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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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Wednesday, 09 August 17
THE KEY IMPORTERS OF U.S. COAL FOR THE FIRST FIVE MONTHS OF 2017 ARE THE NETHERLANDS, INDIA AND JAPAN - PETER SAND, BIMCO
US seaborne coal exports have turned years of negative growth around and seem to be climbing for a third quarter in a row. The increase in total vo ...
Wednesday, 09 August 17
INDONESIAN COAL PRICE REFERENCE INCREASE COULD CONTINUE IN THE COMING MONTHS
COALspot.com: Indonesian coal benchmark price rose 6.36% in August, government data showed.
The benchmark price of Indonesian thermal ...
Wednesday, 09 August 17
COAL HAS GAINED AROUND 40% OVER THE PAST TWELVE MONTHS; IRON ORE HAS MOVED FROM AROUND $50/T IN AUGUST 2016 TO OVER $70/T TODAY - INTERMODAL
During the summer’s peak, and with the markets remaining relatively quiet, we can argue that most markets have built solid foundations to enj ...
Tuesday, 08 August 17
THE BULLISH RIDE CONTINUES ON FOR THE IRON ORE MARKET - GEORGE LAZARIDIS
The bullish ride continues on for the iron ore market, with most in the market now eyeing the possibility for further gains to be had as Chine ...
Tuesday, 08 August 17
COAL SALES DESTINATION IS DOMINATED BY DEVELOPING COUNTRIES IN ASIA - ADARO
COALspot.com: Adaro Energy has produced 13.27 million tonnes of coal during the second quarter of 2017, from the mines PT Adaro Indonesia, PT Semes ...
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Showing 1976 to 1980 news of total 6871 |
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- Kohat Cement Company Ltd. - Pakistan
- Altura Mining Limited, Indonesia
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- The University of Queensland
- Economic Council, Georgia
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- Petron Corporation, Philippines
- Meralco Power Generation, Philippines
- Trasteel International SA, Italy
- Grasim Industreis Ltd - India
- Orica Mining Services - Indonesia
- MS Steel International - UAE
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Thiess Contractors Indonesia
- London Commodity Brokers - England
- Riau Bara Harum - Indonesia
- Meenaskhi Energy Private Limited - India
- Port Waratah Coal Services - Australia
- Semirara Mining and Power Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Makarim & Taira - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Wilmar Investment Holdings
- CNBM International Corporation - China
- Ministry of Transport, Egypt
- LBH Netherlands Bv - Netherlands
- Eastern Energy - Thailand
- Interocean Group of Companies - India
- Samtan Co., Ltd - South Korea
- Alfred C Toepfer International GmbH - Germany
- Energy Development Corp, Philippines
- Bharathi Cement Corporation - India
- The State Trading Corporation of India Ltd
- Deloitte Consulting - India
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- SMG Consultants - Indonesia
- Power Finance Corporation Ltd., India
- Aditya Birla Group - India
- Gujarat Electricity Regulatory Commission - India
- Bukit Baiduri Energy - Indonesia
- Parry Sugars Refinery, India
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- Intertek Mineral Services - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Tata Chemicals Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Sojitz Corporation - Japan
- Manunggal Multi Energi - Indonesia
- Edison Trading Spa - Italy
- Coal and Oil Company - UAE
- Kepco SPC Power Corporation, Philippines
- Australian Coal Association
- Planning Commission, India
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- Latin American Coal - Colombia
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- Energy Link Ltd, New Zealand
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- Essar Steel Hazira Ltd - India
- GMR Energy Limited - India
- PetroVietnam Power Coal Import and Supply Company
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- India Bulls Power Limited - India
- Global Green Power PLC Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Siam City Cement - Thailand
- Ministry of Mines - Canada
- Kobexindo Tractors - Indoneisa
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- Semirara Mining Corp, Philippines
- Price Waterhouse Coopers - Russia
- Bhushan Steel Limited - India
- Indian Oil Corporation Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- Larsen & Toubro Limited - India
- Billiton Holdings Pty Ltd - Australia
- Bukit Makmur.PT - Indonesia
- White Energy Company Limited
