PetroChina to drop PDVSA as partner in refinery project

MOSCOW (MRC) -- PetroChina Co plans to drop Petroleos de Venezuela SA (PDVSA) as a partner in a planned USD10 billion oil refinery and petrochemical project in southern China, reported Reuters with reference to three sources familiar with the matter.

The company’s decision adds to state-owned PDVSA’s woes after the United States imposed sanctions on the company on Jan. 28 to undermine the rule of Venezuelan President Nicolas Maduro.

However, dropping the company was not a reaction to the U.S. sanctions but follows the deteriorating financial status of PDVSA over the past few years, said two of the sources, both executives with China National Petroleum Corp, the parent of PetroChina.

"There will be no role of PDVSA as an equity partner. At least we don’t see that possibility in the near future given the situation the country has been through in recent years," said one of the executives, asking to remain unidentified because he is not authorized to speak to the media.

The move illustrates the fading relationship between Venezuela and China, which has given USD50 billion to the South American country in the form of loans-for-oil agreements. China, the world’s largest oil importer, is now the second-biggest buyer of Venezuelan crude in Asia, taking in 16.63 million tonnes, or about 332,000 barrels per day (bpd), in 2018.

That relationship began to fray in 2015 when Venezuela requested a change in the payment terms on the debt to ease the impact of its falling crude output and declining oil prices. Instead of handing out large fresh loans, Beijing has shifted to small investments or granting extensions in the grace periods for the outstanding loans.

The sanctions were imposed at the same time the United States and other nations have backed opposition leader Juan Guaido as legitimate ruler instead of President Nicolas Maduro. During Maduro’s rule, oil production has plunged while millions have left amid hyperinflation and as consumer goods have vanished from market shelves.

PDVSA was originally a 40 percent equity partner in the refinery project, located the city of Jieyang in the southern province of Guangdong. PetroChina and PDVSA received environmental approval for the project in 2011.

Initial plans were for the refinery to process 400,000 bpd of strictly Venezuelan crude oil. The plans have now been expanded to focus on petrochemical production including a 1.2-million-tonnes-per-year ethylene plant and a 2.6-million tpy aromatics plant. The plant is expected to be operational by late 2021, Caixin reported on Dec. 5.

Under the revised plan, the refinery will not be restricted to Venezuelan oil but could process other so-called heavy crude grades that could come from Middle Eastern producers such as Saudi Arabia and Iran, said the third official, a PetroChina trading executive.

An e-mail response from PetroChina’s public relations company Hill+Knowlton Strategies only stated "China-Venezuela Guangdong Petrochemical Co Ltd is a joint venture company approved by the state," referring to the formal name for the company set up by Petrochina and PDVSA to develop the refinery.

PDVSA and the Venezuelan Ministry of Petroleum did not respond to a request for comment from Reuters.

As MRC informed earlier, in January 2018, PetroChina nearly doubled the amount of Russian crude being processed at its refinery in Dalian, the company’s biggest, since January, as a new supply agreement had come into effect. PetroChina has designated three refineries in northeast China - Dalian, Liaoyang and Jilin - as the main receiving points for the increased Russian supply. Liaoyang will begin taking more crude once a major upgrade is completed at the end of last year - beginning of this year. The new volumes will flow as a result of Russia and China expanding the East Siberian Pacific Ocean pipeline that starts at Rosneft’s oilfields in East Siberia and enters China at border town of Mohe.
MRC

MOSCOW (MRC) -- Neste Corporation Press Release (EET) The Parliament of Finland has voted in favor of a law for gradually increasing the share of biofuels in road traffic to 30% by 2029, said Hydrocarbonprocessing.

In addition, the Parliament has approved a law for the distribution obligation of bio-based light fuel oil. According to the new law, a share of light fuel oil intended for heating, construction machines and fitted motors will be replaced by bio-based fuel oil starting in 2021.

“Neste shares the Finnish Government’s view that we need a large amount of sustainably produced biofuels in order to reduce climate emissions fast and sufficiently enough in the next decade. We need multiple solutions for reducing emissions: energy efficiency, better traffic planning, more public transportation as well as new technologies such as electric and gas-powered vehicles,” says Ilkka Rasanen, Director, Public Affairs at Neste.

“The advantage of liquid biofuels is that they are already available on a large scale today. Biofuels produced from waste and residues, such as Neste MY Renewable Diesel, reduce greenhouse gas emissions by up to 90% in comparison to fossil fuels. Liquid biofuels are fully compatible with the existing infrastructure so they can be used in the existing car pool” Rasanen continues.

The new law is an important step towards lower-emission transport to which Neste as a company is fully committed. The obligation is well aligned with the targets already set in Sweden and Norway and it brings Finland to the same ambitious level with its Western neighbours.
mrcplsat.com

MOSCOW (MRC) -- Bentley Systems announced the availability of OpenUtilities™ DER Planning & Design Assessment Solutions, the latest of Bentley’s electric utility software offerings that provide decision support and cost-based models and simulations for Distributed Energy Resources (DER) integration, as per Hydrocarbonprocessing.

