Russia to lift remaining restrictions on diesel fuel exports soon

Russia to lift remaining restrictions on diesel fuel exports soon

MRC -- Russia will soon lift remaining restrictions on diesel fuel exports, Deputy Prime Minister Alexander Novak said on Wednesday speaking in the upper house of the parliament, said Hydrocarbonprocessing.

Russia, the world's top seaborne exporter of diesel, introduced a ban on fuel exports on Sept. 21 to tackle high domestic prices and shortages. Only four ex-Soviet states - Belarus, Kazakhstan, Armenia and Kyrgyzstan - were exempt.

The government later eased restrictions to allow the export of diesel by pipeline. Last Friday it lifted restrictions on gasoline exports unconditionally. Overseas supplies of diesel by truck and railway are still prohibited.

We remind, Russia has lifted restrictions on gasoline exports, the energy ministry said on Friday, after scrapping most restrictions on exports of diesel last month, saying there was a surplus of supply while wholesale prices had declined. It said it could reimpose export bans if necessary, adding that stocks of gasoline had risen to around 2 million metric tons.

mrchub.com

Europe's Petrochemical Industry Is Heading for Death Row

Europe's Petrochemical Industry Is Heading for Death Row

MRC -- The last time European petrochemical plants processed so little of their favorite feedstock, Sweden’s ABBA was the most popular band on the continent, and the Fall of Saigon had marked the end of the Vietnam War, said Bloomberg.

It was 1975, and the region was still licking its wounds after the first oil crisis. Nearly half a century later, the industry is dying. It would be a mistake to interpret this as a triumph in the fight against plastics. Europe keeps consuming voracious amounts of foams, paints, resins and every other product petrochemical factories make. It’s just replacing indigenous production with imported stuff.

Petrochemicals are intrinsically energy intensive. In Europe, natural gas is about five times more expensive than in the US. Right now, it’s cheaper to buy ethylene, a building block for plastics, in Texas, and ship it across the Atlantic for further processing in Europe than producing it at home. And that’s precisely what petrochemical companies tell me they’re doing. The net result is loss of economic activity in Europe, an erosion of the bloc’s trade balance in chemical products and, ultimately, the loss of jobs and energy security.

First, some context. On average, a European person consumes around 150 kilograms of plastic a year, more than twice the global average of 60 kilograms, according to the European Environment Agency. Plastics are everywhere – from food packaging to construction materials, from mobile phones to clothes.

Next, the data. The petrochemical industry runs largely on two feedstocks: natural gas and naphtha, with the latter being a byproduct of refining oil, similar in some ways to gasoline. According to the International Energy Agency, European naphtha consumption will drop this year to a 48-year low of 34.2 million metric tons. Usage is down 18.5% from pre-Covid-19 levels, and almost 40% below the all-time high set two decades ago.

With processing so low, the industry’s workhorses, called steam crackers, where the naphtha and the gas is transformed into chemical building blocks, are operating at uneconomical rates. Because of their enormous fixed costs, companies typically run their steam crackers as close to capacity as they can throughout the year. Anything below 90% is a source of concern; 85% is bad, and 80% is seen as catastrophic. In recent quarters, however, they have run at loss-making rates of between 65% and 75% of their capacity.

In private, industry executives say they can only lose money for so long — so closures look certain in 2024. Using a more diplomatic language, the IEA said last week that “it is increasingly difficult to see how the continent’s petrochemical industry can recover its previous strength.” I have spent the last few weeks talking to industry executives, and the answer they give is “it won’t — period.”

Across European chemical companies, the proportion of spending in new projects into Asia has jumped by about 50% during the past decade and a half, according to estimates by Jefferies Financial Group Inc., an investment bank.

How does that translate to the economy? Before the pandemic, Europe’s chemical trade balance with the rest of the world was typically in the black to the tune of $40 billion. Last year, the surplus narrowed to just $2.5 billion. Although it’s likely to recover somewhat in 2023, the outlook for 2024 is somber.

We remind, Russia has lifted restrictions on gasoline exports, the energy ministry said on Friday, after scrapping most restrictions on exports of diesel last month, saying there was a surplus of supply while wholesale prices had declined. It said it could reimpose export bans if necessary, adding that stocks of gasoline had risen to around 2 million metric tons.

mrchub.com

Japanese companies and Petronas to develop CCS project offshore Malaysia

Japanese companies and Petronas to develop CCS project offshore Malaysia

MRC -- Japanese companies have agreed to develop a carbon capture and storage (CCS) project with Malaysian energy firm Petronas which should start holding its first carbon dioxide (CO2) emissions from end-2028, Japan Petroleum Exploration Co said on Monday, as per Hydrocarbonprocessing.

