Singapore to raise carbon tax
Singapore announced plans today to increase its carbon tax in a bid to curb greenhouse gas (GHG) emissions.
The government plans to increase the country's carbon tax from S$5/t ($3.70/t) currently to S$25/t in 2024-2025 and S$45/t in 2026-2027. The tax rate will be reviewed with a long-term view of raising it to S$50-80/t by 2030, said the country's finance minister Lawrence Wong today at the unveiling of the country's budget for 2022.
Singapore was the first country in southeast Asia to introduce a carbon tax. In 2020, the government implemented a S$5/t carbon tax rate based on 2019 GHG emission levels to companies that produce at least 25,000 t/yr of CO2e.
The government's initial intention was to raise the tax level to S$10-15/t by 2030. The country's new plan to raise it to S$25/t, significantly higher and earlier than its initial target, signals a greater urgency for the city-state's refining and petrochemical industries to decarbonise.
The government will allow businesses to use "high-quality international carbon credits" to offset up to 5pc of taxable emissions in lieu of paying carbon tax.
The new tax rate will force industry members to start looking at efforts to reduce carbon emission, said market participants in Singapore. Some companies have formed internal working groups to assess potential new investments to minimise carbon tax exposures.
Questions of competitiveness
Challenges are mounting for Singapore's refiners and petrochemical producers as the new tax rate risks lowering their competitiveness. Elsewhere in southeast Asia, Indonesia is the only other country that has shown a degree of seriousness in taxing carbon emissions.
Singapore houses some of the biggest fossil fuel-reliant industries in southeast Asia, while remaining openly cognizant of the impacts climate change has on its long-term well-being. The island-nation's central bank, the Monetary Authority of Singapore, has conducted stress tests for climate change-related risks on the city-state's financial health, among the region's first, if any.
Moving to net-zero emissions will be a "very costly affair for Singapore," said Wong, but added that the cost "cannot be skimped on." The country is now targeting net-zero emissions by the middle of the century.
Meanwhile, the country's energy and chemical hub Jurong Island employs some 26,000 people, according to government-owned infrastructure company Surbana Jurong. And this excludes services related to oil and gas outside Jurong Island, such as shipyards and trade finance.
While indirect carbon emissions are not taxed, costs are expected to be passed down and incorporated into sales prices and contract premiums, hence risking the country's overall cost-competitiveness. Metrices adopted and the required rates of returns to assess decarbonisation investments also remain sporadic.
Efforts have been underway to offset rises in operational expenditures since the introduction of the first carbon taxes. Companies such as ExxonMobil and Chang Chun, which are US and Taiwan-headquartered respectively, have embarked on projects to save energy.
Singapore-based Petrochemical Corporation of Singapore, a joint venture between Sumitomo Chemical, Qatar Petroleum International, and Shell, also completed its plan to reduce flaring and increase ethylene yield.
Shell has announced plans to build a unit that is capable of upgrading 50,000 t/yr of pyrolysis oil produced from converting plastic waste in Singapore. The plant, Shell's first and Asia's biggest, is expected to start operations in 2023. It announced plans to cut crude processing capacity in Singapore by around half just the year before.
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Lebanese exploration blocks in limbo
Lebanese exploration blocks in limbo
Cairo, 21 February (Argus) — The fate of two exploration blocks offshore Lebanon remains in limbo, with the government yet to agree contractual terms with the consortium that bid for the licences last year, the country's energy minister Walid Fayad said. A consortium consisting of TotalEnergies, Italy's Eni and state-owned QatarEnergy submitted bids to explore Blocks 8 and 10 in October last year as part of Lebanon's second licensing round. The blocks lie on Lebanon's recently delineated border with Israel. The same consortium drilled an exploration well in the adjoining Block 9 in August last year but failed to find any commercial volumes of oil or gas . Speaking on the sidelines of the Egypt Energy Show in Cairo, Fayad said the main issue with the bids for Blocks 8 and 10 relates to timeframes for 3D seismic surveys and drilling decisions. TotalEnergies' insistence on a one-year period to decide whether it would shoot 3D seismic on Block 8 is too long, Fayad said. The government's position is that three months should be more than enough, he added. "For Block 10, they're asking for two years to make a decision whether to drill or not. And we're saying you don't need to, you can do it in one year," Fayad said. "That's why they did not sign." TotalEnergies has yet respond to a request for comment. It is unclear whether there will be any further negotiations for Blocks 8 and 10, both of which have been included in Lebanon's third licensing round launched late last year. Fayad said interest in the latest bid round "has yet to be elicited", which is why he is proactively engaging with companies and countries. "It's an uphill battle," he said. The conflict in Gaza is making it more difficult to create a stable environment for the eastern Mediterranean's oil and gas sector to grow, Fayad said. "It makes risk a lot higher, it makes the financing cost a lot higher, and it makes any investment decision a lot more cumbersome. It is crippling the region," he said. By Aydin Calik Send comments and request more information at email@example.com Copyright © 2024. Argus Media group . All rights reserved.
