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Biofuels industry asks court to block EPA waivers

  • Market: Biofuels, Oil products
  • 24/04/19

Opponents of federal fuel blending mandate waivers today asked a US court to block the Environmental Protection Agency from issuing more of the waivers, ratcheting up a running battle over the volumes of renewables in the US transportation fuel supply.

The Advanced Biofuels Association cited redacted materials from another lawsuit against the agency to urge a judge to block EPA from exempting small refineries from 2018 Renewable Fuel Standard (RFS) requirements. The association argued in that lawsuit that the agency under former administrator Scott Pruitt illegally and arbitrarily increased the number of exemptions to record levels — effectively waiving 9.4pc of total US blending requirements for 2017.

The cuts have weighed especially heavy on biodiesel blending. Fuel blenders continue to use ethanol, a cheap octane source that makes up roughly 10pc of gasoline blends sold nationwide. But biodiesel blending faces tougher blending economics and less stable demand.

Credits associated with biodiesel blending have for years filled a gap between the total volume of ethanol that retailers can blend — about 14.5bn USG — and an implied mandate for both conventional ethanol and biodiesel of 15bn USG. Slashing the mandates have helped to depress demand for physical biodiesel blending, producers and blenders have said.

EPA said in early April that the agency was waiting for Department of Energy (DOE) recommendations on a record 40 applications to waiver requirements for 2018.

The association argued in March that redacted documents released to the group as part of the lawsuit showed that the EPA in 2017 disregarded DOE guidance to determine which refineries it would exempt from the requirements. The agency also included debt liabilities assumed by parent companies, ignored profits from selling credits no longer needed under the program and gave outsized weight to diesel production to tilt the program toward more waivers.

The documents remain under seal to protect confidential business information. EPA said its approval process followed the law and said in March that the characterization "is based on the filings of a single party and should be interpreted accordingly."

RFS requires refiners, importers and other companies to each year ensure minimum volumes of renewables blend into the gasoline and diesel they add to the US transportation supply. Congress included a waiver of these requirements for refineries processing less than 75,000 b/d that could demonstrate a hardship caused by the program to EPA and DOE.

These exemptions surged under President Donald Trump's administration, to a record 35 waivers for 2017. Because these waivers do not transfer blending obligations to larger companies, the exemptions effectively reduced blending requirements for the year by 17.1bn USG of gasoline and diesel.


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19/09/24

LNG-burning vessels well positioned ahead of 2025

LNG-burning vessels well positioned ahead of 2025

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US court asked for third Citgo auction extension


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19/09/24

US court asked for third Citgo auction extension

Houston, 19 September (Argus) — The court-appointed special master overseeing the auction of US refiner Citgo has asked the court to delay the announcement of a successful bidder to 26 September and a sale hearing to December. Special master Robert Pincus planned to make an announcement of the proposed buyer on or about 16 September followed by a November sale hearing, but last minute legal challenges derailed what have otherwise been "robust negotiations with a bidder," according to a court filing today. "The special master is continuing to negotiate sale documentation with a bidder," today's motion said. Pincus previously requested a second extension in August and a first extension in late July . By Nathan Risser Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Pertamina supplies first SAF to Virgin Australia


19/09/24
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19/09/24

Pertamina supplies first SAF to Virgin Australia

Singapore, 19 September (Argus) — Indonesian state-owned refiner Pertamina has supplied its first sustainable aviation fuel (SAF) to airline Virgin Australia, as part of the continuing Bali International Air Show. Pertamina is supplying around 160 kilolitres (kl) of SAF to Virgin Australia's Boeing 737 aircraft from the Ngurah Rai aviation fuel terminal in Bali for flights during 18-19 September. This was part of the 3,500 kl of blended SAF that Pertamina had sought for end-August delivery, intended to be used at the air show. The remaining volumes will be sold to other airlines and sales will be assessed before any further SAF purchases are made, a company source said. The SAF is a blend of 38.43pc synthetic kerosine produced from used cooking oil (UCO) and 61.57pc fossil jet fuel, said the director of central marketing and commerce at Pertamina Patra Niaga Maya Kusmaya. Pertamina also has plans to co-process SAF from UCO at its Cilacap refinery next year, before producing SAF by the hydrotreated esters and fatty acids pathway when its Cilacap "green refinery" comes on line, said a company source, although more details have yet to be disclosed. SAF distributed at Ngurah Rai is also managed using mass balancing, meaning that while jet fuel is mixed with SAF in the same tank as both have similar technical specifications, recording and bookkeeping for both products are managed separately. Pertamina obtained International Sustainability and Carbon Certification (ISCC) Corsia and ISCC EU RED-compliant certification for its SAF last month. The SAF supplied also meets ASTM international standards. By Sarah Giam Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Citgo auction result delayed amid last-minute motions


