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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, 25 September 17
U.S WEEKLY COAL OUTPUT DROPS FOR THE FOURTH WEEK IN A ROW, EIA DATA SHOWS
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 15.5 million short ton ...
Wednesday, 20 September 17
SHIPPING MARKET INSIGHT - INTERMODAL
An undoubtedly interesting market lately is the newbuilding market, in which we are witnessing numerous orders across all sectors and sizes. At the ...
Monday, 18 September 17
COAL PRICES WERE RELATIVELY UNCHANGED WEEK OVER WEEK - ANZ
COALspot.com: Coal prices were relatively unchanged, with most interest remaining in the thermal coal market said Daniel Hynes. However, falling st ...
Monday, 18 September 17
PROSPECTS ARE NOT SO CLEAR CUT FOR COAL - CLARKSONS
Prospects are not so clear-cut for coal. According to Clarksons, coal has been a key energy source since the Industrial Revolution and in 2016, ste ...
Friday, 15 September 17
U.S WEEKLY COAL OUTPUT DROPS FOR THE THIRD WEEK IN A ROW, EIA DATA SHOWS
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 15.7 million short ton ...
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Showing 1936 to 1940 news of total 6871 |
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- Straits Asia Resources Limited - Singapore
- Ministry of Transport, Egypt
- ICICI Bank Limited - India
- IEA Clean Coal Centre - UK
- Aboitiz Power Corporation - Philippines
- India Bulls Power Limited - India
- ASAPP Information Group - India
- Billiton Holdings Pty Ltd - Australia
- Petron Corporation, Philippines
- Star Paper Mills Limited - India
- Indian Oil Corporation Limited
- Manunggal Multi Energi - Indonesia
- Salva Resources Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Carbofer General Trading SA - India
- Chamber of Mines of South Africa
- Malabar Cements Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Wilmar Investment Holdings
- Wood Mackenzie - Singapore
- PNOC Exploration Corporation - Philippines
- Georgia Ports Authority, United States
- Ind-Barath Power Infra Limited - India
- Renaissance Capital - South Africa
- Sree Jayajothi Cements Limited - India
- Indonesian Coal Mining Association
- Bharathi Cement Corporation - India
- Antam Resourcindo - Indonesia
- Coalindo Energy - Indonesia
- Central Java Power - Indonesia
- Kideco Jaya Agung - Indonesia
- Altura Mining Limited, Indonesia
- Agrawal Coal Company - India
- McConnell Dowell - Australia
- Indika Energy - Indonesia
- Central Electricity Authority - India
- CNBM International Corporation - China
- Gujarat Mineral Development Corp Ltd - India
- IHS Mccloskey Coal Group - USA
- Mintek Dendrill Indonesia
- Krishnapatnam Port Company Ltd. - India
- Edison Trading Spa - Italy
- Alfred C Toepfer International GmbH - Germany
- Sical Logistics Limited - India
- Gujarat Electricity Regulatory Commission - India
- Neyveli Lignite Corporation Ltd, - India
- Commonwealth Bank - Australia
- Port Waratah Coal Services - Australia
- Eastern Coal Council - USA
- Samtan Co., Ltd - South Korea
- Cement Manufacturers Association - India
- Petrochimia International Co. Ltd.- Taiwan
- Bhoruka Overseas - Indonesia
- Bukit Makmur.PT - Indonesia
- Thiess Contractors Indonesia
- Sinarmas Energy and Mining - Indonesia
- Energy Development Corp, Philippines
- Electricity Generating Authority of Thailand
- Kohat Cement Company Ltd. - Pakistan
- Kalimantan Lumbung Energi - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Xindia Steels Limited - India
- Kumho Petrochemical, South Korea
- Australian Commodity Traders Exchange
- Globalindo Alam Lestari - Indonesia
- Indian Energy Exchange, India
- Sakthi Sugars Limited - India
- MS Steel International - UAE
- Gujarat Sidhee Cement - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Global Green Power PLC Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Bangladesh Power Developement Board
- Kartika Selabumi Mining - Indonesia
- Parry Sugars Refinery, India
- Iligan Light & Power Inc, Philippines
- Aditya Birla Group - India
- Directorate General of MIneral and Coal - Indonesia
- Australian Coal Association
- Heidelberg Cement - Germany
- Independent Power Producers Association of India
- Rio Tinto Coal - Australia
- Miang Besar Coal Terminal - Indonesia
- Medco Energi Mining Internasional
- CIMB Investment Bank - Malaysia
- Standard Chartered Bank - UAE
- Madhucon Powers Ltd - India
- Economic Council, Georgia
- Bulk Trading Sa - Switzerland
