Venezuela Increases Petcoke Exports to India
Caracas, August 21, 2022 (venezuelanalysis.com) – Venezuela has significantly ramped up its petroleum coke (petcoke) sales to Indian companies. According to Reuters, cement companies in India received 160,000 tonnes of petcoke between April and July, with cargoes of at least 80,000 more expected in August. The Asian giant started importing Venezuelan petcoke in 2022 after previously relying on the US and Saudi Arabia as suppliers. The Venezuelan exports have hovered around US $220 per tonne, some 5 to 10 percent below market price, as Caracas seeks international trade partners while heavily targeted by US sanctions. The South American nation has accumulated large stockpiles of petroleum coke, which is a byproduct of oil refining or upgrading. A study from the Venezuelan Academy of Physical, Mathematical and Natural Sciences found that every barrel of heavy crude from the Orinoco Oil Belt yields 25 kilos of petcoke. Venezuela’s state oil company PDVSA produces its flagship Merey export blend (16°API) from upgrading Orinoco heavy crude. The high-carbon petroleum coke is used as an energy source from its combustion and its demand has grown amidst rising coal and fuel prices on a global scale. Though more expensive than coal, petcoke is a more efficient energy source. It is widely used by the cement industry as the toxic sulfur dioxide (SO2) emissions are absorbed by limestone. India uses an estimated 27 million tonnes of petcoke per year and is the world’s largest consumer. Indian corporations Ramco Cements, JSW Cement and Orient are among the main purchasers of Venezuelan coke. Ramco CFO S. Vaithiyanathan told Reuters that the product is of high quality and with low sulfur content as the Caribbean country threatens to displace traditional suppliers. Other significant buyers of the oil industry byproduct include Turkey and China. The higher volume of exports has caused reported disruptions at the country’s main export hub in eastern Venezuela. However, the operational logjam was alleviated with the opening of a new terminal operated by privately owned Maroil Trading. Industry experts claim that Venezuela could boost its market presence even further by addressing infrastructure deficiencies. The estimated 300,000-400,000 tonne-per-month petcoke sales provide some relief as the country’s crude production stagnates under the weight of crushing US sanctions. Since 2017, Washington has levied financial sanctions, an oil embargo, secondary sanctions and a bevy of other measures against Venezuela’s most important industry. The US Treasury Department likewise targeted swap agreements and key imports to keep crude operations running. Oil output fell dramatically as a consequence of the unilateral measures, from nearly 2 million barrels per day (bpd) in mid-2017 to decades lows under 400,000 bpd three years later. Production nearly doubled in 2021 but PDVSA has struggled to meet ambitious goals set. Output has hovered around 700,000 bpd and receded to 661,000 bpd in July. Caracas had previously turned to New Delhi as a prospective trade partner following the January 2019 oil embargo. The Nicolás Maduro government reportedly considered crude-for-medicines deals as possible avenues to bypass sanctions. However, the Trump administration threatened Indian corporations, including refining giant Reliance Industries, against dealing with Venezuela. The US Treasury Department has not explicitly targeted Venezuelan petrochemical and oil byproduct exports but has not issued exemptions either, forcing PDVSA to offer discounts in order to attract customers. The threat of running afoul of wide-reaching US sanctions has kept international corporations from purchasing Venezuelan petroleum coke. According to Argus Media, Turkish cement would not import from the Caribbean nation at discounted rates for fear of jeopardizing cement sales and other business with the US.
