Japan eyes launch of H2, NH3 subsidy scheme next summer
Japanese hydrogen and ammonia suppliers may be able to apply for government subsidies from around mid-2024, as Tokyo seeks to make the cleaner fuels more competitive by narrowing their price gap with conventional fuels.
The winners could be decided by the end of next year at the earliest. The plan is to open the scheme to applications from around the summer of 2024.
Companies that want to apply for the subsidy scheme should begin distributing hydrogen, including in the form of ammonia, synthetic methane and synthetic fuel, at a rate of more than 1,000 t/yr of hydrogen equivalent by the April 2030-March 2031 fiscal year, according to a draft interim report on hydrogen policies released by a subcommittee under Japan's trade and industry ministry on 6 December.
The report will be finalised by the end of January, the subcommittee said.
Meti aims to provide partial or full financial support to clean energy suppliers for 15 years, subject to them having a continuous business for 10 years following the end of the subsidies.
The amount of subsidy for each project will be based on the difference between the respective basic prices, which will generally be fixed for 15 years, and reference prices.
Basic prices should be estimated by potential subsidy recipients in advance, taking into account capital expenditure, operational expenditure and variable costs to produce clean fuels.
Reference prices should be the highest cost out of the total cost of existing fuel and carbon prices, the actual selling price of hydrogen on a cfr Japan basis or at the domestic hydrogen production point, including in other forms, and the deal price in the past when selling in the existing hydrogen and ammonia market. In the power sector, for example, import costs such as for LNG and thermal coal would be an option for reference prices when substituting hydrogen for regasified LNG and ammonia for coal.
Tokyo is aiming to establish and stretch hydrogen supply chains beyond the power sector and into hard-to-abate industries, such as steel and chemicals, as part of the country's decarbonisation drive towards net zero emissions by 2050.
Japan expects to have 3mn t/yr of hydrogen supply in 2030, 12mn t/yr in 2040 and 20mn t/yr in 2050, including in the form of ammonia.
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Germany passes draft carbon management strategy
Germany passes draft carbon management strategy
Berlin, 26 February (Argus) — Germany's economy and climate ministry today proposed legal changes that will enable the deployment of carbon capture and storage or use (CCS/CCU) and the transport and offshore storage of carbon in the country, along with the possibility of applying carbon capture to gas-fired power plants. Federal minister of economic affairs and climate action Robert Habeck presented draft "key points" for a future carbon management strategy, along with a draft amendment to the country's carbon storage law. Habeck stressed that public support for CCS/CCU will be "focused" on emissions that are difficult or impossible to avoid. Germany's government will also ratify the amendment to the London Protocol , enabling the export of CO2, Habeck said. Storing carbon will be permitted in Germany's offshore zone with the exception of protected areas. This will enable Germany to "catch up" with its European neighbours, such as Norway. "In this way, we face the responsibility instead of shifting it to others," Habeck said. But permanent carbon storage onshore will remain banned. The application of CCS to gas-fired power plants was already mentioned as a possibility in the government's draft power plant strategy, to the surprise of observers. Environmental group Germanwatch today slammed the move as having been carried out "evidently at the instigation of the [pro-business government coalition partner] FDP", adding that it might "destroy acceptance for any kind of CCS in Germany". CCS for coal-fired power generation will not be allowed. CCS for gas-fired plants will be permitted but not financially supported, the ministry said. Habeck called the decisions "pragmatic" and "responsible". Without CCS and CCU, Germany's climate targets will be "impossible to reach", he said, adding that "many industrialised countries are already making great strides in developing the technology". And CCS will be needed for the technical carbon sinks that will be necessary to achieve sufficient negative emissions. Natural sinks will not suffice, Habeck said. The ministry is working on a strategy for negative emissions that will be "a kind of sister strategy to the carbon management strategy". The draft carbon storage law will provide a legal framework for future CO2 pipeline infrastructure that is expected to be privately sponsored but within a state regulatory framework. The drafts will now be sent to other ministries, and hearings for the federal states and associations will follow. Germany plans to reach greenhouse gas neutrality in 2045. Recent documents from the European Commission detail a substantial role for carbon management for the EU to reach its climate targets. By Chloe Jardine Send comments and request more information at email@example.com Copyright © 2024. Argus Media group . All rights reserved.
