Big crude oil margins should boost U.S. refiner earnings

MOSCOW (MRC) - U.S. refiners ran full-tilt in the second quarter, fueled by cheap domestic crude and fat margins that should boost earnings, though their heavy activity could eventually saturate the market with gasoline, sapping profits down the road, as per Hydrocarbonprocesing.

U.S. independent refiners, including Phillips 66 and Marathon Petroleum Corp, are expected to announce strong results due to the heavy discounts for U.S. and Canadian crude, along with strong fuel demand and lower costs to comply with the nation's biofuel laws, analysts said.

Strong crack spreads - the margin on turning crude oil into diesel, gasoline and other products - have spurred refiners to keep production high. That margin <CL321-1=R> averaged about $21.07 per barrel in the second quarter, its highest since 2015.

Among the largest independent refiners, Marathon, CVR Energy, and Hollyfrontier Corp rank in the top 10 percent in Thomson Reuters analyst revisions models, which weighs recent changes in estimates for revenue and per-share earnings, suggesting positive trends headed into reporting season for refiners, which begins next week.

The discount on crude prices in Midland, Texas widened by nearly $10 a barrel against benchmark futures <WTC-WTM> during the second quarter, as production in the Permian surged beyond pipeline capacity to move oil out of the region.

Increased export demand also led to high utilization rates, a positive, said Sandeep Sayal, vice president in the refining and marketing group at IHS Markit. The United States exported about 5.1 million barrels per day (bpd) of products through the second quarter, according to data from the U.S. Energy Information Administration.

Refinery utilization rates hit their highest levels since 2005 in June as they processed record amounts of crude oil in June, according to the EIA.
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MOSCOW (MRC) -- Messer, the largest privately run industrial gases specialist, has signed a 15-year hydrogen supply contract with RUTGERS Germany, a subsidiary of Rain Carbon Inc, as per Hydrocarbonprocessing.

The industrial gases company will now invest a total of nine million euros in a hydrogen production facility at the site of Rain Carbon Inc. in Castrop Rauxel. The company will use the hydrogen in the hydrogenation of industrial resins.

Hydrogen is produced in plants like this of Messer in Hungary. The gas is used in the annealing of high-alloy steels and sintered parts as well as in hydrogenation processes in the chemical and food industries, for example.
Hydrogen is produced in plants like this of Messer in Hungary. The gas is used in the annealing of high-alloy steels and sintered parts as well as in hydrogenation processes in the chemical and food industries, for example.
Messer will also use the facility to supply other hydrogen customers in the region. The facility will produce hydrogen by means of the steam reforming process, using natural gas as the feedstock. It will have a capacity of 2,700 normal cubic meters per hour. That is the equivalent of approximately 15 tankers per day. Start-up of the hydrogen plant – Messer’s first in Germany – is planned for the third quarter 2019.
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MOSCOW (MRC)--Praxair, Inc. has renewed and expanded a long-term contract to supply hydrogen to Marathon Petroleum Corporation’s Galveston Bay Refinery in Texas City, Texas, as per Hydrocarbonprocessing.

Marathon Petroleum is the second largest transportation fuels refiner in the U.S. and operates an integrated refining, marketing and transportation system in the Midwest, East, Southeast and Gulf Coast.

This world-class 571,000-barrel-per-day refining complex is the second largest in the U.S. and requires reliable hydrogen supply to support production of clean fuels. Praxair has been supplying industrial gases to the Galveston Bay Refinery since 1985.

"We are proud to renew our contract with Marathon Petroleum,” said Dan Yankowski, president of Praxair’s global hydrogen business. “We look forward to supporting their ongoing operations and future growth, as Praxair continues to provide industry-leading reliability through our Gulf Coast hydrogen system."

Praxair operates over 50 hydrogen production facilities and six hydrogen pipeline systems worldwide. Refinery and chemical customers benefit from Praxair’s comprehensive portfolio of large-volume industrial gases, cylinder gases and specialized technologies, services and supply reliability.
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MOSCOW (MRC) -- Jacobs Engineering Group Inc. has been awarded a feasibility study contract from Equinor Energy AS to evaluate the possibilities for building a hydrogen production plant, including CO2 capture and export facilities, in Eemshaven, the Netherlands, as per Hydrocarbonprocessing.

The hydrogen will be supplied as fuel to an existing natural gas-fired power plant that will be converted into a hydrogen-fueled power plant designed to lower the plant's carbon emissions at a large scale.

The award of the feasibility study follows the Memorandum of Understanding of Equinor, with its partners Vattenfall and Gasunie, to evaluate the possibilities of converting Vattenfall's gas power plant Magnum in Eemshaven into a hydrogen-powered plant.

"Getting the opportunity to work with Equinor to study the possibilities of gas-to-hydrogen conversion and contribute to a significant CO2 reduction is meaningful to Jacobs in many ways," says Jacobs Senior Vice President and General Manager Energy and Chemicals EMEA David Zelinski. "The award enables us to leverage our expertise in gas processing and aligns perfectly with our vision to deliver innovative and sustainable solutions to our clients."

Building on Jacobs' expertise in hydrogen, reformer technology and CO2 capture, the study performed by Jacobs will focus on the objective of selecting the most effective reformer technology for hydrogen production together with a suitable CO2 capture technology. Jacobs will also deliver the conceptual design of the plant as a basis for economic evaluation and further project definition.

In order to avoid CO2 emissions from the hydrogen production process, up to three million tons per year of CO2 will be captured and then liquefied for ease of transportation to Norway, where it will be injected and stored in an off-shore reservoir. The first of three Magnum plant units should be converted to run on natural gas by early 2024.
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MOSCOW (MRC) – aeSolutions, a consulting, engineering and systems integration company that provides industrial process safety, cyber security and automation products and services, announced today that they have earned the Siemens SIMATIC PCS 7 Process Safety Specialist certification, as per Hydrocarbonprocessing.

"We are proud that aeSolutions is the first Siemens Safety certified partner in the Americas,” Ken O’Malley, President of aeSolutions states. “This certification validates our team’s commitment to being a leader in safety instrumented systems engineering and system integration. Because we often support our customers’ most complex and critical processes we consider this level of competence and certification to be essential to our business."

To become certified, solution partners undergo a rigorous, multi?faceted process facilitated by Siemens. A Siemens senior consulting engineer out of Karlsruhe, Germany audited multiple aeSolutions safety projects to ensure their project configuration workflow processes followed Siemens?documented best practices, as well as international functional safety standards (IEC 61511).

Overall, aeSolutions’ engineering team successfully demonstrated their capability to deliver compliant process safety projects using all of the latest Siemens process safety tools (including Safety Matrix). “As customers require PCS 7 safety instrumented systems, we can recommend aeSolutions, our certified Process Safety Specialist Solution Partner, knowing that they have the engineering and quality practices to execute the project right the first time using best practices,” says Rich Chmielewski, Siemens USA PCS 7 Solution Partner Program Manager.

aeSolutions was able to demonstrate and pass all of the requirements from our partner program to achieve the status of Siemens Process Safety Specialist. This certification provides confidence to the market that aeSolutions can offer quality and complete safety lifecycle services per the IEC 61511 functional safety standard for the process industries along with strong technical expertise using Siemens process safety technology,” says Charles M. Fialkowski, CFSE, Siemens National Director for Process Safety.
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