Uganda oil minister hits back at critics of oil plans
Uganda's oil minister today gave a robust defence of the country's planned oil projects, saying more developed nations cannot tell the developing world "to remain in darkness".
Uganda is simultaneously developing its upstream and downstream capacity, with a 60,000 b/d refinery to be fed from the 230,000 b/d Lake Albert crude project that is due on stream in 2025. The Tilenga area will produce 190,000 b/d, and 40,000 b/d will come from the Kingfisher site. Kampala is also constructing the East African Crude Oil Pipeline (EACOP) that will take crude from Uganda's fields to the Tanzanian port of Tanga.
"We hope we will get the money, about $3bn to build this pipeline," oil minister Ruth Nankabirwa said today. "And this is not to say that we are not concerned about climate issues, we are." The $5bn EACOP project has come in for criticism from the European Parliament, which called on TotalEnergies — an upstream partner in Uganda — to delay construction and find a less environmentally-damaging route. TotalEnergies said the parliament was misinformed.
Nankabirwa today said disengaging with fossil fuels would come at the expense of Uganda's development and compromise its plans to increase domestic access to electricity.
"We cannot ignore climate change issues, but to stop us from developing or from getting our reserves, our resources is like you are telling us to remain in darkness," she said. "It is not either [using] gas or oil or solar [energy], or… it is all of those. We have solar [energy], we have geothermal [energy]. We have potential for nuclear in Uganda. And our energy mix equals all that."
She drew a parallel between the financial pressures that have steered Uganda towards progressing fossil fuel projects and some European nations' decision to bolster hydrocarbon use because of a dearth of clean alternatives.
"Europe is worried about how they're going to spend the winter because of the insecurity that has devolved because of the war, [between] Ukraine and Russia," Nankabirwa said. "So when you are such in need, you cannot be blamed why you're using coal, you want to survive. Likewise, Uganda cannot be blamed, why we are constructing a pipeline. Because we are insecure."
Nankabirwa's comments echo those of several Opec+ officials, including de facto coalition leader Saudi Arabia, who have previously defended the simultaneous use and development of hydrocarbon and green resources to avoid energy shortages.
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Greek Corinth crude arrival momentum slows after fire
Greek Corinth crude arrival momentum slows after fire
Barcelona, 30 September (Argus) — Crude receipts at Greek refiner Motor Oil Hellas' (MOH) 180,000 b/d Corinth facility fell in September and arrival momentum has slowed, following a serious fire. Corinth imported 170,000 b/d in September, down from 185,000 b/d in August. The refinery received seven cargoes in the month, but only two were unloaded after the 17 September fire . One cargo of Caspian CPC Blend diverted to BP's 108,000 b/d Castellon refinery in Spain. The fire has damaged crude distillation (CDU) capacity at the refinery, but MOH has not replied to requests for details. The two crude cargoes that unloaded following the fire were staple grade Iraqi Basrah Medium, as are a pair signalling arrival. Both of these departed Basrah prior to the fire. One should arrive on 2 October, and the other is travelling via the Cape of Good Hope and is not slated to arrive until 13 October. No other deliveries are signalling arrival. Around 75pc of the crudes at Corinth are Basrah grades. MOH has previously said it has flexibility in its term contract with Iraq's state-owned Somo and can tailor the pace of deliveries to its needs. Earlier this year MOH said it wanted to buy more Basrah crude from trading firms, but the majority of its cargoes still come direct from Somo, according to Kpler data. This includes the two now on route to Corinth. MOH regularly blends Basrah with CPC Blend and Libyan Es Sider, plus occasional cargoes of Kazakh Kebco and Norwegian Johan Sverdrup. Prior to the fire MOH bought a cargo of Guyanese Unity Gold for the first time . MOH had major works in the summer of 2023 on the older and larger of its two CDUs. On completion deputy managing director Petros Tzannetakis said the refinery would run in excess of 200,000 b/d . Receipts are estimated by Argus at 200,000 b/d in the first three quarters of this year (see chart) . Receipts in September comprised 85,000 b/d of Basrah Medium, 35,000 b/d of Libyan crude split between Es Sider and Sarir, more than 25,000 b/d of Unity Gold and more than 20,000 b/d of CPC Blend. Argus assessed these at a weighted average gravity of 32.3°API and 1.7pc sulphur content, compared with 31.1°API and 2.5pc sulphur in August. The slate averaged 32.1°API and 2pc sulphur in the first nine months of the year, a little lighter and sweeter than 30.3°API and 2.5pc sulphur overall last year. By Adam Porter Corinth crude deliveries mn bl Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Canada to push for more climate cash as oil sands grow