Auge de nearshoring en México depende del 2024
Auge de nearshoring en México depende del 2024
Mexico City, 20 February (Argus) — Las políticas energéticas de México durante este año de elecciones presidenciales ayudarán a determinar si el país está preparado para alcanzar el tan ansiado auge del nearshoring, ya que se espera que el desarrollo de parques industriales se expanda en 2024. México podría exportar cerca de $168 mil millones adicionales entre 2023 y 2028 como resultado de la tendencia de trasladar cadenas de producción más cerca de EE.UU. para evitar retrasos logísticos como los observados durante la pandemia, dijo Alejandro Cervantes Llamas, jefe de investigación cuantitativa del banco mexicano Banorte. Pero la mayor parte de estas exportaciones fluirán durante los últimos tres años de dicho período, una vez que las instalaciones y la infraestructura industrial planificadas sean operativas. Alrededor de $10 mil millones adicionales del total de $168 mil millones en exportaciones llegaron en 2023, añadió Banorte. Mientras tanto, la Cámara de Comercio Internacional (CCI) estima que México verá $38.6 millones de inversión extranjera directa relacionada con el nearshoring en 2024. Hasta el momento solo se ha anunciado 40pc del desarrollo esperado, pero es probable que surjan más proyectos en 2024, dijo Ramsé Gutiérrez, vicepresidente de asesoramiento financiero de inversiones Franklin Templeton México. Sin embargo, el éxito del nearshoring depende de la capacidad que tenga México para proporcionar a la industria en auge la infraestructura necesaria, especialmente electricidad y gas natural, lo que a su vez impulsaría a la demanda de combustibles para motores. La demanda de importaciones de gas por parte de México aumentará de 7.8 Bcf/d en 2023 a 9.3 Bcf/d en 2026, según un estudio realizado por el operador estatal de gasoductos Cenagas el año pasado. Energía para el nearshoring México también necesita invertir $116.8 mil millones — $7.78 mil millones/año en promedio durante los próximos 15 años — en generación y distribución de energía para satisfacer la creciente demanda, de acuerdo con un informe reciente de CCI Mexico. El informe sostiene que, con un crecimiento anual del PIB de 2.4pc, México necesita construir 58,900km de líneas de transmisión y añadir 34.5 GW en capacidad de generación nueva, así como 14.1 GW en capacidad de generación de sustitución hasta 2037. Las estimaciones se basan en factores de carga de 87pc ciclo combinado de gas, de 25pc para plantas solares y 38pc para generación eólica. Además, México necesita otros 800km de líneas/año por punto de crecimiento adicional del PIB. También debe desarrollar una industria alrededor del Corredor Interoceánico del Istmo de Tehuantepec con enlaces ferroviarios, carreteros y gasoductos desde el océano Pacífico hasta el Golfo de México, así como en la península de Yucatán, dijo Osmar Zavaleta, decano asociado de investigación en la Escuela de Negocios Tec de Monterrey. Pero esto será un reto continuo, dado que las empresas extranjeras tienen profundos compromisos con las energías renovables, en tanto que las iniciativas gubernamentales de los últimos años han dificultado el desarrollo de proyectos solares y eólicos privados. Los proyectos de generación solar han experimentado un auge en los últimos años, a medida que la regulación presiona a los proyectos más grandes del sector privado. Este segmento menos regulado está limitado a una capacidad de generación de 500 kW. Sergio Arguelles, presidente de la Asociación Mexicana de Parques Industriales, lleva más de un año y medio ejerciendo presión sobre las autoridades mexicanas para aumentar la energía renovable autogenerada permitida a más de 500 kW. Con las elecciones presidenciales de México previstas para junio, tanto la candidata Claudia Sheinbaum como su principal competidora Xóchitl Gálvez han indicado su apoyo al crecimiento acelerado de las energías renovables para el próximo periodo presidencial de seis años que finaliza en 2030. Con Sheinbaum, quien encabeza las recientes encuestas con una ventaja de dos dígitos, es más probable ver el crecimiento de la capacidad verde impulsado por la empresa estatal de electricidad CFE, mientras que Gálvez apoya una mayor participación del sector privado. Otro reto al que se enfrenta México sigue siendo la inseguridad, especialmente en los estados fronterizos del norte, donde la inversión extranjera directa más fluida dependerá de la capacidad del gobierno para controlar a las organizaciones criminales de la región. Por James Young Send comments and request more information at firstname.lastname@example.org Copyright © 2024. Argus Media group . All rights reserved.
