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Here’s hoping the refining investments come off

The review of Opec’s World Oil Outlook 2017 does not end with what was discussed last week with respect to energy and oil’s supply and demand balances to 2040. If demand for liquid fuels, including crude, is forecasted at 111 million barrel a day (mbd), then there is a need to expand the refineries to meet demand. The current refinery distillation capacity is about 97 mbd, but the expansion also requires meeting individual product demand and their evolving specifications. Hence the need for conversion, desulphurisation and octane improvement is part ...

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Saudi Aramco shuts Jeddah refinery indefinitely – sources

State oil giant Saudi Aramco has shut down its 90,000 barrel per day crude oil refinery in Jeddah indefinitely, industry sources familiar with the matter said on Sunday. Aramco had for years been considering whether to shut the refinery because of age and environmental concerns. The facility, which started operating in 1967, served much of the country’s western region and its closure will increase demand at other Saudi facilities. It produced liquefied petroleum gas, gasoline, diesel, asphalt and jet fuel, and exported naphtha. One source said the facility would be ...

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Natural Gas Prices Have Finally Started To Rise

After months of being stuck in the $2.75 to $3.10 range, natural gas prices have finally started to rise, with the December contract hitting $3.21 per MMBtu on November 10. Although November gas contract expired at $2.75 at the end of October, easily the lowest expiration since March ($2.63), prices closed on Friday at $3.10. The gas-based heating season is in full swing, and residential usage surges to being over 30% in winter for all gas demand, versus around 5% in summer. Gas demand in winter can double from summer ...

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GLOBAL LNG-Asian prices rise as Korea Gas Corp buys winter supply

Asian spot liquefied natural gas (LNG) rose this week as state-run Korea Gas Corp purchased around 10 shipments for winter and outages curbed supply. Spot prices LNG-AS for December delivery rose 25 cents to $9.70 per million British thermal units (mmBtu), and January prices were assessed at $9.85 per mmBtu. Korea Gas Corp, or Kogas, purchased at least 10 cargoes in the past week for January delivery at prices in the high $9 per mmBtu level with Vitol, Engie, Petronas and Royal Dutch Shell closing sales deals, a trader said. ...

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What will peak oil demand mean for refining?

With gasoline demand in the US, the largest gasoline market, forecast to decline from its 2017 peak, the outlook for refined product markets is unclear. We do expect to see a transition back to being distillate-led. And although the change in bunker fuel regulation is a key uncertainty, the requirement for cleaner distillate fuels will be supportive to refining earnings and distillate crack spreads for 2020. Declining OECD gasoline demand also presents the global refining sector with a set of opportunities and challenges, which differ depending on the refiner’s location. ...

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Gazprom continues western European natural gas growth

Gazprom’s natural gas supplies to western Europe edged up by 3% year on year in the third quarter of 2017, according to an S&P Global Platts analysis of Gazprom data, as Russian gas deliveries to its core markets continue to outpace last year’s levels. The Russian gas giant has largely focused its marketing efforts on maintaining healthy relationships with its key customers in western Europe in recent years, with contract renegotiations allowing increased flexibility on pricing and volumes. Gazprom wants to make sure it can fill the growing import gap ...

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New US gas pipelines fall short of ‘last mile’ to LNG demand

A slew of LNG export projects, largely in Texas and Louisiana, are under construction or in the planning phase but new Northeast pipeline capacity appears to fall short of supplying the demand centers. Luke Jackson looks at how the ‘last mile’ problem takes Northeast gas to the Midwest and other areas and paints a bullish story for Henry Hub prices. The Southeast natural gas market has a problem. Gas demand from LNG exports is expected to grow 10 Bcf/d the next five years, and in a high case, as much ...

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Indian state oil firms betting on natural gas as next big thing

India’s state oil refiners are planning an aggressive push into natural gas in coming years to meet Prime Minister Narendra Modi’s goal of making the fuel a bigger part of the country’s energy mix. State-owned oil companies – Indian Oil, Bharat Petroleum and Hindustan Petroleum – are planning to raise gas contributions to between 5 and 15 percent of their incomes over the next few years, up from nearly none now, company executives said. This in line with a government target to raise the natural gas portion of India’s primary ...

