Eni restarts Gela HVO plant with new SAF capability

: Biofuels
24/12/11

Italian integrated Eni says it has restarted its 650,000 t/yr hydrotreated vegetable oil (HVO) plant at Gela, Sicily, following planned works.

Gela is operated by the company's Enilive joint venture with capital fund KKR. Enilve said the works were focused on production of HVO jet fuel (SAF). Enilive said the unit had undergone scheduled maintenance plus "revamping for a new SAF production unit that will be operational from 2025, with maximum flexibility on SAF or HVO production". Works lasted around five-six weeks.

Argus' tracking show the tanker Salina M arrived today at the Gela berth ready to load around 10,000t of HVO for an unspecified destination. The most recent large HVO cargo to leave Gela was 10,000t in the first week of October, according to Kpler data. It went to the port of Genoa, the most regular delivery destination for Gela's HVO. The unit did ship around 6,000t in smaller cargoes during the works, probably loaded from storage.

HVO prices have fluctuated recently. Enilive chief executive Stefano Ballista said the third quarter this year had the "lowest HVO margin ever seen." Since then Gela's maintenance coincided with a brief shutdown for planned works at TotalEnergies' 500,000 t/yr La Mede HVO unit close to the the French Mediterranean port of Lavera. In addition Finnish biofuels producer Neste had an emergency shutdown of its 1.4mn t/yr Rotterdam unit after a fire on 8 November, supporting a sharp rise in HVO prices in November.

By Adam Porter

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24/12/16

Viewpoint: Asia bio-bunkers to gain from EU regulations

London, 16 December (Argus) — New regulations in Europe should support Asian demand for marine biodiesel in 2025. The scope of emissions covered under the EU's Emissions Trading System (ETS) will rise to 70pc next year from 40pc this year, and this will be accompanied by the introduction of the FuelEU Maritime regulations at the turn of the year. FuelEU Maritime requires a reduction of greenhouse gas (GHG) intensity of fuels by 2pc in 2025 and up to 80pc by 2050, against a 2020 baseline level of 91.16 grammes of CO2 equivalent (gCO2e) per MJ. These upcoming regulatory changes in Europe should support buying interest for marine biodiesel blends because biofuels compliant with the EU's Renewable Energy Directive (RED) will have a zero CO2 emissions factor under the ETS next year. And waste-based biodiesel produced from feedstocks such as used cooking oil (UCO), which typically provide higher GHG emissions against fossil comparators under RED than crop-based biofuels, will be a viable alternative for many shipowners looking to reduce the GHG intensity of their conventional vessels. The regulations will not only support demand for marine biodiesel in Europe. They encompasses various flexibility mechanisms, aimed at supporting shipowners in meeting the required reductions, including a system that allows two or more vessels to create a pool in which compliance can be achieved across all vessels within the group as long as the total overall compliance balance of the pool is positive. Vessels operating between Asia and Europe will have half of energy consumed on those voyages subject to FuelEU Maritme regulations. The energy consumed from a marine biodiesel blend bunkered in Singapore, for example, could be mass balanced to be fully accounted for under this scope. Shipowners with vessels operating on the east-west route could therefore look to bunker marine biodiesel in Singapore or other parts of Asia, and then pool that vessel along with other vessels in their fleet that operate solely within Europe to achieve compliance using a non-European bunkered product. This dynamic will be supported by anti-dumping duties (ADD) imposed on Chinese biodiesel imports into Europe. The European Commission announced earlier this year provisional ADD measures on China-origin biodiesel and hydrotreated vegetable oil (HVO), with definitive measures set for mid-February 2025. In anticipation of the provisional duties, exports of Chinese biodiesel to the EU fell by over 50pc to 563,440t in the first half of this year compared with the same period of 2023. At the same time, exports of Chinese biodiesel to Singapore hit a monthly high of 16,500t in August, which was mainly attributed to marine biodiesel blends being bunkered at the port. This pushed Argus price assessments of B24 dob Singapore, a blend comprising used cooking oil methyl ester (Ucome) and very low sulphur fuel oil (VLSFO), to an average discount of about $90/t against B30 Ucome dob ARA in August-October. The more competitive pricing led to a shift in voluntary demand for marine biodiesel blends away from the Amsterdam-Rotterdam-Antwerp (ARA) hub in northwest Europe and towards Singapore. Marine biodiesel blend sales in Singapore hit a monthly high of 116,200t in October, according to data from the local maritime and port authority. The option to bunker marine biodiesel blends in Asia to meet European regulations will not be limited to Singapore. China's Zhoushan Port Authority said it will obtain a domestic blend permit by the end of this year, which will pave the way for suppliers to provide marine biodiesel blends to local and international shipowners. By Hussein Al-Khalisy Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Viewpoint: Policy changes support European biodiesel