Shell exits Iraqi petchem project
Shell exits Iraqi petchem project
Dubai, 20 February (Argus) — Shell has withdrawn from plans to build a petrochemical plant in Iraq's southern Basra region after nearly 10 years, in a blow to Baghdad's aim of driving foreign investment in its energy sector. The major has pulled out following an "in-depth evaluation on the feasibility" of the Nebras complex. Shell will continue to support the project through its Basrah Gas (BGC) joint venture with the Iraqi government and Japan's Mitsubishi. Shell signed an initial agreement in 2015 to develop the project using BGC's associated gas, but it has stalled. Shell has a 49pc stake in the venture estimated at $8bn. BGC will provide ethane feedstock for the complex from its gas processing facilities, with the associated gas coming from the Rumaila, West Qurna 1 and Zubair oil fields. Send comments and request more information at email@example.com Copyright © 2024. Argus Media group . All rights reserved.
Marine fuel global weekly market update
Marine fuel global weekly market update
New York, 20 February (Argus) — A weekly Argus news digest of interest to the conventional and alternative marine fuel markets. To speak to our team about accessing the stories below and access to Argus Marine Fuels , please contact firstname.lastname@example.org. Alternative marine fuels 16 February CMA CGM takes first of 10 LNG-fueled vessels France-based shipping company CMA CGM will take delivery of the first of a series of 10 LNG-fueled container ships this month. 16 February Egypt to load 8-10 more LNG cargoes by end-winter: Eni Egypt could load 8-10 more LNG cargoes "before the end of the winter season", Eni said today. 16 February South Korean refiners opt to co-process biofuels A lack of regional mandates and retreating European demand for hydrotreated biofuels this year has pushed back timelines for new capacity start-ups in Asia-Pacific, driving South Korean refiners to favour co-processing rather than standalone biofuel plants. 15 February WSC proposes fossil-green fuel price gap close The World Shipping Council (WSC) proposed a green balance mechanism to close the price gap between conventional and sustainable marine fuels. 15 February Singapore LNG bunker sales at 5-month high Singapore LNG bunker sales reached a five-month high in January, according to data from Maritime & Port Authority of Singapore (MPA), driven by competitive prices compared with conventional marine fuel. 15 February Lake Charles Methanol to build $3.2bn low-CO2 plant Lake Charles Methanol II announced plans to build a $3.2bn plant that will produce low-carbon intensity methanol and other chemicals at the Port of Lake Charles. 15 February Singapore LNG bunker sales at 5-month high Singapore LNG bunker sales reached a five-month high in January, according to data from Maritime & Port Authority of Singapore (MPA), driven by competitive prices compared with conventional marine fuel. 15 February Maritime sector most promising for H2 in transport: HE The maritime sector provides most opportunities for use of hydrogen-based synthetic fuels in the transport sector, according to a survey carried out by industry body Hydrogen Europe. 15 February JBS says its B100 biodiesel has same yield as diesel Global meat producer JBS said that its 100pc biodiesel fuel (B100) — unblended biodiesel — has an energy efficiency equivalent to diesel and emits up to 80pc less carbon dioxide, based on tests on one of its trucks. 15 February Off-spec bio-blends widen pricing spread The range of prices for marine biodiesel blends in Europe has widened as cheaper product that does not meet the region's diesel engine specifications — as defined by the European EN14214 standard — gains market share. 15 February China turns to domestic ammonia output boost Increased domestic production capacity and weaker downstream industrial demand has the potential to weigh on China's ammonia imports this year. 15 February Mabanaft to build green methanol plant in Australia Hamburg-based Mabanaft has received approval to build a new green methanol plant in Port Augusta, located in southern Australia. 14 February Emerging LNG markets to absorb extra supply: Shell Emerging gas markets in China, southeast and south Asia will absorb much of the increase in LNG supply for the rest of this and the next decade, having been constrained by high prices in 2022-23, Shell said in its global LNG outlook, published today. 14 February Avoid offsets, ETS for carbon removals: Study Carbon dioxide removal (CDR) activities should be promoted for the "right reasons" and at the "right scale", and should not be financed through carbon offset credits or included in emissions trading systems (ETS), according to a recent study by the Institute for Responsible Carbon Removal at American University. 