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ENEOS sees winter fuel oil demand rising 150%, can only meet 100% surge

November 26/2021

MOSCOW (MRC) -- Japan's largest refiner ENEOS currently sees a 150% year-on-year increase in fuel oil demand from the power sector for winter, but can only meet up to a 100% surge, reported S&P Global with reference to ENEOS Holdings Chairman Tsutomu Sugimori's statement Nov. 25.

Speaking to reporters as President of the Petroleum Association of Japan, Sugimori said ENEOS was receiving a lot of inquiries from power utilities for fuel oil supply for winter amid high LNG prices.

Sugimori's comments came after company president Katsuyuki Ota said Nov. 11 that ENEOS was receiving a high number of inquiries from power utilities for fuel oil amid concerns that the country's refiners may not be able to meet all requests for the coming winter.

Last January, Japanese refiners boosted fuel oil supplies to power generators following an emergency request from the Federation of Electric Power Companies of Japan. That came as Japan experienced a power supply shortage as demand surged during extreme cold spells in January, with local power utilities forced to restrict gas-fired power generation due to low LNG stocks.

That was exacerbated by glitches at coal-fired power plants, low hydropower generation due to droughts, fluctuations in solar power output due to weather conditions, reduced oil-fired power generation capacity, and low nuclear power output.

As MRC informed previously, in the first week of June, 2021, Eneos Corp restarted the 168,000-bpd No.1 CDU at its Kashima refinery, east of Tokyo, after it was shut on May 11 due to system trouble. The refiner, which is a unit of Eneos Holdings Inc, restarted the 105,000-bpd No.3 CDU at its Mizushima-B refinery, western Japan, in early June, 2021. The CDU was shut on Feb. 25 for turnaround.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.

Japan's largest refiner JXTG Nippon Oil & Energy was renamed ENEOS Corporation on 25 June, 2020, as part of a wider re-organization of the parent company JXTG Holdings. The move, which also involved renaming the parent company to ENEOS Holdings upon approval at its annual shareholders meeting in June 2020, comes as it strives to be a more comprehensive energy and materials company under its 2040 vision announced in May, 2019. JXTG Holdings was formed as a result of a merger between JX Holdings and TonenGeneral in April 2017. This followed the establishment of JX Holdings as a result of the merger between Nippon Oil and Nippon Mining Holdings in April 2010.
Author:Margaret Volkova
Tags:PP, PE, crude and gaz condensate, propylene, ethylene, petrochemistry, Eneos, Nippon, Japan.
Category:General News
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