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California sues ExxonMobil for plastics marketing

  • Market: Crude oil, Petrochemicals
  • 23/09/24

California has filed a lawsuit against ExxonMobil that alleges the company misled state residents for years by promoting recycling as a solution to plastic waste, despite knowing that most plastic cannot and will not be recycled.

California attorney general Rob Bonta said the lawsuit, filed today in state court, would hold ExxonMobil accountable for a "decades-long deception" that he says has exacerbated plastic pollution on land and waters. The state is seeking to block the company from certain marketing claims about recycling, in addition to imposing penalties and contributing to an abatement fund to clean up plastic waste.

"ExxonMobil has been deceiving the public to convince us that plastic recycling could solve the plastic waste and pollution crisis when they clearly knew this wasn't possible," Bonta said.

ExxonMobil is the world's largest producer of petrochemical polymers used in single-use plastics, the lawsuit says, with 14.5mn t/yr of production capacity of polyethylene and polypropylene last year. The lawsuit comes after an investigation that Bonta launched into the plastic waste "crisis" in 2022.

ExxonMobil did not immediately respond to a request for comment.

The lawsuit has similarities to climate-related lawsuits that state and local governments have recently filed against ExxonMobil and other oil companies by alleging various violations of state laws on "public nuisance" and misleading advertising. Today's lawsuit cites internal company communications to allege ExxonMobil knowingly promoted deceptive information on recycling to avoid "negative" consumer perceptions about single-use plastics.

The lawsuit comes a day after California governor Gavin Newsom (D) signed a law that will ban all plastic bags from being provided at grocery stores in 2026. California law already restricts the availability of thin, single-use plastic bags at stores. Critics said those restrictions led stores to pivot to thicker plastic bags that are mostly thrown away, resulting in a net increase in plastic waste.


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14/11/24

Brazil starts US, Canada PE-dumping probe

Brazil starts US, Canada PE-dumping probe

Sao Paulo, 14 November (Argus) — Brazil's government has started an anti-dumping investigation into polyethylene (PE) produced in the US and Canada. The country's foreign trade committee Gecex launched the investigation on 13 November following allegations from the sole Brazilian PE producer, major petrochemical company Braskem, that these countries are exporting PE to Brazil at prices below what is considered fair market value. Overall imported PE prices into Brazil have been in a downward trend since July, pushing down Braskem prices in the domestic market. Gecex said it will analyze export prices and compare them with those in the domestic markets of both countries. If dumping is confirmed, corrective measures may be applied to protect the Brazilian industry. A preliminary analysis has identified significant evidence of dumping, justifying the continuation of the investigation, Gecex said. It added that there was a considerable increase in PE imports from these countries — especially from the US — during the period being investigated, which may have contributed to the decline in domestic prices and harmed the domestic producer. The preliminary analysis of dumping evidence covered 1 April 2023 to 31 March 2024. The damage analysis period extended from 1 April 2019 to 31 March 2024. The anti-dumping investigation into PE imports from the US and Canada was preceded by an increase in import taxes on a number of polymers and chemicals to 20pc from 12.6pc, including PE, polypropylene (PP) and polyvinyl chloride (PVC), effective since 15 October. Repercussions An international trader specializing in polymer imports into Brazil told Argus that if anti-dumping duties are applied, his company's PE imports from the US to Brazil could drop by 20-30pc. "The decision has a 10-month deadline to be presented, but I believe it will be implemented and possibly announced earlier," he said, adding that this is another Braskem maneuver to regain its traditional 70pc market share in the Brazilian market. If confirmed, the measure is expected to have a significant impact on the Brazilian economy, especially on the plastic products manufacturing industry, as imports of finished plastic products could rise substantially, the trader said. One US-based trader selling US and Canada PE into Brazil sees the possible application of anti-dumping measures on the products as a structural development. "We will need to source PE in different production regions such as Asia and the Middle East, developing new ways of logistics, cash flows, ways of payment, to make it work flawlessly as it currently works with North American PE," the trader told Argus . "Prices should go up and we will increase our margins on PE sales." Brazil's January-September PE production increased by 1pc to 1.7mn t from the same period in 2023, while domestic sales fell bu 2pc to 1.24mn t. In contrast, PE imports jumped by 45pc to 1.54mn t, resulting in an apparent consumption of around 2.8mn t, up by 20pc higher year-on-year and a record high. By Fred Fernandes Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Cop: German opposition pushes for Article 6