14 February Indonesia ammonia production at risk of curtailments Indonesian ammonia producers could be forced to consider production curtailments or outages if southeast Asian loading prices fall much further. 14 February More than 100 US biogas plants to start up in 2024 The American Biogas Council said 96 new biogas projects with a combined production capacity of 66,000 ft³/minute (9.82bn m³/yr) became operational in the US in 2023. It expects over 100 more to start up this year and said output from these will mostly be used for transportation fuel instead of power production. 14 February Chinese yard advances 271,000m³ LNG carrier orders French engineering firm Gaztransport and Technigaz (GTT) has received an order for eight 271,000m³ LNG tanks from a Chinese shipyard, with delivery of the vessels to be fitted with the tanks scheduled between the second quarter of 2028 and fourth quarter of 2029, GTT said. 14 February SE Asian UCO sees limited hit from US fast-food boycott A consumer boycott on US fast food outlets in support of Palestine is affecting some Indonesian and Malaysian used cooking oil (UCO) supplies, but market participants said the overall impact should be limited. 13 February Carnival commissions new LNG-fueled vessel US cruise ship operator Carnival has ordered a newbuild dual-fuel LNG-powered vessel for delivery in spring 2027. 13 February US House readies vote to end LNG review pause President Joe Biden's temporary pause on the review of new US LNG export facilities could face its first congressional test with a vote on a Republican-backed bill that would eliminate federal licensing of those projects. 13 February LNG carrier declares for Greece's Alexandroupolis The TotalEnergies-chartered 174,000m³ Gaslog Hong Kong has declared for arrival at Greece's new 4.3mn t/yr Alexandroupolis import terminal on 15 February, and could deliver the facility's first cargo. 13 February EU hydrogen plan relies on uncertain imports: T&E The EU should not rely on uncertain imports to meet its overly-ambitious hydrogen targets, says a study commissioned by the Brussels-based climate group Transport & Environment (T&E). 12 February Red Sea issues impact European methanol, derivatives Volatility in shipping markets following attacks in the Red Sea is impacting Europe's methanol market indirectly through higher freight rates and has directly impacted European derivative markets, as a result of reduced vessel availability and rerouting. 12 February Qatar taps Nakilat for second phase LNG fleet expansion State-owned QatarEnergy has selected Qatari state-controlled shipowner Nakilat for the ownership and operation of 25 174,000m³ LNG carriers, to be built at an unnamed shipyard in South Korea. 12 February SBTi validates Maersk's GHG emission reduction targets Danish shipping firm Moller-Maersk has become the first company to have its greenhouse gas (GHG) emissions targets validated under new maritime guidance from the UN-backed Science Based Targets initiative (SBTi). 12 February Spanish independent biodiesel producers under pressure Smaller Spanish biodiesel producers remain under pressure from thin margins that are cutting profits and shutting in some output. They are not being supported by domestic demand, which fell to a seven-year low in 2023. 12 February Mabanaft to apply for ammonia import terminal permit German energy trading firm Mabanaft expects to submit a permit application for its planned 1.2mn t/yr ammonia import terminal at Hamburg in the spring of this year. Alternative marine fuels 16 February Fujairah bunker premiums weaken as ships reroute Delivered bunker premiums have fallen in Fujairah, UAE, the world's third largest bunkering centre. Demand has weakened in recent weeks as a result of route diversions, stemming from the tense security situation in the Red Sea. 16 February US Gulf coast fuel oil spreads widest in 11 months Sulphur spreads between US Gulf coast residual fuel oil grades have reached the widest in 11 months, but that could change as refinery turnarounds likely wind down by late February or early March. 16 February Brazil's Paranagua cargo handling rises in January Cargo handling in Brazil's southern Paranagua and Antonina ports increased by 20pc in January from the same month last year, driven by higher exports and imports. 16 February Brazil's Paranagua port seeks to reach net zero by 2035 Brazil's port of Paranagua is working on a decarbonization plan for delivery by the end of 2026 to help it reach net zero balance greenhouse gas (GHG) emissions by 2035 by developing renewable energy sources such as biogas and hydrogen. 