Bangladesh may import Russian diesel at cheaper rate via India
Bangladesh may prefer to import Russian oil via a third country to avert possible risks of the business. According to official sources at the ministry of power, energy and mineral resources, neighboring India might be such a preferred third country with regard to importing Russian oil. ‘Currently, India has been importing Russian oil defying the United States sanctions while Bangladesh has a long term contract with India to import refined oil from its refinery at Numaligarh in Assam state,’ said an official at the ministry preferring anonymity. ‘If there is a bilateral arrangement between the two nations, such a business is very much possible,’ he said, adding it could be a possible way to avert the risk in import of Russian oil at a cheaper rate. The possibility of importing petroleum fuel from Russia came into discussion at the policymaking level following an offer from a Russian company to sell its refined petroleum, specially diesel, at a cheaper rate to Bangladesh. Russneft, a Russian oil company headquartered in Moscow, recently offered the state-owned Bangladesh Petroleum Corporation petroleum fuels at $59 per barrel against a global market price of over $100 per barrel. As per the offer, the Russian company will reach its refined petroleum to Chattagram port at the rate which includes the premium and shipping cost as well. However, the ministry of power, energy and mineral resources has not yet officially disclosed anything about the Russian company’s offer. State minister for power, energy and mineral resources Nasrul Hamid declined to give any detail of such an offer. ‘No more update as yet,’ he told UNB on Thursday. Sources at the BPC said the import of Russian oil is not like fuel import from other countries. They said Bangladesh is assessing its possible risks to import petroleum fuels from Russia as such imports may invite anger from the US and its Western allies. Russia has been facing huge economic sanctions from the US and its European allies following its war with Ukraine. If any country directly imports Russian oil it may face similar sanctions, said the officials, adding that is why any move in this regard will not only depend on the decision of the ministry of power, energy and mineral resources. According to official sources, after receiving the offer from Russia on petroleum fuel sale, now different concerned ministries, including the ministry of foreign affairs, ministry of finance and the ministry of power, energy and mineral resources are assessing the potential risks and different processes of such import. Prime minister Sheikh Hasina at the ECNEC meeting on August 16 said that the government wanted to buy fuel oil, fertiliser and wheat from Russia. In this connection she mentioned she had given the responsibility to her principal secretary to talk to the Russian ambassador regarding the matter. ‘The foreign ministry can take initiative in this matter, we will procure fuel oil from Russia with our own funds as the SWIFT is closed and the price of dollar is very high,’ she said. Meanwhile, Power Cell director Mohammad Hossain said that if the government could manage the import of diesel at cheaper rate, operation of the diesel-run power plants would be resumed to increase the power generation. As part of an austerity measure, the government suspended the operation of the diesel-fired power plants from July 19 and introduced area-wise load shedding to reduce diesel imports and save foreign currency. Although area-based load-shedding was scheduled for one hour, it continued for three hours at a time in some city areas across the country. Load-shedding in rural and remote areas, however, stretched for more hours, consumers claim. Markets and shopping malls can now stay open until 8:00pm. The government also prohibited illumination in different social gatherings in community centers, shopping malls, shops, offices and houses since July 7. Finally, it introduced a holiday staggering for industries on August 11 as part of the plan to save power and natural gas.
