Crude oil prices rise sharply on Kazakhstan unrest and Libyan outages

Crude oil prices rise sharply on Kazakhstan unrest and Libyan outages

MOSCOW (MRC) -- Oil prices rose sharply on Thursday, extending a rally from the previous session, on escalating unrest in OPEC+ oil producer Kazakhstan and supply outages in Libya, reported Reuters.

Global benchmark Brent crude futures rose USD1.78, or 2.2%, to USD82.58 a bbl by 1445 GMT, the highest since late November. US West Texas Intermediate (WTI) crude futures gained USD2.18, or 2.8%, to USD80.03, the highest since mid-November.

Brent's six-month backwardation stood at about USD4 a bbl, its widest since late November. Backwardation is a market structure where current prices trade at a premium to future prices and is usually a sign of a bullish market.

Russia sent paratroopers into Kazakhstan on Thursday to help quell a countrywide uprising after deadly violence spread across the tightly controlled former Soviet state.

"The political situation in Kazakhstan is becoming increasingly tense," Commerzbank said. "And this is a country that is currently producing 1.6 MM bbl of oil per day."

There were no indications that oil production has been affected so far.

Libyan oil output is at 729,000 bpd, the National Oil Corp said on Thursday, down from a high of more than 1.3 MMbpd last year, owing to maintenance and oilfield shutdowns.

Prices rallied despite a surge in US fuel stocks a week earlier. US crude oil stockpiles fell lin early January while gasoline inventories surged by more than 10 MM bbl, the biggest weekly build since April 2020, as supplies backed up at refineries because of reduced fuel demand.

OPEC+, a group that includes members of the Organization of the Petroleum Exporting Countries, Russia and other producers, agreed on Tuesday to add another 400,000 bpd of supply in February, as it has done each month since August.

As MRC informed before, US commercial crude stocks fell 3.48 million barrels to 413.96 million barrels in the week ended Sept. 17, to more than 8% below the five-year average, Energy Information Administration data showed. Stocks were last lower Oct. 5, 2018.

We remind that in late August, 2021, US crude stocks dropped sharply while petroleum products supplied by refiners hit an all-time record despite the rise in coronavirus cases nationwide, the Energy Information Administration said. Crude inventories fell by 7.2 million barrels in the week to Aug. 27 to 425.4 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop. Product supplied by refineries, a measure of demand, rose to 22.8 million barrels per day in the most recent week. That's a one-week record, and signals strength in consumption for diesel, gasoline and other fuels by consumers and exporters.

We also remind that US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, EIA said in a monthly report earlier last year, a smaller decline than its previous forecast for a drop of 210,000 bpd.

Calumet announced close of renewable hydrogen project financing

Calumet announced close of renewable hydrogen project financing

MOSCOW (MRC) -- Calumet Specialty Products Partners, L.P. announced that Montana Renewables LLC (MRL) has closed the previously announced USD50 MM of project financing from Stonebriar Commercial Finance LLC related to construction of the renewable hydrogen plant for Calumet's renewable diesel business in Great Falls, Montana, said the company.

Once complete, the renewable hydrogen plant will allow increased production of renewable diesel and further reduce the carbon intensity of products from MRL. The renewable hydrogen plant has an expected operational startup in the fourth quarter of 2022.

As MRC informed earlier, Commodity trader Guangdong Zhenrong Energy Co. has signed a memorandum of understanding (MOU) with BP for commercial cooperation on an oil refinery in the Caribbean.

Calumet Specialty Products Partners LP has retained boutique energy bank Tudor, Pickering, Holt & Co to sell its small oil refinery in Great Falls, Montana. The refinery has the capacity to process 30,000 barrels per day of crude, according to the company’s website. That puts it below the largest refineries on the U.S. Gulf Coast that can process ten times as much.

Calumet manufactures, formulates, and markets a diversified slate of specialty branded products to customers in various consumer-facing and industrial markets. Calumet is headquartered in Indianapolis, IN and operates twelve facilities throughout North America.

Hydrogen Utopia expands plastics-to-hydrogen projects in Poland

Hydrogen Utopia expands plastics-to-hydrogen projects in Poland

MOSCOW (MRC) -- Hydropolis United has signed a Letter of Intent (LOI) with a Polish regional municipal waste management operator to develop a waste-to-hydrogen system, said the company.

The agreement between the Hydrogen Utopia International (HUI) subsidiary and Regionalny Zaklad Zagospodarowania Odpadow (RZZO) will convert end of life plastics into hydrogen. A plant can be constructed on as little as 1.5 hectares and easily bolted onto existing waste facilities, using scalable and adaptable technology.

HUI has exclusive rights in Hungary, Poland and Greece to use Powerhouse Energy Group (PHE) technology, which converts plastic into hydrogen, and non-exclusive rights in the rest of the world. RZZO will provide a plot of land for the plant and will provide the waste plastic feedstock needed to produce hydrogen, subject to the final contract.

The site is expected to have capacity to process 40 tonnes of plastic waste per day to produce up to 2-3 tonnes/day of hydrogen as well as electricity and heat, with the latter likely to be fed into a district heating system.

RZZO, which was established to deal with new legislation on waste management, will also assist in procuring funding from the EU, national or local grants, and/or private funding, as well as assisting in offtake partners for the energy and hydrogen produced at the plant.

