China's diesel exports surge in August, have nearly tripled so far in 2023

MOSCOW (MRC) - China's diesel exports in August surged from a year earlier and have nearly tripled so far in 2023 compared to the same time a year ago, data showed on Monday, as refiners take advantage of strong regional refining margins to ship fuel overseas, said Hydrocarbonprocessing.

Exports of diesel, the biggest fuel by share of refinery output, last month totaled 1.26 million metric tons, up 51.5% from last year's 830,000 tons, data from the General Administration of Customs showed. Total diesel exports for the first eight months of the year are up 197.2% versus the same period in 2022.

Domestic diesel demand has seen only muted growth amid deepening tumult in the property sector and contracting exports, pushing refiners to shift their output overseas. Gasoline exports were up 23.7% to 1.38 million tons from 1.12 million tons in August last year.

Domestic demand for gasoline was anticipated to be high through August because of a pick-up in road traffic over the summer travel period, the first since 2019 not to be disrupted by COVID-19 containment measures.

Jet fuel exports were 1.55 million tons, up 98.1% from 780,000 tons a year earlier. Domestic flight capacity by available seats was up by about 17% from pre-pandemic levels in August 2019, while capacity on international flights in and out of China remained at around 49% of pre-pandemic levels, according to data from aviation analytics firm OAG.

Sales of jet fuel for outbound international flights are included in this export figure. China's surging fuel exports have coincided with monthly refinery throughput rising to a record 15.23 million bpd in August.

Total fuel exports, including marine bunker fuel, in August were up 23.3% from last year at 5.89 million tons, customs data showed earlier this month.

We remind, Russia's Sakhalin Energy, which produces liquefied natural gas and oil, has fully resumed production following maintenance. The company has said it planned maintenance in July without providing a timeframe. Sakhalin Energy's Sakhalin-2 operating company was transformed into a Russian entity via a presidential decree amid Western sanctions against Moscow over its actions in Ukraine.

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MOSCOW (MRC) -- Topsoe, a global leader in developing solutions for a decarbonized world, has been selected by PT KPI as a technology licensor to provide its HydroFlex technology for the production of renewable fuels at the Cilacap Refinery Complex in Central Java, Indonesia, said Hydrocarbonprocessing.

Once complete, the grassroot unit will use Topsoe’s technology to convert bio-feedstock into SAF and renewable diesel, with plans to produce 6,000 bpsd.

This milestone marks Topsoe’s 50th HydroFlex reference globally. Alok Verma, Managing Director, Asia Pacific, Topsoe, said: “We are pleased to continue our close collaboration with Pertamina marking our 5th technology reference with the Group. This award at the Cilacap refinery is a key milestone for the supply of renewable fuels to the Asia market. It’s a tremendous pleasure working with Pertamina on these very successful projects taking the region towards carbon neutrality.”

We remind, Russia's Sakhalin Energy, which produces liquefied natural gas and oil, has fully resumed production following maintenance. The company has said it planned maintenance in July without providing a timeframe. Sakhalin Energy's Sakhalin-2 operating company was transformed into a Russian entity via a presidential decree amid Western sanctions against Moscow over its actions in Ukraine.

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MOSCOW (MRC) -- Russia's United Oil- and Gas-Chemical Co. and China's Xuan Yuan Industrial Development have agreed to jointly invest USD686 MM in construction of a transshipment oil complex in Russia's far east, said Hydrocarbonprocessing.

The complex will facilitate Russia's oil exports to China as Moscow expands its infrastructure to diversify exports of commodities eastward and away from Europe, which it now deems politically "unfriendly".

The deal to finance the project was signed last week in the far-eastern Russian city of Vladivostok at an economic forum organized by Roscongress. It said the funds will be raised at Russian and Chinese financial institutions.

The transborder complex will be set up in Russia's Jewish Autonomous Region near a railway bridge across the Amur River linking the Russian town of Nizhneleninskoye to China's Tongjiang. Roscongress said there will be five large infrastructure units, including a terminal with a capacity to store, blend and load up to 5.8 million metric tons per year of crude oil and oil and gas condensate mixtures.

