Lyondell Houston refinery to run at 95pc in 2Q
LyondellBasell plans to run its 264,000 b/d Houston, Texas, refinery at average utilization rates of 95pc in the second quarter and may convert its hydrotreaters to petrochemical production when the plant shuts down in early 2025.
The company's sole crude refinery ran at an average 79pc utilization rate in the first quarter due to planned maintenance on a coking unit, the company said in earnings released today.
"We are evaluating options for the potential reuse of the hydrotreaters at our Houston refinery to purify recycled and renewable cracker feedstocks," chief executive Peter Vanacker said on a conference call today discussing earnings.
Lyondell said last year a conversion would feed the company's two 930,000 metric tonnes (t)/yr steam crackers at its Channelview petrochemicals complex. The company today said it plans to make a final investment decision on the conversion in 2025.
Hydrotreater conversions — such as one Chevron completed last year at its 269,000 b/d El Segundo, California, refinery — allow the unit to produce renewable diesel, which creates renewable naphtha as a byproduct.
Renewable naphtha can be used as a gasoline blending component, steam cracker feed or feed for hydrogen producing units, according to engineering firm Topsoe.
Lyondell last year said the Houston refinery will continue to run until early 2025, delaying a previously announced plan to stop crude processing by the end of 2023.
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Rains persist in Brazil's Rio Grande do Sul
Rains persist in Brazil's Rio Grande do Sul
Sao Paulo, 13 May (Argus) — Downpours that began flooding Brazil's heavily agricultural Rio Grande do Sul in late April persisted over the weekend, continuing to wreak havoc in the state. Rains reached an accumulated 123mm (4.8 inches) on 10-12 May in state capital Porto Alegre, according to Brazil's national meteorological institute Inmet. Some areas experienced around 80mm of rain on 12 May alone, according to US National Oceanic and Atmospheric Administration. Showers in Porto Alegre have reached an accumulated 502mm in May already, according to Brazilian meteorological firm Climatempo. The monthly average is of 111mm. River and lake levels also kept rising. The Guaiba lake, in the state's capital, reached 4.9m (16ft) on Monday morning — up from 4.8m on 10 May, according to the state government. It is considered in a flood stage once it reaches 3m. Most rivers in the state, such as the Gravatai, Taquari and Uruguai, are also above flood levels. A bridge over the Cai River, which links Nova Petropolis and Caxias do Sul cities, broke partially on Sunday. As a result, a stretch of the BR-116 highway is closed, according to the national department of transport infrastructure. The river's levels are 6m above normal. Brazil's national center for natural disaster monitoring and alerts still considers the risk of "new hydrological occurrences" to be "very high" in Rio Grande do Sul and neighboring Santa Catarina state. The extreme weather has left 147 dead and 127 missing, according to the civil defense. Over 538,000 people are displaced. By Lucas Parolin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
FTC flexes muscles over US oil mergers
FTC flexes muscles over US oil mergers
New York, 13 May (Argus) — US antitrust regulator the Federal Trade Commission's insistence that the former chief executive of independent Pioneer Natural Resources, Scott Sheffield, be barred from ExxonMobil's board as a condition of approving their $64.5bn merger serves as a cautionary tale for other pending deals. The FTC alleged that Sheffield, a long-time industry leader who made Pioneer one of the biggest producers in the Permian, sought to collude with Opec. It cited hundreds of text messages in which he discussed pricing and output with officials from the oil cartel, as well as efforts to co-ordinate with other Texas producers. The fallout for other transactions still going through the approvals process may be limited, given the specific nature of the allegations against Sheffield, but the FTC's action shows the agency will not hesitate to demand concessions in order to wave deals through. Given heightened political sensitivities to fuel prices in an election year, that should put the industry on notice. At the very least, future reviews are likely to include requests to turn over any records — electronic or otherwise — that involve discussions with competitors or other oil-producing jurisdictions, according to former FTC chairman Bill Kovacic. "It's a reminder that conversations with your competitors about production levels and pricing levels are exceedingly unwise," Kovacic says. It was significant that the FTC did not tamper with the basic fundamentals of the Pioneer acquisition. "I suspect the former CEO is unhappy about being placed on the sidelines," he says. But it is also a "relatively inexpensive price to pay for getting this done". Under the leadership of Lina Khan, the