16 February Tanker targeted in Red Sea A Panama-flagged tanker was targeted by a missile in the Red Sea today around 72 miles northwest of Mokha, Yemen, according to security firm Ambrey. 16 February Japan's NYK taps demand for chemical tankers Japanese shipping company Nippon Yusen Kaisha (NYK Line) plans to receive six chemical tankers from late 2026 to 2029, in anticipation of potential demand growth for petrochemical products. 15 February Upper Mississippi ice report canceled on warm weather An annual government ice measurement program for shipping on the upper Mississippi River was canceled this year because of unseasonably warm weather. 15 February Scorpio Tankers upbeat on clean tanker rates New York-listed Scorpio Tankers said it expects strong market fundamentals to keep clean tanker freight rates elevated, even if disruptions to trade flows dissipate. 15 February Magellan Corpus Christi terminal doing maintenance US crude and refined products pipeline operator Magellan Midstream reported maintenance at its Corpus Christi, Texas, marine terminal. 15 February ARA oil products stocks increase on weaker demand Independently-held oil product stocks at the Amsterdam-Rotterdam-Antwerp (ARA) trading hub hit their highest since mid-August, reaching 5.67mn t in the week to 14 February, according to consultancy Insights Global, as demand in the region slowed down. 15 February Panama Canal freezes customer priority ranking The Panama Canal Authority (ACP) will freeze its customer priority ranking used to secure transit slots while temporary water-saving measures remain in place. 15 February Singapore's oil product stocks inch higher Singapore's overall oil product inventories inched upwards, driven by a surge in middle distillate imports, despite both light and heavy distillate stocks falling close to a 2½ month low, showed latest data from Enterprise Singapore. 14 February Petrobras working to rebuy refinery: CEO Brazil's state-controlled Petrobras is in talks with Abu Dhabi's Mubadala to buy the 300,000 b/d Mataripe refinery back, Petrobras' chief executive Jean Paul Prates said on social media. 14 February HSFO Med/NWE spread reaches near seven-month high High-sulphur bunker fuel in the west Mediterranean moved to its strongest premium to northwest Europe this week as attacks by Houthi rebels squeeze supply. 14 February Vitol can do with Saras what Saras cannot do alone Vitol's takeover of Italian independent refiner Saras, set in motion this week, could turn the latter into a specialised tool within the trading company's diverse business, while giving it a stronger footing to compete with rival Trafigura in Mediterranean oil markets. 14 February South Korea lifts 2023 light distillates output South Korean refiners increased light distillates production in 2023, while gasoil output fell. 13 February BP terminals low on fuel due to Whiting refinery outage BP told wholesale fuel customers it is buying refined products on the market to meet contractual obligations amid the continuing outage of its 435,000 b/d Whiting, Indiana, refinery. 13 February Outages hit Ecuador's 2023 refinery production Ecuador's three oil refineries of Esmeraldas, La Libertad and Shushufindi processed an average 146,235 b/d of crude in 2023, down by 5.3pc compared with the previous year, according to operator state-owned Petroecuador's data. 13 February Japan's bonded marine fuel sales fall in 2023 Japan sold less bonded marine fuel in 2023 compared with a year earlier, pressured by limited supply from domestic refineries owing to a series of disruptions. 12 February Suriname refinery undergoing 7-week turnaround Suriname's state-owned oil company Staatsolie's 15,000 b/d Tout Lui Faut refinery will undergo a seven-week turnaround starting on 16 February, Staatsolie said. 12 February US refiners shrug off dip in earnings US refiners' fourth-quarter financial results so far reveal a dip in earnings from the bumper profits of 2022, but the sector remains on a profitable footing and confident. 12 February India's MRPL plans refinery maintenance in Aug-Sep Indian state-controlled refiner MRPL plans to conduct a maintenance turnaround at one unit of its 311,000 b/d Mangalore refinery for around three weeks during August-September, a top official from the company told Argus. 12 February Atlantic basin diesel faces tight spring European diesel markets could be facing a tight spring as refinery maintenance and disruptions in the Red Sea make resupply difficult and expensive. Send comments and request more information at email@example.com Copyright © 2024. Argus Media group . All rights reserved.