Canada to push for more climate cash as oil sands grow
Calgary, 30 September (Argus) — Canada plans to advocate for more cash and accountability at the UN Cop 29 climate talks in Baku, but its record-high oil production and the threat of a general election might complicate its own climate ambitions. The resource-rich country will be pushing for greater financial commitments from Cop countries in November as they look to replace the current, but broadly recognised as inadequate, $100bn/yr target with a new finance goal for developing countries. Canada, like all developed countries, would not say how much it is willing to commit itself. But it favours broadening the goal's contributor base. "Public finance from a relatively small group of developed countries will not be sufficient to meet current needs," federal agency Environment and Climate Change Canada (EEEC) told Argus . The new goal will require "honest reflection". The country in negotiations mentioned the phase-out of fossil fuel subsidies and fossil fuel sector public financing as a mean to increase investments in energy transition sectors, but other key oil-producing countries disagree. Canada's government says it remains focused on the oil and gas industry and expects to see progress on Cop 28's commitment to transition away from fossil fuels. It became the first G20 country to release a framework targeting "inefficient" fossil fuel subsidies last year, accelerating a 2009 commitment to phase out support for its largest source of emissions. This has not stopped investment in Alberta's oil sands from growing, but the federal government is looking to steer more cash towards clean initiatives such as clean hydrogen, clean electricity and carbon capture. The latter could represent a big business for Alberta's producers if subsidised generously. But it could also be a licence to push Canada's crude production beyond its 4.9mn b/d record set last year. Greenhouse gas (GHG) emissions from Canada's oil and gas sector accounted for 33pc, or 217mn t, of the country's total in 2022, according to the National Inventory Report. Cutting them is critical to meet an overall goal of 403mn-439mn t by 2030, but the Office of the Auditor General of Canada says the country is only on track to lower them to 470mn t by that date. Domestic politics And Canada's climate ambitions might be at risk, with the Liberal minority government facing a general election no later than October 2025. Prime minister Justin Trudeau's popularity has dropped to the benefit of Conservative opposition leader Pierre Poilievre. Trudeau has resisted calls from within his party to step down, while Conservatives prepare for what they call a "carbon tax election". They want to axe the federal carbon tax, tanker bans and regulatory burdens. They promote pipelines and energy independence using a mix of energy sources, including fossil fuels, as part of a "gradual transition" to a low-carbon future, and say "the provinces should be free to develop their own climate change policies". Canada's 10 provinces hold jurisdiction over natural resources and that has posed a serious dilemma for the Liberals as they make climate promises on the international stage. Leading oil province Alberta will be sending a delegation to Cop to promote its own emissions-reduction strategies, and counter those of federal environment minister Steven Guilbeault, as the provincial government slams Ottawa's "punitive regulations" and says its climate policies are unrealistic. Trudeau's pursuit of winding down the oil sands was already tricky considering a state-owned pipeline is effectively subsidising the industry by C$8.7bn ($6.45bn), according to non-profit International Institute for Sustainable Development. Export capacity to the Pacific coast tripled to 890,000 b/d when the Trans Mountain Pipeline Expansion opened this year, underpinning growth plans for Canadian oil. By Brett Holmes Canada GHG emissions by sector Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Libya parliament passes deal to end central bank crisis
Libya parliament passes deal to end central bank crisis