24/12/16

Viewpoint: Policy changes support European biodiesel

London, 16 December (Argus) — European biodiesel participants are looking at a changed market in 2025 as new trade barriers, increasing mandates and a reset of the German greenhouse gas (GHG) savings quota support expectations of improved margins after a sustained squeeze. But continued uncertainty over what a second Donald Trump US presidency will mean for global biofuels markets has stymied some participants and could reshape trade flows again. Just like the old days? Recent policy changes affecting European biofuels are seemingly intended to return the biodiesel market to the period before the rapid increase in imports from China in early 2023, which weighed on prices. But the 2025 market also faces higher mandates and probably higher feedstock costs. In August, the EU imposed provisional anti-dumping duties on imports of biodiesel and hydrotreated vegetable oil (HVO) from China, and definitive anti-dumping duties of 11.1-36.6pc are due to come into force by February. The UK is currently conducting its own anti-dumping investigation into the same products from China, with a provisional recommendation expected by March and final recommendation in August. The duties have significantly slowed imports from China, with Chinese customs data showing biodiesel exports to the EU in August to October at 98,822t, down by 73pc from the same period in 2023. Low demand and high starting stocks continued to weigh on European prices for several months before supply levels tightened because of the drop in imports. Support for some European producers has not completely materialised, with high crop feedstock prices continuing to pressure production margins. European biodiesel supply levels have been further pressured by crop-based producers being unable to secure positive margins in the spot and forward markets, and cutting production, which may persist in 2025. China recently announced the cancellation of its UCO export tax rebate from 1 December, which could raise waste feedstock costs by 13pc from the major exporter. Indonesia also imposed export restrictions on palm oil mill effluent (Pome) oil, supporting advanced feedstock prices. The German cabinet approved a law in November removing the option for companies to carry over excess GHG quota certificates into 2025 and 2026, starting the market from scratch in 2025. In 2023, obligated companies exceeded their quota requirements by around 8mn t of CO2 equivalent, suppressing physical biofuel demand throughout 2024 as tickets were the cheaper option. With the change, Germany is expected to return to an Advanced Fame-focused market. Once the advanced fuel sub-mandate of 0.7pc by energy content has been met, advanced biofuels used towards the GHG quota can be double counted without a cap. When anti-dumping duties were announced, participants expected Chinese advanced producers to switch to feedstock pre-treatment and export to advanced biodiesel producers in Europe or Latin America. But the anticipated ramp-up in production outside China has not materialised, and now it seems that strong German demand may support the arbitrage from China reopening despite the duties imposed. The US outlook Across the Atlantic, a lack of clarity about Trump policies has stalled the market. Most uncertainty hinges on two points — the planned transition from the blender's tax credit to the Inflation Reduction Act's 45Z producer tax credit and Trump's plans to impose import tariffs on various countries . The blender's tax credit is due to expire at the end of this year and be replaced by a production tax credit based on carbon intensity, although official guidance has not yet been published. Exports of finished biofuels to the US would no longer receive the same tax benefit as domestic production, and flows could switch to primarily feedstocks, cutting off one option for European producers to recover thin domestic margins during low demand periods. It is also not clear if Trump will support 45Z or if the blender's tax credit will be extended following industry pressure. If Trump imposes tariffs on Chinese UCO imports, the door could open for European feedstocks and US biofuels could become more expensive. Currently, the UK imports large volumes of HVO from the US at a discount to European HVO to meet mandates — if that arbitrage closes, the UK would probably return to being a Ucome-focused market. By Simone Burgin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US river lock closures may delay product deliveries

