Fire at Swedish oil refinery has been extinguished

A fire, which broke out on Tuesday at Nynas AB's oil refinery in the Swedish city of Nynashamn on the Baltic Sea coast, has been put out, said Reuters.

"The fire broke out mid-morning today and (rescue services) arrived quickly on the scene and the fire is now extinguished. The affected area was immediately evacuated," the Nynas spokesperson said in an email.

A spokesperson for the local fire and rescue service told Reuters earlier it was crude oil that was on fire. She said there were no buildings on fire, and there did not appear to be risk of the flames spreading.

The Nynas AB spokesperson said six persons had been treated onsite after inhaling smoke, one of which had been taken to hospital for further treatment while the others had returned to work.

Images published by daily Aftonbladet and public broadcaster Sveriges Radio showed thick black smoke rising over the refinery located some 50 kilometers (30 miles) south of the Swedish capital Stockholm.

We remind, U.S. crews extinguished a fire on Tuesday at Phillips 66's 149,000-barrel-per-day joint-venture refinery in Borger, Texas, and six people were treated for injuries. Local media reported earlier that the fire had occurred in the storage tank farm at the Borger complex, shutting a state highway near the refinery. All workers at the refinery were accounted for, and the cause of the incident is being investigated.

mrchub.com

The European Commission’s announcement that the EU is proposing a $100/bbl price cap on Russian oil products such as diesel, jet fuel and gasoline, and a USD45/bbl cap on discounted products like fuel oil, would not severely impact Russian refiners, said Hydrocarbonprocessing.

Speaking at Wood Mackenzie’s London office on January 31, Mark Williams, Research Director of Short-Term Refining & Oil Products, said that the oil products price cap, which is due to come into force on February 5, would have minimal impact on Russian refining crude runs and distillate exports.

“With Russian Urals trading at USD40/bbl on an FOB basis, capping the price at USD100/bbl and USD45/bbl, respectively, would still see Russian refining margins of USD20/bbl–$30/bbl,” Williams said. “At these levels, Russian refining economics are still very strong, so the incentive to refine crude into oil products remains high."

Alan Gelder, Vice President of Refining, Chemicals and Oil Markets at Wood Mackenzie, said that the challenge for Russian refiners is finding a pool of new, more distant buyers to replace the distillate barrels currently clearing into Europe. However, he added that with the price cap set at the proposed levels, Russian distillate prices could theoretically discount by a further USD200/metric t vs. market benchmarks before eliminating the commercial incentive to operate their refining sector.

“At these potential discount levels, the economic incentives for key emerging countries to import Russian distillates could outweigh the associated geopolitical and reputation risks and so distillate exports continue to flow,” Gelder added.

Russia has increasingly diversified its distillate exports in recent months, according to Wood Mackenzie's VesselTracker data. However, despite the emergence of new export markets for Russian distillates, the re-distribution of Russian oil product trade from the EU import ban does have a broader market impact. Williams expects Q1 2023 Russian crude runs and diesel exports to be ~800,000 bpd and 200,000 bpd lower than Q4 2022 levels, which will support both global crude and diesel prices through H1 2023.

The next few months are therefore likely to be volatile as global trade flows reshuffle,” Gelder said. “We do not see the price caps having any additional impact on trade flows at the currently proposed levels; however, if flows to new markets continue to develop as pricing discounts widen, there remains an upside risk to both Russian refining crude runs and distillate exports in 2023.”

We remind, independent Russian oil refiner Forteinvest has clinched a deal that will see Russian gasoline sent to Pakistan by land for the first time, two industry sources said on Friday, as Russian refiners seek alternative markets for motor fuels days before an EU import ban. Forteinvest has sold to a trader an initial 1,000-tonne lot of gasoline from its Orsk plant for delivery to Pakistan and has more requests to supply gasoline, diesel and LPG to the country, the sources added.

mrchub.com

KP Engineering (KPE), a leader in the design and execution of customized EPC solutions for the refining, syngas, hydrogen, and renewable fuels industries, is pleased to announce the completed acquisition of its assets by The Shaw Group (Shaw), a leader in global pipe and module fabrication. Going forward the company’s new legal entity will be KP Shaw, LLC., said Hydrocarbonprocessing.

Shaw has built a reputation as the premier fabrication company throughout the U.S. and Middle East, with 1500 employees across six state-of-the-art facilities. This strategic acquisition will further enable Shaw to deliver complete engineering, procurement, and fabrication (EPF) project solutions to a variety of industries around the world. KPE brings a 19-year history of superior engineering, procurement, and project management to Shaw, which will now offer unparalleled modular and EPF solutions to the oil and gas, hydrogen and chemical, and renewable fuels and energy industries.

William E. Preston, who will continue as the President and CEO of KP Shaw, LLC, says, “This acquisition serves to fulfill an urgent requirement for bankable EPF service capacity in the growing North American market. KPE enhances the services in Shaw’s already strong portfolio of offerings, which includes pipe, module, and structural steel fabrication, induction bending and specialty coating services. The integration of Shaw’s high-quality services will enable us to better meet the needs of our well-established customer base and will also provide us with fresh opportunities to engage with new customers on a global scale."

