US: Aggressive ethanol target affirmed despite infrastructure concern

(EnergyAsia, February 29, Friday) — The US government is pushing ahead with its proposed target to achieve nine billion gallons of ethanol in its gasoline pool this year despite industry concerns about the availability of infrastructure and transport to get the fuels to the retail pump.Last year, the target was seven billion gallons.Some lawmakers think…

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MARKETS: CEO of US oil firm warns of oil crisis within a decade

(EnergyAsia, February 29, Friday) — The world is heading for a major oil crisis within 10 years as oil producers are not investing to boost production capacities, said John Hess, the chief executive of US oil firm Hess Corp. Oil prices will spike sharply higher. “An oil crisis is coming, and sooner than most people…

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RUSSIA: Gazprom, Total, StatoilHydro creates company to develop first phase of gas field project

(EnergyAsia, February 29, Friday) — Russia’s Gazprom, France’s Total and Norway’s StatoilHydro have agreed to jointly form Shtokman Development AG to develop the first phase of the Shtokman gasfield in the Barents Sea. The field is thought to hold 3.8 trillion cubic meters of gas and 37 million tons of gas condensates.Gazprom will lead with…

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SRI LANKA: IOC set to expand bunkering, storage operations

(EnergyAsia, February 29, Friday) — Lanka IOC, the Sri-Lanka based affiliate of Indian Oil Corp (IOC), is planning to bulk up its bunker fuel business in the country. The company started bunkering operations in the eastern port of Trincomalee last year.When new pipelines are in place to connect its joint venture Ceylon Petroleum Storage Terminals…

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MARKETS: Venezuela says will not cut oil supplies to US

(EnergyAsia, February 29, Friday) — Venezuela will not cut off its oil supplies to the US despite rising tensions between the two countries, Venezuelan President Hugo Chavez said.Venezuela had appeared ready to cut supplies to the US but pulled backed at the brink. Mr Chavez amended his threat by stating that a supply cut would…

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NEW ZEALAND: Contact Energy invests in sustainable long-term growth

(EnergyAsia, February 29, Friday) — New Zealand’s Contact Energy said its earnings before net interest expense, income taxation, depreciation, amortisation and financial instruments (EBITDAF), edged up to NZ$281.9 million for the second half of 2007, compared with NZ$275.4 million for the same period in 2006. (US$1=NZ$1.3).After adjusting the reported profit of NZ$117.4 million for one-off…

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SINGAPORE: LANXESS to build 400-million euro butyl rubber plant on Jurong Island

(EnergyAsia, February 29, Friday) — Leverkusen, Germany-based specialty chemicals group LANXESS will build a 100,000 metric tonne per year butyl rubber production plant on Singapore’s Jurong Island. The 400-million-euro plant is due to be commissioned in 2011, said Axel C. Heitmann, LANXESS chairman at a press conference in Singapore.

The plant, the company’s largest, will be constructed in the Tembusu sector of Jurong Island.

“LANXESS is already one of the market leaders in the butyl rubber business, which is of strategic importance to us,” said Ron Commander, head of the company’s butyl rubber business unit.

“This new production plant in Singapore is in response to the growing demand for this product. The booming economic region of Asia is playing a particularly important role in this. Our sales to customers in this region have risen by around 45% since 2004.”

Singapore was chosen following a detailed analysis of a wide range of location factors.

“The overriding argument in Singapore’s favor is the excellent availability of raw materials for butyl rubber production,” said Mr Commander.

The company has secured supplies of the key raw material through a long-term contract with Shell Eastern Petroleum (Pte) Ltd before construction even started.

From 2010, Shell will supply Raffinate 1 – a product created through butadiene extraction – by pipeline from its butadiene extraction unit on neighbouring Bukom Island, which is part of the Shell Eastern Petrochemicals Complex (SEPC).

Pieter Eijsberg, SEPC’s general manager, said: “We are delighted that LANXESS has chosen Shell as a significant partner in its expansion plans, and this agreement clearly underlines the industry’s confidence in our C4 business.”

LANXESS will extract isobutene, necessary for rubber production, and will also market the byproduct, Raffinate 2, externally. LANXESS also aims to conclude long-term supply agreements with Asian producers for isoprene, the second raw material for butyl rubber production, of which much lower volumes are needed.