14/11/24
News
14/11/24

Cop: German opposition pushes for Article 6

Berlin, 14 November (Argus) — Germany's main opposition parties have welcomed the progress achieved on Article 6 of the Paris Agreement in at the UN Cop 29 climate summit in Baku, Azerbaijan. They have called on Germany and the EU to make better use of the instrument to allow for more cost-efficient climate action. Germany's dominant opposition party, the right-of-centre CDU/CSU, on 14 November commended the framework under Article 6 as an efficient way of reducing greenhouse gas (GHG) emissions. Article 6 of the Paris accord aims to help set rules on global carbon trade. The Article 6 mechanism allows for reductions to happen where they are quickest, cheapest and easiest to be carried out, the CDU head of the working group on climate action and energy, Andreas Jung, said in a debate in the lower house of parliament, the Bundestag. The deputy head of the FDP faction Lukas Koehler, also speaking in the Bundestag on 14 November, called on Germany and the EU to "finally" integrate the Article 6 in their climate action plans. Koehler argued that if for instance Germany's progress in emissions reduction should turn out to be too slow, the country could temporarily shift its efforts — and the associated finance — to where more rapid mitigation might be achieved, such as Brazil. The EU, of which Germany is a member state, will not make use of Article 6 credits, at least until 2030, to reach its so-called nationally determined contribution (NDC) – its climate action pledge — under the Paris climate accord. The EU has been seeing progress on ongoing Article 6 negotiations at Cop 29, the European Commission's principal advisor for international aspects of EU climate policy Jacob Werksman said today, "mostly because parties are now agreeing with the EU and others that were concerned about the transparency and accountability of the bilateral markets that operate under Article 6.2". Werksman believes there is enough momentum for negotiations to be concluded next week, noting that the atmosphere has "improved" compared with previous negotiations, which echoes the sentiment expressed by a number of negotiators earlier this week . Werksman pointed in particular to the US now agreeing with others and helping to broker compromises. Koehler also warned German government representatives in Baku to refrain from "expensive" pledges which may strain the country's budget. Developed countries agreed in 2009 to deliver $100bn/yr in climate finance to developing nations, and Cop 29 is focused on the next iteration of this — the new collective quantified goal (NCQG) . In a statement, Germany — represented by Scholz despite his absence at the Cop — and other G7 members like Canada, France, or the Netherlands agreed that "developed countries must continue to take the lead and live up to existing finance commitments". Germany faces early elections as the government lost its majority last week following the sacking, by chancellor Olaf Scholz of the Social Democrat SPD, of finance minister Christian Lindner of the pro-business FDP party and the FDP's subsequent withdrawal from the ruling coalition. Polls suggest that the CDU/CSU group will easily win the next federal elections which are scheduled to take place on 23 February. The FDP's persistent refusal to allow Germany to take on more debt to enable more public funding, including of clean technologies, was the main reason for Lindner's sacking. By Chloe Jardine and Victoria Hatherick Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Guyana hires floating generators to avert outages


14/11/24
News
14/11/24

Guyana hires floating generators to avert outages

Kingston, 14 November (Argus) — Guyana is lifting its floating power capacity to 111MW with the rental of plants that the government says will prevent widespread power cuts over the next two years. The government has contracted a 75MW power barge from Turkish firm Karpowership that installed a 36MW barge in May, finance minister Ashni Singh said on Wednesday. The government has not released the terms of the contracts for the floating plants that are being fired by imported heavy fuel oil. Karpowership has been given a two-year contract that the government says will expire with the scheduled commissioning of a $2bn natural gas project that includes a 300MW power plant. The project will be fed by gas from a deepwater block being worked by US major ExxonMobil. The agreements with Karpowership "will take us just beyond the period when the new plant comes on stream," Guyana's vice president Bharrat Jagdeo said. The growing oil producer in northern South America faces a widening power deficit as state power utility GPL cannot meet demand created by a rapidly expanding oil-fired economy, the government said. Power demand in the country of 750,000 people has grown from 115MW in 2020 to 175MW currently and is projected to reach 205MW by year-end, the government said. GPL's fuel oil-fired output of 165MW "does not allow for a comfortable reserve so we need adequate redundant capacity," an official told Argus . Guyana's contract for power barges from Karpowership is the company's third in the region. Six of the company's floating plants are supporting Cuba's faltering power system, while another is stationed in the Dominican Republic. By Canute James Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Cop: EU ETS volatility problem for corporate CCS case


