achieve our business goal of winning a larger percentage of the available market for our petroleum products.

In order to continue to be in business and grow, we must continue to sell our petroleum products to the available market which is why we will go all out to empower or sales and marketing team to deliver our corporate sales goals. In summary, Seven Seas Oil & Gas, Inc. will adopt the following sales and marketing approach to sell our wide range of cupcake flavors;

• Introduce our business by sending introductory letters to residence, merchants and other stakeholders both in United States of America and abroad.
• Open our crude oil refinery business with a party so as to capture the attention of residence who are our first targets
• Engage in road show in targeted communities  from time to time to market our brand
• Advertise our products in community based newspapers, local TV and radio stations
• List our business and products on yellow pages ads  (local directories)
• Leverage on the internet to promote our product cum business
• Engage in direct marketing and sales
• Encourage the use of Word of mouth marketing (referrals)

11. Publicity and Advertising Strategy

Regardless of the fact that our crude oil refinery business is a standard one that can favorably compete with other small scale but standard crude oil refineries in The United States of America and in any part of the world, we will still go ahead to intensify publicity for all our products and brand. We are going to explore all available means to promote Seven Seas Oil & Gas, Inc.

Seven Seas Oil & Gas, Inc. has a long term plan of owning our own oil well in Africa and exports our product all across the world. This is why we will deliberately build our brand to be well accepted in Juneau – Alaska before venturing out to other cities in United States of America and the world.

As a matter of fact, our publicity and advertising strategy is not solely for selling our products but to also effectively communicate our brand. Here are the platforms we intend leveraging on to promote and advertise Seven Seas Oil & Gas, Inc.;

• Place adverts on both print (community based newspapers and magazines) and electronic media platforms
• Sponsor relevant community programs
• Leverage on the internet and social media platforms like; Instagram, Facebook , twitter, et al to promote our brand
• Install our Bill Boards on strategic locations all around major cities in the United States of America
• Engage in road show from time to time in targeted communities
• Distribute our fliers and handbills in target areas
• Position our Flexi Banners at strategic positions in the location where we intend getting customers to start patronizing our petroleum products
• Ensure that all our staff members wear our customized clothes, and all our official cars and distribution tankers are customized and well branded.

12. Our Pricing Strategy

When it comes to pricing for products such as petroleum products, there are no hard and fast rules, the prices are based on per liter or the container in which the petroleum products are placed in.

In view of that, our prices will conform to what is obtainable in the industry but will ensure that within the first 3 to 6 months our petroleum products are sold a little bit below the average prices when compared to other petroleum products production businesses in Nigeria. We have put in place business strategies that will help us run on low profits for a period of 6 months; it is a way of encouraging people to buy into our brands.

• Payment Options

The payment policy adopted by Seven Seas Oil & Gas, Inc. is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.

Here are the payment options that Seven Seas Oil & Gas, Inc. will make available to her clients;

• Payment via bank transfer
• Payment with cash
• Payment via online bank transfer
• Payment via check
• Payment via bank draft

In view of the above, we have chosen banking platforms that will enable our client make payment for farm produces purchase without any stress on their part. Our bank account numbers will be made available on our website and promotional materials to clients who may want to deposit cash or make online transfer for the purchase of petroleum products in wholesale.

13. Startup Expenditure (Budget)

In setting up any business, the amount or cost will depend on the approach and scale you want to undertake. If you intend to go big by renting a place, then you would need a good amount of capital as you would need to ensure that your employees are well taken care of, and that your facility is conducive enough for workers to be creative and productive.

This means that the start-up can either be low or high depending on your goals, vision and aspirations for your business.

The tools and equipment that will be used are nearly the same cost everywhere, and any difference in prices would be minimal and can be overlooked. As for the detailed cost analysis for starting a crude oil refinery business; it might differ in other countries due to the value of their money.

We know that no matter where we intend starting our crude oil refinery business, we would be required to fulfill most of the items listed below;

• The Total Fee for Registering the Business in the United States of America – $750.
• Legal expenses for obtaining licenses and permits as well as the accounting services (software, P.O.S machines and other software) – $1,300.
• Marketing promotion expenses for the grand opening of Seven Seas Oil & Gas, Inc. in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of – $3,580.
• Cost for hiring Business Consultant – $2,500.
• Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $2,400.
• Cost for payment of rent for 12 month at $1.76 per square feet in the total amount of $550,000
• Cost for construction of a small scale but standard crude oil refinery – $2Million
• Other start-up expenses including stationery ( $500 ) and phone and utility deposits ( $2,500 ).
• Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $1Million
• The cost for Start-up inventory – $250,000
• Storage hardware (bins, rack, shelves, food case) – $3,720
• Cost for store equipment (cash register, security, ventilation, signage) – $13,750
• Cost of purchase of distribution tankers – $100,000
• The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, Fax Machines, tables and chairs et al) – $4,000.
• The cost of Launching a Website – $600
• The cost for our opening party – $10,000
• Miscellaneous – $10,000

We would need an estimate of $4 million to successfully set up a small scale but standard crude oil refinery in Juneau – Alaska. Please note that this amount includes the salaries of all the staff for the first 3 month of operation.

Generating Funding / Startup Capital for Seven Seas Oil & Gas, Inc.

No matter how fantastic your business idea might be, if you don’t have the required money to finance the business, the business might not become a reality. Finance is a very important factor when it comes to starting a business such as crude oil refinery business.

No doubt raising start – up capital for a business might not come cheap, but it is a task that an entrepreneur must go through.

Seven Seas Oil & Gas, Inc. is a family business that is owned and financed by Mr. Andrew Coppersmith and his immediate family members. Although in future they plan to welcome external investors, but for now, they do not intend to welcome any external business partners that is why he has decided to restrict the sourcing of the start – up capital to 3 major sources.

