Author: Ricardo Perez

The European Union has agreed a substantial grant to support a carbon capture and green fuel production project in Greece.

Greece’s Vardinoyiannis Group-backed Motor Oil and the European Commission have signed the EU Innovation Fund Grant Agreement of €127m ($138m), for a pioneering Internet Registry Information Service (IRIS) project regarding the construction and operation of a Carbon Capture, Utilisation and Storage (CCS) and e-methanol production system at Motor Oil’s Agioi Theodoroi Refinery.

The IRIS project is among the 41 projects selected, out of the 239 proposals submitted, under the second round of the EU Innovation Fund’s ‘large-scale’ calls for proposals, and just the third in Europe involving a Steam Methane Reformer.

The IRIS project will integrate several innovative industrial processes, on a scale that has never been implemented before in an independent refinery.

In particular, the project will contribute to a 25% reduction of the refinery’s CO2 emissions, and thus to the achievement of the industry’s national and EU carbon reduction targets. At the same time, there are plans to establish an innovative e-methanol production plant, which will be produced from the available renewable hydrogen and part of the captured carbon dioxide, which will be one of the first plants to be set up in Europe.

Part of Motor Oil Group’s ‘Blue Med’ strategic plan, the project aims at the development of a hydrogen value chain in Greece. The quantities of renewable hydrogen produced by the 30MW electrolysis plant under development in Motor Oil’s EPHYRA project will be supplemented by sufficient quantities of low-carbon hydrogen that will comply with the prescribed limits of the EU Classification Regulation.

The launch of the construction of the project, once all the necessary individual agreements have been completed and the final investment decision has been obtained by the company, is expected to start in mid-2025 with a three-year completion deadline, so as to be operational in mid-2028, according to the timetable approved by the European Commission.

George Triantafyllou, gm of strategy at Motor Oil Group, said: “Motor Oil Group is determined to guide the industry’s energy transition and play a leading role in achieving the industrial decarbonisation goals and in establishing the hydrogen and hydrogen derivatives market in Greece.

“The funding from the European Union’s Innovation Fund marks a major milestone for the Group. We remain committed and fully aligned to the €4bn energy transition plan that has been announced, having invested €1bn up to now in this direction.

“We are leading the way, utilising our competitive advantages and we are committed to implementing emblematic and pioneering projects and investments, that will accelerate the transformation of our country’s energy mix, on the road to ensuring energy autonomy.”

January 16, 2024

01.15.2024 By Tank Terminals – NEWS

January 15, 2024 [Oil Price]- The Biden Administration took one more baby step towards refilling the nation’s Strategic Petroleum Reserves (SPR), announcing on Friday a request for proposal for another 3 million barrels of crude oil for May delivery.

The Strategic Petroleum Reserve started out at the onset of the current administration’s term with 638.1 million barrels in storage—the nation’s rainy day oil fund. But by the end of 2021, more than 44 million barrels had been sold off. In 2022, a whopping 221 million barrels had been sold off from the SPR, some of which was sold ostensibly to mitigate high gasoline prices that were at the time squeezing U.S. drivers—a situation that threatened to create a swath of angry voters ahead of the November 2022 mid-term elections. Others were part of a Congressionally mandated sales plan.

The SPR started out 2023 with 371.6 million barrels of oil in the SPR, falling to just 346.8 million barrels in July—just over half of what it was at the beginning of 2021 and the lowest levels since 1983. The Administration said it would eventually refill the SPR should oil prices fall at or below about $67-$72 per barrel. WTI is currently trading at $72.97 per barrel.

In the six months following the 346.8 million barrel low, the SPR has rebounded to 355 million—an increase of 8 million barrels across the six months. At that rate—750,000 per month, it would take years to get the SPR back up to 2021 levels. It would also cost $21 billion at $70 per barrel.

The Administration did cancel 147 million barrels that were previously mandated to be sold out of the SPR, so some argue that 147 million barrels has already been “put back in”

01.15.2024 By Tank Terminals – NEWS

January 15, 2024 [Oil Price]- A higher oil production quota will help to stimulate economic growth in the United Arab Emirates this year, according to a forecast by FocusEconomics cited by the Khaleej Times.Last year, the UAE produced less oil than it did in 2022, but for this year it negotiated a higher quota with its partners in OPEC+. For the duration of the year, the UAE can produce up to 3.219 million bpd of crude.

