Japan Osaka Gas looks to Southeast Asia for LNG business

MOSCOW (MRC) -- Japan's Osaka Gas Co Ltd is considering expanding its Southeast Asia operations, a top executive said, tapping a region where natural gas demand is booming but domestic reserves are dwindling fast, as per Hydrocarbonprocessing.

Osaka Gas, one of the world's biggest gas utilities and importers of liquefied natural gas (LNG), is increasingly turning abroad as it faces faltering demand at home due to a mature market and shrinking population. One opportunity is Vietnam, Kazuhisa Yano, Executive Chairman and Chief Asia Representative of Osaka Gas, told the Reuters Commodity Summit interview series.

Vietnam is one of Asia's fastest-expanding energy markets due to a large population and sharp economic growth, but reserves at its existing oil and gas fields are declining fast. "We will ... study Vietnam's gas market," Yano said on Tuesday, talking to Reuters while attending an industry conference in Singapore.

"There are several industry parks in Vietnam, and (there is) demand for gas for such kinds of industrial (purposes)." Vietnam does not currently import any LNG, but is planning to start in coming years, like other Southeast Asian countries such as Indonesia and the Philippines.

The International Energy Agency (IEA) said this week that Southeast Asia is at the heart of future LNG demand growth, which it expects to increase by a third globally to 500 billion cubic metres (370 million tonnes) by 2023.

While Osaka Gas reviews Vietnam as a potential market, it will also look into expanding its current operations in the region.

The firm already has subsidiaries for operations such as sales and trading in Singapore, Thailand, Indonesia and the Philippines, Yano said. Like Vietnam, domestic gas reserves are running out in the Philippines, and LNG will soon be needed to meet demand from new power generation projects.

Yano said Osaka Gas was considering entering that market as a supplier.

Sonatrach to use Honeywell tech to produce clean fuels

МОSCOW (MRC) -- Honeywell announced that Sonatrach S.p.A. will use a suite of Honeywell UOP technologies to produce 200,000 metric tons per year of methyl tert-butyl ether (MTBE), a high-octane gasoline additive that reduces emissions in automobile exhaust, as per Hydrocarbonprocessing.

Honeywell will provide technology licensing, design services, key equipment and state-of-the-art catalysts and adsorbents for the project at Sonatrach’s refinery in Arzew, Algeria.

"With these technologies, Sonatrach can supply MTBE to the region’s refineries to produce fuels that meet increasingly strict specifications, including Euro V,” said Bryan Glover, vice president and general manager of Honeywell UOP’s Process Technology & Equipment business. “As a single licensor of all technologies in the process, Honeywell UOP can provide Sonatrach the greatest value in the shortest timeframe to commissioning."

MTBE is produced from a chemical reaction between methanol, which typically is derived from natural gas, and isobutylene, which is derived from butane obtained from crude oil or natural gas. Due to its high octane number, it is an effective anti-knocking fuel additive to produce cleaner-burning gasoline.

Included in the technology package is UOP’s Butamer™ technology, which isomerizes normal butane into isobutane. UOP has more than 85 Butamer units currently in operation worldwide.

The package also includes a UOP C4 Oleflex™ unit to dehydrogenate isobutane into isobutylene. C4 Oleflex features low energy consumption, low emissions and a fully recyclable, platinum-alumina-based catalyst system which minimizes environmental impact. This results in a lower cash cost of production, and higher return on investment than competing technologies. Honeywell UOP has been awarded 55 dehydrogenation projects since 2011.

The contract also includes a UOP Ethermax™ unit that converts isobutylene and methanol into a high-octane MTBE blending agent that contains no benzene or aromatics. The Ethermax technology delivers a high MTBE yield and is currently used in 44 units worldwide.

Sonatrach is the largest company in Algeria, employing 120,000 people and accounting for almost one-third of Algeria’s gross national product. Sonatrach operates the Hassi Messaoud oil field, the largest in Algeria, in addition to several other fields.

President-elect Lopez Obrador slams Mexico's Pemex for crude import plan

MOSCOW (MRC) - Mexico’s president-elect Andres Manuel Lopez Obrador criticized state-run Pemex’s plan to import U.S. light crude from refiner Phillips 66, calling it a sign of the country’s failed economic policies, as per Hydrocarbonprocessing.

