Details of Canada's planned regulations to limit oil and gas emissions

Details of Canada's planned regulations to limit oil and gas emissions

MRC -- Canada unveiled planned regulations to limit emissions from the oil and gas sector using a cap-and-trade system, fulfilling a promise by Prime Minister Justin Trudeau's government to cut emissions in its most polluting sector, said Hydrocarbonprocessing.

Here are details on the proposed regulations: Cap-and-trade is a market-based system where the regulator limits emissions and issues emissions allowances that producers can use if they exceed the cap. The government proposes to cap 2030 emissions at 35% to 38% below 2019 levels, or at 106 to 112 megatons compared with 171 megatons in 2019, while providing compliance flexibilities - or allowances - to emit up to a level about 20% of 23% below 2019 levels, or up to 131 to 137 megatons.

In 2021, the oil and gas sector was the largest source of greenhouse gas (GHG) emissions, accounting for 28% of total national emissions with 189 megatons of carbon dioxide equivalent (Mt CO2 eq) emitted, according to official data. In 2021, the sector's GHG emissions were 3% higher than in 2020. Over the period from 1990 to 2021, the sector's GHG emissions increased by 88%.

Each emission allowance would be equivalent to one ton of carbon dioxide equivalent (CO2e). Emission allowances issued under the cap-and-trade regulations would not be fungible with other carbon pricing systems or regulatory instruments. Allowances will initially be free.

We remind, Maersk is about to launch the first of its 18 large methanol-enabled vessels currently on order. On 9 February 2024, it will enter service on the AE7 string connecting Asia and Europe, which includes port calls in Shanghai, Tanjung Pelepas, Colombo and Hamburg (see all port calls in the fact box below), with Ningbo, China, being its first destination.

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India’s Russian oil imports seen rising on lower prices

India’s Russian oil imports seen rising on lower prices

MRC -- Easing global oil prices would help India boost imports from Russia, a senior government official said on Friday, as a lower than USD60 a barrel price of Russian oil will enable buyers to use Western services such as insurance and ships, said Hydrocarbonprocessing.

The Group of Seven large economies known as G7 and some other nations have imposed a ceiling of $60 per barrel for oil at Russian ports to cut Moscow's revenue seen as funding its war in Ukraine.

Russia's flagship grade Ural in Baltic ports has plunged since late November below that level, reflecting subdued global oil prices that are headed for a seventh straight weekly decline. India, the world's third biggest oil importer and consumer, emerged as the biggest buyer of Russian seaborne oil, shunned by the West over Moscow's invasion of Ukraine last year.

The United States last month imposed sanctions on maritime companies and vessels for shipping Russian oil sold above the G7's $60 price cap, in an attempt to close loopholes in the mechanism designed to punish Moscow for invading Ukraine.

The three sanctioned vessels - Kazan, Ligovsky Prospect and NS Century - regularly supplied oil to India. The Indian official, who spoke on condition of anonymity, said there would not be any impact on India's intake of Russian oil due to Western sanctions on ships as enough vessels were available in the market.

He also said India buys Russian oil on delivered basis and refused to comment on the likely destination of NS Century. NS Century was on its way to India when the sanctions were imposed. The vessel has since then floated near Colombo.

We remind, ABS issued an approval in principle to Lemissoler Navigation for its design of a 65K DWT methanol-fueled Ultramax bulk carrier, the first such methanol vessel for China’s shipbuilding industry.

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Nigeria's Dangote refinery receives first crude cargo

Nigeria's Dangote refinery receives first crude cargo

MRC -- The Dangote oil refinery in Nigeria received its first cargo of 1 million barrels of crude oil from Shell International Trading and Shipping Co, bringing the start of operations closer after years of delays, said Hydrocarbonprocessing.

Once fully running, the 650,000 barrel-per-day refinery funded by Africa's richest man Aliko Dangote will turn oil powerhouse Nigeria into a net exporter of fuels, a long-sought goal for the OPEC member that almost totally relies on imports.

Dangote Group said in a statement seen by Reuters on Friday that the cargo of 1 million barrels of crude from Agbami - a deep water field run by Chevron - was the first of 6 million barrels that would enable an initial run of the refinery.

That will kick-start output of diesel, aviation fuel and Liquefied Petroleum Gas, before the refinery later starts producing Premium Motor Spirit. A Dangote Group spokesperson said the STASCO cargo arrived on a chartered vessel and was discharged into the refinery's crude oil tanks.

The next four cargoes will be supplied by state oil firm NNPC in two to three weeks and a final cargo will come from ExxonMobil, Dangote Group's statement said. Nigeria's state oil firm NNPC Ltd signed an agreement in November to supply the Dangote refinery with up to six cargoes of crude starting this month. NNPC has a 20% stake in the refinery.

