Total La Mede crude refining to cease: Update 3

Spanish Market: Biofuels, Crude oil, Oil products
16/04/15

Adds strike details at La Mede in fourth paragraph

Total will cease crude refining at its loss-making 160,000 b/d La Mede refinery and convert it into a 500,000 t/yr biofuels facility, the company confirmed today in its French refinery strategy plan.

La Mede will cease crude refinery operations by the end of 2016. But the 222,000 b/d Donges refinery will remain a crude refinery, and Total today pledged investment of €400mn ($416mn) to "capture profitable new markets with low-sulphur fuels that meet the evolutions of EU specifications". It will construct a 2.6mn t/yr VGO desulphurisation facility and develop hydrogen production. Donges has insufficient desulphurisation capacity at present, so a proportion of its fuels are exported outside of the EU because they do not meet specifications.

Total also said the 105,000 b/d Feyzin, 240,000 b/d Gonfreville and 93,000 b/d Grandpuits refineries "demonstrated their ability to withstand the deteriorating economic environment in 2013 and 2014 and generate ongoing income streams".

The company will invest €200mn in converting La Mede and cut 178 jobs. La Mede workers have been on strike since 04:00 this morning, and have successfully stopped all products from leaving the plant. Strikes are likely to continue tomorrow, Total said.

The move to convert La Mede into France's first biorefinery was widely-expected, despite excess biofuel capacity in Europe. The biorefinery will produce biodiesel from used oils as well as from renewable feedstock. French union CFDT said today that the biorefinery would also produce 55,000 t/yr of biopropane and bionaphtha.

La Mede will join the company's Dunkirk facility — once a 156,000 b/d refinery — which is earmarked to become a 200,000 t/yr second-generation biofuels joint venture, BioTfuel.

Total expects to complete the Dunkirk refinery conversion next year. The company aims to begin producing biofuels from organic waste from 2017, although commercial-scale production is unlikely before 2020. BioTfuel's start-up date has slipped a number of times from an original date of 2012, with costs rising to €180mn ($190.5mn) from €112mn.

Total promised the French government in the wake of its 2010 decision to close the Dunkirk refinery that it would not shut any more plants in France until 2015.

In Europe, Total's focus since the restructuring has been on adapting its refining and chemicals production capacity to changes in demand.

Refineries in Europe have long been struggling because of sluggish demand, global overcapacity and competition from overseas refineries. Total has a long-standing target to reduce its refining and chemicals capacity in the region by 20pc in 2012-17. With the closure of La Mede, as well as its plans to halve the capacity of its 222,000 b/d Lindsey refinery in the UK, sell its 17pc stake in the 208,000 b/d Schwedt refinery in Germany, and shut the steam cracker at the Carling chemicals plant in France, this target has largely been reached.

But further refinery closures in Europe seem inevitable even after Total's planned closures. In its 2014 World Oil Outlook published in November, Opec said it estimated a further 2.4mn b/d of European refining capacity would close by 2019. And the IEA expects economic expansion, rather than lower energy prices, to drive demand growth for refined products, making further consolidation likely in Europe as growth stalls on the continent and imports rise.

Total currently has five operational refineries in France; the Feyzin, La Mede, Donges, Gonfreville and Grandpuits refineries.

The company's total French refining capacity is 820,000 b/d. France makes up around 40pc of the firm's global refining capacity of 2.2mn b/d.

Refinery throughput in France was 639,000 b/d last year, down by 1pc compared with 2013. The utilisation rate in France was 77pc last year, 78pc in 2013 and 82pc in 2012. France made up 36pc of the firm's total refinery throughput last year, compared with 38pc in 2013.

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17/03/25

China’s CNOOC starts Caofeidian, Wenchang crude output

San Francisco, 16 March (Argus) — Chinese state-controlled CNOOC has started output at the Caofeidian 6-4 oil field comprehensive adjustment project and the Wenchang 19-1 oil field phase 2 project offshore China, the company said today. Caofeidian 6-4 produces mainly light crude and is located in the western part of the Bohai Sea, at an average water depth of about 20m. Wenchang 19-1 produces mainly medium crude and is located in the western part of the Pearl River Mouth Basin, at an average water depth of around 125m. Caofeidian 6-4 is expected to achieve peak production of around 11,000 b/d of oil equivalent (boe/d) in 2026 and Wenchang 19-1's output is expected to peak at 12,000 boe/d in 2027. CNOOC plans to put into production a total of 38 development wells at the two projects. It is also planning 22 production wells at Caofeidian 6-4. CNOOC is the operator of the projects and holds a 100pc interest. The associated gas of Caofeidian 6-4 will be reinjected into the reservoir with gas injection compressors, which will reduce CO2 emissions by about 13,000 t/yr. Wenchang 19-1 uses a megawatt-level high-temperature flue gas ORC power generation unit, which is expected to generate up to 24GWh of electricity and reduce CO2 emissions by about 23,000 t/yr, CNOOC said. The company has mainly started output at oil fields in 2025 but said in early March that it made a "major breakthrough" in natural gas exploration as part of a gas discovery at the Weizhou 10-5 oil and gas field at a water depth of 37m in the Beibu Gulf basin in the Bohai sea, with test results indicating production capacity of around 13.2mn ft³ of gas and about 800 b/d of crude. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Açúcar: Mudança tributária abre espaço diplomático

13/03/25

Açúcar: Mudança tributária abre espaço diplomático

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Dangote refinery buys first cargo of Eq Guinea crude