JTC Corporation, Jurong Island’s landlord, has allocated LANXESS a 20,000 sq m site on Jurong Island. Construction is scheduled to start next year. When completed, the plant is expected to employ more than 200 staff.

LANXESS said it has significantly expanded its two existing production sites in Zwijndrecht, Belgium and Sarnia, Canada in the last two years.

Once the latest expansion phase in Sarnia is completed, the company will have an annual capacity totaling 280,000 metric tons of butyl rubber from 2009 onwards.

LANXESS expects sustainable annual market growth for butyl rubber of around 3% per year over the next 15 years. Demand from China, Taiwan and Hong Kong is expected to grow by 6% per year while the Indian market is seen growing by more than 8%.

As well as regular butyl rubber itself, halogenation products from this rubber, particularly bromo¬butyl rubber, are increasingly important and already dominate the market. Inner liners – the innermost, air- and humidity-impermeable layer of a tubeless tire – are the major area of application for halobutyl rubber. They keep tire pressure constant over a long period.

This makes vehicles safer and ensures they consume less fuel and therefore produce fewer harmful emissions. Market growth is being accelerated in particular by the expansion of radial ply tire production in Asia.

Butyl rubber is also essential for a large number of special applications, including bladders for sports balls, pharmaceutical closures and chewing gum production.

LANXESS’s butyl rubber business unit is one of the leading producers of butyl rubber, with annual sales of over 500 million euro.

LANXESS is a leading specialty chemical company, with sales of 6.94 billion euro in 2006 and over 14,500 employees in 21 countries around the world.

MARKETS: Rising oil prices, biofuels may bring famines in the next few years

(EnergyAsia, February 29, Friday) — Rising energy prices, in particular for oil, are driving up global food costs and causing food shortages in many poor countries around the world.For the first time in decades, the shortages will be severe enough to cause famines in the regions that are not prepared to deal with the looming…

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MARKETS: Supply disruptions help coal price spike

(EnergyAsia, February 29, Friday) — Supply disruptions in key coal producing parts of Australia, South Africa and China are adding to demand pressures and causing price spikes on the world markets.In South Africa, power shortages have crimped its industrial sector including its core mining, coal and metal industries.China has imposed curbs on coal exports amid…

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CHINA: Japan’s MHI to supply steam turbine generators to nuclear power plant

(EnergyAsia, February 29, Friday) — Japan’s  Mitsubishi Heavy Industries Ltd (MHI) said it has received an order from Shandong Nuclear Power Co Ltd to supply two packages of a steam turbine generator for use in the Haiyang Nuclear Power Plant to be built in Haiyang in China’s Shandong province.The STG packages, jointly proposed by MHI…

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AUSTRALIA: Noble Group names two top executives to lead coal strategy

(EnergyAsia, February 28, Thursday) — Noble Group Limited, a global supply chain manager of agricultural, industrial and energy products, said it has appointed Gavin May, Gloucester Coal’s former CEO, and former CFO Barry Tudor, to lead Noble’s coal asset strategy in Australia.

The company’s Australian coal assets include coking and thermal coal mines in the states of New South Wales and Queensland, through a majority interest in Donaldson Coal Pty Ltd, which owns coal mines in the Hunter Valley, a 19.7% interest in Gloucester Coal Ltd, a 30% interest in the Middlemount Coal Project, and potential strategic joint venture investments with Macarthur Coal in Monto Coal and Dingo West Projects.

The two executives will utilise their listed company and coal industry experience to shape Noble’s business and financial strategy in relation to Australian coal assets. They will join the Noble Energy Inc senior management team. Noble Energy Inc is a wholly-owned subsidiary of Noble Group Limited.

Noble Group CEO, Richard Elman, said: “We are extremely pleased to have executives of the calibre of Gavin and Barry joining Noble at such a critical stage of the organisation’s expansion into asset ownership. They bring with them a strong, industry specific skill set which will allow Noble to advance its coal asset strategy. Noble now has all the ingredients to assemble and develop a highly successful coal company.”

Noble Energy director Will Randall said: “Gavin and Barry have proven themselves to be a solid management team delivering results in the Australian coal sector over many years. We look forward to them getting involved in our asset platform and taking it to the next level. This is another step in the progression of our coal asset strategy.”

Singapore-listed Noble Group manages a diversified portfolio of raw materials from over 80 offices in more than 40 countries. An experienced team of 10,000 people serve approximately 4,000 customers.