The plans also foresee construction of a depot with vertical and horizontal tanks for receiving, storing and dispensing up to 1 million tons a year of petroleum products and fuel oil. There will also be a gas-filling complex for transshipment of liquefied petroleum gas, which would be able to handle up to 650,000 tons of product annually.

We remind, Russia's Sakhalin Energy, which produces liquefied natural gas and oil, has fully resumed production following maintenance. The company has said it planned maintenance in July without providing a timeframe. Sakhalin Energy's Sakhalin-2 operating company was transformed into a Russian entity via a presidential decree amid Western sanctions against Moscow over its actions in Ukraine.

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MOSCOW (MRC) -- PETRONAS Lubricants International (PLI) has signed a jount study agreement (JSA) with PT Kilang Pertamina Internasional (PT KPI) to explore the possibility of a developing a new greenfield lube base oil plant in Refinery Unit IV Cilacap, Central Java, said the company.

In a statement, PETRONAS said the two companies will carry out a technical and detailed feasibility study, which is expected to cater to the demand of the Indonesian market as well as growing regional markets including China and Southeast Asia.

The investment decision is expected to be concluded by 2025. "This JSA is part of our larger strategic efforts to complement and grow our existing portfolio of high-grade lube base oils.

"Through this collaboration, we will be leveraging each other’s strengths, capabilities and existing network distributions, reaching out to our customers better and faster,” said PETRONAS Lubricants International managing director and group CEO Hezlinn Idris.

According to the statement, the refinery is capable of processing raw materials from existing RU IV Cilacap, producing up to 800 tonnes a day of high-grade lube base oils as well as other supplementary products such as diesel fuel, naphtha and LPG.

We remind, Petronas sees its domestic oil and gas production peaking at about 2 million barrels of oil equivalent per day (boepd) by 2024. About 60-70% of its production is natural gas and will remain so going forward.

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MOSCOW (MRC) -- BASF, a globally leading battery materials producer, and Nanotech Energy, a worldwide leader in the field of graphene-based energy storage products, have agreed to partner to significantly reduce the CO2 footprint of Nanotech’s lithium-ion batteries for the North American market, said the company.

The agreement aims to close the loop for lithium-ion batteries in North America, with BASF producing cathode active materials from recycled metals in Battle Creek, Michigan, for the usage in lithium-ion battery cells produced by Nanotech Energy. Feeding recycled metals into the production of new lithium-ion batteries can reduce the CO2 impact of batteries by about 25 percent compared to the use of primary metals from mines.

Both companies will additionally partner with American Battery Technology Company (ABTC), a lithium-ion battery recycling company in Reno, Nevada, and TODA Advanced Materials Inc. (TODA) with decades of experience in manufacturing specialized pCAM (precursor for Cathode Active Material) and metal hydroxide material located in Ontario, Canada, to establish such a localized battery value chain for the North American consumer electronics and automotive industries. Along that chain, battery scrap and off-spec material from Nanotech’s pilot operation in Chico, California, as well as from its planned commercial facility will be recycled by ABTC. The battery-grade metals as recovered by ABTC – such as nickel, cobalt, manganese, and lithium – will be subsequently used by TODA and BASF to produce new precursors and cathode active materials, respectively. Nanotech will then use these materials again in its battery cell production – overall, a truly circular economy in North America.

BASF recently announced battery recycling capacity in Europe and is already providing recycling services and cathode active material based on recycled metals as a closed-loop solution in Asia for years.

We remind, BASF signed a 25-year power purchase agreement (PPA) with State Power Investment Corporation (SPIC) to purchase renewable electricity for its Zhanjiang Verbund site, which is under construction in Guangdong province, China. The PPA is a further step in the renewable energy partnership between BASF and SPIC following the framework agreement signed in March 2022.

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