“The completion of this transaction is another significant step for Shaw in growing our capabilities to service throughout the entire project lifecycle,” said Mike Childers, President and CEO of The Shaw Group, “KPE’s unique expertise in the energy transition markets is an excellent complement to our existing portfolio in the oil and gas, pulp and paper, pharmaceuticals, food and beverage and wastewater industries. I am happy to welcome the KPE team to join Shaw’s operations."

Shaw acquired all the assets and ongoing operations of KP Engineering, subsuming existing leases at facilities.

KP Shaw, LLC will operate as a subsidiary of The Shaw Group. Branding for the new entity will be established in the coming months.

We remind, ExxonMobil awarded a front-end engineering and design (FEED) contract to Technip Energies for a blue hydrogen project at its complex in Baytown, Texas. ExxonMobil described the contract as the largest of its kind in the world. The company could make a final investment decision (FID) on the project in 2024. If ExxonMobil proceeds, it could start operations in 2027-2028. Financial details were not disclosed.

mrchub.com

Reliance Industries has stopped selling petroleum coke within India and boosted imports of the product to turn it into synthetic gas to power its refineries, according to two sources familiar with the matter and trade data, said Reuters.

Petroleum coke is a carbon intensive solid residue left over from coking units in oil refineries that break down residual oil into more highly valued products. Petcoke, as it is known, can be used as a coal substitute in both steelmaking and in power plants.

Reliance had been depending on liquefied natural gas (LNG) to run its refinery complex and selling the petcoke locally but it is now gasifying its petcoke amid rising LNG prices.

With Reliance's petcoke no longer available domestically, India's imports are likely to rise, after doubling last year because of higher demand from cement makers, who use the petcoke to manufacture the building material. Reliance was the country's biggest domestic supplier until 2021.

"They slowly started reducing supplies (to local markets) in the middle of last year, but now it has come to a complete stop," one of the sources, a petcoke trader, said.

Reliance did not immediately respond to a request seeking comment. Both sources declined to be named as they are not authorized to speak to the media.

I-Energy Natural Resources, a solid fuels trader in India's Gujarat state, said prices of petcoke delivered to India rose last week as cement manufacturers increased their imports since it is still cheaper than overseas coal. There is a very limited supply of domestic petcoke to end-users, and this has made players to procure from the international market," I-Energy said in a note on Monday.

Trade data reviewed by Reuters shows Reliance also imported over 192,000 tonnes of petcoke in the four months to January amid higher internal demand. That compared with about 110,000 tonnes in the eighteen months ending September.

We remind, Reliance Industries Ltd., helmed by billionaire Mukesh Ambani, posted a larger-than-expected quarterly profit as growth in its consumer units offset the weakness in its traditional petrochemicals business. Net income fell 15% to 157.9 billion rupees (USD1.9 billion) in the quarter ended Dec. 31 but was still higher than the average 156.19 billion rupees estimated in a Bloomberg survey. India’s largest company by market value also secured approval of its board to raise as much as 200 billion rupees via bonds.

mrchub.com

Petronas has signed two Project Development Agreements with ExxonMobil Exploration and Production Malaysia Inc. (ExxonMobil) to jointly pursue Carbon Capture and Storage (CCS) activation projects in Malaysia, said the company.

Under the agreements, both parties will define next steps, including the maturation of technical scopes for the CCS value chain, evaluation of the identified fields for CO2 storage utilisation, development of appropriate commercial framework and establishment of advocacy plan support on regulations and policy development in enabling CCS projects.

The agreements were signed by PETRONAS Head of Carbon Management, Emry Hisham Yusoff and ExxonMobil President, Shane Harris. PETRONAS Executive Vice President and Chief Executive Officer of Upstream, Datuk Adif Zulkifli and President of ExxonMobil Low Carbon Solutions, Asia Pacific, Irtiza Sayyed witnessed the signing. Also present was Vice President of ExxonMobil Low Carbon Solutions, Asia Pacific, Tracy Lothian.

Emry Hisham said, “PETRONAS is proud to work with its long-standing partner, ExxonMobil to pursue CCS projects together, aligning our shared aspiration to deliver energy solutions in a responsible and sustainable manner. This collaboration further strengthens PETRONAS’ commitment in providing decarbonisation solutions, aligned with our aspiration in establishing Malaysia as a leading CCS hub in the region.”

The agreements follow the signing of a Memorandum of Understanding (MoU) between both companies in November 2021. It is also part of PETRONAS’ deliberate steps to build a sustainable portfolio with innovative solutions to produce energy responsibly, supporting the transition to a lower carbon future through collaborative efforts with industry partners.

We remind, Italian energy group Eni is studying the possibility of developing and operating a biorefinery in Malaysia together with Japan's Euglena and Malaysia's Petroliam Nasional Berhad (Petronas). The plant would be based in the integrated refinery and petrochemical Pengerang Integrated Complex (PIC) in Southeast Asia, they said in a joint statement. An investment decision for the project is expected by 2023 and the plant is targeted to be completed by 2025.

mrchub.com