High oil prices hurt consumers, dent fuel demand

MOSCOW (MRC) -- High oil prices are hurting consumers and could also have adverse implications for producers, the executive director of the International Energy Agency (IEA) said on Tuesday, as per Hydrocarbonprocessing.

Major emerging Asian economies such as India and Indonesia have been hit hard this year by rising crude oil prices, which despite declining this month are still up by about 15 percent since the start of 2018.

Fuel import costs have been pushed up further by a slide in emerging market currencies against the dollar, denting growth and even triggering protests and government fuel price controls in India.

"Many countries' current account deficits have been affected by high oil prices," IEA chief Fatih Birol said at an energy conference in Singapore.

"There are two downward pressures on global oil demand growth. One is high oil prices, and in many countries they're directly related to consumer prices. The second one is global economic growth momentum slowing down."

The effect of high oil prices will be compounded in Southeast Asia as demand is rising fast but production is falling, resulting in the region becoming a net importer of oil, gas and coal, Birol said.

Despite the possibility of a slowdown, Birol said the general outlook for fuel consumption was for continued growth.

While the rise of electric vehicles is expected to result in peak demand for products like diesel and gasoline within coming years, a consumption boom in products such as plastic as well as fuel demand growth from aviation have triggered large-scale refinery investment into petrochemical products and high quality products like jet fuel.

"Global oil demand will continue to grow even amid the rise of electric vehicles as they are governed by petrochemicals, aviation, among others," he said.

BHP Billiton, the world's biggest miner , which has oil and gas assets but also hopes to benefit from the demand for raw materials coming from batteries for electric vehicles (EV), also said oil demand would still grow despite the rise of EVs.

Fluor awarded EPC contract at Valero's Pembroke refinery

MOSCOW (MRC) – Fluor Corporation announced that it was awarded the engineering, procurement and construction of Valero Energy Corporation’s combined heat and power cogeneration project at its Pembroke Refinery in Wales, UK, as per Hydrocarbonprocessing.

Fluor booked the undisclosed contract value in the third quarter of 2018. "We are pleased to assist Valero with this notable project that will enhance energy efficiency and sustainability at the refinery, which is of significant importance for the economy of Wales and, more particularly, to Pembroke,” said Al Collins, president of Fluor’s Energy & Chemicals business in Europe, Africa and Middle East. “Fluor will utilize its in-depth cogeneration expertise together with previous experience of working at the Pembroke Refinery to deliver a capital-efficient project."

Fluor’s scope includes design, procurement, construction and commissioning support for the new 45 Mega Volt Amps natural gas-fired combustion turbine generator system that will supply power and steam to enhance the refinery’s energy efficiency and operations. The scope also includes substations, transformers, electrical and piping tie-ins and a fuel gas pipeline system.

The project, the first to receive planning permission as a Development of National Significance process under the Planning (Wales) Act 2015, will be executed on a cost reimbursable basis by an integrated engineering team located at Fluor’s office in Farnborough and at the Pembroke Refinery.

Fluor’s UK office is in Farnborough, Hampshire from where the company serves a wide range of industries including energy, chemicals, government, life sciences, advanced manufacturing, infrastructure, mining and power.

Philippines short-lists three company groups for LNG terminal project

MOSCOW (MRC) -- The Philippines has short-listed three different groups to build and operate its first liquefied natural gas (LNG) import terminal and hopes to nominate one by November, as per Reuters.

Short-listed companies were chosen from 18 groups that submitted proposals for the project, Alfonso Cusi told Reuters on the sidelines of the Singapore International Energy Week.

They include state-owned Philippines National Oil Company (PNOC), which is seeking a partner for the project, Cusi said, while Tokyo Gas has partnered with the Philippines' First Gen Corp.

China National Offshore Oil Corp (CNOOC) is also in the running, although it has yet to firm up a local partner, Cusi said. CNOOC has been in talks with the Philippines' Phoenix Petroleum as a partner, he added.

"Hopefully we can have a conclusion on which proposal to accept by the end of November," Cusi said. The Philippines is expected to start importing LNG to feed gas-fired power plants in Batangas province, south of the capital Manila, as domestic gas supplies from its Malampaya field are set to run out in 2024.

Besides meeting local demand, the Philippines also hopes the terminal would become an LNG trading hub for the region, Cusi said. "We are already the de-facto transhipment port for LNG to China," Cusi said, adding that large cargoes are often broken up into smaller parcels for deliveries to China via ship-to-ship transfers off the Philippines.

"We should institutionalize this before someone else does." PNOC last week formally announced it was seeking a joint-venture partner to design, build, finance, operate and maintain an LNG hub in Batangas Bay, near the gas-fired power plants supplying electricity to the country's main Luzon island.

Bidders have until Dec. 21 to submit eligibility documents to PNOC. A First Gen spokeswoman said the company has been open to taking in a partner for the LNG project, but she was not aware of any joint venture agreement or talks between First Gen and Tokyo Gas. First Gen operates four of the country's five gas-fired power plants.

Tokyo Gas declined to comment.

CNOOC and SHELL sign MOU on petrochemical project

MOSCOW (MRC) -- On 16 October, China National Offshore Oil Corp. and Shell International Petroleum Company Ltd. signed a memorandum of understanding (MOU) to explore their existing collaboration and the development of petrochemical manufacturing facilities at the Nanhai site in Huizhou, Guangdong province, said Chemengonline.

The objective is to establish a world-class integrated site that has scale and competitiveness. The MOU was signed by CNOOC chairman Yang Hua and Shell CEO Ben van Beurden, in the presence of Chinese Premier Li Keqiang and Dutch Prime Minister Mark Rutte.

“I am pleased that CNOOC and Shell have taken a step towards furthering our already-beneficial partnership at Nanhai,” says Graham van’t Hoff, executive vice president for Shell’s global chemicals business. “This news builds on the successful start-up of phase two of the site expansion in May and demonstrates the ongoing strategic importance of the site."

In May this year, CNOOC and Shell announced the official start-up of the second ethylene cracker at their Nanhai petrochemicals complex. The new ethylene cracker increased ethylene capacity at the complex by around 1.2 million metric tons per year (m.t./yr), more than doubling the capacity of the complex. The new facility will also include a styrene monomer and propylene oxide (SMPO) plant, which will be the largest in China when it begins operations.

Air Liquide Engineering & Construction wins China chemical contract

MOSCOW (MRC) -- Air Liquide Engineering & Construction has signed a contract to supply an air separation unit (ASU) to Shandong Runyin Bio-Chemical Industry Co. Ltd (Runyin), a subsidiary of Shandong Ruixing Group, a large chemical company and one of the key high-tech players in China, as per Hydrocarbonprocessing.

Under the terms of the contract, Air Liquide Engineering & Construction will design and build a large ASU with a production capacity of 2,950 tons of oxygen per day.

The ASU will be an integral part of the customers’ key research and development project for chemical production. In support of this project, ?Air Liquide will provide its strong expertise and best-in-class oxygen production technologies which enable maximized energy efficiency and reduced environmental footprint.

The first industrial production is expected in 2020. Founded in 1970, Ruixing Group specializes in biochemical, fine chemical, thermal power generation and equipment manufacturing. Domenico D’Elia?, Senior Vice President, Sales and Technology, Air Liquide Engineering & Construction commented: “"Air Liquide demonstrates the commitment to contribute to the upgrading of China industries. This success with our new customer, Shandong Runyin Bio-Chemical, reaffirms our ability to provide competitive solutions that are safe, reliable and highly efficient?.?"