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Friday, 08 September 17
MIXED SIGNALS ON REFINERY PREPARATIONS FOR 2020 FUEL CHANGES - IBIA
A recent consultancy survey has suggested that some 85% of refiners have not made plans for how to deal with the expected dramatic fall in global demand for high sulphur fuel oil (HSFO) in 2020. However, some refineries have made recent announcements showing that they are making production changes, or are thinking about it.
In July, reports emerged that a new survey conducted by consulting company KBC found only 15% of oil refiners know how they are going to handle the shift in demand associated with the drop in the global sulphur limit for marine fuels from today’s 3.50% to 0.50% at the start of 2020. KBC surveyed refiners across the US, Europe, the Former Soviet Union and South Africa about their attitudes to the upcoming regulation.
A report published by KBC in April this year says the 2020 sulphur limit for marine fuels will likely see more than 2 million barrels per day (b/d) of HSFO become “stranded in the market” as ships shift to low sulphur fuels to comply. The KBC report said industry feedback indicated that maybe 10-15% of ships will have installed scrubbers that will enable them to continue to use HSFO compliantly by 2020.
A key observation in the KBC and several other reports is that refiners need to find an outlet for HSFO because it is an inevitable by-product of refinery operations, and if they cannot dispose of it they will be forced to cut overall production or even shut down. The least complex refineries with a high HSFO yield are most at risk, while complex refineries with fluid catalytic cracking and coking conversion facilities can reduce their HSFO yield to 3% or less of the total output.
The problem facing the refining industry, and by extension the marine fuels industry, is that major refinery conversions to reduce HSFO and produce more low sulphur distillate fuels are costly and take time to implement, meaning big investments that haven’t already been planned and approved are unlikely to be operational in time for 2020. And as the uptake of scrubbers may increase fast after 2020, demand for, and hence the value of HSFO could recover, creating uncertainty for refiners contemplating their options. Other tweaks are possible in the short term, such as using sweet crude oil as feedstock, but it is expected that the price differential between light sweet and heavy sour crude oils will increase.
Meanwhile, some refiners are signalling that they are taking notice of the International Maritime Organization’s decision to implement the 0.50% sulphur limit in 2020, and are planning changes in their production profiles in response to the impact of regulation.
One is the management of the Rheinland refinery in Wesseling, Germany, owned by the oil major Shell. It is currently investigating the possibility of expanding the residue processing plant at this refinery because “the high-sulfur residues used so far for the manufacture of marine fuels will no longer be marketable” as a result of the IMO’s 2020 sulphur regulation.
The refinery, which has an overall annual capacity of around 16-17 million tonnes, has yet to submit formal official documents for these plans but has held initial talks with politicians and environmental associations to present preliminary plans for a potential investment project. It means no detailed information is yet available about the scale, cost and timing of the project and it is uncertain if it will be ready in time for 2020. The refinery management said further talks are planned.
Another refiner, Par Petroleum, has gone public with plans to upgrade its Hawaii refinery to cut HSFO output and produce more high-value ultra low sulphur diesel (ULSD) and jet fuel at the plant. The plan is adding a 10,000 barrels per day diesel hydrotreater at the 93,000 b/d plant, which will reduce fuel oil product yields at the refinery by 4%, CEO Joseph Israel told S&P Global Platts in an interview in early August.
Although the refinery’s HSFO output is mainly used by local power stations to make electricity on Hawaii or shipped to the Far East, the refiner’s decision is linked to expectations of lower demand and a very low price for HSFO from the start of 2020, and better margins for ULSD.
The unit is slated to come online in the first quarter of 2019, and the cost of construction is said to be kept low, at $27 million, because the refinery already has a hydrogen plant with sufficient capacity and is currently making more hydrogen than the refinery uses.
The 2020 sulphur limit is expected to push up demand for low sulphur distillates to blend compliant marine fuels. S&P Global Platts said global demand for ULSD is expected to rise by 3.5 million b/d by 2020.
For the Par refinery, an important consideration for the investment was that the new refinery unit will have the flexibility to switch between making jet fuel or ULSD, depending on the margins at the time. At present, no jet fuel is produced locally, but it accounts for about half of all transportation fuels consumed in Hawaii.