CHINA: Higher diesel output to help counter power shortages, but supply fears remain

to ensure the economy will not be tripped up by energy shortages. CNPC and Sinopec, the country’s two largest oil and gas producers, recently ordered their refineries to produce more diesel for electricity generation to counter widespread power shortages caused by the severe winter weather that hit several provinces most of the last two months….

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MARKETS: IEA predicts world oil demand to grow 1.9% to 87.6 million b/d this year

rise by 1.9% to 87.6 million b/d. This is about 200,000 b/d or 0.4 percentage points below its earlier forecast after taking into account the latest signs that the US economy has weakened further. The world economy is growing at its weakest pace since 2003 this year on the spreading impact of the US credit…

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MARKETS: US, China to continue stockpiling despite oil at US$100 a barrel

with their oil stockpiling programmes despite crude oil prices reaching US$100 a barrel this week. The US Department of Energy (DOE) told Congress it will not stop its programme to add 70,000 b/d of crude to the national emergency stockpile. By end-March, the Strategic Petroleum Reserve will hold a record of more than 700 million…

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AUSTRALIA: Santos Ltd reports fall in fourth quarter output

fall in fourth-quarter production due largely to a shutdown at its key Mutineer-Exeter field. The Adelaide-based company did not provide an update on its 2008 production outlook. Its fourth-quarter production fell to 14 million barrels of oil equivalent (boe), bringing the full-year production to 59.1 million boe. While it was within the forecast range of…

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IRAN: State agency says products storage capacity to rise 33% by 2010

storage capacity will rise by a third to 12 billion litres by March 2010. The National Iranian Oil Derivatives’ Distribution Company said it has signed deals for setting up 81 storage tanks in 34 out of 82 warehouses. New warehouse facilities are being built at 11 cities across the country. The agency said Iran now…

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MARKETS: OPEC may abandon US dollar within 10 years

has admitted it may sideline the US dollar and switch to the Euro to price its oil in response to the weakening greenback. In a first admission by the oil cartel, secretary-general Abdullah al-Badri said the move could happen within 10 years. The US currency has fallen by 50% against the Euro since 2000. Iran,…

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PAKISTAN: Energy shortages crimp economy

rates of recent years as worsening power shortages and political instability are taking an increasing toll on daily life. In recent weeks, the country’s industrial electricity deficit fell to some 3,600 megawatts (MW), the result of low water levels at hydro-power damns and supply disruptions after the assassination of Benazir Bhutto last December. Water levels…

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SINGAPORE: Chemoil clinches key storage deal with Brazil’s Petrobras

448,000 cubic-metre Helios oil storage terminal on Singapore’s Jurong Island to Brazil’s state oil major Petrobras. The terminal, which started up last month, will be officially opened today. Petrobras has been in the Singapore bunker fuel market since 2004, offering mainly low-sulphur fuel oil. The long-term lease with Chemoil will enable the Brazilian firm to…

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ASIA: Environment Ministers seek new funds to combat climate change

(EnergyAsia, February 28, Thursday) — Environment ministers from the Greater Mekong Subregion (GMS) are asking their development partners for additional financial and technical assistance to improve their environmental and natural resource management.

In a joint statement issued after the second GMS Environment Ministers Meeting in Vientiane, Laos last month, the ministers called for the need to take a pragmatic and pro-active approach to sustainable and inclusive economic growth.

The GMS includes countries sharing the Mekong River such as Cambodia, China, Laos, Myanmar, Thailand, and Vietnam. Economic growth has come at a high cost to the environment.

In 2005, at the first GMS Environmental Ministers Meeting, ministers launched their Core Environment Program, and its flagship Biodiversity Conservation Corridors Initiative.

A key issue of concern at the recent meeting, which was funded through a technical assistance grant from the Asian Development Bank (ADB), was climate change and the increasing risks it poses to biodiversity, livelihoods and economic competitiveness of the GMS. The ministers want additional financial resources, including the promotion of public-private partnerships, to address and respond to climate change risks.

“Considering our common concern that poverty alleviation remains at the core of our developmental efforts, we are confident that our efforts through the Core Environment Program/Biodiversity Conservation Corridors Initiative (CEP/BCI) can assist us in promoting sound environmental management and contribute toward generating income and reducing livelihood vulnerabilities,” the ministers said in the joint statement.