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18/09/24

Citgo auction result delayed amid last-minute motions

Houston, 18 September (Argus) — The US court-appointed special master overseeing the auction of US refiner Citgo plans to object to a last-minute motion from the Venezuelan government to delay the sale process by four months. The Republic of Venezuela and state-owned oil company PdV filed a motion on Tuesday seeking a four-month pause in the sale of its refining subsidiary Citgo, which is being auctioned off to satisfy debts owed by PdV. Special master Robert Pincus said in a court filing today that he intends to object to Venezuela's motion for a pause. The last-minute motion from Venezuela comes days after the US District Court for the District of Delaware was expected to announce results of the winning bidder. The court asked for a second extension to the auction process in August, delaying announcing a successful bidder to on or about 16 September with a sale hearing on 7 November. But Pincus is now dealing with last-minute legal challenges filed last week outside of the Delaware courts by so-called "alter ego" claimants seeking to "circumvent" the Delaware court's sales process and "jump the line" for enforcing claims against PdV, the special master said in a filing last week. Bidders for Citgo's 804,000 b/d of refining capacity, terminals, retail fuel stations and other plants expect the assets to be sold free and clear of future claims by PdV creditors. Unresolved legal liabilities could lower the value bidders are willing to pay for Citgo, decreasing the pool of money available to those owed by PdV. By Nathan Risser Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Advanced Fame marine biodiesel blends hit 9-month low


18/09/24
News
18/09/24

Advanced Fame marine biodiesel blends hit 9-month low

London, 18 September (Argus) — Some marine biodiesel blend prices in northwest Europe hit a year-to-date low on 17 September, owing to soft fundamentals and easing values in underlying markets. Argus assessed the prices of B30 and B100 Advanced fatty acid methyl ester (Fame) 0 dob ARA — which include a deduction of the value of Dutch renewable fuel tickets (HBE-G) — at $674.01/t and $993.87/t, respectively. At these levels, the two blends were at their lowest outright price since 29 December last year — right before values rose sharply following the halving of the Dutch HBE-G multiplier for maritime blending at the start of the year. Prices have slipped on the back lacklustre demand for marine biodiesel blends in recent months. The price of EU Emissions Trading System (ETS) allowances, for which Advanced Fame marine biodiesel blends receive a zero emission factor, have averaged $70.56/t so far this year, compared with $93.43/t in the same period last year. Consequently, the expansion of EU ETS into the shipping sector has done little to financially incentivise the uptake of marine biodiesel blends this year. On the other hand, voluntary demand for marine biodiesel blends has been steady from shipowners seeking to deliver proof of sustainability (PoS) documentation to their customers to offset the latter's scope 3 emissions. But this may have shifted geographically in recent months in favour of Singapore over ARA. Soft fundamentals in the marine biodiesel blend market has been compounded by pressure on prices in underlying crude and biodiesel markets. The front-month Ice Brent crude futures and gasoil futures contracts hit a near three-year low at 16:30 BST on 10 September. This in turn weighed on values of very-low sulphur fuel oil (VLSFO) and marine gasoil (MGO), and the former makes up 70pc of the B30 Advanced Fame dob ARA blend. VLSFO dob ARA prices have averaged $505.58/t so far in September, compared with $533.38/t on 1-18 August, having hit $483/t on 10 September, the lowest level since August 2021. Meanwhile, in the underlying biodiesel market, Advanced Fame 0 fob ARA prices were at the second-lowest level on record on 17 September, with the price marked at parity to used cooking oil methyl ester (Ucome) for the first time. Several market participants have said that low prices for German greenhouse gas (GHG) quota tickets, which can be traded on the market to meet the country's emissions reduction mandate, have discouraged buyers from physically blending advanced biodiesel, as tickets are a cheaper option. The current year GHG other ticket price hit a new historic low of $85/t CO2 equivalent (CO2e) on 13 September, down by $115/t compared with the same time last year and by $378/t compared with two years ago. Provisional EU anti-dumping duties on Chinese-origin biodiesel that came into force on 16 August have also turned European buyers away from advanced product made in China, which used to be one of the main sources of advanced biodiesel in Europe. By Hussein Al-Khalisy and Simone Burgin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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