13/03/25

Dangote refinery buys first cargo of Eq Guinea crude

London, 13 March (Argus) — Nigeria's 650,000 b/d Dangote refinery has bought its first cargo of Equatorial Guinea's medium sweet Ceiba crude, according to sources with knowledge of the matter. Dangote bought the 950,000 bl cargo loading over 12-13 April from BP earlier this week, sources told Argus . Price levels of the deal were kept under wraps. Most Ceiba exports typically go to China. Around 18,000 b/d discharged there last year, while three shipments went to Spain and one to the Netherlands, according to Vortexa data. This year, two cargoes loading in February and March are signalling Zhanjiang in China, according to tracking data. Traders note that buying a Ceiba cargo is part of Dangote's efforts to diversify its crude sources. Last month the refinery bought its first cargo of Algeria's light sweet Saharan Blend crude from trading firm Glencore, which is due to be delivered over 15-20 March. Market sources said Dangote seems to have sourced competitively priced crude from Equatorial Guinea at a time when domestic grades are facing sluggish demand from Nigeria's core European market amid ample supply of cheaper Kazakh-origin light sour CPC Blend, US WTI and Mediterranean sweet crudes. Several European refineries are due to undergo maintenance in April, which is also weighing on demand. Nigeria's state-owned NNPC is currently in negotiations with the Dangote refinery about extending a local currency crude sales arrangement , which involves crude prices being set in dollars and Dangote paying the naira equivalent at a discounted exchange rate. Any changes to the terms of the programme may pressure Dangote to increase the amount of foreign crude in its slate. Refinery sources told Argus in January that Dangote will source at least 50pc of its crude needs on the import market and is building eight storage tanks to facilitate this. By Sanjana Shivdas Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Nigeria's port authority raises import tariffs

13/03/25

Nigeria's port authority raises import tariffs

London, 13 March (Argus) — The Nigerian Ports Authority (NPA) has raised tariffs by 15pc on imports "across board", taking effect on 3 March, according to a document shown to Argus . The move comes as the independently-owned 650,000 b/d Dangote refinery continues to capture domestic market share through aggressive price cuts, pushing imported gasoline below market value in the country. Sources said that Dangote cut ex-rack gasoline prices to 805 naira/litre (52¢/l) today, from between 818-833N/l. The rise in NPA tariffs may add on additional cost pressures onto trading houses shipping gasoline to Nigeria, potentially affecting price competitiveness against Dangote products further. The move would increase product and crude cargo import costs, according to market participants. But one shipping source said the impact would be marginal as current costs are "slim", while one west African crude trader noted that the tariffs would amount to a few cents per barrel and represent a minor rise in freight costs. Port dues in Nigeria are currently around 20¢/bl, the trader added. One shipping source expects oil products imports to continue to flow in, because demand is still there. Nigeria's NNPC previously said the country's gasoline demand is on average around 37,800 t/d. Over half of supplies come from imports, the country's downstream regulator NMDPRA said. According to another shipping source, Dangote supplied around 526,000t of gasoline in the country, making up over half of product supplied. The refinery also supplied 113,000t of gasoil — a third of total total volumes in the country — and half of Nigeria's jet at 28,000t. By George Maher-Bonnett and Sanjana Shivdas Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US lube industry wary of tariffs uncertainty

13/03/25

US lube industry wary of tariffs uncertainty

London, 13 March (Argus) — The uncertainty around US tariffs could weigh on demand for finished lubricant and base oil, trade body ILMA told Argus . US President Donald Trump has decreed a 25pc tariff on steel and aluminium imports from Canada, a key import source for these materials used in auto manufacturing. The US sources about 70pc of its aluminium imports and around 23pc of its steel imports from its northern neighbour. ILMA chief executive Holly Alfano said the White House recognises that the uncertainty surrounding tariffs "creates a challenging business environment". "A slowdown in auto sales and production due to tariffs could lead to reduced demand for these products," Alfano told Argus. "Manufacturers may postpone investments or expansion plans due to unpredictable costs and market conditions," she said. "If vehicle prices rise due to increased production costs, consumer demand may decline, leading to further reductions in automotive output and associated lubricant consumption." Automotive vehicle production forecasts have fallen to 15.5mn in 2025 since the tariff announcement, down by 250,000 vehicles from the prior estimate by AutoForecast Solutions. This would put output broadly in line with 2024 , stifling growth in finished lubricant demand. US government data show car sales fell by 5pc in 2024, and finished lubricant sales dropped 6pc over the same period. Although lubricant sales are not entirely correlated with new car sales, Alfano noted the auto sector is "a significant consumer of finished lubricants". As it stands the tariffs on steel and aluminium will not now be implemented until 2 April. The White House has said this is to "allow for the flow of parts and sub assembly products into America, to allow American car manufacturers to continue building cars." The US administration is scheduled to host Canadian and Ontario officials today to discuss a possible easing in tariffs. If these talks yield no progress, and if a month is insufficient for supply chains to be reorganised, the tariffs could stunt automotive manufacturing and in turn lubricants needed for these new vehicles. Ontario premier Doug Ford has cautioned the 25pc tariffs could halt the auto manufacturing industry in as little as 10 days. While the US is self-sufficient in terms of its Group II base oils, it is a net importer of Group III, with only 4pc nameplate capacity, and both are key to automotive lubricant production. The US is an importer of Canadian Group III base oils from Petro-Canada's 4,000 b/d plant in Mississauga, Ontario. By Gabriella Twining Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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