It seems the 2020 sulphur regulation impact is increasingly on the radar for refiners, but while they may struggle to find markets for HSFO that has previously gone into the marine fuel pool in 2020, that does not guarantee that they will focus on producing compliant marine fuels. Some will, if they think the price is right and marine fuels will become a lucrative market, others will focus on inland markets.
by Unni Einemo, IBIA
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Monday, 21 August 17
FIRM DEMAND FOR CAPES CONTINUE TO SUPPORT DRY BULK SHIPPING
COALspot.com: The freight market was continued to rose this past week compared to the previous weeks, as BDI, Cape and Panamax indexes show a posit ...
Friday, 18 August 17
U.S. WEEKLY COAL OUTPUT UP 2.1% WEEK OVER WEEK, SAYS EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 16.5 million short ton ...
Thursday, 17 August 17
DESPITE A HOLIDAY-DISRUPTED WEEK IT HAS BEEN A NEW ACTIVE WEEK FOR THE PANAMAXES - FEARNLEYS
Supramax
A very quiet start to the week with holidays in several countries. USG still bringing good results supported by a tight tonnage availabl ...
Monday, 14 August 17
CENTURIES ON, AND DRY BULK STILL RULES THE WAVES... - SARAH HOLDEN | CLARKSONS
By the late 1800s, the shipping industry had been transformed by the introduction of steam power and iron ships. Coal and grain were two of the mos ...
Monday, 14 August 17
THE FREIGHT MARKET CONTINUES ON AN UPWARD PATH
COALspot.com: The freight market was continued to rose this past week compared to the previous week, as BDI, Cape and Panamax indexes show a positi ...
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Showing 1966 to 1970 news of total 6871 |
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- Directorate Of Revenue Intelligence - India
- Salva Resources Pvt Ltd - India
- Coal and Oil Company - UAE
- Indonesian Coal Mining Association
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Straits Asia Resources Limited - Singapore
- Siam City Cement PLC, Thailand
- Kaltim Prima Coal - Indonesia
- Coastal Gujarat Power Limited - India
- McConnell Dowell - Australia
- Bayan Resources Tbk. - Indonesia
- Independent Power Producers Association of India
- Chamber of Mines of South Africa
- Orica Mining Services - Indonesia
- Meralco Power Generation, Philippines
- Energy Development Corp, Philippines
- MS Steel International - UAE
- LBH Netherlands Bv - Netherlands
- Tamil Nadu electricity Board
- Pipit Mutiara Jaya. PT, Indonesia
- European Bulk Services B.V. - Netherlands
- Ambuja Cements Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Semirara Mining Corp, Philippines
- The University of Queensland
- Global Business Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Global Green Power PLC Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Goldman Sachs - Singapore
- Maheswari Brothers Coal Limited - India
- CIMB Investment Bank - Malaysia
- Bukit Baiduri Energy - Indonesia
- Energy Link Ltd, New Zealand
- Timah Investasi Mineral - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Indo Tambangraya Megah - Indonesia
- Attock Cement Pakistan Limited
- Lanco Infratech Ltd - India
- Toyota Tsusho Corporation, Japan
- Billiton Holdings Pty Ltd - Australia
- Cigading International Bulk Terminal - Indonesia
- Agrawal Coal Company - India
- Indogreen Group - Indonesia
- Medco Energi Mining Internasional
- Posco Energy - South Korea
- Karaikal Port Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- International Coal Ventures Pvt Ltd - India
- Borneo Indobara - Indonesia
- Indika Energy - Indonesia
- Central Java Power - Indonesia
- Indian Oil Corporation Limited
- Rio Tinto Coal - Australia
- PowerSource Philippines DevCo
- Bukit Makmur.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Deloitte Consulting - India
- Parliament of New Zealand
- Videocon Industries ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Interocean Group of Companies - India
- Kepco SPC Power Corporation, Philippines
- VISA Power Limited - India
- Ministry of Finance - Indonesia
- Sojitz Corporation - Japan
- Barasentosa Lestari - Indonesia
- Jindal Steel & Power Ltd - India
- Larsen & Toubro Limited - India
- Aboitiz Power Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bhatia International Limited - India
- Gujarat Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- Directorate General of MIneral and Coal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Therma Luzon, Inc, Philippines
- Wood Mackenzie - Singapore
- Simpson Spence & Young - Indonesia
- Altura Mining Limited, Indonesia
- Petron Corporation, Philippines
- Formosa Plastics Group - Taiwan
- GAC Shipping (India) Pvt Ltd
