US EPA grants three biofuel waivers to refiners before Trump leaves office

MOSCOW (MRC) -- The US Environmental Protection Agency (EPA) granted three waivers to oil refiners that exempt them from US biofuel blending obligations, a last-minute move before President Donald Trump leaves office, reported Reuters.

The agency granted two waivers for the 2019 compliance year and one waiver for the 2018 compliance year. The announcement followed four years of controversy around the waiver program under the Trump administration, but left many questions unresolved. Some 30 waiver requests remain outstanding for 2019 and 15 for 2020, which the incoming administration of Joe Biden will need to deal with.

The three waivers were granted to oil refiners, but it was not clear which refiners received the exemptions.

During his term Trump attempted to find a compromise between two major constituencies, farmers and oil refiners, that disagreed about national requirements to blend biofuels into the fuel mix.

Under the US Renewable Fuel Standard, refiners are required to blend billions of gallons of biofuels into their fuel mix, or buy credits from those that do. Refiners can apply for an exemption if they can prove the requirements would do them financial harm.

Biofuel producers and farmers say the waivers hurt demand for their products, while oil refiners reject that claim and say they are necessary to keep small refiners afloat. The Trump administration has greatly increased the number of waivers it grants to refiners.

The administration recently announced a series of moves regarding US biofuel blending laws. The agency this month said it was requesting comment on a potential general waiver for refiners for the 2019 and 2020 compliance years and also was proposing a new rule that would remove or alter the labeling for retail gasoline that contains higher ethanol blends.

The agency also said it was proposing to further extend the deadlines for oil refiners to prove compliance with blending requirements for both the 2019 and 2020 years.

Biofuel groups criticized Tuesday's announcement.

"It flouts both the statute and recent court decisions that clearly limit EPA's authority and ability to grant these exemptions," said Renewable Fuels Association President Geoff Cooper.

A lower court ruling that severely limited the government's powers to grant exemptions is due to be considered by the US Supreme Court later this year.

As MRC informed earlier, last year, US lawmakers introduced a relief bill that would include aid to biofuel producers after demand for the fuel plummeted because of the coronavirus pandemic, causing mass shutdowns in the industry. The bill, introduced by House Democrats, would reimburse producers that suffered unexpected market losses because of the pandemic from January 1 through May 1. It is not clear whether the bill as proposed will be passed into law.

We remind that within the framework of its net zero strategy, Total will convert its Grandpuits refinery (Seine-et-Marne) into a zero-crude platform and will invest more then EUR500 mln into this project. By 2024 the platform will focus on four new industrial activities: production of renewable diesel primarily intended for the aviation industry, production of bioplastics, plastics recycling and operation of two photovoltaic solar power plants.

We also remind that in November 2019, Total disclosed that itis evaluating construction of a new gas cracker at its Deasan, South Korea, joint venture (JV) with Hanwha Chemical.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC

Trinidad and Tobago returns to market searching for refinery buyer

MOSCOW (MRC) -- Trinidad and Tobago will return to the open market to seek a buyer for its oil refinery that ceased operations two years ago after rejecting a proposal from a local group, Finance minister Colm Imbert said, said Reuters.

Imbert said Patriotic Energies, a subsidiary of a trade union which represents oil workers, could not provide any credible offer of financing for the Petrotrin oil refinery. The government decided to “return to the open market to see if there is anybody else interested in the plant…and explore all options for the utilization of the refinery", he said.

The government shut down the state-run Petrotrin and ceased operations two years ago at its only refinery, which then had the capacity to process about 140,000 barrels per day of crude, to curtail losses of over USD1 billion in the previous five years.

The government said Petrotrin required a cash injection of USD4 billion to remain in operation, upgrade its infrastructure and repay the nearly USD2 billion in debt it had racked up.

As MRC informed previously, oil producers face an unprecedented challenge to balance supply and demand as factors including the pace and response to COVID-19 vaccines cloud the outlook, according to an official with International Energy Agency's (IEA) statement.

