N. America chemical rail begins December high and firm

N. America chemical rail begins December high and firm

Chemical rail traffic in North America remained high entering the last month of 2023, according to new data from the Association of American Railroads (AAR).

During the week ended Dec. 9, chemical railcar volume in North America totaled 45,470 carloads, down 10.2% from the previous week and up 9.3% year over year. The four-week moving average (4wma) came to 46,556 carloads, down 0.1% sequentially, up 11.7% year over year and up 6.5% from the seasonal trendline, as represented by the average for 2014–22.

In the US, 4wma chemical railcar volume came to 31,129 carloads, up 0.2% sequentially, up 5.7% year over year and down 0.0% from the region's seasonal trendline (right chart). In Canada, 4wma chemical railcar volume came to 14,629 carloads, down 0.6% sequentially, up 30.5% year over year and up 25.6% from the trendline. In Mexico, 4wma chemical railcar volume came to 798 carloads, down 4.9% sequentially, down 21.8% year over year and down 21.8% from the trendline.

For the year to date, chemical railcar volume in North America is up 0.2%, while total railcar volume is up 1.2%. US chemical railcar volume is down 1.2% on the same basis, while Canadian chemical railcar volume is up 30.5% and Mexican chemical railcar volume is up 13.1%.

We remind, The Association of American Railroads (AAR) today reported U.S. rail traffic for the week ending December 2, 2023, as well as volumes for November 2023. U.S. railroads originated 1,128,573 carloads in November 2023, down 0.0 percent, or 102 carloads, from November 2022. U.S. railroads also originated 1,279,906 containers and trailers in November 2023, up 5.0 percent, or 60,486 units, from the same month last year. Combined U.S. carload and intermodal originations in November 2023 were 2,408,479, up 2.6 percent, or 60,384 carloads and intermodal units from November 2022.

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SABIC, Linde sign MoU to cut CO2 emissions for EG tech

SABIC, Linde sign MoU to cut CO2 emissions for EG tech

SABIC, a SABIC affiliate and Linde signed a memorandum of understanding (MoU), under which they would find ways to reduce the carbon emissions for an ethylene glycol (EG) process technology, they said on Wednesday.

Under the MoU, the three will find ways to combine SABIC's carbon recovery and purification technology to the EG process technology of its affiliate, Scientific Design (SD). Linde has experience in capturing and liquefying carbon dioxide (CO2).

SABIC's CO2 technology has the capacity to recover and purify up to 500,000 tonnes/year of the gas. SABIC said the captured carbon could be used to make urea or methanol. It could also be liquefied and used in the food and beverage industry.

SABIC's affiliate, United, operates what it calls the world's largest carbon capture and utilization plant.

"By combining SABIC’s SD gas processing technology with Linde’s expertise in capturing and liquefying CO2, plus our strong track record in designing, executing and operating plants, we hope to find solutions that support a carbon neutral petrochemical industry," said John van der Velden, senior vice president global sales & technology, Linde Engineering,

We remind, PDVSA and U.S. oil major Chevron have requested a 15-year extension for two of their joint ventures from the country's oil ministry. PDVSA and Chevron have expanded operations since late last year under a special U.S. license, allowing Venezuela to resume crude exports to what was its largest market, the United States. But more investment is needed to reach production levels seen before oil sanctions were first imposed in 2019.

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Japanese refineries close as the country's petroleum consumption falls

Japanese refineries close as the country's petroleum consumption falls

Japanese refiner ENEOS permanently closed a 120,000-barrel-per-day (b/d) refinery in western Japan in mid-October 2023, and another company, Idemitsu Kosan, plans to close a 120,000-b/d refinery in March 2024. These closures represent 7% of the country’s refinery capacity, said Hydrocarbonprocessing.

We forecast consumption of petroleum products in Japan will decline by 3% between 2023 and 2024 to 3.3 million b/d. Japan’s petroleum consumption declined by an average 2% per year through 2022 from its peak of 5.7 million b/d in 1996, largely because of demographic and economic changes. The oil intensity of Japan’s economy, measured as barrels of oil consumed per $1,000 of gross domestic product, has been declining.

Japan’s population peaked in 2009, and the country has seen some of the slowest economic growth among OECD countries since then. In addition, the share of Japan’s population aged 65 and older was 30% as of 2022, compared with 21% in the EU, 17% in the United States, and 14% in China, according to the World Bank.