These are the areas we intend generating our start – up capital;

• Generate part of the start – up capital from personal savings and sell of stocks
• Source for soft loans from family members and friends
• Apply for loan from my Bank

N.B: We have been able to generate about $1.5 million (Personal savings $1 million and soft loan from family members $500,000) and we are at the final stages of obtaining a loan facility of $2.5 million from our bank. All the papers and document have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.

14. Sustainability and Expansion Strategy

The future of a business lies in the numbers of loyal customers that they have the capacity and competence of the employees, their investment strategy and the business structure. If all of these factors are missing from a business (company), then it won’t be too long before the business close shop.

One of our major goals of starting Seven Seas Oil & Gas, Inc. is to build a business that will survive off its own cash flow without the need for injecting finance from external sources once the business is officially running. We know that one of the ways of gaining approval and winning customers over is to retail our petroleum a little bit cheaper than what is obtainable in the market and we are well prepared to survive on lower profit margin for a while.

Seven Seas Oil & Gas, Inc. will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare is well taken of.

Our company’s corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner. As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of three years or more.

We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.

Check List / Milestone

• Business Name Availability Check:>Completed
• Business Registration: Completed
• Opening of Corporate Bank Accounts: Completed
• Securing Point of Sales (POS) Machines: Completed
• Opening Mobile Money Accounts: Completed
• Opening Online Payment Platforms: Completed
• Application and Obtaining Tax Payer’s ID: In Progress
• Application for business license and permit: Completed
• Purchase of Insurance for the Business: Completed
• Leasing of a facility and construction of a small scale but standard crude oil refinery: In Progress
• Conducting Feasibility Studies: Completed
• Generating capital from family members: Completed
• Applications for Loan from the bank: In Progress
• Writing of Business Plan: Completed
• Drafting of Employee’s Handbook: Completed
• Drafting of Contract Documents and other relevant Legal Documents: In Progress
• Design of The Company’s Logo: Completed
• Graphic Designs and Printing of Packaging Marketing / Promotional Materials: In Progress
• Recruitment of employees: In Progress
• Purchase of the needed crude oil processing equipment, furniture, racks, shelves, computers, electronic appliances, office appliances and CCTV: In progress
• Creating Official Website for the Company: In Progress
• Creating Awareness for the business both online and around the community: In Progress
• Health and Safety and Fire Safety Arrangement (License): Secured
• Opening party / launching party planning: In Progress
• Establishing business relationship with vendors – wholesale suppliers / merchants of petroleum products: In Progress
• Purchase of delivery tanks: Completed

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Sample Crude Oil Refinery Business Plan

Are you into oil refining or wish to start a business in the oil and gas line ? Click here for a sample crude oil refinery business plan.

It’s a great business idea that will require getting everything in place to launch a successful operation. One of the most fundamental requirements includes having a plan.

CRUDE OIL REFINERY BUSINESS PLAN SAMPLE

Your business plan is simply your blueprint to success.

However, a shabbily written plan won’t do much to help your business grow. This is why we’ve written this crude oil refinery Business Plan to serve as a guide.

SEE: Developing A Diesel Supply Business Plan

Here, we’ve included all the basics with the strong hope that you’ll get the help you need.

It Begins with Identifying the Main Sections

Every business plan is structured in a certain way.

Here, we’re referring to the key sections contained within the plan. Basically, these sections include the executive summary, the company description, and the products & services sections.

There’s more!

Other key inclusions are the market analysis section, the strategy & implementation, the organization & management team as well as the financial plan & projection sections.

Detailed analysis and breakdown of each of these sections are needed to have a comprehensive plan.

i. Executive Summary

Consider the executive summary section as an introduction to the plan.

This is a compressed version that highlights the vital aspects of the plan. It’s written comprehensively and largely determines whether your business idea is viewed favorably by lenders or not.

Here, the aim is to keep your readers interested and making them want to learn more about your business idea.

Although the executive summary section appears first in order of arrangement, it’s actually written last. This helps capture all the key points to be included.

Business Name & Location

The business name and location are key details you can’t leave out or ignore. Your crude oil refining business must have a name. Where is it going to be located?

Location counts as it has to do with the supply of raw materials (in this case crude oil) as well as easy distribution of refined products.

Products and/or Services Offered

There’s also the products and services section. Whatever your scale of operation, crude oil refining is big business.

Apart from gasoline, a wide range of by-products is derived from crude. You’ll need to list your products while also stating any number of services offered.

Mission & Vision Statements

The mission and vision statements give an idea of where the business is headed and what it seeks to accomplish.

Your mission statement should briefly explain what your business offers, how it does this, and also who it helps. In a nutshell, it should encapsulate the value of your products and service.

The vision statement on the other hand is part of your strategic plan. It should clearly describe what you wish to achieve and also what you intend to offer your customers.

It should be inspiring enough to allow your workforce to key into it.

Purpose of the Plan

What’s the purpose of putting together a crude oil refining plant? Clearly stating its purpose gives more direction and enables you to clarify your goals. This enhances your likelihood of success.

ii. Company Description

The company description section is important to you as well as to your audience (lenders). It clearly highlights key aspects of your operations. It explains who you are, your goals as well as your operations.

This section should include information on the legal structure of your crude refining business.

Also, comprehensive information on the nature of the business as well as its brief history must be stated. What specific demands do you wish to satisfy?

Crude refining products serve the needs of a huge energy market.

Include an overview of services & products not leaving out your customers and suppliers. Ensure you include financial & market highlights as well. There should also be a summary of short and long-term business goals.

Clearly identify how you intend to make a profit.

iii. Products & Services

What products will your crude oil refining business offer? These must be clearly defined in addition to stating how they benefit the market or your customers.

Some visual representation such as the use of diagrams and pictures will make your presentation more understandable.

The market role of your products and services is crucial. You’ll need to state its advantages over competing products. What research and development activities are currently in place?