Liberty Steel targets Australian hydrogen, CCS deals
Liberty Steel targets Australian hydrogen, CCS deals
Sydney, 26 February (Argus) — UK-owned producer Liberty Steel has signed separate agreements with the South Australia (SA) state government and domestic independent Santos to respectively explore the use of hydrogen and discuss carbon capture and storage (CCS) opportunities for its Whyalla steel plant in SA. Liberty could become the first domestic third-party customer for the Santos-operated 1.7mn t/yr Moomba CCS project in SA's onshore Cooper basin, which is on track to start injection in mid-2024. Santos has secured finance for its $150mn share of the $220mn project, it said on 26 February, following an initial deal signed with Liberty over the weekend. Santos and Liberty will now enter discussions for a potential term natural gas supply deal that could include abated gas from Moomba. This could help reducing residual emissions from the Whyalla steelworks during a transition period, before the plant fully moves to green hydrogen once that is available at scale, Liberty's owner GFG Alliance said on 25 February. Liberty's separate agreement with the SA government, also signed on 25 February, is for potential supplies from the government's planned 250MW green hydrogen facility near Whyalla in the Spencer Gulf region. The SA government last October chose a consortium comprising Canadian-owned infrastructure group Atco and German firm Linde's subsidiary BOC as preferred contractors for the plant, which is expected to come on line by the end of 2025 . "Today's agreement gives us and our stakeholders confidence to ramp up our efforts and commitment to the production of our 4bn t of high-quality magnetite, the establishment of a state-of-the-art green iron and green steel plant which will ultimately be powered by renewable energy and green hydrogen," GFG Alliance chairman Sanjeev Gupta said. Liberty plans to build an electric arc furnace (EAF) at Whyalla , which will replace the existing coke ovens and blast furnace and lift steel production capacity to more than 1.5mn t/yr from 1mn t/yr. The company has received a A$63.2mn ($41.4mn) grant from the Australian federal government to support the purchase and installation of the EAF. It also has A$50mn committed by the SA government for use towards the EAF, pending approval. GFG Alliance also plans to produce 7.5mn t/yr of iron pellet from locally-sourced magnetite from 2030 in a direct reduced iron plant, which would initially use a mix of natural gas and green hydrogen as the reducing agent before fully transitioning to the latter. Santos is also targeting to offer CCS services from Moomba to reduce emissions from other hard-to-abate industries such as aluminium and cement, as well as from fuels like LNG, it said. Santos owns 66.7pc of Moomba with the balance controlled by Australian independent Beach Energy, which anticipates 30pc of its equity greenhouse gas emissions will be offset by the storage . By Juan Weik Send comments and request more information at firstname.lastname@example.org Copyright © 2024. Argus Media group . All rights reserved.
Braya begins renewable diesel production
Braya begins renewable diesel production
Washington, 22 February (Argus) — Canada's Braya Renewable Fuels today launched commercial operations at its renewable fuels plant in Come By Chance, New Foundland and Labrador. Braya expects to produce 18,000 b/d of renewable diesel, using internally-produced traditional hydrogen. It envisions expanding its diesel capacity to 35,000 b/d and adding sustainable aviation fuel (SAF) production in the future. It also said it is in the early stages of exploring renewable hydrogen production at the refinery to lower its carbon footprint, but does not have a timeline. Last year it began seeking a supplier of 35,000 t/yr of renewable hydrogen to support its diesel and SAF production, and in March 2023 selected German renewables developer ABO Wind as its preferred supplier. Braya's ownership group Cresta Fund Management acquired the 130,000 b/d petroleum refinery in 2020 and began work to convert the facility to produce renewable fuels in late 2021. Initially it aimed to produce 14,000 b/d of renewable diesel and targeted SAF production in mid-2022, but a fire in September 2022 postponed startup. By Emmeline Willey 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.
Houthi missile hits Saudi fertilizer vessel off Yemen
Houthi missile hits Saudi fertilizer vessel off Yemen
London, 20 February (Argus) — The crew members of the Belize-flagged Handysize bulk carrier Rubymar , carrying a cargo of Saudi fertilizer, have abandoned ship off Yemen after it was hit by a missile fired by Houthi militants late on 18 February. The British-owned vessel was in the Gulf of Aden near the Bab el-Mandeb strait when it was hit by at least one missile while another missed its target, according to US Central Command. The UK Maritime Trade Operations (UKMTO) said it had received reports of an attack 40 miles (about 64.4km) south of Mokha, Yemen, on an unnamed vessel. US Central Command confirmed that the Rubymar sustained damage and then issued a distress call that was answered by a coalition warship and another merchant vessel. The crew was evacuated safely and have been transported to the port of Djibouti, according to the Djibouti Ports and Free Zones Authority. The Rubymar was last located on vessel-tracking data in the Bab el-Mandeb strait between Yemen and Djibouti. The UKMTO said the vessel was at anchor and had been abandoned. A Houthi social media statement said the ship was at risk of sinking. The vessel departed the Saudi port of Ras al-Khair on 8 February and was bound for Varna, Bulgaria, on the western edge of the Black Sea, vessel-tracking data show. It was due to arrive on 27 February. There has been no confirmation as to what grade of fertilizer was on board, although vessel-tracking data do list fertilizers as the cargo. Bulgaria in the past has imported NP grades from Saudi Arabia. A spokesperson for the Saudi producer declined to comment on any aspect of the incident. The size of the vessel would indicate a cargo of about 30,000t. This is the second confirmed major strike on a vessel carrying fertilizer in the region. In mid-January, the US-owned Genco Picardy , carrying a cargo of 30pc P2O5 phosphate rock from Egypt to India, came under drone attack by Houthi militants. This caused a fire onboard that was extinguished and the vessel proceeded to Thoothukudi. By Mike Nash Send comments and request more information at firstname.lastname@example.org Copyright © 2024. Argus Media group . All rights reserved.