Cop: Azerbaijan president criticises ‘petrostate’ label

: Crude oil, Emissions, Natural gas, Oil products
24/11/12

Azeri president Ilham Aliyev remonstrated a room packed with world leaders at the UN Cop 29 summit in Baku about calling his country a "petrostate", given its small share of global oil and gas production.

He said that it was "not fair" to label Azerbaijan a "petrostate", adding that it might have been "acceptable" when the country produced more than half of global oil output in the 19th century.

He said the country accounts for 0.7pc of global oil production and 0.9pc of global gas production today. He also said that Azerbaijan's share of global greenhouse gas emissions is only 0.1pc. Azerbaijan's oil output reached 480,000 b/d in October.

"Right after Azerbaijan was elected as a host country of Cop 29 we became a target of co-ordinated, well-orchestrated campaign of slander and blackmail," he said.

The Azeri president reiterated that oil and gas is a "gift of god" and that countries rich in natural resources should not be blamed for bringing them to the markets as they are needed.

He pointed out again that eight of the 10 countries that are supplied with Azeri gas are in Europe and that the EU asked Azerbaijan to double its gas supply to the bloc by 2027.

Natural gas output in Azerbaijan reached a new high of 132mn m³/d in 2023, and the country aims to increase it further. Upping exports to the EU to 20bn m³/yr by 2027, from the current 12bn m³/yr, has been a key government commitment since 2022, when Europe was desperate for alternative gas suppliers.

The UAE, Azerbaijan and Brazil — the Cop presidencies Troika — face scrutiny for pushing for increased global climate ambitions, but at the same time seemingly avoiding the question of fossil fuels in relation to their own new climate targets.

The Troika countries look at fossil fuels through the lens of their own national circumstances — with their economies being heavily reliant on them. Azerbaijan's increasing gas exports spurred an economic boom, with GDP increasing tenfold over 2003-13.

"As a president of Cop 29, I will be a strong advocate for the green transition, but at the same time we must be realistic," he said. He listed green projects in Azerbaijan, either in the pipeline or already operating, including an agreement to be signed at Cop 29 with BP to build a 240MW solar power station.

By Caroline Varin

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24/11/12

California RD plant signals later start up

New York, 12 November (Argus) — An long-delayed project to convert a Bakersfield, California, oil refinery to produce renewable diesel (RD) has been given another extension for start up. Global Clean Energy Holdings, working to open a 15,000 b/d RD refinery, and trading house Vitol agreed last week to adjust the terms of a supply and offtake deal singed in June. The initial agreement said that Vitol could exit the agreement if the refinery was not producing at least 5,000 b/d of renewable diesel by the end of October, but that deadline has now been moved to 15 December. Global Clean Energy told Argus last month that it still has "plans in place to complete the remaining work and start up the facility" despite recently cancelling an agreement with its principal contractor. Vitol, after an initial three-year term, can now request up to three one-year extensions of the contract, up from two in the initial deal. The agreement, which cleared the way for former business partner ExxonMobil to exit, stipulates that Vitol will be the exclusive supplier of feedstocks to the plant and exclusive marketer of all fuel and environmental attributes. The revised agreement also says that if Global Clean Energy modifies its credit agreement to allow for more than $330mn in debt financing, then the renewable fuels producer will have to pay Vitol an additional fee that increases as more funds are borrowed. Global Clean Energy declined to clarify whether it had already triggered the obligation to pay Vitol the excess fee, saying that it could not provide more information ahead of filing its quarterly investor report "in the near future." If the plant begins operations as planned, it will have to contend with a challenging investment environment for biorefineries given recently low environmental credit prices and uncertainty around how president-elect Donald Trump will enforce a new federal clean fuels tax credit. At the same time, California regulators agreed last week to update the state low-carbon fuel standard, including by setting stricter carbon intensity targets that start next year. The regulatory updates lifted the prices of credits used for program compliance, which are a crucial source of revenue for companies bringing lower-carbon fuels like renewable diesel into the state. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: MDBs to up climate financing to $170bn/yr by 2030