FTC has taken a tougher line when it comes to mergers, and second requests for information have become the norm when it comes to oil deals. Chevron's planned $53bn acquisition of US independent Hess has been held up by such a request, even as a dispute over the target company's stake in a giant offshore find in Guyana has cast a cloud over the transaction. Diamondback Energy's announced $26bn takeover of Endeavor Energy Resources was also subject to a second request. Occidental Petroleum chief executive Vicki Hollub told analysts in February that "some of our teams felt like [the FTC] asked for everything" when going through the approval process for the company's $12bn purchase of CrownRock. But Occidental said this week that its teams are working "constructively" with the regulator, and that the deal is expected to close in the third quarter. Consolidation over consumers? The rapid pace of consolidation in the US oil and gas sector since late last year has led to mounting calls for increased scrutiny on antitrust grounds. "Let's not kid ourselves, these mergers aren't just about efficiency or lowering costs," US Senate Democratic majority leader Chuck Schumer wrote in a letter signed by 50 Senate and House Democrats in March. They are about "buying out the competition so the newly consolidated industry can boost profits at the expense of consumers". Given long-serving company executives' preference to stick around after selling their firms, the FTC's action in relation to Pioneer could theoretically dissuade other ‘big-name' founders from going down the same road, consultancy Rystad senior analyst Matthew Bernstein says. On the other hand, the loss of control for family-owned operators has already served as a big enough obstacle for some companies that would otherwise be seen as takeover targets. As for Sheffield, Pioneer has said the FTC's complaint reflects a "fundamental misunderstanding" of US and global oil markets and "misreads the nature and intent" of his actions. Pioneer more than doubled its daily production between 2019 and 2023, playing its part in adding to domestic energy supply, the firm said. By Stephen Cunningham Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
German heating oil demand surges as diesel declines
German heating oil demand surges as diesel declines
Hamburg, 13 May (Argus) — German heating oil sales have hit their second highest weekly average this year on the back of falling prices and low household stocks. Daily average traded volumes rose by 45pc last week compared with the previous week, with increases in all regions. Lower prices are the main reason for the growth in demand. The volume weighted average cost of heating oil in Germany was around €79.40/100 litres last week, the lowest since the start of the year. A significant factor behind the low heating oil price is a drop in the value of Ice gasoil futures, which has been driven by a diesel surplus in Europe. Low household stocks are also supporting German heating oil demand. Stocks reached a year-to-date low at the start of May, as in previous years, Argus MDX data shows. In contrast, German diesel sales dropped slightly last week, as an uptick in demand from the agriculture sector was offset by lower-than-expected demand from industry and logistics. There have been some tentative signs of economic recovery that may support diesel demand. Mileage of trucks on German motorways was up on the year in April and 1pc higher than in March, data from the federal statistical office Destatis show. This was the first year-on-year increase since August 2022. Construction activity in Germany rose by 3.9pc in January-March compared with the final quarter of 2023. By Johannes Guhlke Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Japan’s Daio Paper to explore biorefinery
Japan’s Daio Paper to explore biorefinery
Tokyo, 13 May (Argus) — Japanese paper manufacturer Daio Paper is planning a trial biorefinery, aiming to begin commercial production of sustainable aviation fuel (SAF), second-generation bioethanol and biodegradable plastic feedstock by the April 2032-March 2033 fiscal year. Daio, in partnership with domestic biorefinery venture Green Earth Institute (GEI), plans to develop technology to demonstrate manufacturing the bioproducts by 2030. Daio Paper plans to use wooden biomass, waste paper and paper sludge as feedstock. The company declined to disclose any planned commercial output capacity, as well as location of the biorefinery. The project is financed by Japan's state-owned research institute Nedo. Daio Paper is attempting to achieve decarbonisation, while weakening paper demand has forced the industry to seek new business opportunities. Fellow Japanese paper producer Nippon Paper has also tried to develop biorefinery technology with GEI, targeting to begin commercial production of bioethanol for SAF and petrochemical feedstock by 2027-28. By Nanami Oki Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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