Brazil adopts new fuel, gas price rules
Brazil's hydrocarbons regulator ANP issued two separate resolutions that obligate distributors, producers and importers to disclose pricing information for fuel and natural gas.
Producers and importers of refined products will be required to disclose prices at five major delivery points, later to be expanded nationwide to more than 35 points. Prices must be published by the companies on their websites.
The new resolutions also require distributors, producers and importers to include price adjustment information in sales contracts requiring ANP approval.
The fuel-related resolution, which takes effect in 30 days, covers gasoline, diesel and ultra-low sulfur diesel, LPG, kerosene, aviation gas, fuel oil and asphalt.
The resolution concerned with natural gas allows the ANP to publish purchase and sale agreements between distributors of pipeline gas to captive markets. The change, which takes effect in 60 days, is designed to give consumers access to the formation of prices.
"The [resolutions] aim to reduce asymmetry of information and to protect consumer interests in price, quality and supply of products, promoting free competition in both the short and long term," ANP said.
The agency started work on the resolutions in the wake of a May 2018 truck drivers´ strike. At the time, ANP director general Decio Oddone rejected calls for price controls, opting instead for releasing more price information. Oddone calls the changes a "transparency revolution," particularly for gas where almost no pricing data has been available for decades.
The resolutions approved by the agency yesterday are the result of almost a year of back-and-forth consultations with local industry. Industry leaders such as state-controlled Petrobras and Shell-Cosan joint venture Raizen disagreed with the ANP's approach to increasing transparency. The agency diluted initial proposals that would have required companies to disclose price calculations.
Petrobras was not immediately available to comment.
The fuels resolution impacts the climate for downstream investment in Brazil. Petrobras plans to sell around half of its 2.2mn b/d in domestic refining capacity by 2021.
The company has also signaled that it will completely withdraw from natural gas distribution.
Related news posts
Oil firm ReconAfrica agrees to class action settlement
Oil firm ReconAfrica agrees to class action settlement
Cape Town, 18 April (Argus) — Africa-focused, Canada-based upstream firm ReconAfrica has agreed to pay $10.8mn in total to eligible shareholders to settle class action lawsuits lodged in different jurisdictions over allegations that the company made misleading statements. The company will pay $7.05mn to investors who bought its shares on the US over-the-counter (OTC) markets and $3.7mn to shareholders who bought securities in the firm on Canada's TSX Venture Exchange and the Frankfurt Stock Exchange within specified class periods. In Canada, parties reached the proposed settlement after a full-day mediation in October 2023, without any admission of liability by ReconAfrica. A hearing has been scheduled on 20 June for the British Columbia Supreme Court to approve the settlement. The plaintiffs allege that between May 2020 and September 2021, ReconAfrica released misleading statements, including its plans to undertake hydraulic fracturing of "unconventional" resources and "shale" deposits within Namibia. The firm failed to disclose that Namibia has never before allowed fracking. The plaintiffs further claim that ReconAfrica did not disclose data from its test wells that revealed poor prospects for achieving commercially viable oil and gas production. The company also stands accused of undertaking unlicensed drilling and illegal water usage, as well as other environmental and human rights violations. It denies all these allegations. ReconAfrica has a current market capitalisation of C$204.7mn. Earlier this month, it raised C$17.25mn in a public share offering. The firm plans to undertake a multi-well drilling campaign this year, with the first well in Namibia's Damara Fold Belt scheduled for June. The company controls the entire Kavango sedimentary basin, which spans over 300km from the northeast of Namibia to northwest Botswana. Early estimates claimed the basin could hold as much as 31bn bl of oil, of which 22.3bn bl are in Namibia and 8.7bn bl in Botswana. ReconAfrica has a 90pc stake in the PEL 73 licence, which extends 25,000km² across northeast Namibia. The remaining 10pc is held by Namibian state-run company Namcor. The Kavango basin includes part of the ecologically sensitive Okavango Delta, a Unesco World Heritage site. The Okavango watershed consists of the Okavango river and a network of shallow, interlinked aquifers, which is a vital water source for more than a million people. The delta also serves as a habitat and migration path for many endangered animal species. Last year, ReconAfrica received environmental approval to drill 12 more wells in the Kavango. The firm recently completed a technical review of its entire exploration inventory in Namibia and now expects to find a mix of oil and gas. ReconAfrica announced an updated prospective resource estimate for Damara last month, indicating an unrisked 15.4bn bl of undiscovered oil initially-in-place. This compares with a previous estimate that pointed only to prospective natural gas resources amounting to 22.4 trillion ft³. The change "is the result of in-depth analyses of all geochemical data, including cores, cuttings, mud logs, seeps and additional basin modelling studies," ReconAfrica said. The firm has made the updated estimates available to potential joint venture partners and expects to complete this month a farm-out process that it started in December 2023. By Elaine Mills Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
NSTA fines Neo Energy for North Sea methane venting
NSTA fines Neo Energy for North Sea methane venting