Will they lead to the development of more products?

iv. Market Analysis

This is where a great deal of work is needed. The market analysis section is written after thorough research of the refining industry.

It should include details such as a targeted customer segment sketch, an industry description, and outlook with statistical backing as well as historical, current, and projected marketing data.

It’s also important to include an evaluation of your competitors. Here, you’ll be more interested in identifying their strengths and weaknesses.

v. Strategy & Implementation

A summary of sales and marketing strategies as well as their implementation is what this section encapsulates.

You’ll need to explain you intend to promote your crude oil refining business to the market. Provide all details on product costs, pricing, promotion & distribution.

There needs to be a clear understanding of how your business will function. Here, the operational cycle, as well as information on labor sources and employees is necessary.

vi. Organization & Management Team

The organizational structure of your crude oil refining business needs to be discussed. This is better presented with an organizational chart that describes key departments and employees.

Details about the owners, their names, level of involvement as well as percentage ownership are necessary.

The profiles of your management team must also be stated. Key inclusions will cover skills and background, positions, names, and main responsibilities.

vii. Financial Plan & Projection

Your crude oil refining business plan won’t be complete without the financial plan & projections section. The input of a professional is vital here.

With the help of a professional accountant, have a detailed breakdown of your historical financial data, in addition to realistic prospective financial information.

A brief analysis of your financial data is also a necessary inclusion to your crude oil refining business plan.

With these sections comprehensively written, you have a solid plan that guarantees success.

You can also follow this framework to create a unique oil and gas business plan .

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How To Write a Business Plan for Refinery in 9 Steps: Checklist

By alex ryzhkov, resources on refinery.

• Financial Model
• Business Plan
• Value Proposition
• One-Page Business Plan
• SWOT Analysis
• Business Model
• Marketing Plan

Are you considering starting a refinery and want to ensure its success? Writing a comprehensive business plan is essential for laying the foundation for your refinery. In this blog post, we will walk you through the nine crucial steps to create a business plan for a refinery. But first, let's take a look at some recent statistics that highlight the growing potential of the industry.

The refinery industry in the US has been experiencing impressive growth in recent years. According to the latest data, the industry's compound annual growth rate (CAGR) is projected to reach 3.8% from 2021 to 2026. This growth is primarily driven by the increasing demand for refined petroleum products, fueled by various sectors such as transportation, manufacturing, and power generation. As the industry continues to expand, now is the perfect time to dive into the world of refining and establish your own successful venture.

Now, let's jump into the nine critical steps that will guide you in creating an effective business plan for your refinery.

• Step 1: Conduct market research
• Step 2: Determine the target market and customer base
• Step 3: Analyze competitors and industry trends
• Step 4: Identify potential risks and challenges
• Step 5: Define the business model and value proposition
• Step 6: Set clear goals and objectives
• Step 7: Calculate financial requirements and projections
• Step 8: Formulate a marketing and sales strategy
• Step 9: Develop an organizational structure and team composition

By following these steps, you will gain a comprehensive understanding of the refinery industry, identify your target market, and create a roadmap for success. So, let's dive in and start crafting your refinery business plan!

Conduct Market Research

In order to successfully establish and run a refinery, conducting thorough market research is essential. This will provide valuable insights into the industry landscape, help identify potential opportunities, and guide strategic decision-making. Here are key steps to follow when conducting market research for your refinery:

• Identify the target market: Start by defining the specific region or market segment you intend to serve. Consider factors such as the demand for refined petroleum products, existing competition, regulatory environment, and any market gaps or untapped opportunities.
• Analyze customer needs and preferences: Gain a deep understanding of what your potential customers require and prefer when it comes to refined petroleum products. This could include factors such as product quality, pricing, delivery speed, and customer service.
• Study industry trends and market dynamics: Stay updated on the latest industry trends, technological advancements, and market dynamics that may impact the refinery business. This can help you anticipate changes, identify emerging opportunities, and stay competitive in the market.
• Assess customer buying behavior: Explore how customers currently source and purchase refined petroleum products. This can include understanding the role of distributors, wholesalers, and direct customer relationships. Identify any pain points or unmet needs in the market that your refinery can address.

Tips for conducting effective market research:

• Utilize both primary and secondary research methods to gather data. Primary research involves collecting information directly from potential customers and industry experts through surveys, interviews, or focus groups. Secondary research involves analyzing existing market reports, industry publications, and data from reputable sources.
• Consider partnering with market research firms or consultants who specialize in the oil and gas industry. They can provide valuable insights and expertise to ensure comprehensive data analysis.
• Regularly update your market research to stay informed about evolving customer preferences, industry trends, and regulatory changes.
• Look for opportunities to differentiate your refinery from competitors by identifying unique selling points or niches within the market.

Determine The Target Market And Customer Base

Identifying the target market and customer base is a crucial step in developing a successful business plan for a refinery. By understanding who your target market is, you can tailor your products and services to meet their specific needs and preferences.

1. Conduct thorough market research: Begin by conducting comprehensive market research to gather data and insights about the oil and gas industry. This research will help you determine the size and dynamics of the market, including the demand for refined petroleum products and the overall industry trends.

• Use industry reports, market surveys, and data from reputable sources to obtain accurate and reliable information.
• Consider hiring a professional market research firm to gather in-depth insights into the industry and identify potential target markets.
• Segment the market based on factors such as geography, customer preferences, and purchasing behavior to identify the most lucrative customer segments.

2. Analyze competition: Identify and analyze your competitors to gain knowledge about their target markets, customer profiles, and marketing strategies. This analysis will help you identify gaps in the market and areas where your refinery can differentiate itself.

• Utilize tools like SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats) to evaluate your competitors' strengths and weaknesses.
• Look for opportunities to target underserved market segments that your competitors may have overlooked.
• Consider conducting a competitive analysis to benchmark your products, services, and pricing against your competitors.

