Energy

SAO PAULO (ICIS)–Petrobras is to restart its large-scale ANSA fertilizers plant in Araucaria, state of Parana, which has been idle since 2020, the Brazilian state-owned energy major said late on Wednesday. The company did not disclose the date it intends to restart production but said as soon as “next week” technicians would work at the site to establish what repair or upgrading work is necessary to restart the facilities. The facilities are called Araucaria Nitrogenados SA (ANSA), a wholly owned Petorbras subsidiary. They are located next to Petrobras’ Presidente Getulio Vargas Refinery (REPAR). Production capacities stand at 720,000 tonnes/year of urea, 475,000 tonnes/year of ammonia, and 450,000 cubic meters/year of the so-called ARLA urea, an additive added to diesel engines to reduce the emission of polluting gases. “In view of the review of the company's strategic guidelines approved last year, investment in fertilizers production is once again part of Petrobras' portfolio,” said the company. Petrobras new CEO, Jean Paul Prates, was appointed by President Luiz Inacio Lula da Silva in January 2023, when he started his term. Unlike the prior Administration, Lula wants Petrobras to play a more active role in the economy. Lula has repeatedly said Brazil needs to increase fertilizers production to lessen its dependence on imports – the country’s trade deficit in fertilizers is large as its agricultural output has become on of the largest in the world. Agriculture is now a quarter of Brazil's economy. Moreover, the significant producer of fertilizers in the country, Unigel, has paused production on two large-scale fertilizers plant due to high natural costs while it negotiates with its creditors a debt restructuring. The two plants were a 10-year lease from Petrobras signed in 2019. Meanwhile, Unigel and Petrobras have been involved in negotiations to help the former restart its plants, but an agreement signed in December is now under scrutiny. All in all, the two plants remain idle. This week, Petrobras said its “re-entry” into the fertilizers sector would first focus on “assets that already belong” to it. Front page picture: Petrobras' facilities in Aracaura, state of Parana  Source: Petrobras

18-Apr-2024

LONDON (ICIS)–Eloise Radley, Energy Market Reporter, and Ignacio Sotolongo, Senior Editor at ICIS, sit down to discuss how geopolitics have impacted US oil production in recent years and how things could change if we see a new administration in November.

17-Apr-2024

SAO PAULO (ICIS)–Polymers major Braskem and US petrochemicals engineering services provider Lummus are to carry out a joint study with US engineering services provider Lummus to electricity one of its steam crackers in Brazil. Financial details were not disclosed. The two companies did not disclose which facility Lummus’ proprietary technology for e-cracking will be tested. Lummus commercializes its proprietary technology under the branded name SRT-e. “The SRT-e electric cracking heater leverages Lummus’ proven Short Residence Time (SRT) technology modified to operate using electricity and incorporates a modular unit-cell design that can be replicated for plants to accommodate any commercial capacity,” said the two companies. “The technology uses all commercially demonstrated components, plus an optimum heat flux profile leading to a longer radiant coil life and longer run length. In addition, decoking can be carried out on a unit-cell basis so maintaining a spare heater is not required.” Steam cracking is one of the most energy-intensive activities within a petrochemical plant. The sheer amount of energy required has so far made crackers’ electrification elusive. Some petrochemicals majors are developing experimental e-cracking units. In 2022, Dow and Shell announced one test unit in the Netherlands. Also in 2022, Germany’s BASF and Saudi Arabia’s SABIC, together with industrial gases major Linde, announced another test unit at BASF’s flagship Ludwigshafen site.

17-Apr-2024

SINGAPORE (ICIS)–Singapore's petrochemical shipments in March fell by 3.6% year on year to Singapore dollar (S$) 1.16 billion ($853 million), extending the 2% contraction in the previous month and weighing on overall non-oil domestic exports (NODX), official data showed on Wednesday. March non-electronic NODX down 23.2% year on year March manufacturing PMIs show continued expansion Singapore economy forecast to grow 1.0-3.0% in 2024 Overall exports of chemicals and chemical products in March fell by 37% year on year to S$3.54 billion, reversing the 5.8% expansion in February, Enterprise Singapore said in a statement. The country's NODX for the month fell by 20.7% – a much steeper decline from February’s 0.2% contraction – to S$14 billion because of a high base a year ago, with shipments to most major trading partners posting declines. March non-electronic NODX, which includes petrochemicals and pharmaceuticals, fell by 23.2% year on year to S$11.2 billion. Overall NODX to seven out of Singapore's top 10 markets fell in March, but shipments to Hong Kong, Taiwan and China rose. Singapore is a major manufacturer and exporter of petrochemicals in southeast Asia. Its petrochemicals hub Jurong Island houses more than 100 global chemical firms, including energy majors ExxonMobil and Shell. In the first quarter, the country’s economy grew by 2.7% year on year in the first quarter, accelerating slightly from the 2.2% expansion in the preceding quarter, according to official advance estimates. On a quarter-on-quarter seasonally adjusted basis, Singapore’s economy expanded by 0.1%, extending the 1.2% expansion in Q4. The manufacturing sector in Q1 grew by 0.8% year on year, moderating from the 1.4% expansion in the previous quarter. "Within the sector, output expansions in the chemicals, precision engineering and transport engineering clusters more than offset output contractions in the electronics, biomedical manufacturing and general manufacturing clusters," the Ministry of Trade and Industry (MTI) said. For the whole of 2024, Singapore's economy is expected to expand by 1.0-3.0%, compared with actual GDP growth of 1.1% growth in 2023, the ministry said. Manufacturing activity in Singapore improved in March, with the Singapore Institute of Purchasing and Materials Management (SIPMM) purchasing managers' index (PMI) inching up to 50.7, marking the seventh straight month of expansion. In contrast, a separate survey of private manufacturers by financial information and services provider S&P Global showed Singapore’s March PMI eased to 55.7 from 56.8 in February. Focus article by Nurluqman Suratman Thumbnail image: Singapore harbour and the Marina Bay Sands Hotel, 16 March 2023. (Franz Neumeier/imageBROKER/Shutterstock) ($1 = S$1.36)

