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Pertamina supplies first SAF to Virgin Australia

  • Market: Biofuels
  • 19/09/24

Indonesian state-owned refiner Pertamina has supplied its first sustainable aviation fuel (SAF) to airline Virgin Australia, as part of the continuing Bali International Air Show.

Pertamina is supplying around 160 kilolitres (kl) of SAF to Virgin Australia's Boeing 737 aircraft from the Ngurah Rai aviation fuel terminal in Bali for flights during 18-19 September. This was part of the 3,500 kl of blended SAF that Pertamina had sought for end-August delivery, intended to be used at the air show. The remaining volumes will be sold to other airlines and sales will be assessed before any further SAF purchases are made, a company source said.

The SAF is a blend of 38.43pc synthetic kerosine produced from used cooking oil (UCO) and 61.57pc fossil jet fuel, said the director of central marketing and commerce at Pertamina Patra Niaga Maya Kusmaya.

Pertamina also has plans to co-process SAF from UCO at its Cilacap refinery next year, before producing SAF by the hydrotreated esters and fatty acids pathway when its Cilacap "green refinery" comes on line, said a company source, although more details have yet to be disclosed.

SAF distributed at Ngurah Rai is also managed using mass balancing, meaning that while jet fuel is mixed with SAF in the same tank as both have similar technical specifications, recording and bookkeeping for both products are managed separately.

Pertamina obtained International Sustainability and Carbon Certification (ISCC) Corsia and ISCC EU RED-compliant certification for its SAF last month. The SAF supplied also meets ASTM international standards.


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25/09/24

Vertex Energy files for bankruptcy, seeks sale

Vertex Energy files for bankruptcy, seeks sale

Houston, 25 September (Argus) — Specialty refiner Vertex Energy has filed for chapter 11 bankruptcy in a US court following a failed foray into renewable fuels production at its 88,000 b/d Mobile, Alabama, refinery. Vertex has entered into a restructuring support agreement with its lenders and secured $80mn of new funding to finance its day-to-day business operations, the company said late Tuesday. The refiner is also considering a "more value-maximizing sale transaction" and expects to confirm its chapter 11 bankruptcy plan by the end of the year, according to the 24 September press release. Vertex announced in May this year that it would "pause" renewable diesel production at its Alabama refinery and return the unit to producing fossil fuel products. The company later said it would use a third quarter turnaround to return the Alabama plant's converted hydrocracking unit to processing fossil fuel feedstocks and be back online in the fourth quarter. Vertex also operates a re-refinery near New Orleans, Louisiana, that produces low-sulfur vacuum gas oil (VGO) and multiple used motor oil (UMO) processing plants and collection facilities along the Gulf coast. Refiners have faced mixed fortunes in recent years with their investments in renewable fuels after a glut of new supply flooded markets and depressed renewable credit prices. US independent refiner Delek announced in August that it is temporarily idling three biodiesel plants in Texas, Arkansas and Mississippi as it explores alternative uses for the sites. Chevron said earlier this year it was indefinitely closing two biodiesel plants in Wisconsin and Iowa due to market conditions. By Nathan Risser Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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EU crushing up in August on rapeseed, US soy harvest


25/09/24
News
25/09/24

EU crushing up in August on rapeseed, US soy harvest

London, 25 September (Argus) — EU and UK mills crushed more soybeans and rapeseed in August compared with the previous month and a year earlier, as inclement weather caused earlier harvests this year in Europe, increasing EU supplies. But total refined oil production levels were unchanged on the month. Fewer sunflower seeds (SFS) were crushed in August than in July, as high SFS prices lowered margins for crushers. Total oilseed crush levels increased on the month by 7pc to 3.5mn t in August, led by greater volumes of crushed soybeans and rapeseed, which increased by 6pc and 13pc, respectively. The UK and EU imported 135,000t less oilseeds on the month in August as the European harvest began, resulting in about 1.35mn t of imports in total. Production of semi-refined oil — typically used in the biodiesel sector — increased by 7pc on the month. But fully-refined oil — typically for the food sector — fell by 4pc, leaving total refined oil production virtually unchanged on the month. Rapeseed crushing rose by 13pc on the month in August and by 5pc on the year, as Ukraine, the UK and the EU began harvesting their 2024-25 harvests 3-4 weeks earlier than usual, given the crop's earlier flowering and ripening with unfavourable weather conditions. Soybean crushing continued to increase in August. But the share of soybeans in total oilseed imports has fallen — from 78.5pc in July to 71pc in August. The EU and the UK imported 200,000 fewer tonnes of soybeans in August than in July — or about 960,500t of soybeans in total. SFS crushing fell by 14pc in August to 0.4mn t on high SFS prices and limited stocks in the EU and Ukraine, as new-crop SFS arrivals — for the 2024-25 marketing year — do not start before this month. Nevertheless, SFS crushing increased by 17pc across the first seven months of this year on the back of greater EU crushing capacity. The strongest seed crushing growth expected by the USDA is in Romania, Bulgaria and Hungary, and to a lesser extent in Germany and Italy. By Madeleine Jenkins EU + UK crushing volumes mn t Aug-24 Jul-24 m-o-m change Aug-23 y-o-y change Jan-Aug 24 Jan-Aug 23 y-o-y change Soybean 1.21 1.14 6% 1.15 5% 9.5 9.6 -1% Sunflower seed 0.39 0.45 -14% 0.37 5% 4.0 3.4 17% Rapeseed 1.88 1.67 13% 1.72 9% 13.3 12.6 5% Semi-refined 0.35 0.33 7% 0.34 3% 2.7 2.6 5% Fully-refined 0.60 0.62 -4% 0.57 4% 4.9 4.5 8% Total Total oilseed 3.48 3.25 7% 3.24 7% 26.8 25.6 5% Total refined 0.95 0.95 0% 0.91 4% 7.5 7.0 7% Fediol Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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LNG-burning vessels well positioned ahead of 2025