24/12/13

US river lock closures may delay product deliveries

Houston, 13 December (Argus) — Mid-Mississippi River and Illinois River locks are expected to undergo long-term closures starting next month, slowing down some commodity deliveries. Three locks around the St Louis, Missouri, and Granite City, Illinois, region will be closed for repairs for up to three months starting 1 January, according to the US Army Corps of Engineers. The Mel Price Main Lock, where the Illinois River flows into the Mississippi River, and Lock 27's main lock, where the Missouri flows into the Mississippi, will also be closed from 1 January through 1 April. The Mel Price Main Lock will commence the final phase of replacement for its upstream lift-gate. Replacement of embedded metals will occur during the closure for Lock 27's main lock. Lock 25 will have a shorter closure date for a sill beam and guide-wall concrete installment from 1 January through 2 March. This is the first lock on the upper Mississippi River, after the Illinois River. These closures are expected to be more of a nuisance than a deterrent for commodity traffic, according to barge carriers. Ice in the river is likely to have melted by mid-March, which may cause barge carriers to wait in the St Louis harbor for the locks to open. Two other lengthy closures are anticipated on the Illinois River beginning on 28 January. The Lockport Lock — the second to last lock on the Illinois River — will be fully closed from 28 January through 25 March for full repairs to the sill and seal of the lock. The prior lock, Brandon Road Lock, will be closed during weekdays over the same time period, but traffic can pass through over the weekend. The lock closures and repairs are expected to delay some barge shipments, specifically to the Great Lakes and Burns Harbor. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Japan’s Saffaire SAF project gets ISCC certification

24/12/13

Japan’s Saffaire SAF project gets ISCC certification

Tokyo, 13 December (Argus) — Japan's Saffaire Sky Energy has acquired an international sustainable aviation fuel (SAF) certification and is moving ahead with its domestic SAF manufacturing project in Osaka prefecture, it said in a statement. Saffaire Sky Energy is a joint venture established in 2022 between Japanese refiner Cosmo Oil, engineering firm JGC, and biodiesel producer Revo International. Saffaire Sky Energy obtained the International Sustainability and Carbon Certification's (ISCC) Carbon Offsetting and Reduction Scheme for International Aviation (Corsia) in November, it said today, proving the sustainability of its SAF produced at its Sakai plant in Osaka prefecture. The joint venture plans to complete the construction of the plant by the end of 2024 and then begin a trial run at the beginning of 2025. It targets to generate 30,000 kilolitre/yr (517 b/d) of SAF by using domestic used cooking oil (UCO), with the commercial production to start from the beginning of April 2025-March 2026 fiscal year, likely in April or May, JGC said. The firm also acquired the ISCC EU certificate for its SAF and bio-naphtha production, showing that it complies with the EU's Renewable Energy Directive (RED) II. Saffaire Sky Energy has already received several inquiries to buy its SAF from companies, JGC added. It has accelerated its efforts to procure UCO by signing agreements with various organisations within the country, including the city of Sakai in Osaka, city of Kobe in western prefecture Hyogo, leisure and service provider Keikyu and restaurant operator Dining Innovation Investment. By Nanami Oki Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US rail group optimistic about 2025 rail demand

24/12/12

US rail group optimistic about 2025 rail demand

Washington, 12 December (Argus) — US rail volume is likely to start strong in 2025, but railroads will need to navigate changing federal policies, the Association of American Railroads (AAR) said. Volume next year hinges on a few key factors, including the resilience of consumer spending, strength in the labor market, and the trajectory of inflation and interest rates, the group said. Railroads will need to remain vigilant as these economic indicators will be critical in helping assess rail traffic and broader economic health in the months ahead, AAR said. "Strong intermodal growth and stable consumer demand offers reasons for optimism," AAR said. "But railroads and the economy alike must navigate evolving policies and potential disruptions" as the US enters 2025 under a new administration, the group said. The AAR'S optimism comes as rail traffic in November "while by no means stellar, suggests that the broader economy remains on stable footing", AAR said. US intermodal rail volume set new records in November. The increase reflected strong consumer demand following job gains that pushed increased spending, AAR said. Intermodal traffic is made up primarily of consumer goods shipped in containers between different modes of transportation, although some scrap metal and specialty agriculture products ship this way. US railroads loaded an average of 282,000 intermodal containers and trailers per week, up by 11pc from a year earlier. That was the highest weekly average for any November since AAR began tracking intermodal data in 1989. Carload traffic fell by 3.8pc compared with November 2023. Carload traffic is primarily made up of commodities. Coal was the "biggest problem", AAR said. US railroads loaded 15pc less coal last month compared with a year earlier, while year-to-date loadings were down by 14pc from the same 11 months in 2023. If coal were excluded, monthly US carload traffic in November would have notched a 10th consecutive year-on-year increase. Industrial products volume was down by 1pc from a year earlier. Manufacturing is a major driver of US carload traffic, and that sector remains sluggish, AAR said. By Abby Caplan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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