L&T Commissions Green Hydrogen Plant At Its Manufacturing Complex In Hazira, Gujarat
Larsen & Toubro (L&T), an Indian multinational engaged in EPC Projects, Hi-Tech Manufacturing and Services, today announced the commissioning of a Green Hydrogen Plant at its AM Naik Heavy Engineering Complex in Hazira, Gujarat. The plant was inaugurated by Mr. Shrikant Madhav Vaidya, Chairman – Indian Oil Corporation Limited. The production of Green Hydrogen based on an alkaline electrolysis process has begun today. The plant will produce 45 Kg of Green Hydrogen daily, which will be used for captive consumption in the company’s Hazira manufacturing complex. The Green Hydrogen Plant is designed for an electrolyser capacity of 800 kW comprising both Alkaline (380 kW) and PEM (420 kW) technologies and will be powered by a rooftop solar plant of 990kW peak DC capacity and a 500kWh Battery Energy Storage System (BESS). As part of the first phase of the project 380 kW Alkaline electrolyser has been installed, while the 420 kW PEM electrolyser along with solar plant capacity augmentation to 1.6 MW peak DC, will be part of future expansion. Commenting on the occasion, Mr. Subramanian Sarma, Whole-time Director & Senior Executive Vice President (Energy), L&T said: “L&T is at the forefront of providing innovative and sustainable solutions that will help meet the energy needs of the future. We are proud that our engineers have set up the Green Hydrogen generation plant at Hazira complex and integrated it with the existing manufacturing shops for use of the green hydrogen.” He added that “This initiative is in line with L&T’s climate leadership targets of Lakshya-2026 that will help reduce greenhouse gases footprint for us as well as our clients by approximately 300 tonnes/annum. We believe that Green Hydrogen is a promising alternative fuel, and this plant is a testimony that we are committed to create a greener tomorrow.” The plant is spread across 3000 sq. meters, and the first phase of the project has been installed, tested, and commissioned. The scope involves the generation of high purity Green Hydrogen (99.99%) and Oxygen, and their captive consumption in the manufacturing shops. A blend of 15% Hydrogen with Natural Gas will be used as a fuel, and oxygen will supplement the existing usage in cutting and welding applications. To ensure safe operation and production, the plant design incorporates both active and passive safety systems and will be operated through state-of-the-art control systems with remote monitoring functionality. In addition, an integrated data analytics platform designed by L&T will provide insights into the performance of the electrolysers and the overall plant. As part of its ESG commitments, L&T has pledged to achieve water neutrality by 2035 and carbon neutrality by 2040. Making Green Hydrogen an integral part of its clean fuel adoption policy. L&T’s climate change, energy efficiency and renewable energy programmes are aligned with the National Action Plan on Climate Change (NAPCC), released by the Government of India. The Company’s programmes are also being aligned to the Nationally Determined Contributions (NDCs) ratified by the Government of India during the COP 21 – Paris Agreement.
GAIL Faces Profit Hit Over Gas Supply Cut – Report
Profit at state-run GAIL (India) Ltd will be hit as it rations gas sales after supplies are cut under its long-term deal with a former unit of Russian energy giant Gazprom amid high spot prices, its head of finance Rakesh Kumar Jain said on Thursday. GAIL, India’s largest gas distributor and operator of pipelines, imports 14 million tonnes per annum (mtpa) of liquefied natural gas (LNG) under various long term deals. Of this about 2.5 mtpa, or up to 39 LNG cargoes, were to be supplied this year by Gazprom Marketing and Trading Singapore (GMTS), now a unit of Gazprom Germania. Since the end of May, GMTS has missed delivery of 8 LNG cargoes to GAIL and is not certain about future supplies as it is securing the fuel for Europe, Jain said in an analyst call. He said GMTS has not declared force majeure, but “they are not scheduling (LNG cargoes supplies) at the moment. “Profitability certainly will be hit if the situation remains as it is today…There is a challenge in this quarter,” he said, adding GAIL’s gas marketing and transmission business will be hit due to lower supplies. GAIL has cut supplies to fertiliser and industrial clients besides reducing operations at its petrochemical plant at Pata, northern India, by over 50% to avoid purchase of costly spot LNG, Jain said, confirming a Reuters report. The state-run firm is also advancing delivery of some of its overseas LNG cargoes through time swaps and has chartered ships to bring in some of its U.S. LNG that it was planning to trade. GAIL has deals to import 5.8mtpa LNG from the US. Jain said GAIL is also scouting for long term LNG deals to secure supplies, although its previous tender for a 10-year 0.75mtpa deal failed. The company agreed a 20-year deal with Russia’s Gazprom in 2012 for annual purchases of an average 2.5 million tonnes of LNG. Supplies under the contract began in 2018. GMTS had signed the deal on behalf of Gazprom. At the time, Gazprom Germania was a unit of the Russian state firm. However, following Western sanctions against Russia over its invasion of Ukraine, Gazprom gave up ownership of Gazprom Germania in early April without explanation and placed parts of it under Russian sanctions.