24/11/12

Cop: MDBs to up climate financing to $170bn/yr by 2030

London, 12 November (Argus) — A group of leading Multilateral Development Banks (MDBs) estimated they could increase climate financing to $170bn/yr by 2030, they said today at the UN's Cop 29 climate conference in Baku, Azerbaijan. The group, made up of the World Bank and nine other MDBs including the European Investment Bank (EIB), today estimated their annual financing for low- and middle-income countries at $120bn/yr by 2030, of which $42bn for adaptation. For high income countries the group plans to reach financing of $50bn/yr, including $7bn for adaptation. The ten MDBs provided a total of $125bn of financing in 2023 , up on $100bn/yr in 2022. Of last year's funding $75bn went to low- and middle-income countries and $50bn to high-income countries. The MDBs hope to leverage an additional $130bn/yr of financing from the private sector, split equally between high-income countries on the one hand and middle- and low-income ones on the other. The split between private and MDB finance implies that the organisations are hoping to increase the efficiency with which they mobilise private finance, according to Melanie Robinson, Global Climate, Economics and Finance Director at NGO World Resources Institute. Financing from MDBs will be one of the main layers of climate financing contributing towards the New Collective Quantified Goal (NCGQ), a new goal on international climate financing for developing countries. Negotiations on the NCQG began today in Baku, with countries' positions "far apart," Robinson said. Participants' stances still differ on the amount of money which should be aimed for, and on which countries should contribute, which is to be expected at this stage of the negotiations, she said. By Rhys Talbot Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Finnish, Baltic gas demand falls on year in October

24/11/12

Finnish, Baltic gas demand falls on year in October

London, 12 November (Argus) — Aggregate Finnish and Baltic gas consumption dropped by nearly 24pc on the year in October, but still reached a six-month high as the heating season began. Combined demand in Finland, Estonia, Latvia and Lithuania last month rose to 3.19TWh from 2.61TWh in September , in line with the typical seasonal progression, but was well below the 4.18TWh consumed a year earlier and the average of roughly 5.2TWh in 2018-21 ( see consumption graph, data and download ). Demand in all four individual countries was lower on the year, with the biggest drop in Lithuania, where consumption fell by more than 600GWh. In October 2023, the region's biggest consumer Achema had briefly resumed full production at both of its ammonia production units at Jonava , boosting Lithuanian demand that month. Despite the year-on-year drop, this was the fifth consecutive month-on-month increase after demand hit a near two-year low in May. Cumulative demand in the first 10 months of the year totalled 35TWh, well up from 30.3TWh a year earlier. That said, strong demand in the first quarter when the region experienced a prolonged cold snap supported a slightly skewed figure. If only considering April-October, demand of 18.5TWh was slightly below last year's 18.9TWh and well under the 30TWh average in 2018-21. This may indicate a more structural decline in the region's gas demand, particularly with power-sector demand falling as higher nuclear and renewables output cuts into the room left available for gas in the generation stack. Gas-fired power generation in the four countries totalled 186GWh last month, Fraunhofer ISE data show. This was well below 307GWh in October 2023, and the second lowest for any October since at least 2018 ( see gas-fired power graph ). Gas-fired output was lower on the year in all four countries, with roughly 40GWh drops in Lithuania, Finland and Latvia. Onshore wind production in Finland, by far the region's largest overall power producer, jumped by more than 1TWh on the year, more than offsetting lower nuclear and hydro output. This allowed Finland to net export around 150GWh of power, having net imported nearly 300GWh in October 2023, according to Fraunhofer data. Prices on the regional GET Baltic exchange averaged €41.74/MWh in October, up by 3pc on the month but 18pc down on the year. The price on the exchange "increasingly correlates with" the TTF, a correlation that will likely strengthen as GET Baltic trading migrates to the larger EEX platform next year , chief executive Giedre Kurme said. This transition will "create opportunities for competition, more liquid trading and price convergence", and "we are already seeing increased interest from international participants in the Baltic-Finland region", Kurme said. Firms traded 708GWh on the exchange in October, the most for any month since February, and all transactions were on the daily market. The joint Latvian-Estonian market accounted for 43pc of total trades, followed by Lithuania at 31pc and Finland at 26pc, GET Baltic said. Maintenance continues to limit Finnish LNG sendout Extensive maintenance on the Balticconnector pipeline this month, which makes all southbound capacity from Finland towards Estonia unavailable, continues to limit sendout from Finland's Inkoo LNG terminal. After maintenance on the 14-27 October gas days took exit capacity towards Estonia fully off line, this capacity is again unavailable because of further maintenance on 4-17 November. Without southward pipeline capacity, sendout from Inkoo must fall to levels that only the domestic market can absorb. Inkoo received the 145,000m³ Arctic Princess just before the maintenance started on 3 November, and the next scheduled delivery is not until 28 November ( see LNG data and download ). Sendout is likely to remain low even after the end of maintenance so as not to fully deplete stocks before the next arrival. Sendout from Inkoo averaged 23 GWh/d on 4-11 November. In contrast, sendout from Lithuania's Klaipeda terminal has jumped to 104 GWh/d this month, helping to plug the Baltic supply gap left by no southward inflows from Finland. Sendout from Klaipeda has been higher this month than the 85 GWh/d in October and 80 GWh/d on 1-11 October last year. Klaipeda has already received two cargoes this month, on 4 and 12 November, and will receive a further two on 21 and 29 November, the terminal's schedule shows. This suggests that sendout is likely to remain brisk for the rest of this month, helping to meet higher regional demand as the weather turns colder and limits the need for strong withdrawals from storage early in the winter season. By Brendan A'Hearn FinBalt gas consumption by country GWh Gas-fired power generation by country GWh Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Cop: Brazil to release detailed 2035 climate plan

