Exports of U.S. light sweet crude jump at Louisiana port

MOSCOW (MRC) -- The Louisiana Offshore Oil Port (LOOP) exported a record 283,333 barrels per day of light sweet crude last month, according to trade sources, as prices weakened against global Brent, said Hydrocarbonprocessing.

LOOP, which exports mostly medium sour grades produced in the U.S. Gulf of Mexico, last month exported more than twice the amount of light sweet from the prior month. Overall exports of U.S. crude hit a record 3.77 million barrels per day (bpd) one week in June, U.S. government data showed.

A decline in oil imports at the facility, stemming from record U.S. production, paved the way for exports from LOOP storage facilities, said Abudi Zein, chief executive of market research firm ClipperData.

Crude imports at the port dropped in June to about 56,667 bpd, from 174,194 bpd in May, data from Refinitiv Eikon showed. While nearly a dozen new oil-export ports have been proposed along the Gulf Coast, LOOP is the only U.S. oil terminal now capable of fully loading and unloading supertankers.

U.S. crude’s discount to Brent WTCLc1-LCOc1 widened in late May to minus $10.99 per barrel, the most in about a year, bolstering demand for U.S. oil. The spread was $6.42 per barrel on Tuesday.

Six tankers in June together carried a record 8.5 million barrels of light sweet crude from LOOP toward destinations in Asia and Europe, according to data from ClipperData and Refinitiv Eikon.

“If there were a lot of imports coming in, they wouldn’t have the space to push out all that crude,” Zein said. “Higher exports mean the pipe is pumping more out of the (storage) caverns."

LOOP spokesman Wade Tornyos declined to comment. Among the tankers exporting light sweet crude from LOOP in June was New Prime, chartered by Royal Dutch Shell Plc, which departed toward India, according to Refinitiv Eikon data and ClipperData.

Suezmax vessels Cap Felix and Amli Sky, last month departed LOOP for Greece and Italy, respectively, the data showed.

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MOSCOW (MRC) -- A law firm representing small U.S. refineries has urged the Environmental Protection Agency to keep refiners' applications for waivers from the nation's biofuel policy secret from the Department of Agriculture, arguing that the petitions include confidential business information, said Hydrocarbonprocessing.

The request, made by Perkins Coie in a letter to the EPA dated July 8, adds to mounting pressure from representatives of the refining industry for the Trump administration to box the USDA out of the controversial waiver program. The letter follows Agriculture Secretary Sonny Perdue publicly expressing opposition to the way the program has been run in recent years.

The program can exempt small refiners in financial turmoil from their responsibility to blend ethanol into gasoline under the Renewable Fuel Standard. Waivers can save them tens of millions of dollars but are broadly opposed by the corn industry, which argues they undercut biofuel demand.

Since President Donald Trump took office, the EPA has roughly tripled the number of waivers it has granted to small refiners, drawing anger from the corn lobby and putting Trump in the middle of a battle between two powerful constituencies important to his re-election campaign.

In the letter to EPA Administrator Andrew Wheeler, Perkins Coie said the applications contained confidential business information (CBI) that should not be shared with the USDA. "The USDA seeks the small refineries’ CBI in order to assert influence over EPA’s final decisions and thereby reduce the number of small refinery petitions granted by EPA. This interference is improper as a matter of law," it said.

The letter added that refiners feared the USDA would share the confidential information in the applications with players in the agriculture community, which could undermine the refineries' ability to compete.

"We would view any release of CBI to USDA as an indication that USDA was given improper influence over the decision-making process for small refinery hardship relief," the letter said.

Last week, Republican senators representing oil states wrote to Trump asking him to keep Perdue away from any decision-making process over the petitions. Louisiana Senator John Kennedy also wrote to Perdue saying he will block confirmation of agency nominations until Perdue "stops interfering."

Perdue has often sided publicly with farmers on the issue of biofuel waivers and told farmers at an event in Iowa recently that he had spoken to Trump about it and was helping to devise a fix. Trump has also ordered a review of the small refinery waiver program after hearing criticism from farmers during a recent tour of farm country.
MRC

MOSCOW (MRC) -- Iraq and Oman signed a memorandum of understanding to cooperate in the oil and gas sector, including the possibility of building a shared refinery in Oman for processing imported Iraqi crude, reported Reuters with reference to the Iraqi oil ministry's statement.

Iraq will aim to export crude to Oman, according to the MoU, import oil products from there and build oil storage facilities in both countries, the statement quoted Iraqi oil minister Thamer Ghadhban as saying.

"The MoU aims at studying the possibility of building a shared oil refinery in the Sultanate of Oman to process the crude oil imported from Iraq," Ghadban said.

The two countries will also explore prospects of cooperation and investment in exploring and producing oil and gas. In addition to refining, manufacturing, storing and marketing crude oil and oil products between them, the ministry statement said.

As MRC wrote previously, in April 2019, Petrofac secured a number of new awards and contract extensions, with a combined value of more than GBP23 million, to provide training solutions for key National Oil Company and International Oil Company clients in Oman, the UAE and Iraq.
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MOSCOW (MRC) -- Belarus’s Naftan refinery has started loading clean Russian oil after a major oil contamination earlier this year, reported Reuters with reference to the Polotsktransneft Druzhba pipeline operator.

The operator said in a statement it had started cleaning part of the Druzhba pipeline between Unecha and Polotsk and that it had pumped dirty oil back to Russia from the Unecha-Polotsk-1 section of the pipeline.

As MRC informed previously, in mid-May 2019, Belarusian Deputy Prime Minister Igor Lyashenko said that Minsk was able to raise the volume of oil it processes and had proposed to Russia to increase its deliveries to the Naftan oil refinery. Belarus plans to seek compensation from Russia for export and transit revenues that it did not receive due to the contamination of oil via the Druzhba pipeline.
MRC

MOSCOW (MRC) -- S-Oil's new residue upgrading complex (RUC) and olefin downstream complex (ODC) has been inaugurated at the company's Onsan Refinery in Ulsan, South Korea, according to Apic-online.

The project, which cost around USD4-billion, involved construction of a plant to upgrade low-value residue oil to high-value gasoline and propylene. The propylene is to be used for the production of 405,000 t/y of polypropylene (PP) and 300,000 t/y of propylene oxide.

Separately, S-Oil and Saudi Aramco, a majority shareholder in S-Oil, signed a memorandum of understanding (MoU) to collaborate on a USD6-billion steam cracker and olefin downstream project. Completion is expected by 2024.

PCN earlier reported that the project would include a 1.5-million-t/y steam cracker, which would produce ethylene and other basic petrochemicals from naphtha and refinery off-gas.

The downstream units would include the production of polyethylene and PP.

As part of the MoU, Aramco will provide its Thermal Crude-to-Chemicals technology, "shifting S-Oil's focus from 'oil to chemicals' to better position the company in the future energy market," Aramco noted.

We remind that, as MRC wrote earlier, in January 2019, S-Oil Corp, South Korea’s third-biggest refiner by capacity, said that refining margins are expected to improve in 2019, boosted by growing diesel demand.
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