We remind that the COVID-19 outbreak has led to an unprecedented decline in demand affecting all sections of the Russian economy, which has impacted the demand for petrochemicals in the short-term. However, the pandemic triggered an increase in the demand for polymers in food packaging, and cleaning and hygiene products, according to GlobalData, a leading data and analytics company. With Russian petrochemical companies having the advantage of access to low-cost feedstock, and proximity to demand-rich Asian (primarily China) and European markets for the supply of petrochemical products, these companies appear to be well-positioned to derive full benefits from an improving market environment and global economy post-COVID-19, says GlobalData.

We also remind that in December 2020, Sibur, Gazprom Neft, and Uzbekneftegaz agreed to cooperate on potential investments in Uzbekistan including a major expansion of Uzbekneftegaz’s existing Shurtan Gas Chemical Complex (SGCC) and the proposed construction of a new gas chemicals facility. The signed cooperation agreement for the projects includes “the creation of a gas chemical complex using methanol-to-olefins (MTO) technology, and the expansion of the production capacity of the Shurtan Gas Chemical Complex”.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC

Indian oil imports at near three-year high in December

MOSCOW (MRC) -- India’s crude oil imports in December soared to the highest levels in nearly three years to more than 5 million barrels per day (bpd) as its refiners cranked up output to meet a rebound in fuel demand, reported Reuters with reference to data from trade sources.

A boy walks past an oil tanker train stationed at a railway station in Ghaziabad, on the outskirts of New Delhi, India, February 1, 2019.

India’s year-end rush for crude supplies coincided with stronger demand from north Asian buyers during winter, boosting prices and an accelerating de-stocking of floating storage globally.

December oil imports by India, the world’s third biggest crude importer and consumer, were about 29% more than the previous month and about 11.6% higher than a year earlier, the data showed, after fuel consumption rose for a fourth straight month to an 11-month high in December.

“India’s refinery utilisation rates are also nearing full capacity and probably refiners are replenishing inventory anticipating higher prices during winter,” said Ehsan Ul Haq, analyst with Refinitiv.

“This is the harbinger of a recovery in fuel demand and improving refining margins.”

However, India’s annual crude imports declined by about a tenth in 2020 from the previous year to 4.04 million bpd, the lowest in five years, data compiled by Reuters showed.

The share of India’s imports from the Organization of the Petroleum Exporting Countries, including supplies from the Saudi-Kuwait Neutral Zone, fell to a record low of 67% in December. OPEC’s average share for the first nine months of India’s current fiscal year which ends in March was about 74%.

OPEC's share of India's oil imports drop to record low

While India cut back imports from Middle Eastern, African and US oil in December from the previous month, it marginally lifted its intake of Latin American and Caspian Sea oil.

In December, Iraq remained the top oil supplier to India followed by Saudi Arabia, United Arab Emirates. Nigeria emerged as the fourth biggest supplier, pushing the United States down to the sixth position just after Brazil.

As MRC informed before, India’s Chemicals and Fertilisers Minister D V Sadananda Gowda said in mid-December, 2020, the demand for chemicals and petrochemicals is expected to rise 9% annually, and the size of the industry is likely to grow to USD300 billion by 2025.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC

Sinopec Yizheng selects INVISTA leading PTA Technology

MOSCOW (MRC) -- INVISTA’s technology and licensing group, INVISTA Performance Technologies (IPT), and China Petrochemical International Co., Ltd. (Sinopec Yizheng) have reached an agreement for licensing of INVISTA’s industry leading PTA P8++ technology for Sinopec Yizheng’s third PTA line, reported BusinessWire.

This plant will be installed in Jiangsu province, China, with an annual name-plate capacity of 3 million tonnes.

Sinopec Yizheng previously utilised IPT’s P6 PTA technology for its 450,000 te/annum second PTA line. Sinopec Yizheng and INVISTA are pleased to once more leverage this technology to create long-term value for both parties.

This is a further confirmation of INVISTA’s strategy of relentlessly improving its PTA technology offering, through a combination of increased scale, reduced capital and variable cost per tonne of PTA, and greater sustainability.