3. Determine customer preferences and needs: Gain a deep understanding of your potential customers by identifying their preferences, needs, and pain points. This will allow you to tailor your products and services to meet their specific requirements and ensure customer satisfaction.

• Conduct surveys, interviews, and focus groups with your target customers to gather valuable insights and feedback.
• Observe consumer trends and changing preferences in the oil and gas industry to anticipate future customer needs.
• Identify any common challenges or pain points faced by your target customers and develop solutions to address them.

By carefully determining your target market and customer base, you can align your business strategies and offerings to meet their needs effectively. This knowledge will not only help you attract and retain customers but also position your refinery for long-term success in the competitive oil and gas industry.

Analyze Competitors And Industry Trends

When starting a refinery business, it is crucial to have a comprehensive understanding of your competitors and the industry trends. This analysis will provide you with valuable insights that can help you position your refinery for success and stay ahead of the competition.

Competitor Analysis:

• Identify your direct and indirect competitors in the refinery industry.
• Assess their strengths, weaknesses, and competitive advantages.
• Evaluate their market share, pricing strategies, and customer base.
• Analyze their operational efficiencies, technology infrastructure, and supply chain management.
• Identify any gaps in the market that you can exploit to differentiate your refinery from competitors.
• Learn from their successes and failures to refine your own business strategy.

Industry Trends Analysis:

• Stay updated on the latest industry trends, macroeconomic factors, and regulatory changes affecting the refinery sector.
• Monitor shifts in consumer preferences, such as the demand for cleaner and sustainable energy sources.
• Understand the impact of technological advancements on refining processes and efficiency.
• Track changes in the global oil and gas market, including supply and demand dynamics, price fluctuations, and geopolitical factors.
• Identify emerging market opportunities, such as refining alternative fuels or servicing niche markets.

Tips for Competitor and Industry Trends Analysis:

• Subscribe to industry publications, attend conferences, and join professional networks to stay informed.
• Utilize online resources and databases to access market research reports and competitor profiles.
• Engage in benchmarking exercises to evaluate your performance against industry leaders.
• Regularly review and update your competitor and industry analysis to stay proactive in a rapidly evolving market.

By thoroughly analyzing your competitors and industry trends, you can gain valuable insights that will inform your strategic decision-making and help you establish a competitive advantage in the refinery business.

Identify Potential Risks And Challenges

Identifying potential risks and challenges is a crucial step in developing a business plan for a refinery. Being aware of the possible obstacles that may arise allows you to devise strategies to mitigate them, ensuring the long-term success of your refinery. Here are some key areas to consider:

• Regulatory and compliance risks: Refinery operations are subject to stringent regulations to ensure safety, environmental protection, and adherence to industry standards. Familiarize yourself with local, state, and federal regulations governing the industry and ensure your operations comply with them.
• Volatility in crude oil prices: Crude oil prices can fluctuate significantly due to various factors such as geopolitical tensions, economic conditions, and global supply and demand. These price fluctuations can impact the profitability of your refinery. Have a plan in place to manage and mitigate the effects of volatile crude oil prices on your business.
• Supply chain disruptions: Dependence on a steady supply of crude oil is crucial for refinery operations. Any disruptions in the supply chain, such as transportation issues or logistical challenges, can disrupt your operations and affect revenue. Consider alternative suppliers or contingency plans to minimize the impact of potential disruptions.
• Technological advancements: The refining industry is constantly evolving, with new technologies and processes emerging. Keeping up with technological advancements can be a challenge, but it is essential to remain competitive. Stay informed about industry trends and invest in research and development to enhance operational efficiency and stay ahead of the curve.
• Environmental considerations: Refineries have a significant environmental impact due to emissions and waste generated during the refining process. Compliance with environmental regulations is crucial to avoid penalties and damage to your reputation. Develop sustainable practices and invest in environmentally friendly technologies to minimize your refinery's ecological footprint.
• Conduct a thorough risk assessment and create a risk management plan to address potential risks and challenges.
• Stay updated on industry news and trends to anticipate any changes that may impact your refinery.
• Establish strong relationships with key stakeholders, such as suppliers and customers, to navigate challenges together.
• Regularly review and revise your risk management strategies to ensure they remain effective.

Define The Business Model And Value Proposition

Defining a clear and effective business model is crucial for the success of any refinery. It outlines how the company will create, deliver, and capture value in the market. The business model should align with the overall goals and objectives of the refinery, while considering the unique characteristics of the industry.

The value proposition is a key component of the business model and describes the benefits and value that the refinery will provide to its customers. This can include factors such as high-quality refined petroleum products, reliable and consistent supply, competitive pricing, and exceptional customer service. The value proposition should differentiate the refinery from its competitors and attract customers.

Here are some important aspects to consider when defining the business model and value proposition:

• Product and service offerings: Clearly define the range of petroleum products the refinery will produce and market to its customers. Consider factors such as product quality, production capacity, and potential diversification opportunities.
• Supply chain management: Outline how the refinery will secure a consistent and reliable supply of crude oil from oil and gas producers. Establishing long-term contracts can provide stability and ensure a dependable supply.
• Customer relationships: Identify the target market and customer base the refinery will serve. Consider their needs, preferences, and expectations. Building strong customer relationships through excellent service and personalized solutions can be a competitive advantage.
• Competitive advantage: Determine how the refinery will differentiate itself from competitors. This can involve factors such as technology advancements, cost leadership, operational efficiency, or sustainability initiatives.
• Revenue streams: Identify the different sources of revenue for the refinery, including sales of finished petroleum products and potential tolling agreements where the refinery processes oil owned by others for a fee.
• Partnerships and collaborations: Explore opportunities to collaborate with key players in the industry, such as oil and gas producers, distributors, and suppliers. Building strategic partnerships can help strengthen the refinery's position in the market.
• Keep the business model simple and focused to ensure clarity and ease of implementation.
• Regularly review and update the business model to adapt to market changes and evolving customer needs.
• Ensure that the value proposition aligns with the refinery's mission and vision, and communicates a compelling reason for customers to choose the refinery over competitors.