London, 30 September (Argus) — Libya's eastern-based parliament today approved an agreement to resolve a leadership crisis at the central bank, which is likely to lead to a lifting of the country's oil blockade. The eastern-based House of Representatives and the western-based High Council of State agreed on 26 September a deal to appoint Naji Mohamed Issa Belgasim as governor of the central bank and Marei Muftah Rhayyel Al-Bar'assi as deputy governor. The leadership of the central bank was thrown into disarray on 18 August when the western-based presidency council attempted to replace long-serving governor Sadiq al-Kabir — a move rejected by the country's eastern-based administration. The eastern-based Libyan National Army (LNA) imposed an oil blockade on 26 August in a bid to starve the western-based government of revenues. This has halved the country's crude output, which Argus estimates at about 500,000 b/d. The deal to resolve the leadership central bank crisis is likely to see the LNA lift its blockade, although precise timing is unclear. An oil industry source told Argus that he expects it to be this week. The El Sharara oil field is also likely to restart production when the blockade is lifted, a source told Argus . El Sharara was producing around 260,000-270,000 b/d when it was shut down in early August , in a dispute unrelated to the central bank crisis. A total lifting of the blockade would restore Libya's crude output to more than 1.2mn b/d. By Aydin Calik Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
PE firm Elliott bids $7.3bn for Citgo assets: Update
PE firm Elliott bids $7.3bn for Citgo assets: Update
Adds reaction from Amber, details throughout. Houston, 27 September (Argus) — An affiliate of private equity group Elliott Investment Management has been selected as the top bidder in an auction for US refiner Citgo, with a bid of $7.286bn. The special master for the auction, being held in the US District Court for the District of Delaware, will need to make a final formal recommendation for the court to choose the Elliott affiliate, Amber Energy, pending a 1 October hearing with parties disputing the auction. But a final hearing to ratify the sale of over 800,000 b/d of refining capacity could be held in November. Final bids for Citgo's US refineries, lubricant plants, midstream and retail assets were submitted on 11 June, with the auction aiming to satisfy debts owed by the company's parent firm, Venezuelan state-owned PdV. If the sale to Amber moves forward following a successful November hearing, it will mark the largest purchase of US refining assets since Andeavor's acquisition by Marathon Petroleum in 2018. "Amber Energy's strategy for growth includes plans to reinvest in the business and potentially pursue strategic investments that enhance the profitability of Citgo," the company said. Citgo was not immediately available for comment. Amber is lead by chief executive Gregory Goff, who was previously chairman, president, and chief executive officer of Andeavor. Company president Jeff Stevens is currently president of Franklin Mountain Energy, which is focused on the Permian basin. He has also been an executive officer of independent refiner and marketer Western Refining. The company plans to keep the Citgo brand, and expects the deal to close by mid-2025. Conditions of the deal include the buyer applying for and acquiring a license from the US Treasury's Office of Foreign Assets Control, because the ultimate owner of Citgo is Venezuelan state-owned PdV, which is subject to US sanctions. "We look forward to partnering with the people of Citgo to ensure that the company continues to operate with the highest standards of safety and reliability," Amber said. Even though it is owned by PdV, Citgo since 2019 has operated under a board appointed by the Venezuelan opposition and vetted by the US government after the US rejected Venezuela's 2018 presidential election as illegitimate. PdV remains under control of President Nicolas Maduro's government. Maduro has rejected the US court proceedings on selling Citgo as "theft" and the issue is likely to feature in his protracted battle with the US-backed opposition, which claims to have defeated Maduro in the July presidential election. The court earlier this year approved a ranking order in which debtors will be paid out of proceeds, rather than allocating them on a pro rata basis. The first in line is defunct Canadian mining firm Crystallex, now owned by New York hedge fund Tenor Capital, with a $990mn claim. ConocoPhillips has a total of three claims approved by court, but only two of those are likely to be satisfied, potentially netting $1.4bn. The next largest is a $1.5bn claim by Russian-Canadian gold miner Rusoro, while energy company Koch's minerals arm is chasing a $457mn claim. Separate US court proceedings involve holders of $3.4bn in PdV 2020 bonds guaranteed by 50.1pc in Citgo Holding — a PdVH-owned legal entity that directly owns Citgo. In theory, the bondholders have the right to be paid first before other claimants are satisfied. The US government has blocked the bondholders' ability to pursue the claim, most recently issuing a ban that is valid until mid-October. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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