Japan plans to be carbon-neutral by 2050 and is actively developing renewable and alternative energy sources from hydrogen and ammonia to solar and wind power, with CCS technology also playing an important role in its strategy.

Japan Petroleum Exploration Co (JAPEX) is developing the CCS project with JGC Holdings Corp and Kawasaki Kisen Kaisha, or K Line, as well as state-controlled Petronas. The companies plan to start the front-end engineering design next year with a goal to inject and store CO2 from Japan and Malaysia in depleted oil and gas fields off the Malaysian coast, the statement said.

JAPEX did not provide a cost estimate but said that at least 2 million metric tons of CO2 per year is planned to be injected at the start, rising to 5 million tons annually by the end of this decade and to over 10 million tones in early 2030s.

Early this year, Japan set a target of annual CO2 storage capacity of 6-12 million tonnes by 2030 under a long-term roadmap for CCS which removes CO2 emissions from the atmosphere and stores them underground.

We remind, Russia has lifted restrictions on gasoline exports, the energy ministry said on Friday, after scrapping most restrictions on exports of diesel last month, saying there was a surplus of supply while wholesale prices had declined. It said it could reimpose export bans if necessary, adding that stocks of gasoline had risen to around 2 million metric tons.

mrchub.com

Petrobras partners with European Energy to explore e-methanol business prospects

Petrobras partners with European Energy to explore e-methanol business prospects

MRC -- Petrobras agreed a Memorandum of Understanding with the Danish company, European Energy, to investigate the business opportunities for developing an e-methanol plant in Brazil, on a non-binding basis, said Hydrocarbonprocessing.

The agreement was signed in Denmark, at European Energy’s headquarters. They have vertically integrated operations involving the energy transition, including generating renewables and providing green hydrogen-based solutions.

E-methanol is a low-carbon substance that can be used in various industrial processes and as a fuel, especially for maritime transport. It is produced from various renewable sources of green hydrogen, such as solar and wind power, and biogenic carbon dioxide.

“Petrobras wants to focus on having good partners like European Energy. Established, reliable companies who are solid enough to work with us on large-scale projects. This partnership will benefit both sides. We can provide our knowledge and help to bring both the companies and our countries closer together”, commented Jean Paul Prates, the president of Petrobras.

The Memorandum of Understanding fits with the strategic elements of the 2024-28 Strategic Plan, which is designed to ensure Petrobras is ready for a more sustainable future, and is contributing to the success of the energy transition.

We remind, Petrobras remains eager to repurchase a refinery from Abu Dhabi state investor Mubadala despite antitrust barriers, and a new biofuels partnership could open the door to future talks. Petrobras on Monday announced a memorandum of understanding with Mubadala for potential investment in a biofuel refinery under development in Bahia state by Mubadala-owned Acelen.

mrchub.com

Clariant’s catalyst chosen for Shenghong’s new world-scale biodegradable plastics project

Clariant’s catalyst chosen for Shenghong’s new world-scale biodegradable plastics project

MRC -- Clariant, a sustainability-focused specialty chemical company, today announced that it has been awarded a major contract by Jiangsu Shenghong Petrochemical Co., Ltd, to use Clariant’s SynDane 3142 LA catalyst for its new maleic anhydride (MA) production plant in Lianyungang, Jiangsu province, China, said Hydrocarbonprocessing.

With a production capacity of 200,000 tons per year, the new plant slated for start of production in 2025, will be one of the largest production plants for MA worldwide.

The plant in Lianyungang will produce maleic anhydride as an intermediate product for polybutylene adipate terephthalate (PBAT), which in turn will function as a base product for biodegradable plastic. Using the SynDane catalyst, Shenghong Petrochemical will be able to improve production efficiency and reduce power consumption, leading to annual energy savings of up to 24 million CNY.

Xaver Karsunke, Head of Clariant Specialty Catalysts, commented: “Sustainability is at the heart of our company strategy to drive change by partnering with our customers to develop sustainable, efficient solutions. We are excited to support Shenghong in this ambitious and important project to address the plastic waste problem and maximize their energy savings during MA production with our innovative SynDane catalyst.”

We remind, Clariant posted a 28% decrease on earnings before interest, tax, depreciation and amortisation (EBITDA) in the third quarter amid lower prices and volumes. Clariant expects to see an easing inflationary environment, but no economic recovery in the final three months of 2023, with macroeconomic uncertainties and risks remaining. Despite that, Clariant confirms its sales guidance for the full year 2023 of Swfr4.55bn–4.65bn, it said.

mrchub.com