Set Clear Goals And Objectives

Setting clear goals and objectives is essential for the success of any business, including a refinery. Goals provide direction, purpose, and a roadmap for your efforts, while objectives help you measure progress and track achievements. Here are some important considerations when setting goals and objectives for a refinery:

• Identify your core mission: Define the overarching purpose and mission of your refinery. This will guide your decision-making and shape your goals.
• Be specific and measurable: Ensure that your goals are specific and measurable, so you can track progress and evaluate success. For example, instead of setting a generic goal like 'increase revenue,' strive for a specific target such as 'achieve a 10% increase in revenue within the first year of operation.'
• Set realistic and achievable targets: While ambition is important, it is crucial to set goals that are realistic and achievable. Unrealistic goals can lead to frustration and demotivation if they are not met.
• Align goals with business model: Your goals should align with your chosen business model and value proposition. For instance, if your refinery's competitive advantage lies in offering premium quality products, one of your goals could be to become the preferred supplier for high-end customers.
• Consider short-term and long-term objectives: Set both short-term objectives to drive immediate progress and long-term objectives to guide the direction of your refinery. Short-term objectives can act as stepping stones towards achieving bigger, long-term goals.
• Regularly review and reassess your goals and objectives to ensure they remain relevant and aligned with the evolving market conditions and industry trends.
• Break down bigger goals into smaller, manageable milestones to keep your team motivated and focused on continuous progress.
• Communicate your goals and objectives clearly to your team members, establishing a shared understanding of what needs to be accomplished and why.
• Regularly track and measure your progress towards achieving your goals, making adjustments and improvements as necessary to stay on track.

Calculate Financial Requirements and Projections

When starting a refinery business, it is crucial to have a clear understanding of the financial requirements and projections. This step involves analyzing the costs involved in setting up and operating the refinery, as well as estimating the potential revenue and profitability.

1. Determine the start-up costs: Begin by identifying the expenses associated with setting up the refinery. This may include acquiring land and permits, purchasing equipment and machinery, and conducting necessary environmental assessments. It is essential to factor in all relevant costs to create a comprehensive financial plan.

2. Assess operational costs: Once the refinery is up and running, various operational costs need to be considered. This includes expenses related to crude oil supply, labor, energy consumption, maintenance, and compliance with regulatory standards. By evaluating these costs, you can determine the ongoing financial requirements of maintaining and operating the refinery.

3. Estimate revenue streams: Analyze the potential revenue streams for the refinery. This typically includes income generated from long-term contracts with oil and gas producers, distributors, and customers for the sale and delivery of refined petroleum products. Additionally, revenues from tolling agreements, whereby the refinery processes crude oil owned by others for a fee, should also be factored into the projections.

4. Create financial statements: Develop financial statements such as income statements, balance sheets, and cash flow statements to present a clear picture of the refinery's financial position and projected performance. These statements will help you assess the profitability, liquidity, and overall financial health of your refinery business.

5. Consider external funding: If the financial requirements for the refinery exceed the available capital, you may need to explore external funding options. Research potential financing options, such as loans from financial institutions, government grants, or partnerships with investors, to ensure sufficient funds for the refinery's establishment and operations.

Tips for calculating financial requirements and projections:

• Consult industry experts or financial advisors to gather accurate data and insights.
• Take into account potential risks and uncertainties that may impact financial projections.
• Regularly review and update your financial projections to reflect any changes in market conditions.

By calculating the financial requirements and projections, you will have a comprehensive understanding of the funding needed and the expected financial performance of your refinery business. This step forms the foundation for making informed decisions regarding investment, financing, and overall business strategy.

Formulate A Marketing And Sales Strategy

Once you have a clear understanding of your target market and customer base, it is crucial to develop a robust marketing and sales strategy that will effectively promote and sell your refined petroleum products. Here are some key considerations to keep in mind:

• Define your unique selling proposition: Clearly articulate what sets your refinery apart from the competition. Highlight your competitive advantages such as superior product quality, reliability, or efficient production processes.
• Identify the most effective marketing channels: Research and determine the most suitable platforms to reach your target audience. This may include online advertising, industry trade shows, direct mail campaigns, or partnership with local distributors.
• Establish pricing strategies: Analyze the market trends and closely examine your competitors' pricing models. Determine a pricing strategy that balances competitiveness and profitability.
• Build a strong brand: Develop a compelling brand identity that represents the values and strengths of your refinery. Consistently reinforce this brand through all marketing efforts, including logo design, website, and advertising materials.
• Create a comprehensive sales plan: Outline a step-by-step approach to selling your petroleum products, including target sales volume, customer acquisition strategies, and sales team structure.

Marketing and Sales Strategy Tips:

• Invest in digital marketing: Utilize social media platforms, search engine optimization (SEO), and targeted online advertising to expand your reach and visibility.
• Establish partnerships: Collaborate with local distributors or retailers to widen your distribution network and reach a larger customer base.
• Provide exceptional customer service: Focus on building strong relationships with your customers by providing excellent service, timely order fulfillment, and personalized assistance.
• Stay updated on industry trends: Regularly monitor industry news and market trends to stay ahead of the competition and adapt your marketing strategies accordingly.

By formulating a comprehensive marketing and sales strategy, you will be well-equipped to effectively promote your refined petroleum products, attract customers, and establish a strong presence in the market.