Japan’s refineries were built mainly to serve its domestic fuel needs, and they have trouble competing in international markets. These refineries are smaller and less complex than newer refineries in Asia, including China, South Korea, and India. Complexity refers to a refinery’s secondary processing capacity, such as hydrocracking and coking, which upgrades low-value heavy fuel oil into valuable transportation fuels. More complex refineries can produce more high-value products from the crude oil they process.

Less complex refiners like those in Japan also process lighter and sweeter grades of crude oil, which are more expensive than heavier and more sour grades. Higher yields of lower-value products combined with using more expensive crude oils makes refiners in Japan less profitable and less competitive in world markets. Complex refinery margins in Asia can be 30%–50% higher than simple refinery margins.

In our recent International Energy Outlook, we project Japan’s petroleum consumption will continue to decline beyond 2024, suggesting that refiners in Japan will face additional competitive pressures.

We remind, PDVSA and U.S. oil major Chevron have requested a 15-year extension for two of their joint ventures from the country's oil ministry. PDVSA and Chevron have expanded operations since late last year under a special U.S. license, allowing Venezuela to resume crude exports to what was its largest market, the United States. But more investment is needed to reach production levels seen before oil sanctions were first imposed in 2019.

mrchub.com

PDVSA, Chevron request 15-year extension for two joint ventures

PDVSA, Chevron request 15-year extension for two joint ventures

A unit of Venezuela's state oil company PDVSA and U.S. oil major Chevron have requested a 15-year extension for two of their joint ventures from the country's oil ministry, as per Hydrocarbonprocessing.

PDVSA and Chevron have expanded operations since late last year under a special U.S. license, allowing Venezuela to resume crude exports to what was its largest market, the United States. But more investment is needed to reach production levels seen before oil sanctions were first imposed in 2019.

The largest of the two joint projects, Petroboscan, which is currently producing some 65,000 barrels per day (bpd) of heavy crude, will require $1.28 B for investment and $3.35 B for operational expenses in the 15-year period, Perez added during a conference.

The second project, Petroindependiente, will need $10.7 million for investment and some $205 MM for expenses.
Venezuela's National Assembly, dominated by the government's party after an election that did not have international observation, is expected to discuss the request before giving the go-ahead.

Perez also said Venezuela is producing below its 1.9 million-bpd OPEC quota, so it expects to remain exempted from any OPEC+ output cuts planned.

"Because of the sanctions, our output remains below the quota. We, of course, have a margin and want to continue ramping up (production)," Perez told Reuters on the sidelines of the conference.

Venezuela confirmed the government is working for reviving the idle offshore gas project Plataforma Deltana near to waters reclaimed by Guyana, but Perez did not provide details.

We remind, Chevron expects 2024 capital expenditures (capex) of $15.5bn-16.5bn for its subsidiaries and $3bn for its affiliates. Two-thirds of its planned $14bn upstream spending is allocated to the US, including $6.5bn to develop its US shale and tight portfolio. About 80% of its estimated $1.5bn downstream spending is allocated to the US. Both budgets include about $2bn in lower carbon capex.

mrchub.com

Aramco to acquire a 40% stake in Gas & Oil Pakistan

Aramco to acquire a 40% stake in Gas & Oil Pakistan

Aramco, one of the world’s leading integrated energy and chemicals companies, signed definitive agreements to acquire a 40% equity stake in Gas & Oil Pakistan Ltd, said Hydrocarbonprocessing.

GO, a diversified downstream fuels, lubricants and convenience stores operator, is one of the largest retail and storage companies in Pakistan. The transaction is subject to certain customary conditions, including regulatory approvals.

The planned acquisition is Aramco’s first entry into the Pakistani fuels retail market, advancing the Company’s strategy to strengthen its downstream value chain internationally.

This transaction would enable Aramco to secure additional outlets for its refined products and further provide new market opportunities for Valvoline-branded lubricants, following Aramco’s acquisition of the Valvoline Inc. global products business in February 2023.

Mohammed Y. Al Qahtani, Aramco Downstream President, said: “Our second planned retail acquisition this year aligns with Aramco’s downstream expansion strategy, with a clear path ahead for growing an integrated refining, marketing, lubricants, trading and chemicals portfolio worldwide. GO has a significant storage capacity, high-quality assets and growth potential, which will help launch the Aramco brand in Pakistan.”

We remind, ExxonMobil Catalysts and Licensing LLC has licensed its advanced fluid bed Methanol-to-Gasoline technology to Aramco for a demonstration scale unit to be located in NEOM’s Hydrogen Innovation and Development Center (HIDC).

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