17 April 2013 19:35 [Source: ICIS news]
MEDELLIN, Colombia (ICIS) --The Argentine biodiesel sector looks poised to ramp up production, following the government’s decision on Wednesday to increase the mandatory blend rate to 10%, a large seller in the region said.
The Argentine Secretary of Energy issued an announcement to refiners, including Yacimientos Petroliferos Fiscales (YPF), Shell, and Petrobras, announcing the increase of the blend rate from the current 7% to 10% by June, the source said.
The decision to increase biodiesel blending rates comes after Argentina’s YPF had to suspend operations in early April after a fire broke out at the La Plata refinery near Buenos Aires following heavy rains and an electrical outage.
The 188,000 bbl/day La Plata refinery accounts for 30% of Argentina’s refining capacity.
Many biodiesel producers in the region have been running at about 50% capacity in recent months, following restrictions on trade with Europe and uncertainty of federally-mandated domestic pricing.
Sources in the region have said that decreased biodiesel production has effectively lowered blend rates even below the previously mandated 7% because limited product available for blending.
A source familiar with the refinery’s operations said production at the La Plata refinery will likely be 15-20% lower than in 2012, and that additional fuel would have to be imported this year to meet demand.YPF was nationalised in May 2012 by President Cristina Fernandez de Kirchner’s government in an effort to reinvigorate a domestic industry marred by a decade of production stagnation.
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