Develop An Organizational Structure And Team Composition

Creating an effective organizational structure and assembling the right team is crucial for the success of your refinery business. A well-structured organization ensures clear roles and responsibilities, efficient communication, and optimal coordination among team members. Here are some important considerations when developing your organizational structure:

• Define key roles and responsibilities: Determine the key positions required in your refinery, such as operations manager, finance manager, sales and marketing manager, and technical experts. Clearly define the responsibilities and authority for each role to ensure clarity and accountability.
• Identify reporting relationships: Establish reporting lines to ensure effective communication and decision-making within the organization. This includes determining who reports to whom, creating a hierarchy that aligns with the goals and objectives of your business.
• Consider team composition: Assess the skill sets and expertise required for each role and assemble a team with diverse talents and experiences. Look for individuals with knowledge of the oil and gas industry, refinery operations, finance, marketing, and other relevant areas.
• Encourage collaboration and teamwork: Foster a culture of collaboration and teamwork within your organization. Encourage open communication, idea sharing, and mutual support among team members, which will contribute to innovation and productivity.
• Consider creating cross-functional teams to enhance collaboration and problem-solving.
• Provide training and development opportunities to enhance the skills and knowledge of your team members.
• Regularly review and update your organizational structure as your business grows and evolves.
• Seek feedback from your team to improve organizational effectiveness and address any challenges or issues.

Developing an effective organizational structure and assembling a skilled team lays the foundation for a successful refinery business. By carefully defining roles and responsibilities, fostering collaboration, and continuously supporting your team's growth, you can build a strong and capable organization that can effectively navigate the complexities of the industry.

Writing a business plan for a refinery is a crucial step in starting and successfully running this type of venture. By following the nine steps outlined in this checklist, you can ensure that your plan covers all the necessary aspects, from market research to organizational structure and team composition.

Conducting thorough market research will provide valuable insights into the industry and help you determine your target market and customer base.

Analysing competitors and industry trends will allow you to identify potential risks and challenges and differentiate your refinery from others in the market.

Defining your business model and value proposition will help you establish a strong foundation for your refinery and attract customers and partners.

Setting clear goals and objectives will provide a roadmap for your refinery's success and guide your decision-making process.

Calculating financial requirements and projections is essential for creating a realistic and achievable financial plan for your refinery.

Formulating a marketing and sales strategy will help you effectively promote and sell your refined petroleum products to potential customers.

Developing an organizational structure and team composition is crucial for ensuring smooth operations and efficient management of your refinery.

By following these steps, you can create a comprehensive business plan that will increase your chances of success in the competitive refinery industry.

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Oil Refinery Business Plan Sample PDF Example | Free Download Presented by BizMove

Watch This Video Before Starting Your Oil Refinery Business Plan PDF!

Checklist for Starting a Oil Refinery Business: Essential Ingredients for Success

If you are thinking about going into business, it is imperative that you watch this video first! it will take you by the hand and walk you through each and every phase of starting a business. It features all the essential aspects you must consider BEFORE you start a Oil Refinery business. This will allow you to predict problems before they happen and keep you from losing your shirt on dog business ideas. Ignore it at your own peril!

For more insightful videos visit our Small Business and Management Skills YouTube Chanel .

Here’s Your Free Oil Refinery Business Plan DOC

Free book for you: how to start a business from scratch (pdf).

Copy the following link to your browser and save the file to your PC:

https://www.bizmove.com/free-pdf-download/how-to-start-a-business.pdf

A little child was playing one day with a very valuable vase. He put his hand into it and could not withdraw it. His father too, tried his best, but all in vain. They were thinking of breaking the vase when the father said, "Now, my son, make one more try. Open your hand and hold your fingers out straight as you see me doing, and then pull."

To their astonishment the little fellow said, "O no, father. I couldn't put my fingers out like that, because if I did I would drop my penny."

Smile, if you will - but thousands of us are like that little boy, so busy holding on to the world's worthless penny that we cannot accept liberation. I beg you to drop the trifle in your heart. Surrender! Let go!

Believe The Impossible

Every great achievement was once impossible until someone set a goal to make it a reality.

Lewis Carroll's famous masterpiece Through the Looking Glass contains a story that exemplifies the need to dream the impossible dream. There is a conversation between Alice and the queen, which goes like this:

"I can't believe that!" said Alice.

"Can't you?" the queen said in a pitying tone. "Try again, draw a long breath, and shut your eyes."

Alice laughed. "There's no use trying," she said. "One can't believe impossible things."

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When you dare to dream, many marvels can be accomplished. The trouble is, most people never start dreaming their impossible dream.

How High Can You Jump?

Flea trainers have observed a predictable and strange habit of fleas while training them. Fleas are trained by putting them in a cardboard box with a top on it. The fleas will jump up and hit the top of the cardboard box over and over and over again. As you watch them jump and hit the lid, something very interesting becomes obvious. The fleas continue to jump, but they are no longer jumping high enough to hit the top. Apparently, Excedrin headache 1738 forces them to limit the height of their jump.

When you take off the lid, the fleas continue to jump, but they will not jump out of the box. They won't jump out because they can't jump out. Why? The reason is simple. They have conditioned themselves to jump just so high. Once they have conditioned themselves to jump just so high, that's all they can do!

Many times, people do the same thing. They restrict themselves and never reach their potential. Just like the fleas, they fail to jump higher, thinking they are doing all they can do.

The Culprit of Your Overweight Challenges Has Been Finally Identified

Ever wonder who is to blame for your weight loss suffering? Well, wonder no more. Here's the full story.

And God populated the earth with broccoli and cauliflower and spinach, green and yellow vegetables of all kinds, so Man and Woman would live long and healthy lives.

And Satan created McDonald's. And McDonald's brought forth the 99-cent double-cheeseburger. And Satan said to Man, "You want fries with that?"

And Man said, "Super size them."

And Man gained pounds.

And God created the healthful yogurt, that woman might keep her figure that man found so fair.

And Satan brought forth chocolate.

And woman gained pounds.

And God said, "Try my crispy fresh salad."

And Satan brought forth ice cream.

And woman gained pounds. And God said, "I have sent you heart healthy vegetables and olive oil with which to cook them."

And Satan brought forth chicken-fried steak so big it needed its own platter.

And Man gained pounds and his bad cholesterol went through the roof.