24/11/12

Cop: Brazil to release detailed 2035 climate plan

Baku, 12 November (Argus) — Brazil will release a detailed climate plan for 2035, covering all sectors of the economy, on 13 November, the country's environment minister Marina Silva said on the sidelines of the UN's Cop 29 climate summit in Baku, Azerbaijan. Brazil had already announced that it will reduce greenhouse gas (GHG) emissions by between 59-67pc by 2035, compared with 2005 levels , but had not released its new nationally determined contribution (NDC) — climate plan to be submitted to the UN Framework Convention on Climate Change (UNFCCC). The new NDC will include emissions reduction targets for the agriculture, transport and industrial sectors and will also reiterate the country's commitment to eliminating deforestation across all biomes, environment minister Marina Silva said. Brazil will seek to increase its agricultural output through productivity gains, rather than expansion into new areas. "We have the potential to double agricultural output without destroying the forest," she added. "We want to lead by example," Silva said. Brazil will host Cop 30 next year in Belem. Regarding the election of Donald Trump as US president, she pointed out that global efforts to protect the environment are not going to be diminished because of political cycles. "The US is an important country and the second largest CO2 emitter globally," Silva said, adding that many US states have "their own independent climate policies, which will not be suspended." Alongside Brazil, two countries have also announced new emissions reduction goals under their updated NDCs: the UAE and the UK . All Cop parties have to submit their 2035 NDCs by February next year. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Algerian bitumen importers eye resumed Spain flows

24/11/12

Algerian bitumen importers eye resumed Spain flows

London, 12 November (Argus) — Algerian bitumen importers are getting ready to resume cargo imports from Spain after the Algerian government signalled last week that trade can restart for the first time in more than two years. The government's decision in June 2022 to suspend a friendship and co-operation treaty with Spain, linked to Madrid's public recognition of Morocco's autonomy plan for Western Sahara, led to the immediate cancellation of previously agreed bitumen cargo movements from Spain to Algeria. In a notice issued by the Bank of Algeria on 6 November, Algerian firms were told they could resume trade with their Spanish counterparts under the usual transaction rules, and both state-owned and private Algerian bitumen importers say they are now free to discuss deals to buy and bring Spanish cargoes to their facilities for supply into the domestic market. No such deals are understood to have been concluded yet, but private importers into western Algerian import terminals like Ghazaouet, Oran and Arzew are well placed because of their relative proximity to Spanish export terminals at Tarragona, Huelva and Cadiz compared with existing supply sources in Italy and even more so when compared with cargoes shipped from Greece or Turkey. Ship brokers said freight rates for standard 5,000t bitumen tanker cargo movements from Tarragona — site of a 1.2mn t/yr Asesa bitumen refinery held in a 50-50 joint venture by Repsol and Moeve, formerly Cepsa, — to Ghazaouet are around $35/t, compared with around $50/t for the Augusta, Italy, to Ghazaouet route. Spanish and international bitumen trading and supply firms are still examining the Algerian developments and seeking clearance "on all sides", as one said today, before resuming bitumen cargo discussions with their Algerian counterparts. That could mean the actual restart of Spain-Algeria flows takes until early 2025. Demand for now may be hindered by a pre-winter slowdown in Algerian road construction and bitumen-consuming activity as weather conditions gradually worsen. Algerian state-owned Sonatrach, which imports cargoes into a raft of bitumen terminals along the country's Mediterranean coast, is largely dependent on substantial term flows from Sonatrach Raffineria Italiana's (SRI) 170,000 b/d refinery and export terminal at Augusta, Sicily, and occasionally takes Greek cargoes from Motor Oil Hellas' Agioi Theodoroi refinery and export terminal at Corinth. Sonatrach is less likely than private Algerian buyers to seek Spanish cargoes, on which it had been highly reliant until 2020 before it switched in a big way to Augusta after it bought the refinery there from ExxonMobil in 2018. Algerian market participants said the recent slippage in bitumen cargo prices linked to Mediterranean high-sulphur fuel oil (HSFO) declines and seasonally weakening bitumen cargo differentials to the regional HSFO cargo prices — coupled with a late season slippage in cross-Mediterranean freight rates over the past few weeks — are all factors conducive to resumed imports from Spain. Spanish fob cargo premiums to Mediterranean HSFO cargoes have dropped from around $10/t in mid-October to $2-3/t last week, while outright prices for Spanish bitumen exports have slipped from $498-499/t fob to $458/t over the same period. By Keyvan Hedvat Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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