SOCAR Supervisory Holds Meeting

MRC -- Chaired by Mikayil Jabbarov, the Minister of Economy of the Republic of Azerbaijan and Chairman of the Supervisory Board of the State Oil Company of Azerbaijan Republic (SOCAR), a pivotal meeting was convened to thoroughly assess SOCAR's operational performance over the nine months of 2023, said the company.

The session encompassed detailed analyses of oil and gas field development activities, production metrics, advancements in renewable energy, and initiatives taken in decarbonization. Additionally, a thorough evaluation of the corporate Key Performance Indicators (KPIs) based on the nine-month was undertaken, and projection for the 2024 budget were discussed.

In alignment with the Presidential Decree issued on December 25, 2023, which designated 2024 as the ‘Green World Solidarity Year’ in the Republic of Azerbaijan, the establishment of SOCAR Green LLC was sanctioned. This initiative is aimed at bolstering the development of renewable energy sources in Azerbaijan and advancing SOCAR’s decarbonization objectives.

The meeting also featured a presentation on the current status of the ‘New Operating Model’. It was underscored that the operational model, deployed to fulfill strategic objectives, has significantly enhanced SOCAR’s corporate management efficiency, reinforced business sustainability, and expedited the progression of the company’s corporate culture within a notably short period.

The Supervisory Board’s agenda covered a range of other pertinent issues, fostering robust discussions and leading to the issuance of strategic directives for upcoming actions.

We remind, Romgaz said it signed the first individual contract for gas deliveries from Azerbaijan, with Azeri national oil company Socar. The contract allows for scheduled gas deliveries through the Southern Corridor starting January 1, using the transportation capacities of the Trans Adriatic Pipeline (TAP) and the Greece-Bulgaria Interconnector (IGB) , as well as those of the Bulgarian and Romanian transmission systems, Romgaz said in a statement filed with the Bucharest Stock Exchange, BVB.

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TechnipFMC has been awarded a major integrated Engineering, Procurement, Construction, and Installation (iEPCI™) contract by Petrobras to deliver the Mero 3 HISEP® project, which uses subsea processing to capture carbon dioxide-rich dense gases and then inject them into the reservoir, said Polymerupdate.

TechnipFMC, in partnership with Petrobras, has advanced the qualification of some of the core technologies needed to deliver the HISEP® (High Pressure Separation) process entirely subsea, several of which are proprietary and will be used in other subsea applications. These include gas separation systems and dense gas pumps which enable the injection of CO2-rich dense gas.

The Mero 3 project in Brazil’s pre-salt field will be the first to utilize Petrobras’s patented HISEP® process subsea. HISEP® technologies enable the capture of CO2-rich dense gases directly from the well stream, moving part of the separation process from the topside platform to the sea floor. In addition to reducing greenhouse gas emission intensity, HISEP® technologies increase production capacity by debottlenecking the topside gas processing plant. These technologies are supported by Petrobras and its partners in the Libra Consortium.

Luana Duffe, Executive Vice President, New Energy at TechnipFMC, commented: “This is an important moment for our Company. With the HISEP® project, we will again demonstrate how our leadership in subsea processing, technology innovation, and integrated solutions can deliver real and sustainable benefits to our partners. We are honored to be trusted by Petrobras and its partners in the Libra Consortium to deliver this transformational project.”

The contract covers the design, engineering, manufacture, and installation of subsea equipment, including manifolds, flexible and rigid pipes, umbilicals, power distribution, as well as life of field services. The contract follows a tender process and aligns with research and development guidance established by the Brazilian National Petroleum Agency (ANP).

We remind, Technip Energies has been selected to provide Proprietary Technology, Engineering, and Procurement services for Dow’s net-zero Scope 1 and 2 emissions integrated ethylene cracker in Fort Saskatchewan, Alberta, Canada. Technip Energies provided an Extended Basic Engineering Package for this new ethylene plant, including the cracking furnaces and the downstream separation section. This is the first ethylene plant worldwide to be designed to achieve net-zero CO2 emissions.

