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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, 06 November 17
MARINE BUNKER EXCHANGE EXPECTS BUNKER PRICES WILL CONTINUE UPWARD TREND NEXT WEEK
World fuel indexes rose during the week, supported by main oil producers’ statements about possible extension of oil production cut agreement ...
Monday, 06 November 17
THE THERMAL COAL MARKET CAME UNDER SOME PRESSURE AS THE OUTLOOK FOR DEMAND WEAKENED - DANIEL HYNES
Commodities were mixed as investors grappled with a revised tax plan in the US amid a rising USD said Daniel Hynes in his linked in post.
Acco ...
Monday, 06 November 17
THE FREIGHT MARKET WAS CONTINUED TO SOFTEN THIS PAST WEEK; BCI DOWN 184 POINT WEEK OVER WEEK
COALspot.com: The freight market was continued to soften this past week compared to the previous week, as BDI and all segments except Panamax index ...
Friday, 03 November 17
U.S. COAL PRODUCTION FELL WEEK-OVER-WEEK, EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 14.5 million short ton ...
Wednesday, 01 November 17
SHIPPING MARKET INSIGHT - KONSTANTINOS KONTOMICHIS
As it was expected, the strong dry bulk freight market of the past couple of months has inspired similar activity in the second-hand market. Noneth ...
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Showing 1896 to 1900 news of total 6871 |
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- Interocean Group of Companies - India
- Singapore Mercantile Exchange
- PNOC Exploration Corporation - Philippines
- Edison Trading Spa - Italy
- Bhatia International Limited - India
- India Bulls Power Limited - India
- TeaM Sual Corporation - Philippines
- Leighton Contractors Pty Ltd - Australia
- Sree Jayajothi Cements Limited - India
- Heidelberg Cement - Germany
- Marubeni Corporation - India
- Therma Luzon, Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Georgia Ports Authority, United States
- Maheswari Brothers Coal Limited - India
- Orica Australia Pty. Ltd.
- Semirara Mining Corp, Philippines
- CNBM International Corporation - China
- TNB Fuel Sdn Bhd - Malaysia
- International Coal Ventures Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Cigading International Bulk Terminal - Indonesia
- Sakthi Sugars Limited - India
- Uttam Galva Steels Limited - India
- Indo Tambangraya Megah - Indonesia
- Straits Asia Resources Limited - Singapore
- Indonesian Coal Mining Association
- Kohat Cement Company Ltd. - Pakistan
- Siam City Cement - Thailand
- GMR Energy Limited - India
- Global Green Power PLC Corporation, Philippines
- Vedanta Resources Plc - India
- Bangladesh Power Developement Board
- Savvy Resources Ltd - HongKong
- Eastern Energy - Thailand
- Parliament of New Zealand
- Economic Council, Georgia
- Simpson Spence & Young - Indonesia
- Ministry of Mines - Canada
- Bhoruka Overseas - Indonesia
- Port Waratah Coal Services - Australia
- Ind-Barath Power Infra Limited - India
- Thai Mozambique Logistica
- Sinarmas Energy and Mining - Indonesia
- Agrawal Coal Company - India
- Borneo Indobara - Indonesia
- Sarangani Energy Corporation, Philippines
- Ambuja Cements Ltd - India
- Tata Chemicals Ltd - India
- Manunggal Multi Energi - Indonesia
- The Treasury - Australian Government
- Kapuas Tunggal Persada - Indonesia
- Coalindo Energy - Indonesia
- Mintek Dendrill Indonesia
- Toyota Tsusho Corporation, Japan
- Salva Resources Pvt Ltd - India
- Eastern Coal Council - USA
- Riau Bara Harum - Indonesia
- Indogreen Group - Indonesia
- Larsen & Toubro Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- The University of Queensland
- Kartika Selabumi Mining - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- VISA Power Limited - India
- Altura Mining Limited, Indonesia
- Central Java Power - Indonesia
- IHS Mccloskey Coal Group - USA
- Pendopo Energi Batubara - Indonesia
- Jindal Steel & Power Ltd - India
- Chamber of Mines of South Africa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GN Power Mariveles Coal Plant, Philippines
- South Luzon Thermal Energy Corporation
- Coal and Oil Company - UAE
- Parry Sugars Refinery, India
- Jorong Barutama Greston.PT - Indonesia
- Sindya Power Generating Company Private Ltd
- Sical Logistics Limited - India
- Mercuria Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Power Finance Corporation Ltd., India
- PTC India Limited - India
- Videocon Industries ltd - India
- Vizag Seaport Private Limited - India
- Goldman Sachs - Singapore
- Metalloyd Limited - United Kingdom
- PetroVietnam Power Coal Import and Supply Company