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Turkey’s BOTAŞ, Qatargas sign liquefied natural gas deal

Turkey and Qatar, one of the leading countries in the world in natural gas reserves, signed a liquefied natural gas (LNG) agreement on Wednesday during President Recep Tayyip Erdoğan’s visit to Doha, the last stop of a three-day regional trip after Russia and Kuwait. During President Erdoğan’s visit, accompanied by Energy and Natural Resources Minister Berat Albayrak, strengthening cooperation between BOTAŞ and Qatargas was discussed. Under the agreement, Qatargas will deliver 2 billion cubic meters of natural gas equivalent LNG to BOTAŞ. According to information obtained from ministry sources, the ...

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Spot LNG continues steady climb on winter demand, tenders

Spot LNG prices continued a steady climb in the four weeks from 16 October to 15 November, on the back of growing demand from east Asian buyers, and tender activity from Egypt, India and Pakistan, as well as strengthening crude oil prices. The ICIS December East Asia Index (EAX) opened the period at $8.900/MMBtu, rising to $9.650/MMBtu by the end. It averaged $9.213/MMBtu over the month, up by 12% from the month before. It was also up by 30% against the same period the year before. The world’s largest LNG ...

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Israel says received bids from Greek, Indian firms to explore offshore

Israel said it received bids to explore for oil and gas in its economic waters from Greece’s Energean and a consortium of Indian firms including ONGC Videsh, Bharat PetroResources, Indian Oil Corp and Oil India. Israel hoped it would draw 2-3 foreign firms to come drill in 24 new offshore blocks in its latest bidding round that opened a year ago. Israel’s Energy Ministry said it would spend the coming weeks examining each bidder’s offer and work plan before making a final decision. It said it will hold another bidding ...

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China’s oil refiners rush to cash in on bumper profits

Chinese oil refiners are churning out record amounts of fuel in the last quarter of 2017, looking to cash in on the best refining profits in nearly two years after a rally in diesel and gasoline prices. Officials at five state-owned oil processors said they are refining and shipping as much product as possible after receiving generous export quotas. That is creating a domestic shortage that China’s independent refiners – often called teapots – are rushing to meet, while also raising their output to profit from a hike in state-controlled ...

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Abu Dhabi-Owned Refiner Pivots to Asia as Europe Sales Slow

Madrid-based refiner Cepsa plans to boost petrochemical sales to Asia because it’s the only major region to buck a global trend of slowing growth, the company’s chief executive officer said. Rising populations and incomes in India, China and Southeast Asia, will increase the use of refined products and of the chemicals that go into consumer goods, according to the Abu Dhabi-owned company’s 2030 energy outlook published this week. “Growing in Europe is almost impossible,’’ Pedro Miro, CEO for the oil processor known officially as Cia. Espanola de Petroleos SAU, said ...

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Novatek preparing for its first offshore Arctic drilling

It the «Amazon», which in July 2018 will spud the Severo-Obskoye well, the deposit located in the central part of the Ob Bay, Prime reports. The 6,570 ton installation was in October this year sent to Sabetta, the new Arctic port on the northeastern tip of Yamal Peninsula, and subsequently from there towed to the port of Yamburg on the eastern bank of the Ob Gulf. The «Amazon» is owned by Gazpromflot, the subsidiary of Gazprom, and is likely to be in Yamburg until the first half of July 2018 ...

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Eni’s Giant Gas Field Prompts Egypt to End Imports in 2018

Egypt will stop importing liquefied natural gas in 2018 and may eventually export gas after it starts producing this year at the giant Eni SpA-operated Zohr field off the country’s Mediterranean coast, Oil Minister Tarek El-Molla said. Zohr’s output will mostly supply the domestic market, and the nation’s two existing gas-liquefaction facilities are large enough to process any available surplus into LNG for international sale in 2019, El-Molla said Tuesday in an interview in Abu Dhabi. If Zohr and other gas fields generate enough supplies, Egypt may consider adding a third LNG-exporting terminal, ...

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