Still, that would mean cutting production during the first quarter of the year by some 160,000 bpd, the Khaleej Times report noted. That would be equal to 5% of its average 2023 output.

As the UAE’s oil output fell in 2023, exports of crude oil also declined, data from shipbroker Banchero Costa revealed earlier this month. Per the data, the UAE exported 129.1 million tons of crude oil in the first eleven months of the year. This was down 1.7% from 2022. In that year, the UAE saw a strong rebound in exports, at 15.3% higher than in 2021.

Also in 2022, the UAE’s economy grew at the fastest rate in more than a decade, according to the Khaleej Times, only to slow down in 2023. This should reverse this year, according to FocusEconomics.

“Regional instability is a downside risk, while Opec+ quota changes are a risk in both directions,” the economic intelligence provider said.

While regional instability is bad news for the economies in the region as investment destinations, the current situation in the Red Sea has revived the war premium attached to oil prices. On Friday, following strikes by U.S. and UK forces on targets in Yemen, Brent crude briefly topped $80 per barrel. Although it later retreated, the benchmark—as well as West Texas Intermediate—is on the rise as traders await news about possible supply disruptions.

January 25, 2024 [CGTN]- China’s renewable energy storage sector is developing rapidly, with installed capacity in operation exceeding 30 million kilowatts of power by the end of 2023. That’s the key message from the National Energy Administration in Beijing on Thursday. Officials said the newly added installed capacity topped 22 million kilowatts in 2023, up more than 260 percent compared to the end of 2022.

The government says the addition of new energy storage installed capacity has promoted investments worth more than 100 billion yuan, or 14 billion U.S. dollars, since the 14th Five-Year Plan. Officials also introduced the International Day of Clean Energy, which falls on January 26. It was declared by the UN General Assembly to raise awareness and mobilize action for a just and inclusive transition to clean energy for the benefit of people and the planet.

PAN HUIMIN Deputy Director General, Dept. of International Cooperation National Energy Administration “According to the latest data, the world’s newly installed renewable energy capacity hit 510 million kilowatts in 2023 and China has contributed more than 50 percent. Overseas clean energy investments by Chinese firms are spread across major countries and regions, covering major fields such as wind power, photovoltaic power generation, and hydropower.”

01.25.2024 By Tank Terminals – NEWS

The European Union has agreed a substantial grant to support a carbon capture and green fuel production project in Greece.

Greece’s Vardinoyiannis Group-backed Motor Oil and the European Commission have signed the EU Innovation Fund Grant Agreement of €127m ($138m), for a pioneering Internet Registry Information Service (IRIS) project regarding the construction and operation of a Carbon Capture, Utilisation and Storage (CCS) and e-methanol production system at Motor Oil’s Agioi Theodoroi Refinery.

The IRIS project is among the 41 projects selected, out of the 239 proposals submitted, under the second round of the EU Innovation Fund’s ‘large-scale’ calls for proposals, and just the third in Europe involving a Steam Methane Reformer.

The IRIS project will integrate several innovative industrial processes, on a scale that has never been implemented before in an independent refinery.

In particular, the project will contribute to a 25% reduction of the refinery’s CO2 emissions, and thus to the achievement of the industry’s national and EU carbon reduction targets. At the same time, there are plans to establish an innovative e-methanol production plant, which will be produced from the available renewable hydrogen and part of the captured carbon dioxide, which will be one of the first plants to be set up in Europe.

Part of Motor Oil Group’s ‘Blue Med’ strategic plan, the project aims at the development of a hydrogen value chain in Greece. The quantities of renewable hydrogen produced by the 30MW electrolysis plant under development in Motor Oil’s EPHYRA project will be supplemented by sufficient quantities of low-carbon hydrogen that will comply with the prescribed limits of the EU Classification Regulation.

The launch of the construction of the project, once all the necessary individual agreements have been completed and the final investment decision has been obtained by the company, is expected to start in mid-2025 with a three-year completion deadline, so as to be operational in mid-2028, according to the timetable approved by the European Commission.

George Triantafyllou, gm of strategy at Motor Oil Group, said: “Motor Oil Group is determined to guide the industry’s energy transition and play a leading role in achieving the industrial decarbonisation goals and in establishing the hydrogen and hydrogen derivatives market in Greece.