HUI’s flagship project is set to be in Konin, Poland, following an agreement between the firm and the City of Konin signed in February 2021. It is likely to come online in the next year.

As per MRC, BP announced that it has agreed Memoranda of Understanding (MoUs) with a series of new potential customers for its proposed clean hydrogen production facility in Teesside in north-east England. In March, Bp announced plans for a clean hydrogen facility in Teesside (H2Teesside) that would aim to produce up to 1GW of ‘blue’ hydrogen - 20% of the UK’s hydrogen target - by 2030. At the same time, it announced it had signed initial MoUs to scope the supply of hydrogen to chemicals manufacturer Venator and gas distributor Northern Gas Networks.

Hydropolis United is a subsidiary of Hydrogen Utopia International Plc (a technology company that convert non-recyclable waste plastics to hydrogen). Hydrogen Utopia last week admitted its ordinary shares to trading on the AQSE Growth Market. It raised gross proceeds of GDP3 million by way of a subscription and placing. Hydrogen Utopia existing cash resources, together with the net proceeds of its fundraising, will be used to fund the pre-build costs of its facility, marketing and business development and working capital.

RZZO works closely with the local government and has a long-term contract to manage municipal waste with the city of Ostrow Wielkopolski. It has built several modern waste management facilities in the region.

Saudi Aramco and AEC signed MOU to strengthen digital ecosystem in Saudi Arabia

MOSCOW (MRC) -- Aramco and Advanced Electronics Company (AEC), a SAMI company, are collaborating to promote the localization of digital businesses in Saudi Arabia, according to Hydrocarbonprocessing.

The two companies have signed a MOU to accelerate the kingdom’s digital ecosystem development.

The partnership aims to support wider efforts to enable Internet of Things technologies, computing and communication, robotics, drones, and semiconductors that complement the expansion of the digital ecosystem at large in the kingdom.

Aramco has included the Industrial Digital Business under the industrial investment program, Aramco Namaat, which aims to complement the establishment of various digital hubs in Saudi Arabia.

The program aims to maximize local content, contribute to GDP growth, create new jobs, accelerate digital talent development, and enhance Aramco’s reliability and operational efficiency.

Ahmad Al Sa’adi, Aramco SVP Technical Services, said: “This partnership aims to help us to develop technologies and local talent as we work with leading technology providers to add value to the company and wider economy.”

The program is designed to drive increased investment, economic diversification, job creation and workforce development within the kingdom.

As MRC informed before, in June 2020, Aramco finalized its USD69 billion acquisition of a 70% stake in Saudi Basic Industries Corp., the Middle East's biggest petrochemical maker. SABIC reported more than a fivefold year-on-year increase in its Q3 net profit to USD1.49 billion thanks to higher average sales prices.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,265,290 tonnes in the first eleven months of 2021, up by 14% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,363,850 tonnes in January-November, 2021, up by 25% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

Saudi Aramco, officially the Saudi Arabian Oil Company, is a Saudi Arabian national oil and natural gas company based in Dhahran, Saudi Arabia. Saudi Aramco's value has been estimated at up to USD10 trillion in the Financial Times, making it the world"s most valuable company. Saudi Aramco has both the largest proven crude oil reserves, at more than 260 billion barrels, and largest daily oil production.

Lanaz to use Honeywell technology to modernize Iraqi refinery

Lanaz to use Honeywell technology to modernize Iraqi refinery

MOSCOW (MRC) -- Honeywell announced that the Lanaz Company will use UOP modular naphtha hydrotreating and fixed-bed platforming process units to upgrade its refinery in Iraq said Hydrocarbonprocessing.

The project marks the first use of UOP modular technology in the country and will help Lanaz comply with increasingly strict specifications for fuel products. UOP has supplied licensing and basic engineering design services as well as full modular units to Lanaz, based in Erbil in the Kurdistan region of Iraq.

As refiners in developing economies seek to upgrade their facilities to produce high-quality gasoline, many are seeking modular solutions to maintain costs and mitigate risk with pre-fabrication and assembly completed in a safe and controlled environment off-site. In addition, modular technology provides a faster pathway to operations with facilities coming online less time.

The Lanaz Refinery is a fully equipped, high capacity refinery built in 2008 in the Kurdistan Region of Iraq and processes about 100,000 bpd of crude oil.

We remind, Honeywell announced Zhenhua Petrochemical Co. Ltd will use Honeywell UOP’s C3 Oleflex technology for propane dehydrogenation to process 1 million metric tons per year of polymer-grade propylene for a proposed plant in Dongying City, Shandong Province, China.

As MRC reported earlier, in March 2021, Honeywell announced that Hengli Petrochemical Co. Ltd. successfully used Callidus burner technology from Honeywell UOP to minimize nitrogen oxide (NOx) and carbon monoxide (CO) emissions in China, and reduce the impact of these emissions while ensuring safe and stable operations.

Honeywell UOP is a leading international supplier and licensor of process technology, catalysts, adsorbents, equipment, and consulting services to the petroleum refining, petrochemical, and gas processing industries. Honeywell UOP is part of Honeywell’s Performance Materials and Technologies strategic business group, which also includes Honeywell Process Solutions, a pioneer in automation control, instrumentation and services for the oil and gas, refining, petrochemical, chemical and other industries.