- Dalmia Cement Bharat India
- Mintek Dendrill Indonesia
- New Zealand Coal & Carbon
- AsiaOL BioFuels Corp., Philippines
- Uttam Galva Steels Limited - India
- India Bulls Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- White Energy Company Limited
- Australian Commodity Traders Exchange
- GVK Power & Infra Limited - India
- Eastern Energy - Thailand
- South Luzon Thermal Energy Corporation
- Cement Manufacturers Association - India
- Sarangani Energy Corporation, Philippines
- Bangladesh Power Developement Board
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Asmin Koalindo Tuhup - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Sinarmas Energy and Mining - Indonesia
- Ministry of Transport, Egypt
- Power Finance Corporation Ltd., India
- Parry Sugars Refinery, India
- Sakthi Sugars Limited - India
- Semirara Mining and Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Maharashtra Electricity Regulatory Commission - India
- Karbindo Abesyapradhi - Indoneisa
- Latin American Coal - Colombia
- ICICI Bank Limited - India
- Oldendorff Carriers - Singapore
- Marubeni Corporation - India
- Minerals Council of Australia
- Star Paper Mills Limited - India
- Bhoruka Overseas - Indonesia
- Electricity Authority, New Zealand
- Essar Steel Hazira Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Samtan Co., Ltd - South Korea
- Globalindo Alam Lestari - Indonesia
- Pendopo Energi Batubara - Indonesia
- Ministry of Mines - Canada
- Global Coal Blending Company Limited - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Riau Bara Harum - Indonesia
- Wilmar Investment Holdings
- Bulk Trading Sa - Switzerland
- Chettinad Cement Corporation Ltd - India
- Meenaskhi Energy Private Limited - India
- Sical Logistics Limited - India
- Mercuria Energy - Indonesia
- Xindia Steels Limited - India
- Singapore Mercantile Exchange
- Grasim Industreis Ltd - India
- OPG Power Generation Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Sindya Power Generating Company Private Ltd
- Bharathi Cement Corporation - India
- Vedanta Resources Plc - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ind-Barath Power Infra Limited - India
- The State Trading Corporation of India Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- IHS Mccloskey Coal Group - USA
- Madhucon Powers Ltd - India
- Malabar Cements Ltd - India
- Kumho Petrochemical, South Korea
- San Jose City I Power Corp, Philippines
- Anglo American - United Kingdom
- PNOC Exploration Corporation - Philippines
- Heidelberg Cement - Germany
- Carbofer General Trading SA - India
- Romanian Commodities Exchange
- Merrill Lynch Commodities Europe
- Intertek Mineral Services - Indonesia
- Electricity Generating Authority of Thailand
- Kobexindo Tractors - Indoneisa
- Edison Trading Spa - Italy
- Planning Commission, India
- Bhushan Steel Limited - India
- Sree Jayajothi Cements Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Eastern Coal Council - USA
- Miang Besar Coal Terminal - Indonesia
- Aditya Birla Group - India
- Thai Mozambique Logistica
- Orica Australia Pty. Ltd.
- Economic Council, Georgia
- Central Electricity Authority - India
- Port Waratah Coal Services - Australia
- IEA Clean Coal Centre - UK
- Banpu Public Company Limited - Thailand
- Makarim & Taira - Indonesia
- CNBM International Corporation - China
- Antam Resourcindo - Indonesia
- Kideco Jaya Agung - Indonesia
- Indian Energy Exchange, India
- Tata Chemicals Ltd - India
- Metalloyd Limited - United Kingdom
- Kartika Selabumi Mining - Indonesia
- PTC India Limited - India
- Rashtriya Ispat Nigam Limited - India
- Thiess Contractors Indonesia
- Mercator Lines Limited - India
- Price Waterhouse Coopers - Russia
- Gujarat Sidhee Cement - India
- SN Aboitiz Power Inc, Philippines
- The Treasury - Australian Government
- Kapuas Tunggal Persada - Indonesia
- Manunggal Multi Energi - Indonesia
- SMG Consultants - Indonesia
- Australian Coal Association
- Holcim Trading Pte Ltd - Singapore
- Standard Chartered Bank - UAE
- Georgia Ports Authority, United States
- Iligan Light & Power Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- Coalindo Energy - Indonesia
- ASAPP Information Group - India
- SMC Global Power, Philippines
- TeaM Sual Corporation - Philippines
- Baramulti Group, Indonesia
- Renaissance Capital - South Africa
- GMR Energy Limited - India
- Siam City Cement - Thailand
- Gujarat Mineral Development Corp Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Trasteel International SA, Italy
- Mjunction Services Limited - India
- London Commodity Brokers - England
- Commonwealth Bank - Australia
- Jorong Barutama Greston.PT - Indonesia
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