- Pendopo Energi Batubara - Indonesia
- Simpson Spence & Young - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Directorate Of Revenue Intelligence - India
- Kapuas Tunggal Persada - Indonesia
- Romanian Commodities Exchange
- Chettinad Cement Corporation Ltd - India
- Uttam Galva Steels Limited - India
- San Jose City I Power Corp, Philippines
- Meenaskhi Energy Private Limited - India
- Baramulti Group, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- The University of Queensland
- Bhushan Steel Limited - India
- South Luzon Thermal Energy Corporation
- London Commodity Brokers - England
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Grasim Industreis Ltd - India
- Maheswari Brothers Coal Limited - India
- Mercuria Energy - Indonesia
- Bhatia International Limited - India
- Rashtriya Ispat Nigam Limited - India
- Posco Energy - South Korea
- Global Coal Blending Company Limited - Australia
- PowerSource Philippines DevCo
- Trasteel International SA, Italy
- TeaM Sual Corporation - Philippines
- GN Power Mariveles Coal Plant, Philippines
- Latin American Coal - Colombia
- Energy Link Ltd, New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Semirara Mining Corp, Philippines
- Therma Luzon, Inc, Philippines
- Planning Commission, India
- New Zealand Coal & Carbon
- Power Finance Corporation Ltd., India
- Interocean Group of Companies - India
- Jaiprakash Power Ventures ltd
- SMG Consultants - Indonesia
- Binh Thuan Hamico - Vietnam
- Singapore Mercantile Exchange
- Essar Steel Hazira Ltd - India
- Metalloyd Limited - United Kingdom
- The Treasury - Australian Government
- Parliament of New Zealand
- Semirara Mining and Power Corporation, Philippines
- Coal and Oil Company - UAE
- PTC India Limited - India
- Africa Commodities Group - South Africa
- Sojitz Corporation - Japan
- Kobexindo Tractors - Indoneisa
- Price Waterhouse Coopers - Russia
- Coastal Gujarat Power Limited - India
- Borneo Indobara - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- VISA Power Limited - India
- White Energy Company Limited
- Orica Mining Services - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Oldendorff Carriers - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Tamil Nadu electricity Board
- SN Aboitiz Power Inc, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Dalmia Cement Bharat India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Pipit Mutiara Jaya. PT, Indonesia
- Karaikal Port Pvt Ltd - India
- SMC Global Power, Philippines
- Vizag Seaport Private Limited - India
- Meralco Power Generation, Philippines
- Indogreen Group - Indonesia
- The State Trading Corporation of India Ltd
- OPG Power Generation Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Holcim Trading Pte Ltd - Singapore
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- Jindal Steel & Power Ltd - India
- Ministry of Mines - Canada
- Tata Chemicals Ltd - India
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
- Timah Investasi Mineral - Indoneisa
- Siam City Cement - Thailand
- Kaltim Prima Coal - Indonesia
- Videocon Industries ltd - India
- Vedanta Resources Plc - India
- Orica Australia Pty. Ltd.
- Bukit Asam (Persero) Tbk - Indonesia
- GMR Energy Limited - India
- Ambuja Cements Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Kepco SPC Power Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Formosa Plastics Group - Taiwan
- European Bulk Services B.V. - Netherlands
- Marubeni Corporation - India
- Indo Tambangraya Megah - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Mercator Lines Limited - India
- Makarim & Taira - Indonesia
- Lanco Infratech Ltd - India
- Deloitte Consulting - India
- GVK Power & Infra Limited - India
- Riau Bara Harum - Indonesia
- Savvy Resources Ltd - HongKong
- Global Business Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Eastern Energy - Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Mjunction Services Limited - India
- Larsen & Toubro Limited - India
- Minerals Council of Australia
- Banpu Public Company Limited - Thailand
- Ministry of Finance - Indonesia
- Toyota Tsusho Corporation, Japan
- Sarangani Energy Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Thai Mozambique Logistica
- Bayan Resources Tbk. - Indonesia
- LBH Netherlands Bv - Netherlands
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Sindya Power Generating Company Private Ltd
- Electricity Authority, New Zealand
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