Maduro seeks end to all sanctions before elections
Venezuelan president Nicolas Maduro said today he wants all US sanctions against Venezuela lifted and control of US-based refiner Citgo returned to state-run PdV before holding more talks with the opposition for open elections.
In a pair of fiery speeches on Wednesday Maduro criticized an agreement his government entered into over the weekend to resume talks in exchange for a limited loosening of sanctions that would allow Chevron to sell some Venezuelan crude. The agreement will not allow for any payments to the government directly but helps fund a UN-administered program to provide food, medicine and other humanitarian goods to Venezuela.
Government and opposition leaders met in Mexico City briefly over the weekend to announce a restart to talks.
"They want free elections?" Maduro said in a speech to government officials and the press today. "Ok, elections free of all sanctions!"
He also demanded Citgo be returned "free and clear" to Venezuelan control, including millions of dollars in profits it has made since 2019.
Maduro's demands, combined with harsh words for the largest opposition group involved in the renewed talks, Plataforma Unitaria, belie any notion the recent moves were signs of a more conciliatory tone from the Venezuelan government. He called the group "right-wing, coup plotter, interventionist, pro-gringo and terrorists," and accused it of trying to assassinate him.
Any backtracking on the agreement is likely to lead to calls from the US Congress on the administration of President Joe Biden to rescind the recently granted Chevron licenses to resume some activities in the country.
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Elliott bids $7.3bn for Citgo assets
Elliott bids $7.3bn for Citgo assets
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 the court choose the Elliott affiliate, Amber Energy, pending a 1 October hearing with parties disputing the auction. But a final a 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. Since 2019 Citgo 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. But its ultimate parent company, state-owned PdV, remains under control of the Maduro government. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
SAF market is far from takeoff: Airlines
SAF market is far from takeoff: Airlines
New York, 27 September (Argus) — Airline executives descended on climate events in New York this week to emphasize their commitments to use more sustainable aviation fuel (SAF) — and to hint that these goals will prove difficult absent additional government support. At events tied to the UN General Assembly and Climate Week NYC, supporters of alternative jet fuels said that a range of policies were growing the market, including tax incentives, US states' low-carbon fuel standards and increasingly stringent mandates for SAF usage in the EU. While US production capacity of SAF is expected to rise significantly in the coming years, there is still concern that limited supply and a steep premium to conventional petroleum jet fuel will hinder adoption. SAF "will always be more expensive because it's a better product," said Aaron Robinson, vice president of US SAF for the International Airlines Group, a holding company that includes British Airways and Iberia. Executives, while calling generally for more policies to stimulate supply and demand, were more inclined to support subsidies over mandates. The airline industry already runs on tight margins, and executives fear that prospective customers could stay home instead of paying more for lower-carbon flights. "I think the worst thing we could do right now is choose a very short-term solution that takes that green premium and directly saddles it onto our customers," said Delta Air Lines chief sustainability officer Amelia DeLuca. She argued that the EU's SAF mandates were "pushing the fuel forward a little bit too fast in terms of where the supply and the green premium are." Still, the most prominent government subsidy for SAF — a tax credit kicking off next year in the US that will offer up to $1.75/USG for domestic SAF producers — was described as helpful but insufficient. The Inflation Reduction Act, which included that credit, was "historic, monumental, not good enough," said United Airlines chief sustainability officer Lauren Riley. President Joe Biden's administration has frustrated US biofuel groups by not yet providing guidance around qualifying for that credit, known as "45Z," which requires SAF to meet an initial carbon intensity threshold and increases the subsidy as the fuel's greenhouse gas emissions fall. Regardless, airlines and fuel producers say that the credit — which expires at the end of 2027 — is too short-lived to build up a supply chain. Policies like the 45Z credit should "have an end" but the end needs to be "far enough into the future," ExxonMobil vice president of strategy and planning for product solutions Tanya Vetter said this week at a clean energy event in Washington, DC. Competing interests Prolonging the 45Z credit would require legislation, but reopening a debate over clean fuels incentives in Congress could divide groups generally supportive of SAF. Airlines and refiners support more flexibility around feedstocks — including fuels produced from foreign sources like Chinese used cooking oil and fuels produced by co-processing petroleum — while farm groups want policy to increase demand for domestically produced vegetable oils and corn ethanol. A bipartisan group of farm state lawmakers this week introduced legislation that pairs an extension of the 45Z credit through 2034 with restrictions on fuels sourced from foreign feedstocks. With Congress set to debate tax policy next year regardless of who controls the White House, airlines supportive of more generous and longer-lasting SAF subsidies will also have to contend with Republicans that want to repeal much of the Inflation Reduction Act and with competing lobbies that would rather devote funds to extending other incentives. For instance, Justine Fisher — the chief financial officer at the Canadian carbon capture company Svante — signaled interest this week in increasing a tax credit for carbon capture, utilization, and storage that is included in the law. The incentive, which offers $85/metric tonne for captured carbon and is more popular than other parts of the law among oil and gas companies, is currently not "high enough to make project economics work," she said. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Haftar’s lucrative oil blockade