London, 18 April (Argus) — UK offshore regulator the North Sea Transition Authority (NSTA) has fined UK upstream firm Neo Energy £100,000 for breaching its methane venting permit at North Sea fields. The company emitted 1,200t of methane in excess of its permit from the Donan, Lochranza and Balloch fields in the first nine months of 2022. Neo had permission to vent 378t of methane from installations at these fields in that year, but incorrectly assigned volumes vented through unlit flares to its flaring consent, the NSTA found. Neo showed a "lack of oversight" by failing to detect the licence breach for seven months, NSTA said. The company reached its annual limit by 21 March 2022, but continued venting without authorisation until October 2022. The company said it did not update its flare and vent allocation process to reflect NSTA guidance updated in 2021, and as such was still assigning its flaring and venting according to previous guidance. Neo becomes the fourth company to be fined by the NSTA over breaches relating to flaring and venting consents. The regulator in 2022 sanctioned Equinor and EnQuest and last year fined Spanish utility Repsol for consent breaches. The four companies have been fined a total of £475,000 for the breaches. And the regulator in February had four more investigations under way for breaches of vent consents. Neo Energy's fine is equivalent to £2.98/t of CO2e emitted, assuming a global warming potential of methane that is 28 times that of CO2 on a 100-year time scale, compared with a UK emissions trading system price of £34.40/t of CO2e on 17 April. The UK offshore industry targets a 50pc reduction in production emissions of greenhouse gases by 2030, from a 2018 baseline. And it intends to end all routine venting and flaring by that year. The regulator last year warned that "further, sustained action" would be needed to reach the 2030 emissions reduction goal. Methane emissions from offshore gas fell in recent years, to 1mn t in 2022 from 1.6mn t in 2018, according to NSTA data. Roughly half of methane emissions in the sector in recent years has been produced by venting, while flaring makes up about a quarter of the emissions. The UK government is a member of the Global Methane Pledge group of countries that aims to reduce methane emissions by 30pc by 2030 from a 2020 baseline. By Rhys Talbot Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
UAE air traffic recovery begins after storm disruptions
UAE air traffic recovery begins after storm disruptions
Singapore, 18 April (Argus) — Air traffic at Dubai International (DXB) has begun to recover after an unprecedented storm hit the country on 16 April, although flight delays are expected to continue. "DXB resumed inbound flights of international airlines operating out of terminal 1", a spokesperson for DXB operator Dubai Airports said on 18 April. But it urged travellers not to come to the terminal for outbound flights before confirming their flight status, as it said the access to the terminal is "strictly limited" to guests with confirmed departures. Prolonged flight disruptions at DXB, which was ranked the second-busiest airport in the world in 2023, according to the Airports Council International's preliminary ranking, could affect regional jet fuel demand. Dubai low-cost carrier flydubai said it has now resumed partial operations from DXB, having previously cancelled all of its flights scheduled to depart from Dubai on 16 April evening until 10am on 17 April. Select outbound flights were to operate from DXB's terminal 2 with scheduled operations resuming after 8pm on 17 April, it said, while flights from terminal 3 were due to resume after midnight. But Dubai-owned Emirates Airlines has extended the suspension on check-in for passengers departing DXB until 9am on 18 April, after having initially suspending it between 8am and midnight on 17 April. The airline said the extension was because of "continued operational challenges caused by bad weather and road conditions". Neighbouring Abu Dhabi's Zayed international airport said it is "operating smoothly", despite issuing a warning on 17 April that some flights might be delayed. By Ieva Paldaviciute Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
June deadline set for Citgo auction bids
June deadline set for Citgo auction bids
Houston, 17 April (Argus) — Bidders for Citgo's US refining assets have until 11 June to submit offers for the company's 805,000 b/d of refining capacity and associated assets, with a tentative sale hearing set for 15 July. Documents filed Tuesday in the US District Court for the District of Delaware set 11 June as the deadline for interested parties to submit final binding bids after non-binding bids were received 22 January. The court began the auction process for Citgo's parent PdV Holding (PdVH) in October, part of the process of satisfying debts owed by Venezuelan-state owned oil company PdV. The court will file a notice of a successful bid "as soon as reasonably practicable" following the 11 June deadline and selection of a successful bidder. No date has been set for the filing of objections to the sale or replies to the objections before the tentative 15 July hearing. The legal wrangling over Citgo is unlikely to conclude even if the Delaware court successfully executes the sale as 27 businesses have filed claims against Citgo amounting to more than $21bn. The scale of Citgo's operations in the US are also a challenge to any potential buyer. Few companies look ready to buy the company's three refineries, three lubricants plants and retail and midstream assets. The assets have been valued by various analysts anywhere between $6.5bn and $40bn, with a lofty valuation potentially deterring bidders. But the auction process itself has been the main cause for concern. Independent refiner PBF Energy's chief executive Matthew Lucey previously called the auction a "quagmire" , considering its ties to a complex geopolitical situation in Venezuela, saying he did not expect the sale to go anywhere in the near term. Marathon Petroleum expressed similar disdain. "We're not interested in the auction process," Marathon chief executive Michael Hennigan said on an earnings call in October . By Nathan Risser Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more