19/09/24
News
19/09/24

LNG-burning vessels well positioned ahead of 2025

New York, 19 September (Argus) — Vessels outfitted with dual-fuel LNG-burning engines are poised to have the lowest marine fuel expense heading into 2025 when the EU will tighten its marine EU emissions trading system (ETS) regulations and add a new regulation, " FuelEU", from 1 January 2025. Considering both regulations, at current price levels, fossil LNG (also known as grey LNG) will be priced the cheapest compared with conventional marine fuels and other commonly considered alternative fuels such as biodiesel and methanol. The EU's FuelEU maritime regulation will require ship operators traveling in, out and within EU territorial waters to gradually reduce their greenhouse gas (GHG) intensity on a lifecycle basis, starting with a 2pc reduction in 2025, 6pc in 2030 and so on until getting to an 80pc drop, compared with 2020 base year levels. The FuelEU GHG intensity maximum is set at 85.69 grams of CO2-equivalent per MJ (gCO2e/MJ) from 2030 to 2034, dropping to 77.94 gCO2e/MJ in 2035. Vessel pools exceeding the FuelEU's limits will be fined €2,400/t ($2,675/t) of very low-sulphur fuel oil (VLFSO) energy equivalent. GHG emissions from grey LNG vary depending on the type of marine engine used to burn the LNG, but ranges from about 76.3-92.3 gCO2e/MJ, according to non-governmental environmental lobby group Transport & Environment. This makes a number of LNG-burning, ocean-going vessels compliant with FuelEU regulation through 2034. The EU's ETS for marine shipping commenced this year and requires that ship operators pay for 40pc of their GHG generated on voyages within, in and out of the EU. Next year, the EU ETS emissions limit will increase to 70pc. Even with the added 70pc CO2 emissions cost, US Gulf coast grey LNG was assessed at $639/t VLSFOe, compared with the second cheapest VLSFO at $689/t, B30 biodiesel at $922/t and grey methanol at $931/t VLSFOe average from 1-18 September (see chart). "In 2025, we expect [US natural gas] prices to rise as [US] LNG exports increase while domestic consumption and production remain relatively flat for much of the year," says the US Energy Information Administration. "We forecast the Henry Hub price to average around $2.20/million British thermal units (mmBtu) in 2024 and $3.10/mmBtu in 2025." Provided that prices of biodiesel and methanol remain relatively flat, the projected EIA US 2025 LNG price gains would not affect LNG's price ranking, keeping it the cheapest alternative marine fuel option for ship owners traveling between the US Gulf coast and Europe. LNG for bunkering global consumption from vessels 5,000 gross tonnes and over reached 12.9mn t in 2023, according to the International Maritime Organization (IMO), up from 11mn t in 2022 and 12.6mn t in 2021. The maritime port authority of Singapore reported 111,000t of LNG bunker sales and the port authorities of Rotterdam and Antwerp reported 319,000t in 2023 from all size vessels. Among vessels 5,000 gross tonnes and over, LNG carriers accounted for 89pc of LNG bunker demand globally, followed by container ships at 3.6pc, according to the IMO. The large gap between LNG global and LNG Singapore, Rotterdam, and Antwerp bunker demand, is likely the result of most of the demand taking place at the biggest LNG export locations where LNG carriers call, such as the US Gulf coast, Qatar, Australia, Russia and Malaysia. By Stefka Wechsler USGC bunkers and bunker alternatives $/t VLSFOe Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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South Korea's GS Caltex supplies SAF to Japan