Haftar’s lucrative oil blockade
The general's eastern power base appears to be benefiting financially, but the country's economy is suffering, writes Aydin Calik London, 27 September (Argus) — Libya's oil blockade has entered its second month with more than half of its typical crude production of 1.2mn b/d off line. Although the UN's Libya mission reports progress in efforts to resolve a leadership crisis at the central bank that sparked the blockade, a workable solution could yet prove elusive. But whether the blockade is lifted in days or endures for weeks, the shutdowns have demonstrated eastern-based general Khalifa Haftar's ability to choke his rivals in the west of oil revenues at little cost to himself. Previous wide-scale blockades instituted by Haftar exacted a heavy toll on both the internationally recognised administration in the west and parallel administrations he has propped up in the east. But this time around, Haftar has managed to design the blockade to avoid the financial and political costs associated with past shutdowns. For one, the current shutdowns at oil fields can only really be described as a partial oil blockade. Libya has exported more than 400,000 b/d of crude so far this month, with almost all of this from eastern terminals where operations were ordered to stop in late August. Argus estimates Opec member Libya's current crude production at about 500,000 b/d. Most of this production is part of state-owned NOC's crude-for-products programme, which feeds a booming fuel-smuggling industry in the east. There has been no let-up here. Imports of refined products this month are at their highest on record at 300,000 b/d, according to Kpler, far beyond Libya's real domestic needs. Some crude is also being exported by eastern-based Libyan firm Arkenu Oil, which analysts suspect was set up to create a direct oil revenue stream independent of the central bank in Tripoli. "The Haftar family has managed the feat of orchestrating an economically lucrative oil blockade," senior fellow at the Atlantic Council Emadeddin Badi says. And some crude output is being kept on line to feed domestic refineries and allow associated gas production to supply power plants. Past blockades have tended to cause power cuts and reduce domestic supplies of diesel and gasoline, putting pressure on Haftar to lift them. But now, he can keep revenue channels open and mostly absolve himself from any backlash resulting from insufficient domestic energy supplies. General practice Haftar's ability to design the blockade to suit his interests partly derives from an informal deal in July 2022 that saw him end a months-long oil blockade in return for installing Farhat ben Gudara as chairman of NOC. In this role, ben Gudara has proven far more co-operative than his predecessor Mustafa Sanalla, who refused to allow Haftar to benefit from any blockade he imposed. That "deal" had underpinned the relative peace between the country's east and west since. If a durable solution to the current leadership crisis at the central bank is to be achieved, a new arrangement between east and west will need to be worked out. Horse-trading behind the scenes continues. "There's still a lot of negotiations to go as far as Libyan politics is concerned," an oil industry source says on the possibility of the blockade being lifted. The longer the central bank crisis persists, the more precarious Libya's economic predicament becomes. Oil revenues that usually flow into the bank have all but stopped and its ability to conduct international financial transactions has been degraded. But even if a resolution is found and oil production returns to normal levels, this would at best represent a fragile and temporary solution to a long-term problem — the lack of a coherent central authority. Worryingly, Libya is a long way from any sort of political process that could heal its divisions. Libya crude production Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Jet Zero gets $9.6mn in grants for Australia SAF plant
Jet Zero gets $9.6mn in grants for Australia SAF plant
Sydney, 27 September (Argus) — Australian bioenergy developer Jet Zero gets A$14mn ($9.6mn) of grants from federal and state governments for its proposed Project Ulysses, a sustainable aviation fuel (SAF) project in the northern Queensland state city of Townsville. The joint funding consists of A$9mn from the federal Australian Renewable Energy Agency (Arena) and A$5mn from Queensland's state government to develop the local production plant and build SAF value chains. Project Ulysses plans to utilise agricultural by-products to manufacture 102mn litres/yr of SAF and 11mn l/yr renewable diesel. Jet Zero will use the funds to complete front-end engineering and design of the plant and progress commercial deployment of alcohol-to-jet (AtJ) SAF technology. Jet Zero in February signed a licence and engineering agreement to use US sustainable fuels company LanzaJet's AtJ technology which converts bioethanol into SAF and renewable diesel. The funding complements an A$30mn investment by project partners Qantas, Airbus and Idemitsu Kosan, Jet Zero said on 27 September. The transport sector accounts for about one fifth of Australia's total greenhouse gas emissions but scheduled closure of coal-fired electricity generators means it could be the largest source by 2030, as Canberra turns its attention to decarbonising the industry via a certification scheme for low-carbon liquid fuels. . By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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