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Japanese refiner Toa Oil, a unit of Idemitsu Kosan, has shut a 70,000 bpd sole CDU at the Keihin refinery, near Tokyo, on Dec. 3 due to a system glitch, an Idemitsu spokesperson said on Friday, as per Hydrocarbonprocessing.

It is not clear for now when the unit will restart, he said.

We remind, U.S. gasoline and distillate inventories posted large builds last week as demand slipped, while crude stocks fell more than expected, the Energy Information Administration said on Thursday, news that sank prices for crude, gasoline and heating oil. U.S. gasoline stocks rose by 10.9 million barrels, the largest build since May 1993, to 237 million barrels in the week to Dec 29, the EIA said, compared with analysts' expectations in a Reuters poll for a 215,000 barrel drop.

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U.S. refiner and petrochemical manufacturer Phillips 66 is in active discussions for a sale of its non-core assets, Chief Executive Mark Lashier said on Thursday during an energy conference, said Hydrocarbonprocessing.

Last year, the company said it would monetize $3 billion in non-core assets in 2024 as part of a plan to boost returns by cutting costs and assets. Lashier, however, said there was no fixed timeline when such potential sales may occur.

"We don't have (a) sense of urgency... It's really going to be a function of whether someone puts a greater value on these assets than we do."

The refiner has lagged behind its rivals at a time when the industry benefited from higher fuel demand and saw a surge in margins. The company has also come under fire from activist investment firm Elliott Investment Management for its refining operations.

About the refining business, Lashier said inventories continue to be low, but he sees strength going into next year. The CEO was also optimistic about the long-term prospects of CP Chemical, a 50/50 joint venture with Chevron, that some Wall Street analysts have pegged as a potential divestiture.

"We still have good, strong conviction around the long-term benefits of chemicals business but we did hit bottom in 2023... we see fundamentals continue to improve."

We remind, Phillips 66 announced a 2024 capital budget of $2.2 B, including $923 MM for sustaining capital and $1.3 bn for growth capital. Excluding joint venture debt repayments due in 2024, the company’s 2024 capital budget is $2 bn.

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Cepsa and Air Europa have sealed an alliance whereby the energy company will supply 14.4 tons of SAF to the airline for one year to cover the first monthly Madrid-Havana flight, said Hydrocarbonprocessing.

This is the first time that two companies in Spain have established a regular supply of this sustainable fuel for a specific air route. During the period of collaboration between Cepsa and Air Europa, the emission of around 50 tons of CO2 will be avoided, equivalent to planting 575 trees.

The trips, which will feature 2% SAF in aircraft tanks, will serve as a test run ahead of the targets set by the European Union in its "ReFuelEU Aviation" legislative initiative, developed to boost sustainability in the airline industry. While there is no current obligation for airlines to use SAF, the new regulation requires European airlines to fly with 2% of sustainable fuel beginning in 2025, increasing to 6% in 2030 and 70% in 2050.

Jesus Nuno de la Rosa, CEO of Air Europa, said: "This agreement fulfills the commitments made in terms of sustainability, one of the backbones of the airline's 2023-2025 Strategic Plan. Likewise, by using this fuel on the route to Havana, the company is highlighting its strategic role in air connectivity with the Americas."

Tobi Pardo, Cepsa's Aviation Director, expressed the company's satisfaction at closing an agreement of this nature: "We strongly believe that these types of initiatives are fundamental to moving towards more environmentally friendly aviation. We are proud to join forces with Air Europa in its commitment to the decarbonization of air transport, helping Spain to become a benchmark for sustainable tourism. We will continue to invest in innovative technologies that will enable us to offer more efficient solutions to facilitate the sector’s energy transition and a cleaner, safer future for all."

Cepsa produces second generation (2G) biofuel at its La Rabida Energy Park in Palos de la Frontera (Huelva) from organic waste and used cooking oils. These second-generation biofuels, in addition to reducing aircraft emissions by up to 90% compared to conventional kerosene, promote the circular economy as they are produced using waste that would otherwise end up in landfills.

Cepsa is promoting the decarbonization of aviation as part of its Positive Motion strategy, which aims to lead the production of SAF in Spain and Portugal with an annual production capacity of 800,000 tons in 2030, an amount of sustainable fuel sufficient to fly over the planet 2,000 times.

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