17-Apr-2024

HOUSTON (ICIS)–Global container shipping major Maersk will resume Panama Canal transits for its OC1 service beginning 10 May, ending its “two-loop” setup it established in January because of transit restrictions brought on by a persistent drought. Maersk ceased transiting the canal in January for the service connecting Asia-Pacific and the US East Coast and instead transported containers across Panama using railroads. The company said it is taking the action because of the onset of the rainy season in the region and after the Panama Canal Authority (PCA) added three more daily slots based on the present and projected water levels in Gatun Lake. The PCA said it is optimistic that traffic through the canal could return to normal in 2025 as current forecasts indicate that steady rainfall will arrive later this month and continue during the rainy season. The PCA said all future plans remain contingent on how much rainfall comes and water levels in Gatun Lake. Peter Sand, chief analyst at ocean and freight rate analytics firm Xeneta, said he thinks there is still a long way to go before trade lanes via the Panama Canal become normal. “There may be projections for increased rainfall but at the moment they are just that – projections,” Sand said. “If water levels do not rise then it will be interesting to see how this plays out and whether Maersk can stick to this timeline.” Container ships and costs for shipping containers are relevant to the chemical industry because while most chemicals are liquids and are shipped in tankers, container ships transport polymers, such as polyethylene (PE) and polypropylene (PP), which are shipped in pellets. Some liquid chemicals are also shipped on container ships using isotanks. Please see the Logistics: Impact on chemicals and energy topic page

16-Apr-2024

LONDON (ICIS)–Gas in Focus deputy editor Marta Del Buono talks about key drivers for the current weeks affecting European gas market: Increasing geopolitical tensions support European gas prices ICIS technical analysis also indicates bullish sentiment across commodities Below average temperatures and below solar generation in Germany add support

16-Apr-2024

LONDON (ICIS)–As cyber threats are intensifying, many energy utilities, producers and suppliers divert cash needed to develop new projects or prepare for the energy transition to boosting cyber defences. In this free paper , ICIS’ energy and cross-commodity expert Aura Sabadus and senior market reporter Rob Dalton highlight the risks by discussing three recent cases where companies or organisations in the energy sector were the target of cyberattacks and which illustrate the dangers facing the industry. The paper concludes with remarks related to the safeguards that could be introduced to boost cybersecurity.

16-Apr-2024

South Korea LNG storage levels healthy Official data from January ICIS estimates for March SINGAPORE (ICIS)–South Korea LNG inventories were estimated at 5.1m tonnes in March 2024, according to ICIS data, a healthy level that has benefited from weak LNG consumption, rising power generation from alternative fuels and renewables and a mild winter. The estimates also align with the KESIS monthly energy statistics released this week that showed January at 4.5m tonnes, 16% higher than the same month last year, and 50% above the five-years-average. For the March estimate by ICIS, 19% of LNG imports were stored in the tank for winter gas supply security purposes. In November 2023, state-run KOGAS and private LNG importers vowed to actively cooperate and ensure no disruption of LNG-to-power generation until the end of winter in March 2024.

16-Apr-2024

LONDON (ICIS)–Energy market reporter Amun Govil Lie sits down with relationship manager Pål Rasmussen from Gassco to discuss gas transport infrastructure on the Norwegian Continental Shelf, what the future holds for Norwegian gas exports to Europe, opportunities for hydrogen transport and the risks of sabotage on critical infrastructure.

15-Apr-2024

HOUSTON (ICIS)–Here are the top stories from ICIS News from the week ended 12 April. Oil slumps by more than $2/bbl on Israel-Hamas ceasefire hopes Oil prices fell by more than $2/barrel on Monday amid easing tensions in the Middle East after Israel further withdrew troops from southern Gaza and signalled a willingness to resume ceasefire talks with Palestinian militant group Hamas. EPA’s final rule on US chem plant emissions could weigh on EO production – ACC The US Environmental Protection Agency (EPA) finalized a rule on Tuesday aimed at reducing hazardous air pollutants from chemical plants, which some think could weigh on production of key chemistries and could lead to higher costs being passed through to consumers. INVISTA to explore alternatives for nylon fibers business INVISTA plans to explore strategic alternatives for its nylon fibers business and has engaged Barclays as exclusive financial advisor during the exploration process, the US-based manufacturer of chemical intermediates, polymers and fibers said in a statement late on Tuesday. US East Coast PET bale prices steadily rise amid snug supply, rising beverage demand Despite historic patterns, East Coast polyethylene terephthalate (PET) bottle bale prices have risen only slightly and very steadily over the last several weeks. Crude demand expectations fall for 2024 as trends shift back to pre-COVID pattern – IEA The International Energy Agency (IEA) on Friday cut crude oil demand forecasts for the year, with rates expected to fall further next year as consumption returns to the pre-COVID-19 trend, increasing the odds of a peak in oil consumption this decade, the agency said. Argentina’s inflation up to 288% in March, but central bank cuts rates on ‘pronounced slowdown’ Argentina’s annual rate of inflation rose to 287.9% in March, up from 276% in February, the country’s statistical agency Indec said on Friday.

15-Apr-2024