14/11/24
News
14/11/24

Cop: EU ETS volatility problem for corporate CCS case

Baku, 14 November (Argus) — Price fluctuations in the EU emissions trading system (ETS) make it difficult for carbon capture and storage (CCS) projects to attract finance, delegates at a UN Cop 29 climate conference side event in Baku, Azerbaijan, heard today. Fluctuations in the EU ETS price make it more difficult to model the support provided to CCS projects through avoided compliance costs, law firm Latham & Watkins partner Jean-Philippe Brisson said. These ups and downs are "very difficult for corporates", Japanese bank MUFG director Yukimi Shimura said. The benchmark front-year EU ETS contract has closed at an average of €66.20/t ($69.82/t) of CO2 equivalent (CO2e) so far this year in Argus assessments, compared with €85.30/t CO2e last year. While carbon pricing is an "absolute must" for CCS, if ETS cost avoidance is your only revenue stream it is very difficult to convince financials or board members to support projects, Swiss cement major Holcim vice president Pavan Chilukuri said, as the long-term viability of projects is not guaranteed. Additional funding is therefore needed to accelerate project implementation, Chilukuri said. This could be in the form of revenues from carbon dioxide removal credits — generated when plants run on biogenic energy and the carbon captured — or carbon contracts for difference. The CCS hub concept — where a number of sites capturing CO2 are located near each other to make use of the same transportation and storage infrastructure — can also help to limit costs, he said. But hubs come with their own cross-chain risks, Shimura said, including uncertainty surrounding liability for issues such as delays. The UK government — which is developing two CCS clusters — is doing an "excellent job" to minimise such risks, Shimura said. But more needs to be done in the US and Asia, with a role to be played by governments, she said. Most CCS activity remains concentrated in the US because incentives there are very strong and fixed for 12 years, Brisson said, referring to the $85/t tax credit for CCS offered under the country's Inflation Reduction Act. But even this is now "not good enough", Shimura said, as inflation has pushed costs up since the figure was set. By Victoria Hatherick Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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IEA sees wider oil market surplus next year


14/11/24
News
14/11/24

IEA sees wider oil market surplus next year

London, 14 November (Argus) — The IEA is predicting a global oil supply surplus of over 1mn b/d next year, which it says will provide "much-needed stability" to the market. The Paris-based agency's latest Oil Market Report (OMR) shows a 1.15mn b/d supply surplus next year, the highest since it first started projecting supply and demand levels for 2025 in April this year. It is 40,000 b/d higher than its estimate last month. "With supply risks omnipresent, a looser balance would provide some much-needed stability to a market upended by the Covid pandemic, Russia's full-scale invasion of Ukraine and, most recently, heightened unrest in the Middle East," the IEA said. The IEA's projected supply surplus could be much higher if Opec+ members push ahead with a plan to start unwinding 2.2mn b/d of "voluntary" production cuts from January over a 12-month period. But this is not guaranteed. Weaker-than-expected demand has already forced the Opec+ members to delay their plan to start increasing output by three months. Opec+ ministers are set to decide on their output policy for 2025 and beyond in a meeting on 1 December. The IEA's oil demand growth forecasts for this year and next remain below 1mn b/d — a steep drop compared with 2mn b/d last year and 2.5mn b/d in 2022. For this year, the IEA has raised its oil demand growth projection by 60,000 b/d to 920,000 b/d, mostly because of higher-than-expected consumption in Europe. Its forecast for next year has been nudged down by 10,000 b/d to 990,000 b/d compared with last month's OMR. Much of the slowdown in global consumption centres on China, where the economy is not growing as fast as it once did. The IEA has kept its oil demand growth for China unchanged at 150,000 b/d for this year, but this is far below the 710,000 b/d it was forecasting in January. The agency said Chinese oil demand contracted for a sixth straight month in September, pushing consumption in the third quarter 270,000 b/d below year-earlier levels. For next year, the IEA has lowered its Chinese demand growth forecast by 30,000 b/d to 190,000 b/d. China's slowing oil demand is also due to an increased uptake of electric vehicles, LNG-powered trucks and high-speed rail, the IEA said. On global supply, the IEA has trimmed its growth estimate for this year by 20,000 b/d to 640,000 b/d. But for next year, it sees supply growth accelerating to more than 2mn b/d, led by the US, Canada, Guyana, Brazil and Argentina. The agency said global observed oil stocks declined by 47.5mn bl in September to their lowest level since January. It also said preliminary data show stocks fell further in October. By Aydin Calik Supply and demand balance Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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