EU planning sustainable fuel target to cut airline emissions

MOSCOW (MRC) -- The European Commission is drawing up targets for airlines to use a minimum share of sustainable fuels, it said last Wednesday, after dropping a draft 5% goal that it deemed too low, reported Reuters.

The pledge came as the EU executive outlined measures to tackle transport's climate impact, including a goal previously reported by Reuters to have 30 million zero-emission vehicles on Europe's roads by 2030.

A late draft had included the 5% share of low-carbon fuels to be reached by airlines in 2030, rising to above 60% in 2050. Both targets were cut from the published version.

EU climate chief Frans Timmermans said the Commission now intended to set higher goals for sustainable aviation fuel.

"We will come out with an ambitious proposal later, because we thought we could do better than what was written in the initial draft," Timmermans said.

Sustainable aviation fuels (SAF), which can be produced from biomass or renewable energy, currently account for less than 1% of Europe's jet fuel consumption.

Their uptake has been stunted by high costs and weak demand from airlines, which have traditionally opposed mandated quotas. The industry's position is, however, evolving amid increasing scrutiny of its environmental impact.

"The EU proposal for a SAF mandate could, under certain conditions, be a positive development in providing a degree of certainty to the market and driving production," said Michael Gill, head of ATAG, a global aviation sector lobby group.

Those conditions include policy support for SAF development and avoiding anti-competitive effects, Gill said.

Finland, France, the Netherlands, Spain and Sweden are among European states already considering their own binding targets.

The EU plan would also seek to make transport services carbon-neutral for journeys under 500 kms (310 miles), encouraging a shift from air to rail.

Campaigners such as clean energy group Transport and Environment urged the EU to promote hydrogen produced with renewable energy over biofuels that can worsen deforestation.

Brussels also wants zero-emission large aircraft to be market-ready by 2035, a deadline Airbus has set itself to put a carbon-free plane into service.

As MRC informed before, ExxonMobil said in mid-December it plans further reductions in greenhouse gas emissions over the next five years to support the goals of the Paris Agreement and anticipates meeting year-end 2020 reductions. ExxonMobil plans to reduce the intensity of operated upstream greenhouse gas emissions by 15% to 20% by 2025, compared to 2016 levels. This will be supported by a 40% to 50% decrease in methane intensity, and a 35% to 45% decrease in flaring intensity across its global operations. The emission reduction plans, which cover Scope 1 and Scope 2 emissions from operated assets, are projected to be consistent with the goals of the Paris Agreement. The company also plans to align with the World Bank’s initiative to eliminate routine flaring by 2030.

We remind that ExxonMobil underttook a planned shutdown at its cracker in Singapore. The company halted operations at the cracker for maintenance on September 14, 2020. The cracker was expected to remain off-line till end-October, 2020. Located at Jurong Island, Singapore, the cracker has an ethylene production capacity of 1 million mt/year and a propylene production capacity of 450,000 mt/year.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,760,950 tonnes in the first ten months of 2020, up by 3% year on year. Only high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased. At the same time, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.
MRC

MOSCOW (MRC) -- Asian refining margins for jet fuel climbed for a third consecutive session on Tuesday, hitting a more than nine-month high, as aviation demand begins to find some support from increasing number of scheduled operating flights, said Hydrocarbonprocessing.

Refining margins, or cracks, for jet fuel gained 26 cents to USD5.09 per barrel over Dubai crude during Asian trade on Tuesday, a level not seen since March 13. After the COVID-19 pandemic brought air travel to a virtual halt this year, refining profits for the aviation fuel have surged to multi-month highs in all key trading hubs in December on hopes of higher demand in 2021.

Global jet fuel markets are coming back to life, resuscitated by a rebound in air cargo demand, gradually recovering passenger traffic and hopes that COVID-19 vaccines will spur more international flights next year. Scheduled flights operating globally were 43.5% lower in the week to Monday, an improvement from 46.1% a week earlier, according to aviation data firm OAG.