“The funding from the European Union’s Innovation Fund marks a major milestone for the Group. We remain committed and fully aligned to the €4bn energy transition plan that has been announced, having invested €1bn up to now in this direction.

“We are leading the way, utilising our competitive advantages and we are committed to implementing emblematic and pioneering projects and investments, that will accelerate the transformation of our country’s energy mix, on the road to ensuring energy autonomy.”

January 15, 2024

H2 Energy Europe, a builder of hydrogen ecosystems in Europe, has obtained environmental approval for its large-scale green hydrogen production facility in Esbjerg, Denmark.

The approval issued for the facility, which will have a 1 GW electrolysis capacity, is said to be a significant milestone, bringing the project closer to a final investment decision (FID).

According to H2 Energy Europe, the planned facility will support the decarbonization of heavy industries and road transportation, while also serving as chemical feedstock for the production of sustainable e-fuels like methanol and ammonia, advancing Europe’s green transition.

In addition to creating approximately 60 permanent jobs and up to 700 jobs during the construction phase, the facility will also produce CO2-neutral surplus heat, which has the potential to supply the majority of households in Esbjerg with district heating.

Jesper Frost Rasmussen, the mayor of Esbjerg municipality, said the environmental approval granted to the upcoming hydrogen plant by H2 Energy Europe is of immense significance for Esbjerg, positioning it as a leading green business city in Europe.

“H2 Energy Europe will play a pivotal role in attracting additional Power-to-X (PtX) companies to Esbjerg. However, there remains a need for clarity regarding the placement of the hydrogen pipeline and its expected establishment, which are critical for the realisation of a robust hydrogen industry in Denmark. We hope for a resolution on these matters very soon, further advancing the region’s green energy ambitions,” Rasmussen explained.

Mark Pedersen, Operations Manager at H2 Energy Europe, stated: “Our foremost priority is the safety of our operations. Achieving an environmental approval for a project of this size and at such an early stage in the year highlights our commitment to ensuring the well-being of our community. It also reflects the supportive and forward-thinking approach of Esbjerg municipality. We are deeply grateful for their cooperation and shared vision in making this project a reality.”

While this approval represents a significant milestone for Denmark in leading the way in Power-to-X technology, H2 Energy Europe noted it acknowledges the challenges that lie ahead.

The significance of the proposed pipeline, slated for completion by 2028, cannot be overstated, as it will play a vital role in distributing the green hydrogen produced by the facility to other countries in Europe, bolstering Denmark’s economy, the company concluded.

January 15, 2024

South Africa’s Transnet National Ports Authority has appointed Dutch terminal operator Vopak and its consortium partner Transnet Pipelines to build and operate a liquefied natural gas (LNG) import facility at the Port of Richards Bay.

Both TNPA and Transnet Pipeline are part of South African rail, port, and pipeline company, Transnet, owned by the government of South Africa.

Following a procurement process through a request for proposals, TNPA has appointed the Vopak & TPL consortium to design, develop, construct, finance, operate, and maintain the LNG terminal in the South Dunes Precinct at the Port of Richards Bay for a period of 25 years, it said in a statement.

TNPA said the terminal is a partnership between the private sector and the public sector, with the private sector as the lead investor.

Also, TNPA will invest in the common user port infrastructure, while the terminal operator will provide the terminal infrastructure.

2027

TNPA said this terminal is set to change the “economic dynamics of the port city, the KwaZulu Natal Province and introduce an alternative source of energy as South Africa battles an energy crisis and transitions towards decarbonization.”

The firm said this project is the first of its kind in South Africa and brings TNPA closer to its strategic goal of assisting the country through this LNG import terminal and as a midstream LNG importation infrastructure for markets in the KwaZulu Natal hinterland.

According to TNPA, project timelines will see the commercial operation during 2027, with the next step being the signing of the terminal operator agreement which is currently under negotiation.

TNPA did not reveal any information regarding the LNG import terminal in the statement.

According to TNPA’s tender documents issued in 2022, the LNG-to-power project must be designed to enable the realization of a minimum annual throughput of 1 million tons per annum scaling up to achieve a throughput of 5 million tons per annum by 2036.