They emphasised the need for sustainable and efficient use of natural resources to improve environmental management and economic competitiveness in the GMS.

Launched in 2006, the GMS Core Environment Program is a long-term programme funded by the ADB. It is implemented under the GMS Economic Cooperation Program with a long-term goal of a poverty-free and ecologically rich GMS. Its implementation is coordinated by the GMS Environment Operations Center in Bangkok, Thailand.

PHILIPPINES: World Bank’s IFC partners with BPI to expand access to sustainable energy finance

(EnergyAsia, February 27, Wednesday) — IFC, a member of the World Bank Group, said it has agreed to help the Bank of the Philippine Islands build a sustainable energy financing loan portfolio.

IFC will help BPI expand its financial products, focusing on micro, small, and medium enterprises in manufacturing. The bank will also focus on energy efficiency in hospitals, schools, hotels and shopping malls, and the business process outsourcing industry.

Aurelio Montinola III, BPI President, said: “We look forward to partnering with IFC as it strengthens our leading role in the country’s financial community. IFC will provide us with the focused support and global experience we need to develop the market for sustainable energy financing. We are delighted to be a pioneering financial institution in supporting sustainable energy businesses.”

Jesse Ang, IFC acting country manager for the Philippines, said: “This project is a part of IFC’s global strategy of climate change mitigation, which is being integrated into our global, regional, and country operations. Through our advisory services, we aim to help BPI expand its portfolio to reach out to forward-thinking businesses that recognise the business case for renewable energy and energy efficiency.”

A leading universal bank in the Philippines, BPI is the first in the country to leverage IFC’s Sustainable Energy Finance Program to focus on small and medium enterprises and other key sectors.

The bank is also working on climate change mitigation. Last December7, it established a partnership with Kabang Kalikasan ng Pilipinas (World Wildlife Fund Philippines) to establish the Climate Savers’ Program, which aims to reduce the bank’s carbon footprint over the next five years. The BPI Foundation is also engaged in a series of advocacy programs on environmental promotion.

A key part of IFC’s strategy in the Philippines is to strengthen the financial sector by supporting local capital market development, sustainable energy finance, access to finance for small and medium enterprises, housing finance, and firms in agriculture and services to improve their competitiveness.

IFC said its recently established Sustainable Energy Finance Program in the Philippines builds on experiences of similar programmes in China, Central Europe, and Russia. Through its work in sustainable energy markets, including energy efficiency and renewable energy, IFC has played a pioneering role in helping mobilise private sector investment in clean energy technologies and services in emerging markets.

VIETNAM: New LPG storage depot in Haiphong port

(EnergyAsia, February 27, Wednesday) — The Northern Liquefied Petroleum Gas Trading Joint Stock Company has started building a depot in the northern Vietnamese port city of Haiphong to store and handle LPG.Located in the Dinh Vu Industrial Park, the 388-billion-dong depot will store up to 7,500 tonnes when fully completed. (US$1=16,000 dong). Its first phase…

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SAUDI ARABIA: Far from peaking, crude production capacity seen reaching 12 million b/d by end-2009

(EnergyAsia, February 27, Wednesday) — Saudi Arabia will raise its crude production capacity to 12 million b/d by end 2009, said the CEO of the kingdom’s state oil and gas company, Aramco.Abdallah Jum’ah dismissed fears that Saudi oilfields including the giant Ghawar wells are at or near their reserves peak, and could soon begin to…

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AUSTRALIA: State government to develop strategy to reduce Queensland’s oil demand

(EnergyAsia, February 27, Wednesday) — Australia’s Queensland state is looking to reduce its oil consumption as part of the government’s strategy to help its people reduce their reliance on fossil fuels.A subscriber to the ‘peak oil’ theory, Minister for Sustainability, Climate Change and Innovation, Andrew McNamara, said the future availability of fossil fuel and alternative…

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CHINA: Oil output and consumption reach record levels in 2007

(EnergyAsia, February 27, Wednesday) — China’s crude oil production and oil consumption reached record levels last year, said the China Petroleum and Chemical Industry Association (CPIA).Its crude oil output rose 1.6% to a new high of 186.7 million tons, while its net import surged 14.7% to 159.28 million tons.Domestic consumption of crude oil rose 7.3%…

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