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And so, Satan created HMOs.

Now, experts Agree that more businesses face an unstable business environment. Improvements in data processing and telecommunications have made major changes in many industries. In addition to this, improvements in transport and the development of foreign markets (especially in Europe and Asia) have created a global marketplace and surpassed certain businesses. Additionally, as consumers are exposed to more choices, loyalty has become less significant than it once was; a marginally better price or a temporary lack of stock can easily result in the loss of consumers. Competitors can also change rapidly, with new ones appearing from out of nowhere (frequently this means another side of the globe). With the instability of the global market, it's important that you make strategic planning component of your overall company plan. Proactive Versus Reactive Management. A couple of decades ago, you can establish and maintain a company by reacting to and fulfilling changes in tastes, prices and costs. This reactive style of management was often enough to help keep the business moving. But, today changes occur fast and come from a number of directions. From the time a reactive supervisor can make the required alterations, they may lose many clients -- possibly for good. Proactive Planning is the anticipation of future events. Decisions are based on predictions of future conditions of the environment instead of responses to several crises as they occur. Proactive planning within an unstable, technology-driven business environment is critical to ongoing success in almost any endeavor. As opposed to responding to the situation as it changes, proactive planning requires you to examine environmental forces and earn resource-allocation decisions. By doing this you will take your business where it needs to be in another month, decade and year. Barry Worth, a consultant specializing in small business management, puts it this way: Today's entrepreneur must be a company proprietor. Anything constructed in the present business environment must have a step-by-step blueprint or plan on the best way to reach success. The blueprint for the business owner is a company program. The Need To Get a Strategic Plan. Planning plays an important role in any business enterprise. It can make the difference between the success or failure of your organization. You should plan carefully before investing your time and effort, especially, your money in any business enterprise. The need for a strategy is best exemplified by the following situation -"A Tale of 2 Businesses." Two franchises (B and A ) were launched by people who had worked in direction in much bigger companies. While Franchise A provided a item and Franchise B per service, the output of the franchise systems had been sold exclusively in the USA before the present owners became involved. The output of both was readily available in other developed nations as well. The franchises started about precisely the exact same time and neither franchisee had a solid market presence, nor do they at present. Today Franchise B is broke. By comparison, Franchise A is promoting products in the Midwestern United States and in Europe. What was the Deciding difference from both franchises' success? You probably expect it to be the one had developed a tactical plan and the other hadn't; howeverit isn't this easy. Several things can influence the outcome of a business venture. There were many similarities between the businesses, but there also were many differences. Most notably, Franchise A sold a solution and Franchise B a service (although this doesn't clearly limit choices ). The other variation was that Franchise A had a carefully thought-out plan. The investors understood as they looked to get a franchise partner they wanted to find a product which could satisfy international markets along with a franchiser who'd encourage that type of sales effort. These investors were established in the Midwest, but negotiated for exclusive rights to export the franchiser's product. Once they had obtained the franchise, as soon as they started to establish their company domesticallythey also began to contact government experts in the U.S. Department of Commerce as well as educators and local managers with global experience. Clear plans Were developed outlining how they would position, market and distribute the solution and which foreign markets would be targeted first. Even as they were building sales in one European market, they were attending trade shows and preparation entry strategies others. By contrast, The next investor (Franchise B) began his business strictly because he wanted to leave a former employer. Of course many small businesses get started this way; however, in this case no evaluation of franchising options was done. The organization was located in a place that, as it turned out, contained virtually no customers for the type of support being supplied. If this error was realized, it had been too late to proceed --the investor simply did not have the cash or the desire to risk starting back again. Other examples Further demonstrate the demand for strategic planning and for developing a clear business plan. The owner of a business that appeared to be doing quite well in just two locations was about to open in a thirdparty. The authors were called in to develop a benefits plan and discovered cash flow problems that may be found just after operations had started in the new location. After analyzing the situation, an expansion and fiscal plan was developed for the audio locations only. In another case, the authors determined that a business had purchased more equipment than was necessary to do the present workload. After careful Evaluation, intends to make further purchases were placed on hold, and the equipment available was utilized effectively to meet immediate needs. A Enterprise Enterprise is to complicated to assume that failure to develop a solid organization Plan will be the reason behind issues Nevertheless, this failure frequently counts One of the variables contributing to business difficulties. As Worth has said, "Being a business entrepreneur today takes constant vigilance in order to Be able to benefit from new opportunities and the availability of new Technology and information as they become." Step one in Doing this would be to get a plan.

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Refinery Planning and Scheduling: An Overview

• First Online: 01 January 2010

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• Jens Bengtsson 5 , 6 &
• Sigrid-Lise Nonås 5  

Part of the book series: Energy Systems ((ENERGY))

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In this chapter, we give an overview of recent literature on the planning and scheduling of refinery activities. Planning of refinery activities ranges from determining which crude oil types to acquire to which products that should be produced and sold in the market. The scheduling ranges from scheduling of crude oil unloading and blending to blending of components to finished products. This overview treats three different categories of activities: planning and scheduling of crude oil unloading and blending, production planning and process scheduling, and product blending and recipe optimization. The focus will be on identifications of problems, the models outlined for the specified problems, and the computational difficulties introduced by the models. A final section discusses an agenda for future research.

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Adhitya, A., Srinivasan, R., & Karimi, I. A. (2007). Heuristic rescheduling of crude oil operations to manage abnormal supply chain events. AIChE Journal, 53 , 397–422.