Despite being Africa's biggest oil producer, Nigeria experiences repeated fuel shortages. It spent $23.3 billion last year on petroleum product imports and consumes around 33 million liters of petrol a day. "Our focus over the coming months is to ramp up the refinery to its full capacity," Dangote was quoted as saying in the statement.

Nigeria commissioned the refinery in May, after it ran years behind schedule. At a cost of $19 billion, the massive petrochemical complex is one of Nigeria's single largest investments.

We remind, Maersk is about to launch the first of its 18 large methanol-enabled vessels currently on order. On 9 February 2024, it will enter service on the AE7 string connecting Asia and Europe, which includes port calls in Shanghai, Tanjung Pelepas, Colombo and Hamburg (see all port calls in the fact box below), with Ningbo, China, being its first destination.

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Indonesia's Pertamina starts carbon injection tests in Sukowati oil and gas field

Indonesia's Pertamina starts carbon injection tests in Sukowati oil and gas field

MRC -- Indonesia state energy firm Pertamina has started an underground carbon injection trial in Sukowati field, the second site the company is testing for carbon capture, utilization and storage (CCUS), said Hydrocarbonprocessing.

The "huff and puff" tests started on Thursday with the injection of as much as 500 tons of CO2 into the Sukowati-18 well in Sukowati field in East Java province, the company said in a statement late on Thursday.

"The CO2 enhanced oil recovery hopefully can boost output in Sukowati," said Pertamina Hulu Energi development and production director, Awang Lazuardi. The field produced around 5,000 barrels of oil per day (bpd) before the trial. Huff and puff is an enhanced oil recovery technique that can raise oil output by increasing the pressure of a reservoir.

Pertamina worked with Japan Oil, Gas and Metals National Corporation (JOGMEC) and Japan Petroleum Exploration Company Limited (JAPEX) to carry out the CCUS tests in Sukowati field. Pertamina aims to cut its greenhouse gas emissions by 30% by 2030 and has been exploring CCUS technology with several partners including Exxon Mobil and Chevron to offset emissions and boosts its oil and gas production.

Aside from the trials in Sukowati and Jatibarang field, Pertamina is looking to develop carbon capture and storage (CCS) or CCUS in six other locations in Indonesia. The energy ministry is drafting a regulation on CCS and CCUS implementation to encourage oil and gas operators to install carbon capture facilities at their operations by making them commercially viable.

We remind, Pertamina expects to complete the capacity upgrade at its Balikpapan refinery in April next year, Nicke Widyawati, chief executive of Pertamina, the parent company of PHE. Pertamina is expanding Balikpapan's capacity to 360,000 barrels of oil per day (bpd) from 260,000 bpd currently. The refinery would also be able to produce fuel to Euro V emission standards.

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Pemex eyeing later refinery start-up date, months after initial announcement

Pemex eyeing later refinery start-up date, months after initial announcement

MRC -- Mexican state-owned oil company Petroleos Mexicanos is working to nail down the start-up date at its newest refinery, months after the government said it had begun early output to ramp up to full capacity by December, said Hydrocarbonprocessing.

The Dos Bocas refinery, in the Gulf state of Tabasco, was set to be fully operational and close to producing commercial-grade diesel and gasoline this month, former Energy Minister Rocio Nahle said in September.

The refinery, which is to process 340,000 barrels per day (bpd) at full capacity, has said it had received its first load of crude and begun refining it.

Mexican President Andres Manuel Lopez Obrador had also said the refinery, with a price tag which has more than doubled the initial estimate of $8 billion, would be producing tens of thousands of barrels a day by the end of the year.

Both deadlines were met with skepticism from analysts and the top Pemex executives who spoke on the condition of anonymity, noting that a series of pipeline connections and tests are needed at the refining before it can ramp up production. Pemex said late Wednesday the refinery was still being inspected.

Pemex CEO Octavio Romero visited the site "with the objective of reviewing how the facilities will operate and planning start-up dates for the project," the oil firm said on its X social media account. Pemex did immediately not respond to a request for comment.

Romero was still in Tabaso on Thursday, a source told Reuters. He met with Lopez Obrador earlier this week at the refinery. Neither the government nor Pemex have given further insight into the refinery's status. Mexico has for years struggled with its expensive, obsolete refining system, and the president has heavily propped up the indebted oil company during his administration.

With its six active domestic refineries, Pemex is processing less than half of its combined capacity of 1.6 million bpd. Lopez Obrador had promised to achieve fuel self-sufficiency by 2024, when his term ends. In addition to Dos Bocas, Pemex purchased a refinery in Texas and is building two coker plants, though Pemex continues to import massive quantities of gasoline and diesel.

We remind, Maersk is about to launch the first of its 18 large methanol-enabled vessels currently on order. On 9 February 2024, it will enter service on the AE7 string connecting Asia and Europe, which includes port calls in Shanghai, Tanjung Pelepas, Colombo and Hamburg (see all port calls in the fact box below), with Ningbo, China, being its first destination.

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