Flights in India were down 36.4% year-on-year in the week to Dec. 14, compared with a 38.3% drop in the preceding week, while flights in Australia were 45.5% lesser from the corresponding period last year, as against a 51% drop in the previous week. Cash discounts for jet fuel narrowed to 13 cents a barrel to Singapore quotes on Tuesday, compared with a discount of 27 cents per barrel on Monday.

As MRC informed earlier, Asian refining margins for 10 ppm gasoil rose on Friday, posting their seventh consecutive weekly gain, but the pace of demand recovery is expected to take a hit as several regional economies continue to battle COVID-19 infections.

We remind that PetroChina has nearly doubled the amount of Russian crude being processed at its refinery in Dalian, the company's biggest, since January 2018, as a new supply agreement had come into effect. The Dalian Petrochemical Corp, located in the northeast port city of Dalian, was expected to process 13 million tonnes, or 260,000 bpd of Russian pipeline crude in 2018, up by about 85 to 90 percent from the previous year's level. Dalian has the capacity to process about 410,000 bpd of crude. The increase follows an agreement worked out between the Russian and Chinese governments under which Russia's top oil producer Rosneft was to supply 30 million tonnes of ESPO Blend crude to PetroChina in 2018, or about 600,000 bpd. That would have represented an increase of 50 percent over 2017 volumes.

Ethylene and propylene are feedstocks for producing PE and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,760,950 tonnes in the first ten months of 2020, up by 3% year on year. Only high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased. At the same time, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.
MRC

MOSCOW (MRC) -- Lummus Technology (Houston) and Chevron Lummus Global (CLG) announced multiple technology contracts with PT Pertamina Rosneft Pengolahan dan Petrokimia (PRPP), a joint venture (JV) between Indonesia’s PT Pertamina (Persero) and Russia’s Rosneft Oil Company for a grassroots refinery and petrochemical complex in Tuban, Indonesia, said Chemweek.

"This award is an excellent example of Lummus’ distinct ability to provide integrated, multi-technology solutions, which is a major benefit for large operators in Southeast Asia,” said Leon de Bruyn, President and Chief Executive Officer of Lummus Technology. “By selecting our best in class technologies, PRPP will minimize its risk of implementation for this project and achieve competitive process economics in the future."

"The CLG and Lummus technologies we are licensing will lead to reliable and profitable operations for PRPP’s grassroots complex in Indonesia,” said Ujjal Mukherjee, Managing Director of CLG. “Our residue desulfurization technology will help optimize their product quality, product yield, run-length, capital investment and operating cost."

Lummus will provide the license and basic engineering for the following technologies: ethylene technology, including Pyrolysis gasoline hydrogenation, C4 total hydrogenation and BASF SELOP selective hydrogenation technology; ethylbenzene/styrene technology; and CDMtbe technology. CLG will provide the license and basic engineering for its residue desulfurization technology.

Once complete, the olefins complex will be largest liquefied petroleum gas steam cracker in the world and highly integrated with the refinery to maximize propylene.

As part of the license agreement, Lummus Technology will offer its Short Residence Time (SRT) heaters, a proprietary technology ideally suited to achieve maximum yields, at a later stage of the project. CLG will also later be providing ISOMIX-e proprietary reactor internals to optimize its state-of-the-art catalyst system for higher yields and longer run lengths.

Ethylene and propylene are feedstocks for producing PE and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,760,950 tonnes in the first ten months of 2020, up by 3% year on year. Only high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased. At the same time, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.
MRC

MOSCOW (MRC) -- US Midwest refiners are gearing up to send more gasoline and diesel to East Coast buyers, hoping to fill a void created by refinery closures and cutbacks, but likely to add pressure to regional fuel producers, reported Reuters.

Midwest refiners, such as BP and Husky Energy, that process inexpensive Canadian crude are betting on East Coast markets to boost sales and margins. But the move could make it more difficult for PBF Energy to restore production of gasoline, diesel and jet fuel at its Paulsboro, N.J., plant.

