North American chemical railcar traffic rose for a second week

MOSCOW (MRC) -- North American chemical railcar traffic rose for a second week, with loadings for the week ended 29 July up 3.1% year on year to 48,009, according to the freight rail data of Association of American Railroads.

For the first 30 weeks of 2023 ended 29 July, North American chemical rail traffic was down 2.6% year on year to 1,355,556 - with the US down 3.8% to 934,382 loadings.

In the US, chemical railcar loadings represent about 20% of chemical transportation by tonnage, with trucks, barges and pipelines carrying the rest. In Canada, chemical producers rely on rail to ship more than 70% of their products, with some exclusively using rail.

We remind, North American chemical railcar traffic rose for the first time in 10 weeks, with loadings for the week ended 22 July up 1.3% year on year to 45,218, according to the freight rail data of Association of American Railroads. In Canada, rail traffic continued to be affected by a strike from 1-13 July at the Vancouver and other west coast ports, as well as by ongoing wildfires in parts of the country.

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MOSCOW (MRC) -- Shandong Haike Chemical Co. Ltd, a Chinese refining and petrochemical company, has selected Axens’ Vegan technology to produce low carbon, cost competitive sustainable aviation fuel (SAF) by retrofitting its existing assets, said Hydrocarbonprocessing.

Vegan technology is a second-generation hydrotreated vegetable oil (HVO) solution which processes up to 100% of any kind of lipid, including wastes from agriculture and food industry to produce renewable fuels that are able to reduce greenhouse gas emissions by up to 80% compared with a conventional jet fuel production scheme.

This new contract with Haike Chemicals is Axens’ first reference for its Vegan technology in Asia and represents a major opportunity to scale up production of SAF in line with recognized international standards (ASTM D7566) and able to meet growing demand from the European and North American markets. According to ATAG1, the aviation sector will need around 450-500 million tons of SAF per year by 2050 to meet future demand and deliver its decarbonization targets. The challenge is to ramp up production rapidly to deliver economies of scale and make SAF production competitive.

Haike Chemicals aims to have their first SAF-only unit on stream with high yield on-spec production within 12 months before rolling out the process to other units to become a competitive world-leading supplier of high-quality SAF.

Flexibility is the key advantage of Axens’ Vegan technology in terms of feedstock, product and implementation. Based on a two-step process, it can process a wide range of feedstocks such as vegetable oils, animal fats, tall oil and used cooking oil to produce SAF or renewable diesel according to market demand. Vegan® technology can be applied in both standalone and integrated refinery environments. In this way, the retrofit of existing hydrotreatment assets into Vegan units represents a fast-track approach to advance a biorefinery project.

We remind, Axens has signed an agreement with KazMunayGas (KMG) to supply the process design package for its proprietary AlphaButol technology for producing high-purity 1-butene, which is required for producing PE. KMG has plans for a 1.2 million t/y PE plant in Atyrau, Kazakhstan. French technology and engineering group Axens has signed an agreement with KazMunayGas (KMG) to supply the process design package for its proprietary AlphaButol technology that produces high-purity 1-butene, which is required for producing PE. KMG plans to build a 1.2 million t/y PE plant in the Atyrau region of Kazakhstan – a timescale for the project has not been disclosed.

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MOSCOW (MRC) -- Britain committed to granting hundreds of licenses for North Sea oil and gas extraction as part of efforts to become more energy independent, drawing criticism from environmental campaigners, said Hydrocarbonprocessing.

Prime Minister Rishi Sunak confirmed plans for more than 100 such licenses, which attracted bids earlier this year and said hundreds of future licenses could also be granted. He also announced fresh support for two carbon capture and storage (CCS) clusters in Scotland and northern England.

Britain has a target to reach net-zero emissions by 2050, but Prime Minister Rishi Sunak said even by this date the country is expected to get more than a quarter of its energy from oil and gas. He said new domestic fossil fuels would help to improve energy security and reduce reliance on states such as Russia.

"We have all witnessed how (Russia's President) Putin has manipulated and weaponized energy... Now more than ever, it’s vital that we bolster our energy security," he said in a statement. British efforts to reach the net-zero target have become a sharp dividing line between the governing Conservatives and the opposition Labour Party ahead of an election expected next year, with Sunak saying it should be met in a "pragmatic" way that does not add to household bills.

The government argues that stemming the decline in domestic supply would reduce the carbon footprint when compared with an alternative option of importing liquefied natural gas, however it is facing legal challenges from climate activists and green groups who warn increasing fossil output is at odds with the goal.