In partnership with Siemens’ Digital Grid business unit, OpenUtilities Solutions for DER empowers electric utilities, electricity suppliers, and distribution network operators (DSO) with software applications to analyze, design, and evaluate DER interconnection requests through desktop and cloud-based services, while supporting the reliability and resilience of network operations. OpenUtilities Solutions for DER create automatic network analysis models for Siemens’ PSS®SINCAL with the integration of GIS-based network data (including ESRI, GE, and Smallworld).

The solutions generate an electrical digital twin for utilities – a GIS digital twin that enables owner/operators to more efficiently model the grid for decentralized energy without compromising safety and reliability. Some of the major challenges utilities encounter with DER integration are system complexity, increased regulatory requirements, high customer demand, and cost management. Digital twins can provide huge efficiencies in grid operations by streamlining DER interconnection applications with optimized workflows to better assess operational impacts, long-term strategic scenarios and investment decisions.

With the increasing penetration of DER into the grid, utilities need digital applications to handle the increasing demand for DER interconnections and collaborate across work groups. OpenUtilities DER Optioneering offers a cloud-based decision support initial screening and supplemental screening mechanism to evaluate DER interconnection requests using validation checkpoints and hosting capacity analysis. Utilities can benefit from this fast-track interconnection procedure to readily approve DER applications or to defer them to power systems planners to conduct further studies and impact analysis. The application provides a practical and cost-effective method to streamline and automate the DER approval process without always having to involve costly engineering resources and expedite the interconnection request process. It enables non-engineering staff and managers alike to effectively manage DER interconnection applications while adhering to complex regulatory requirements for DER permits.
MRC

MOSCOW (MRC) -- Fuchs Petrolub AG, a lubricant producer, announced that JArgen Hambrecht intends to resign from his position as Chairman of the Supervisory Board, which he assumed in 2011, at the end of the Annual Shareholders' Meeting on May 7, as per the company's press release.

The Supervisory Board will propose to the Shareholders' Meeting Kurt Bock, former CEO of BASF SE, to succeed Hambrecht in the Supervisory Board. If elected, the Board intends to appoint Dr. Bock as Chairman.

The changes are part of the long-term organization of the Supervisory Board.

At the upcoming elections of the Supervisory Board members in 2020, Erhard Schipporeit will retire from the Supervisory Board. Schipporeit has been a member of FUCHS PETROLUB's Supervisory Board as well as the Chairman of its Audit Committee since 2008.

At the Annual Shareholders' Meeting in 2020, the Supervisory Board will propose Christoph Loos, CEO of HILTI AG, for election to the Supervisory Board.
MRC

MOSCOW (MRC) -- U.S. exports of ethane have increased from nearly nothing in 2013 to an average of 260,000 barrels per day through the first 10 months of 2018, accounting for about one-sixth of U.S. hydrocarbon gas liquids exports, as per Hydrocarbonprocessing.

Ethane is a key feedstock for petrochemical manufacturing. The United States became the world’s top exporter of ethane in 2015, surpassing Norway, the only other country to ship ethane internationally. In 2014 and 2015, all U.S. ethane shipments went to Canada, but in 2018 the United States sent ethane to 10 countries.

U.S. production of ethane, which is separated from raw natural gas at processing plants, increased along with development of U.S. natural gas shale resources. U.S. ethane production grew 74%, from an average of 1.0 million b/d in 2012 to 1.7 million b/d in the 10-month period from January to October 2018. During the same period, ethane consumed in the United States increased from 0.9 million to 1.5 million b/d, primarily because of new sources of demand and new infrastructure that allows ethane to reach consumers.

The U.S. petrochemical industry, responding to greater feedstock availability and consequent lower prices of ethane on the domestic market, added capacity at existing plants and built new petrochemical steam crackers, resulting in an estimated USD200 billion dollars of new investment across the country.

Since early 2014, when the United States first exported ethane by pipeline to Canada, further infrastructure additions have enabled exports of ethane to grow and expand their geographic reach. Two more pipelines to Canada, as well as two marine terminals capable of shipping super-cooled ethane overseas, entered service in early 2018. Altogether, current U.S. export capacity totals nearly 450,000 b/d, and the United States now supplies ethane to Brazil, Canada, India, Mexico, Norway, Sweden, and the United Kingdom.

Recent completion of the Utopia pipeline—from Ohio to Ontario—has facilitated more ethane exports to Canada, and ethane exports are expected to grow, along with the capacity of the Canadian petrochemical industry to process the ethane into ethylene at the Sarnia, Ontario hub. Additional export facilities in the United States are also either under construction or being planned. Exports of ethane from Marcus Hook are likely to increase once the Mariner East 2 pipeline, which will deliver ethane to the terminal, is complete.

Energy Transfer Partners, parent company of Sunoco Logistics, is planning to build its second ethane export terminal along the Gulf Coast in Nederland, Texas. The Orbit Ethane Export Terminal, planned for completion in late 2020, will have the capacity to export 175,000 b/d of ethane overseas, with 150,000 b/d of that capacity already committed to Satellite Petrochemicals of China for its two newly built petrochemical crackers.
MRC