19/09/24
News
19/09/24

South Korea's GS Caltex supplies SAF to Japan

Singapore, 19 September (Argus) — South Korean refiner GS Caltex exported around 5,000 kilolitres of sustainable aviation fuel (SAF) to Japan's Narita airport via Japanese trading firm Itochu on 13 September, GS Caltex said today. The SAF was a blend of neat SAF from Finnish biofuel producer Neste and jet fuel. It is compliant with the Carbon Offsetting and Reduction Scheme for International Aviation (Corsia) and is International Sustainability and Carbon Certification (ISCC)-certified. Neste said it supplied over 1,000t of neat Corsia-eligible and ISCC-certified SAF to GS Caltex's refinery in Yeosu for blending, in what it described as the first time SAF was blended locally in South Korea. The blended SAF was then transported to Japan. The first batch is scheduled to be sold to major Japanese airlines All Nippon Airways (ANA) and Japan Airlines (JAL), ahead of the International Civil Aviation Organization's (ICAO) mandate to use Corsia-eligible SAF from 2027. ANA and JAL have previous agreements with Itochu to secure SAF for their flights departing and landing at Haneda, Narita, and Chubu International Airport. GS Caltex, Neste and Itochu have been collaborating on this project since last year, and will continue to sell Corsia-compliant SAF commercially to Japan. Japan is proposing stricter rules for domestic SAF producers , with further details expected later this year. The country in 2022 mandated that SAF has to account for at least 10pc of domestic airlines' jet fuel consumption by 2030. GS Caltex will likely be the fourth South Korean refiner to produce biofuels this year. S-Oil has been co-processing SAF at its Onsan refinery since January, and SK Energy in September completed a dedicated SAF production line at its 840,000 b/d Ulsan refinery which will begin commercial output next month. Hyundai Oilbank also supplied co-processed SAF to ANA via Japanese trading firm Marubeni earlier this year, marking Japan's first import of South Korean SAF. South Korea's Ministry of Trade, Industry and Energy and the Ministry of Land, Infrastructure and Transport announced an SAF expansion strategy on 30 August, which includes a target for South Korea to capture 30pc of the global blended SAF export market. By Deborah Sun Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Indonesia to require SAF for flights from 2027


19/09/24
News
19/09/24

Indonesia to require SAF for flights from 2027

Singapore, 19 September (Argus) — Indonesia will require flights to use sustainable aviation fuel (SAF) in their fuel mix from 2027, the Co-ordinating Ministry for Maritime Affairs and Investment announced on 18 September during the Bali International Air Show. International flights departing Indonesia will be required to use 1pc SAF in their fuel mix, or an estimated 60,000 kilolitres (kl), in 2027. This will rise to 2.5pc by 2030, 12.5pc by 2040, 30pc by 2050, and 50pc, or a projected 7.88mn kl, by 2060. The country's SAF roadmap and policy action plan was also announced on 18 September, and will be implemented as a Presidential Instruction by September. Used cooking oil (UCO) and palm fatty acid distillate (Pfad) were cited as prioritised feedstocks, although other potential feedstocks like palm oil-based feedstocks, coconut, and seaweed will be explored as well. Crude palm oil (CPO) was identified as the alternative SAF feedstock that is most widely available within Indonesia, with a current excess supply of 16.5mn t after energy and food use, which can be converted into 13.3mn t of SAF. But SAF produced from CPO is estimated to have life cycle emissions of 77-99 gCO2/MJ, above the International Civil Aviation Organisation (ICAO), US and EU standards, limiting its global marketability. Indonesia aims to establish a taskforce to further engage ICAO on this, over a maximum of two years. SAF Action Plan A 2025-29 Action Plan was also announced, with three main policy pillars of demand, supply and enablers which were mentioned earlier in the year . Notable points under the supply pillar includes securing enough domestic feedstocks for SAF production via the hydroprocessed esters and fatty acids (HEFA) pathway – which included a proposed domestic market obligation (DMO) for Pfad, and export quota and/or tariff for UCO. Emission-based incentives for SAF and exploring SAF production through other pathways, like alcohol-to-jet, were also mentioned. The country's Ministry of Investment said that the country has potential to produce up to 1.72mn kl of SAF, 8.03mn kl of biodiesel, and 1.76mn kl of bioethanol, based on the Strategic Investment Downstream Roadmap over 2023-2040. Under the enablers pillar, there are plans to appoint a national accreditation body for SAF certification and a domestic SAF certification ecosystem. Under the demand pillar, the country aims to implement pilot SAF offtake agreements for international flights from Ngurah Rai International Airport, and to increase the SAF mandate at Ngurah Rai, the Soekarno-Hatta International Airport, and other major airports. It also plans for an SAF usage mandate for corporate and government travellers. South Korea previously announced a 1pc SAF mandate in August for international flights, while Japan proposed stricter rules for domestic SAF producers to cut greenhouse gas emissions from jet fuel use in June, with the discussions to be finalised later this year. By Sarah Giam Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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