“The midwest refining complex is a firehose to the East Coast, which is already drowning in imports,” said Zachary Rogers, senior oil analyst at consultancy Rapidan Energy Group.

Shippers are geared up to transport up to 25,000 barrels per day (bpd) of refined products on the Mariner 1 pipeline from the Midwest as soon as this week, two traders familiar with the matter said. If demand permits, refiners could double that amount, they said.

“We do expect that this service will help to lower overall fuel costs for Pennsylvania residents and business,” said a spokeswoman at Energy Transfer, which operates Mariner 1. Volumes of between 20,000 bpd and 25,000 bpd will begin this month, she said.

Gasoline prices in the Midwest traded 4 cents a gallon below the futures benchmark for gasoline on the New York Mercantile Exchange on Tuesday while New York Harbor conventional gasoline prices were 3.25 cents above the futures benchmark.

East Coast refineries produce only part of the fuel consumed in the region, with pipeline and seaborne imports furnishing most. Three refineries, owned by Delta Airlines, PBF Energy and Phillips 66, produce 700,000 bpd combined out of the 5.2 million bpd of gasoline, diesel, and jet fuel consumed last year, Energy Information Administration data shows.

The largest refiner, Philadelphia Energy Solutions, halted operations following a 2019 explosion, Canada’s Come-by-Chance, which sold fuel into the East Coast, was idled in May, and PBF Energy said in October it would shut fuel-producing units at its 180,000 bpd Paulsboro refinery.

PBF did not reply to a request for comment.

As MRC wrote before, in October 2020, US refiner Phillips 66 said it plans to reconfigure its refinery in Rodeo, California to produce renewable fuels from used cooking oil, fats, greases and soybean oils.

We remind that US-based Phillips 66 remains open to developing another ethane cracker for its Chevron Phillips Chemical (CP Chem) joint venture, the refiner's CEO said in March 2018.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,760,950 tonnes in the first ten months of 2020, up by 3% year on year. Only high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased. At the same time, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.
MRC

MOSCOW (MRC) -- Russia’s government commission on foreign investment has formally approved Sinopec’s proposed acquisition of a 40% ownership stake in the USD10-billion Amur gas chemicals complex being developed by Sibur (Moscow) in Russia’s Far East, said Chemweek.

The approval was announced in a formal statement by the Russian government. Sibur began foundation construction activity for the Amur project in Blagoveshchensk, Russia, in August this year. The complex, near Russia’s border with China, is planned to produce 2.3 million metric tons/year of polyethylene (PE) and 400,000 metric tons/year of polypropylene (PP), with commissioning scheduled in 2025. The facility’s steam cracker will be supplied with 2 MMt/y of ethane and 1.5-MMt/y of liquefied petroleum gas (LPG) as feedstock under a supply agreement with Gazprom (Moscow), which is building a 42-billion cubic meters/year gas processing plant at the same location.

Sibur said in August that Sinopec was expected to become its partner in the project and that China “remains the key driver behind global polymer consumption growth and is a target market for Amur.” The two companies signed a shareholder agreement in June.

As MRC informed earlier, LyondellBasell, the world’s leading licensor of polyolefin technologies, announced that the Amur Gas Chemical Complex project, being implemented by SIBUR Holding PJSC, the largest integrated petrochemicals company in Russia, has selected LyondellBasell’s Spheripol technology for a new facility. The process technology will be used for a 400 KTA polypropylene unit to be built in Svobodny, Amur region, Russia.

According to MRC's DataScope report, Russian companies increased external purchases of polypropylene in November, imports reached 20,400 tonnes against 17,900 tonnes a month earlier. Thus, overall PP imports into Russia reached 202,000 tonnes in January-November 2020, compared to 167,400 tonnes a year earlier. Purchasing of all grades of propylene polymers in foreign markets increased, with homopolymer PP imports accounting for the most noticeable rise.
MRC