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Bengtsson, J., Nonås, SL. (2010). Refinery Planning and Scheduling: An Overview. In: Bjørndal, E., Bjørndal, M., Pardalos, P., Rönnqvist, M. (eds) Energy, Natural Resources and Environmental Economics. Energy Systems. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-12067-1_8

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The Economics of Petroleum Refining: Understanding the business of processing crude oil into fuels and other value added products

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09 May 2024

Bangchak Group Reports First-Quarter 2024 Performance Driving Growth in Alignment with Consolidated Business Plan and Synergy Recognition, Setting New Records in Refining Capacity, Sales Volume, and Upstream Business

Bangchak Group reported its first-quarter 2024 performance, which recorded total revenue from sales and services of THB 135,567 million, EBITDA of THB 15,382 million, and profit attributable to owners of the parent of THB 2,437 million, equivalent to earnings per share of THB 1.68. The Refinery and Oil Trading Business Group achieved a record-high average crude run from two world-class refineries of 271,700 barrels per day. The Marketing Business Group recorded total sales volume across all channels, reaching 3,541 million liters, and increased the service station market share. The Natural Resources Business, through OKEA ASA, recorded a new historic high revenue from significant growth in production and sales volume from the performance recognition of the Statfjord and Hasselmus fields.

Chaiwat Kovavisarach, Group Chief Executive Officer and President, Bangchak Corporation Public Company Limited, disclosed that the first quarter performance of 2024 benefitted from the synergy within Bangchak Group and successfully drove growth according to business plans and goals. The company recorded revenue from sales and services of THB 15,308 million, a 48% increase from the previous quarter and a 39% increase from the same period in 2023, and recorded profit attributable to owners of the parent of THB 2,437 million, more than a 100% increase from the previous quarter, equivalent to earnings per share of THB 1.68.

During the first quarter of 2024, Bangchak Group began to realize synergies amounting to approximately THB 1,500 million across its Refinery and Oil Trading Business, Marketing Business, Logistics, and Shared Services. The Group is committed to driving synergy to achieve the target EBITDA Synergy (before tax) of no less than THB 2,500 million in 2024 and no less than THB 3,000 million per year in the coming years. A Single Linear Program (LP) is expected to be implemented by the latter half of the year to improve the refining process further and complete the change of service station logos by the end of this year.

Moreover, in early 2024, the Group commemorated a groundbreaking ceremony for Thailand’s first SAF production unit, which is set to begin commercial operation in the second quarter of 2025. To secure a stable raw material supply for SAF production, the company initiated the ‘Fry to Fly’ campaign to purchase used cooking oil and partnered with Sumitomo Corporation to procure used cooking oil to strengthen the UCO-to-SAF supply chain. Bangchak Group signed a cooperative framework agreement with Cosmo Oil and Sumitomo Corporation to purchase SAF produced by Bangchak.

For the second quarter of 2024, Bangchak Group will be attentively monitoring several critical factors. These include the potential decrease in refining margins due to economic slowdown and global inflation, the planned turnaround maintenance of Phra Khanong Refinery, and the anticipated seasonal demand reduction. According to strategic plans, the company will closely monitor the situation, manage operations to enhance productivity and efficiency and pursue continuous development as it enters its fifth decade in 2024. It remains committed to maintaining a balanced approach in conducting business under the “Greenovate to Regenerate” concept and contributes to driving Thailand sustainably towards its Net Zero Emissions target.

Phatpuree Chinkulkitnivat, Chief Financial Officer and Senior Executive Vice President, Accounting and Finance, reported the significant performance in the first quarter of 2024 of each business group as follows:

The Refinery and Oil Trading Business Group (Phra Khanong Refinery and Sriracha Refinery) had EBITDA of THB 4,404 million, an increase of more than 100% from the previous quarter, and a 9% increase from the same period in 2023. It achieved a record-high average crude run from the two world-class refineries of over 271,700 barrels per day. This was attributed to the increased capacity of 150,300 barrels per day at the Sriracha Refinery (from 119,300 barrels per day), considered the highest crude run in the refinery's history. The Phra Khanong Refinery maintained a high capacity of 121,400 barrels per day. During the first quarter, there was a gradual increase in operating GRM (from USD 4.65 per barrel in the fourth quarter of 2023 to USD 6.08) and lower inventory loss. BCPT’s oil trading business grew 36% from the previous quarter due to procuring crude oil and refined products for two refineries. It has continued to broaden its sales networks and overseas trading business to accommodate business growth and diversification.

The Marketing Business Group had an EBITDA of THB 1,899 million, more than a 100% increase from the same period in 2023. Sales volume across all channels was as high as 3,541 million liters, growing by 5% from the previous quarter and over 100% from the same period in 2023. Key factors behind the growth included an extensive network of over 2,217 service stations nationwide, particularly in Bangkok and metropolitan areas, integrated marketing strategies, and increased sales from Bangchak Sriracha Public Company Limited (BSRC) service station after rebranding to Bangchak. During the first quarter of 2024, 332 service stations operated by BSR C changed their logos to Bangchak, enhancing the “Bangchak” brand strength and competitiveness. This is reflected in the sales volume and the service station market share, which increased to 29.2% (from 28.8% at the end of 2023).

The Clean Power Business Group by BCPG Public Company Limited recognized the share of profits from additional investments in associated companies of USA natural gas power plants, with the first quarter of 2024 recoding an EBITDA of THB 1,411 million, a 35% increase from the previous quarter, and a 66% increase from the same period in 2023.

The Bio-Based Product Business Group by BBGI Public Company Limited had an EBITDA of THB 284 million, a 12 % increase from the previous quarter and more than a 100% increase from the same period in 2023. This increase was mainly attributed to higher demand from BSRC.

The Natural Resources Business Group had an EBITDA of THB 7,404 million, a 30% increase from the previous quarter and a 37% increase from the same period in 2023. This was a new record high, thanks to significant growth in production and sales volume from OKEA ASA’s performance recognition of the Statfjord field, which it had acquired on 29 December 2023, and the Hasselmus field, which started commercial operations in October 2023. Nonetheless, the Statfjord field incurred impairment loss due to lower-than-anticipated production volume for 2024. This loss was partly offset by a reversal of loss from impairment of assets based on the shareholding ratio (after tax) of THB 366 million.