Pemex is set to begin crude imports in November, for the first time in over a decade. It needs them to feed Mexico’s main refinery, which is working below capacity due to a lack of light oil.

The purchase of 1.4 million barrels of U.S. Bakken crude will follow a tender awarded earlier this week to Phillips 66. Up to 100,000 barrels per day (bpd) of crude imports are planned for the last quarter of 2018.

“This announcement ... is another example of the great failure of neo-liberal economic policies in the last 30 years,” Lopez Obrador said on Twitter. Once he takes power in December, Lopez Obrador could force Pemex to halt the imports, which would likely impact domestic refining and boost the need for other kinds of imported fuel.

The issue has divided opinion among his allies. One of his economic advisers, Abel Hibert, said earlier this month that crude imports could continue as a way to increase processing levels at Mexico’s refineries, even after Lopez Obrador takes office.

“I think Pemex has good reason to do it due to current market conditions,” he told local media. Mexico’s light crude output has declined faster than expected this year, hit by operational problems at the Xanab oilfield.

Pemex chief executive Carlos Trevino has said the company’s goal of producing 1.95 million bpd of crude this year will not be met, and that the 2019 target is also likely to be missed. If Pemex does not start crude imports for its refining network, purchases of finished fuel, especially gasoline, would grow again to satisfy Mexico’s consumption of about 1.5 million bpd, analysts have said.

Lopez Obrador’s main plan for the oil industry involves building a new mid-size refinery to boost fuel production while reducing crude exports with the final goal of halting them.

He has criticized his predecessor’s opening of the oil and gas industry to foreign investment but has not given details of how he would reverse the country’s dwindling crude production.

Swiss allow diesel release as Rhine water levels hit imports

MOSCOW (MRC) - The Swiss government has authorized the temporary release of diesel from the country’s compulsory stockpile after low water levels on the Rhine reduced supplies to the country, as per Reuters.

Around 40 percent of Switzerland’s diesel is brought into the country along the Rhine, with the rest by cargo trains, pipelines, trucks and the country’s own refineries.

The Swiss Federal Office for National Economic Supply decided to allow the release of 30,000 cubic meters of diesel on Monday from its stockpile, which belongs to import companies.

The figure is equivalent to 2.5 percent of all the diesel it holds. The country holds diesel, petrol, and heating oil for four-and-a-half months of emergency supply and three months for aircraft fuel.

“The water levels in the Rhine have been very low, which has reduced the import of diesel into Switzerland,” said Lucio Gastaldi, head of the energy and industry secretariat.

“We have authorized the release of enough diesel as an immediate measure to last until the end of the month. We are watching the situation very closely and will release more diesel if necessary.”

A further evaluation with the oil industry will take place on Thursday to discuss further measures, although no steps have yet been decided, Gastaldi said.

Switzerland imports 120,000 cubic meters of diesel per month via the Rhine.

The emergency supply measures have not been extended to petrol or heating oil at present, mainly because mild autumn weather so far has reduced the need for heating oil.

Petrol is imported more via railways and the shortages are not currently as pronounced as with diesel, Gastaldi said.

China September diesel, gasoline exports fall on robust domestic demand

MOSCOW (MRC) - China’s September diesel and gasoline exports fell sharply from August as robust domestic demand curbed overseas shipments, asper Hydrocarbonprocessing.

Gasoline exports were 730,000 tonnes last month, the lowest since the same month a year ago when shipments were 568,000 tonnes, data from the General Administration of Customs showed.

Diesel exports in September fell to a 21-month low at 1.03 million tonnes below 1.184 million tonnes during the same month a year earlier, the data showed.

Exports last month fell even as China’s refinery runs rose to a daily record high as refiners ramped up production on improving margins. This suggests that the increased fuel output was consumed inside the country.

Liquefied natural gas imports were at 4.37 million tonnes in September, up 27 percent from a year ago but falling from 4.71 million tonnes in August, the data showed.

For the first nine months of the year, arrivals rose 44 percent from the same period last year to 36.98 million tonnes, according to the data.