During the recent project kick-off meeting, Mr. Guo Xiaojun, Sinopec Yizheng’s General Manager, expressed his trust in the INVISTA PTA technology and extended his gratitude towards the INVISTA project team. Mr. Guo said, “These 3 million te/annum PTA plants is a major project for SINOPEC during the 14th five-year plan period and a critical project for Sinopec Yizheng as well. I look forward to the cooperation between the two parties. To ensure the success of the project, we will execute the project in an effective manner by setting the goal as ‘excellent quality, fast schedule and profitable investment’.”

Adam Sackett, IPT vice president of PTA, commented, “Following the experience of working directly with the Sinopec Yizheng team on the second PTA line in 2003, I am excited by this new chapter in the partnership between our organizations. The manufacturing capability of Sinopec Yizheng combined with INVISTA’s industry leading PTA technology is a great fit, which should meet the ambitious project goals set by Mr. Guo.”

INVISTA’s industry-leading PTA technology, including its latest version of P8 technology, is available as a license package from IPT.

As MRC wrote before, Sinopec Yangzi Petrochemical Company, part of Sinopec Group, has brought on-stream its No.3 purified terephthalic acid (PTA) unit in Nanjing. The company resumed operations at the unit on August 21, 2020. The unit was shut for maintenance on August 6, 2020. Located at Nanjing in China, the No.3 PTA unit has a production capacity of 650,000 mt/year.

PTA is used to produce polyethylene terephthalate (PET), which, in its turn, is used in the manufacturing of plastic bottles, films, packaging containers, in the textile and food industries.

According to MRC's ScanPlast report, Russia's estimate PET consumption reached 61,110 tonnes in November 2020, up by 1% year on year. Overall PET consumption in Russia reached 648,110 tonnes in the first eleven months of 2020, down by 18% year on year.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group's key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.
MRC

Mexico City goes back to the future with plastic bag ban

MOSCOW (MRC) -- Mexico City’s new ban on plastic bags has inspired visions of a journey back in time even as local makers of the packaging worry they could become obsolete, said Reuters.

The city’s government this week banned single-use plastic bags to complement worldwide efforts to protect the environment, sparking protests from companies that produce them. "We have to take plastic out of circulation,” said Andree Lilian Guigue, the official overseeing the ban in Mexico City, one of the world’s biggest metropolises. “Plastic and other waste products that damage the planet end up in the ravines, woods and public spaces of the city - and nobody cleans it up."

The ban that began Jan. 1 prohibits the sale or distribution of the bags pervasive everywhere from Walmart to corner shops.

Plastics industry association ANIPAC says the roughly 20 million people who live in Mexico City and its sprawl use about 68,000 tons of bags a year. Fines for plastic offenders could range from 42,000 pesos (USD2,219) to 170,000 pesos.

Gabriel Sanchez, who hawks produce at a marketplace, said the ban was a return to 1960s packaging. "Now we’re going back to paper bags, sacks, baskets,” he said. “I think it will take a while but people will get used to it."

Firms including Walmart's Mexico unit WALMEX.MX, breadmaker Bimbo BIMBOA.MX and conglomerate Femsa FEMSAUBD.MX agreed to offer free reusable bags this month and explore more ways to reduce plastic packaging.

Plastic producers say the plan will hurt an industry already struggling to adjust to a patchwork of reforms across Mexico, and are lobbying lawmakers to enact a federal law that would standardize rules and allow reusable, thicker bags. "The solution should be regulating bags, not prohibiting them," said Aldimir Torres, president of ANIPAC, which registers 141 plastic bag producers in Mexico City.

Nationwide the industry generates about USD30 billion a year, but it shrunk in 2019, partially due to plastic bans in various cities. Mexico City thinks the solution could be compostable bags, which easily break down.

But Jose del Cueto, spokesman of Inboplast, an association of companies that make more environmentally-friendly bags, says that would require costly imported materials. He wants the city to take after California, which banned single-use bags in 2014, but allows multiple-use plastic bags.

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports.
MRC