Refining Developments SpecialRepoRt

Background. Thirty refineries operate within Japan with a total crude processing capacity of about 4.8 million bpd. Capacity and total product demand is closely balanced. Almost all refined products are sold to the domestic market, although Japanese refineries occasionally import and export products between other Asian countries. The Japanese petroleum businesses, once protected, faced tough competition after industry deregulation in the mid-1990s. Competition within the Japanese market became excessive, thus dramatically reducing refinery margins. To counter this increasingly competitive situation and to improve margins, Japanese refineries, including Fuji Oil, have deployed a variety of Innovative Production Technology Improvement Programs based on the bottom-up “Kaizen” methodologies. This case history investigates Fuji Oil’s improvement activities in the planning and scheduling activities at the Sodegaura refinery.