- Sakthi Sugars Limited - India
- Straits Asia Resources Limited - Singapore
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- Sree Jayajothi Cements Limited - India
- Indian Energy Exchange, India
- Mercuria Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Global Business Power Corporation, Philippines
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- Star Paper Mills Limited - India
- Sindya Power Generating Company Private Ltd
- Karaikal Port Pvt Ltd - India
- Coalindo Energy - Indonesia
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- The Treasury - Australian Government
- South Luzon Thermal Energy Corporation
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- Bayan Resources Tbk. - Indonesia
- Mintek Dendrill Indonesia
- Bhatia International Limited - India
- Leighton Contractors Pty Ltd - Australia
- Posco Energy - South Korea
- Holcim Trading Pte Ltd - Singapore
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- Uttam Galva Steels Limited - India
- Dalmia Cement Bharat India
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- Metalloyd Limited - United Kingdom
- Vedanta Resources Plc - India
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- Goldman Sachs - Singapore
- OPG Power Generation Pvt Ltd - India
- Therma Luzon, Inc, Philippines
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- Attock Cement Pakistan Limited
- Carbofer General Trading SA - India
- Siam City Cement PLC, Thailand
- Globalindo Alam Lestari - Indonesia
- ICICI Bank Limited - India
- Global Coal Blending Company Limited - Australia
- Heidelberg Cement - Germany
- Cigading International Bulk Terminal - Indonesia
- Maheswari Brothers Coal Limited - India
- IHS Mccloskey Coal Group - USA
- Karbindo Abesyapradhi - Indoneisa
- TeaM Sual Corporation - Philippines
- San Jose City I Power Corp, Philippines
- Indonesian Coal Mining Association
- Baramulti Group, Indonesia
- Ind-Barath Power Infra Limited - India
- Independent Power Producers Association of India
- Africa Commodities Group - South Africa
- Standard Chartered Bank - UAE
- IEA Clean Coal Centre - UK
- Lanco Infratech Ltd - India
- Kartika Selabumi Mining - Indonesia
- Orica Australia Pty. Ltd.
- Indogreen Group - Indonesia
- Indika Energy - Indonesia
- PowerSource Philippines DevCo
- Central Electricity Authority - India
- Romanian Commodities Exchange
- PTC India Limited - India
- Sinarmas Energy and Mining - Indonesia
- Parliament of New Zealand
- Cement Manufacturers Association - India
- Banpu Public Company Limited - Thailand
- Electricity Generating Authority of Thailand
- Gujarat Mineral Development Corp Ltd - India
- PNOC Exploration Corporation - Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Electricity Authority, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- New Zealand Coal & Carbon
- Rio Tinto Coal - Australia
- Binh Thuan Hamico - Vietnam
- Bangladesh Power Developement Board
- Central Java Power - Indonesia
- Sarangani Energy Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Tamil Nadu electricity Board
- Singapore Mercantile Exchange
- Malabar Cements Ltd - India
- Georgia Ports Authority, United States
- Mercator Lines Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Commonwealth Bank - Australia
- AsiaOL BioFuels Corp., Philippines
- Sical Logistics Limited - India
- Formosa Plastics Group - Taiwan
- Marubeni Corporation - India
- Eastern Coal Council - USA
- Coastal Gujarat Power Limited - India
- Chamber of Mines of South Africa
- Anglo American - United Kingdom
- Bank of Tokyo Mitsubishi UFJ Ltd
- Madhucon Powers Ltd - India
- Jaiprakash Power Ventures ltd
- McConnell Dowell - Australia
- Savvy Resources Ltd - HongKong
- Kalimantan Lumbung Energi - Indonesia
- Wood Mackenzie - Singapore
- Timah Investasi Mineral - Indoneisa
- Mjunction Services Limited - India
- GVK Power & Infra Limited - India
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- Simpson Spence & Young - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Merrill Lynch Commodities Europe
- Renaissance Capital - South Africa
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- Aboitiz Power Corporation - Philippines
- Ministry of Finance - Indonesia
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- Rashtriya Ispat Nigam Limited - India
- Minerals Council of Australia
- Toyota Tsusho Corporation, Japan
- Australian Commodity Traders Exchange
- Maharashtra Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Xindia Steels Limited - India
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