Time to turn pledges into plans: Climate leaders
Time to turn pledges into plans: Climate leaders
Edinburgh, 20 February (Argus) — The UN climate summit Cop 28 has delivered historic commitments, but pledges need turning into action, with the deadline for parties to submit new climate plans only a year away, energy and climate leaders told delegates at a high-level roundtable hosted by the IEA. "Now is the time for all stakeholders to step up", Cop 28 president Sultan al-Jaber said today, after listing progress made during the summit last year. Almost 200 countries agreed to triple renewable energy capacity by 2030 and transition "away from fossil fuels in energy systems" in a "just, orderly and equitable manner" under the UN Framework Convention on Climate Change's (UNFCCC) first global stocktake. The historic outcome was dubbed the UAE Consensus. Al-Jaber said that all the parties who signed the consensus must start working on new Nationally Determined Contributions (NDCs) — countries' climate plans — and "adopt comprehensive, economy-wide emission reduction targets that cover all greenhouse gases, and are aligned with the science and keep 1.5°C in reach." But he also warned that a balanced approach must be taken. "The energy transition will lead to energy turmoil if we only address the supply side. We must tackle the demand side at the same time," he said. NDCs are submitted every five years, with the next round due in February next year, ahead of Cop 30 in Brazil. "Everybody needs to have a plan," US climate envoy John Kerry said, adding that what has been agreed at Cop 29 must be implemented to avoid disappointment. "How many countries since the Cop 28 decision was made have implemented plans to transition away from fossil fuels," Kerry asked. He said that G20 countries have a key responsibility, reiterating the need for some large countries to move away from coal. "NDCs are key and need to reflect the decision of the consensus including on plans to move away from fossil fuels," Denmark's climate minister Dan Jorgensen said. Brazilian national secretary for climate change Ana Toni said that parties "need to become real in their second NDCs", and need to produce detailed plans, including on investments. She said Brazil was hoping to have the international community and international agencies such as the IEA helping some countries to develop those plans. The IEA said today that ahead of the next round of NDCs the agency has received "several requests" from countries asking for help on data, analysis and policy advice and will offer some support. It will also keep track of all the pledges made during Cop 28 in co-ordination with the UNFCCC. The IEA will also look into new financial mechanisms to support the energy transition, especially in developing countries. "This is where the IEA can play a big role," Jorgensen said. "We need [the IEA's] data and input in regard to the financing question" and also on the "dangers for countries in not choosing the right path". Al-Jaber pointed out that Cop 29 is "mandated" to deliver the NCQG — the new finance goal moving beyond the previous $100bn/yr target. He reiterated that parties need to move from billions to trillions, but also "activate every source of finance, including policies and incentives to attract private capital. Cop 21 president Laurent Fabius agreed that "billions not trillions" will be needed, but said that Azerbaijan might face a difficult task "because time is short and the international situation is not good". "This is the reason why the Troika will be decisive," he said. Toni said one of the missions of the newly formed Cop presidencies Troika — comprising Cop 28, 29 and 30 hosts the UAE, Azerbaijan and Brazil — is to keep the 1.5°C goal on track. By Caroline Varin Send comments and request more information at firstname.lastname@example.org Copyright © 2024. Argus Media group . All rights reserved.