- SN Aboitiz Power Inc, Philippines
- Oldendorff Carriers - Singapore
- Makarim & Taira - Indonesia
- Indian Oil Corporation Limited
- Meralco Power Generation, Philippines
- Iligan Light & Power Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- Standard Chartered Bank - UAE
- McConnell Dowell - Australia
- Essar Steel Hazira Ltd - India
- Minerals Council of Australia
- Karaikal Port Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Samtan Co., Ltd - South Korea
- Formosa Plastics Group - Taiwan
- Directorate General of MIneral and Coal - Indonesia
- Aditya Birla Group - India
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
- Timah Investasi Mineral - Indoneisa
- ICICI Bank Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Bayan Resources Tbk. - Indonesia
- White Energy Company Limited
- Bahari Cakrawala Sebuku - Indonesia
- Baramulti Group, Indonesia
- Grasim Industreis Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- Cement Manufacturers Association - India
- Chettinad Cement Corporation Ltd - India
- SMC Global Power, Philippines
- Carbofer General Trading SA - India
- Romanian Commodities Exchange
- Gujarat Electricity Regulatory Commission - India
- Wood Mackenzie - Singapore
- Commonwealth Bank - Australia
- Rio Tinto Coal - Australia
- Meenaskhi Energy Private Limited - India
- Directorate Of Revenue Intelligence - India
- Orica Mining Services - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Coastal Gujarat Power Limited - India
- Wilmar Investment Holdings
- Bukit Makmur.PT - Indonesia
- PowerSource Philippines DevCo
- Malabar Cements Ltd - India
- Mercator Lines Limited - India
- Banpu Public Company Limited - Thailand
- Petrochimia International Co. Ltd.- Taiwan
- San Jose City I Power Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Bharathi Cement Corporation - India
- Star Paper Mills Limited - India
- ASAPP Information Group - India
- Energy Development Corp, Philippines
- Ministry of Transport, Egypt
- Barasentosa Lestari - Indonesia
- Mjunction Services Limited - India
- Alfred C Toepfer International GmbH - Germany
- Kideco Jaya Agung - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ministry of Finance - Indonesia
- Siam City Cement PLC, Thailand
- Krishnapatnam Port Company Ltd. - India
- Merrill Lynch Commodities Europe
- Planning Commission, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- GAC Shipping (India) Pvt Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Deloitte Consulting - India
- Dalmia Cement Bharat India
- Kalimantan Lumbung Energi - Indonesia
- Global Coal Blending Company Limited - Australia
- Thiess Contractors Indonesia
- Attock Cement Pakistan Limited
- LBH Netherlands Bv - Netherlands
- Bhushan Steel Limited - India
- Trasteel International SA, Italy
- Kumho Petrochemical, South Korea
- Price Waterhouse Coopers - Russia
- The State Trading Corporation of India Ltd
- Electricity Generating Authority of Thailand
- Kobexindo Tractors - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Xindia Steels Limited - India
- Sojitz Corporation - Japan
- Maharashtra Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Australian Coal Association
- Jaiprakash Power Ventures ltd
- Energy Link Ltd, New Zealand
- Independent Power Producers Association of India
- Rashtriya Ispat Nigam Limited - India
- Indika Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bulk Trading Sa - Switzerland
- New Zealand Coal & Carbon
- Central Electricity Authority - India
- Lanco Infratech Ltd - India
- OPG Power Generation Pvt Ltd - India
- GVK Power & Infra Limited - India
- SMG Consultants - Indonesia
- Bukit Baiduri Energy - Indonesia
- Renaissance Capital - South Africa
- Global Business Power Corporation, Philippines
- London Commodity Brokers - England
- Kaltim Prima Coal - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Petron Corporation, Philippines
- Africa Commodities Group - South Africa
- Gujarat Sidhee Cement - India
- Madhucon Powers Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- CIMB Investment Bank - Malaysia
- Medco Energi Mining Internasional
- Posco Energy - South Korea
- AsiaOL BioFuels Corp., Philippines
- Australian Commodity Traders Exchange
- Kepco SPC Power Corporation, Philippines
- MS Steel International - UAE
- Globalindo Alam Lestari - Indonesia
- Antam Resourcindo - Indonesia
- Indian Energy Exchange, India
- European Bulk Services B.V. - Netherlands
- Tamil Nadu electricity Board
- Electricity Authority, New Zealand
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