TNPA’s document show that the project includes an FSRU which would be located at Berth 207 in the port.

Vopak’s LNG growth

LNG Prime contacted Vopak to provide more information on the terminal.

A spokeswoman for Vopak said this move “very well fits into Vopak’s strategy to grow in LNG”, but she declined to provide more details.

Vopak has extensive experience in LNG terminal operations.

In partnership with Dutch Gasunie, it operates the Gate LNG terminal in Rotterdam and the FSRU-based LNG hub in Eeemshaven.

Vopak also has a 60 percent stake in the Altamira LNG terminal in Mexico, a 49 percent share in Colombia’s only FSRU-based LNG import facility in Cartagena, and a 44 percent stake in the Engro Elengy FSRU-based terminal in Pakistan.

LNG Prime, January 12, 2024

Growing oil producer Guyana is talking with five potential investors interested in building and operating the country’s first refinery, vice-president Bharrat Jagdeo said last week.

The government issued a tender in October for the 30,000 b/d facility, but has not said when it will decide which bidder will design, construct and operate the refinery.

Guyana “is exploring all options to ensure that its refinery will be economically viable, sustainable, and will bring added benefits to the country,” Jagdeo said.

A Guyana plant would counter a trend in the Caribbean basin that was once dominated by large plants with cumulative capacity of over 1.6mn b/d that process mainly imported feedstock.

But the region’s refining capacity has been reduced to approximately 160,000 b/d inthe past 35 years as refineries have been shuttered.

Closed refineries include the 650,000 b/d St Croix plant in the US Virgin Islands, Curacao’s 335,000 b/d Isla, Aruba’s 235,000 b/d San Nicolas facility and the 165,000 b/d Guaracara plant in Trinidad and Tobago.

US Virgin Islands domestic start-up Port Hamilton is locked in legal arguments with US federal environmental agency EPA that ordered a halt in 2022 to preparatory work to reopen St Croix.

China’s GZE, Germany’s Klesch, Dutch contractor Corc and US-Brazilian consortium CPR are among companies that unsuccessfully vied to reopen Isla, which was shuttered in 2019 when Venezuela’s state oil company PdV declined to renew its expired long-term lease.

Trinidad shut Guaracara in 2018 because it became uneconomic. Despite approaches from a domestic labor union-owned company and California-based electrical contractor Quanten, the government has been unable to offload the facility.

Negotiations for Quanten to purchase San Nicolas also failed after state-owned oil company RdA cancelled an agreement in June 2022.

Problems that afflicted PdV have also set back expansion plans in regional refineries in which it had in interest.

The Dominican Republic took complete ownership of the 34,000 b/d Haina refinery in August 2021 with the purchase of PdV’s 49pc stake, saying it was “disappointed” by PdV’s delay in implementing its commitment to expand Haina’s capacity to 60,000 b/d.

Jamaica’s government also took PdV’s 49pc stake in the 35,000 b/d Kingston facility, contending that the Venezuelan firm had reneged on an agreement to expand the capacity to 50,000 b/d.

Cuba’s state oil company Cupet took over PdV’s 49pc stake in the 65,000 b/d Cienfuegos refinery in 2017, after the collapse of an agreement to lift capacity to 150,000 b/d.

Russian oil firm Rosneft is yet to deliver on a later project to expand Cienfuegos and upgrade the island’s Soviet-era Nico Lopez refinery in Havana and the Hermanos Diaz in Santiago.

Guyana is projecting crude output of 1.2mn b/d by 2027. Its rapidly expanding production raised hopes of available feedstock to lift refinery capacity in the region.

The Dominican Republic said in August that it reached an agreement with Guyana to jointly develop a 50,000 b/d plant on Guyana’s north coast.

But Guyana has no immediate plans to build a second facility, Jagdeo said a week later. “We do not have the capacity for two refineries now.”

Trinidad’s Guaracara facility could be reopened to process Guyana’s crude, Trinidad energy minister Stuart Young said. But Guyana will not accept that offer, according to natural resources minister Vickram Bharrat.

“Everything points to a successful refinery project in Guyana,” a Trinidadian industry official told Argus last week. “But there’s little hope of a reopening or expansion of any refinery in the region. And I would not be surprised if some existing capacity were to be shut down.”

Argus Media, Canute James, January 8, 2024