Sunak said the new licenses were compliant with the government's environmental targets. The North Sea Transition Authority (NSTA) regulator expects the first of the new licenses to be awarded in the autumn. It is still evaluating 115 bids from producers for fields in the ongoing licensing round which closed in January.

Sunak, who will visit an energy infrastructure site in Scotland on Monday, said the new CCS clusters would also help support thousands of jobs. The plans were welcomed by energy companies, including Shell and Harbour Energy, who are among the partners in the Acorn CCS project which will gain so-called Track 2 status and can now enter into commercial negotiations with the government.

Harbour's Viking CCS project to store CO2 in the depleted gas fields has also been awarded Track 2 status. Britain aims to use CCS technology, which involves capturing planet-warming carbon from industrial smokestacks before it hits the atmosphere and storing it underground, to hold 20 million to 30 million tons CO2 by 2030.

There currently is no large-scale or commercial CCS project operating in Britain, and the government has faced criticism for slow progress on its deployment.

We remind, Russia's seaborne diesel and gasoil exports in July rose by 5% from a month earlier to about 3.8 million metric tons as seasonal refineries maintenance slowed down, data from traders and Refinitiv Eikon showed. Idle primary oil refining capacity for July was estimated at 2.458 million metric tons, down from June by some 37%, Refinitiv data and Reuters calculations showed. Since the full EU embargo on Russian oil products took effect on Feb. 5, Turkey remains the main destination for Russian diesel and gasoil seaborne exports, reaching about 1.3 million metric tons in July, or about one third of total month supplies.

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MOSCOW (MRC) -- A large fire broke out in an industrial zone in Iran's southwestern city of Doroud, state media reported on Wednesday, as per Reuters.

"A fire occurred in the tanks of the Gohar petro-refinery Industrial Zone in Doroud, injuring two people who were hospitalized," an official from Lorestan provincial authority said.

Sixteen fire trucks were dispatched to tackle the blaze, whose cause was unknown.

We remind, a fire broke out at Dow's Plaquemine chemical facility in Louisiana. Everyone at the facility was accounted for and the fire was being managed by the company's Emergency Operations Center, Dow Louisiana said in a statement posted on Facebook, adding that they were in contact with officials.

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MOSCOW (MRC) -- Phillips 66 reported a substantial 46% drop in its second-quarter profits, reflecting the challenges faced by U.S. refiners due to declining margins, said the company.

This decline comes after last year’s record-high margins, which were boosted by a surge in fuel demand and supply constraints caused by the pandemic-driven refinery closures and the global oil market disruptions resulting from Russia’s invasion of Ukraine. The company’s premarket trade showed its shares falling 1.2% to USD110.80.

During the second quarter, Phillips 66‘s realized margins plummeted to USD15.32 per barrel, a significant decrease from the USD28.62 per barrel reported in the same period last year. Despite the decline in margins, fuel demand has proven to be resilient. The April-June quarter typically witnesses robust demand, as companies ramp up gasoline and jet fuel production to cater to the summer vacation season.

In the second quarter, Phillips 66’s crude utilization rate was recorded at 93%, slightly higher than the 90% rate from the previous year. Additionally, the total processed input remained unchanged year-over-year at 1.9 million barrels per day (bpd).

On an adjusted basis, the Houston-based refiner reported earnings of USD3.87 per share for the three months ended June 30, surpassing the average analysts’ estimate of USD3.56, as per Refinitiv data.

Similar to Phillips 66, rivals Valero Energy Corp and Marathon Petroleum also reported considerable declines in quarterly profits due to pressure on margins. However, both companies managed to outperform market expectations. Overall, Phillips 66’s (NYSE:PSX) net income for the second quarter stood at USD1.7 billion, or USD3.72 per share, down from USD3.2 billion, or USD6.53 per share, during the same period last year.

We remind, Phillips 66 beat Wall Street's estimate for first-quarter profit due to elevated margins on sustained fuel demand amid tight crude supplies. The company's shares rose 1.3% to USD95.98 in morning trade. Profits from turning crude oil into gasoline, diesel and jet fuel surged as supplies remained tight due to pandemic-era closure of facilities and a recovery in demand.

Phillips 66 manufactures, transports and markets products that drive the global economy. The diversified energy company’s portfolio includes Midstream, Chemicals, Refining, and Marketing and Specialties businesses. Headquartered in Houston, Phillips 66 has employees around the globe who are committed to safely and reliably providing energy and improving lives while pursuing a lower-carbon future.

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