Petrobras banking on renewable fuels, niche refining
Brazil's state-controlled Petrobras is developing green diesel and other niche refining businesses as part of its effort to reduce emissions.
Earlier this year, the company concluded refinery tests on its patented hydrotreated vegetable oil (HVO) production technology. The co-processed renewable fuel uses up to 10pc vegetable oils to produce a drop-in fuel that is chemically identical to petroleum diesel.
Petrobras' HVO diesel, also known as green diesel, reduces emissions by 70pc compared to conventional diesel and by 15pc compared to biodiesel, downstream director Anelise Lara said in a call with analysts this week.
Production of renewable diesel is technically possible at the company's existing refineries and has already been tested at the 208,000 b/d Presidente Getulio Vargas refinery (Repar) in Parana state, Lara said. Repar is among the refineries that Petrobras plans to divest.
While Petrobras is in the process of exiting conventional biofuels production, the company is evaluating investments in greenfield biokerosene projects, as well as the construction of dedicated co-processed green diesel refineries.
"We are waiting for approval from the CNPE (national energy policy council) and the ANP (hydrocarbons regulator) to begin selling our renewable diesel in Brazil," she said. "Recognition that our renewable diesel meets the requirements of the Renovabio (biofuels law) is an important step to making these projects economically viable."
The ANP conducted a public hearing process between July and September regarding the classification of HVO and renewable diesel. The agency received nearly 40 contributions from market participants and is expected to release its recommendations to the CNPE later this year or in early 2021.
In a preliminary designation, the ANP stopped short of classifying HVO as biodiesel as Petrobras had hoped. Instead, it sided with Brazil's biodiesel and agricultural industry associations, which asserted that only 5pc of Petrobras' green diesel comes from renewable sources while 95pc of its feedstock remains fossil fuel.
Lara highlighted that the company's renewable diesel reduces the "collateral impact" of biodiesel use on engines, which "suffer" from conventional biodiesel blends.
Brazil's biodiesel producers' association Ubrabio rejects claims that biodiesel causes engine damage.
The expansion of second-generation biofuels production is part of Petrobras' new niche refining strategy, which will focus on environmentally friendly products with a renewable content, Lara said. The company is also planning to concentrate its refining assets in populous southeastern Brazil, while it divests half of 2.2mn b/d of refining capacity in other parts of the country.
Related news posts
Australia to delay mandatory climate reporting to 2025
Australia to delay mandatory climate reporting to 2025
Sydney, 28 March (Argus) — Australia's biggest companies will likely face mandatory climate reporting from 1 January 2025, six months later than originally planned, according to a bill the Australian federal government introduced in parliament. Under the revised proposal, the country's largest companies and financial institutions will need to start disclosing their climate-related risks and opportunities, including scope 1 and 2 greenhouse gas (GHG) emissions, within their annual sustainability reports from 1 January 2025 instead of 1 July as previously intended . Scope 3 emissions disclosure will continue to be required from the second year of reporting. Companies will be arranged in three groups, with group 1 entities including companies meeting at least two of three criteria: more than A$500mn ($324mn) of annual revenues, over A$1bn of gross assets, 500 or more employees. Group 2 companies will have lower thresholds — above A$200mn of revenues, $500mn of assets and 250 employees — and will start reporting from the financial year starting on 1 July 2026. Reporting for group 3 entities — those with more than A$50mn of revenues, $25mn of assets and 100 employees — will begin from 1 July 2027. The 1 January 2025 start date might be pushed further to 1 July 2025, if the bill does not become law before 2 December. It will now be debated in parliament and needs to pass both houses, the Senate and the House of Representatives, before receiving royal assent. Its approval will support more investment in renewable energy as well as help companies and investors manage climate risks, the government said. Companies are currently not required to report their scope 3 emissions under Australia's National Greenhouse and Energy Reporting Act, which is used to measure and report GHG emissions and energy production and consumption. Scope 3 can include emissions within supply chains that occur inside or outside Australia, such as emissions from the combustion of Australian coal or LNG exported to other countries. By Juan Weik Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Brazil, France launch €1bn program to protect Amazon
Brazil, France launch €1bn program to protect Amazon
Sao Paulo, 27 March (Argus) — Brazil and France launched a four-year, €1bn ($1.1bn) investment program to protect the Amazon rainforest using private and public funds, the countries said on Tuesday as French president Emmanuel Macron is visiting the South American nation. "Gathered in Belem, in the heart of the Amazon, we, Brazil and France, Amazonian countries, have decided to join forces to promote an international roadmap for protection of tropical forests," the two countries said. Under the program, Brazil's public banks — such as the Bndes development bank — and the French development agency will form "technical and financial partnerships." The two countries also agreed to develop new research projects on sustainable sectors and create a research hub to share technologies to develop the bioeconomy. Macron and Brazilian president Luiz Inacio Lula da Silva visited Belem — near the mouth of the Amazon and the host city of Cop 30 — on 26 March. During the trip, indigenous leader and environmental campaigner Raoine Metuktire, of the Kayapo tribe, urged Lula to prevent construction of the 900km (559-mile) Ferrograo railroad , which could lower costs of transporting grains from Mato Grosso state, Brazil's largest agricultural producer. Macron will also visit Rio de Janeiro, Sao Paulo and capital Brasilia. This is his first trip to Brazil, as he had cut ties with the South American country during former president Jair Bolsonaro's administration. Bolsonaro put little focus on environmental protections during his term, policies that his successor has reversed. Brazil now aims to reach zero deforestation by 2030. It reduced deforestation in the Amazon by almost 50pc last year, according to government data. Deforestation in the region hit 196km² in January-February, a 63pc drop from the same period in 2023 and a six-year low, according to NGO Imazon, which focuses on research to promote climate justice in the Amazon. By Lucas Parolin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Ethanol constraints minor on Baltimore closure: Update
Ethanol constraints minor on Baltimore closure: Update
Houston, 27 March (Argus) — Ethanol flows in the US northeast may only see minor near term constraints following the closure of the Port of Baltimore due to the collapse of a bridge at the mouth of the waterway. Producers and other market participants expect longer local transit times for trucks carrying hazardous materials — including ethanol — to retail stations because of the collapse of the Francis Scott Key Bridge, which carried nearly 12.4mn cars and trucks in 2023, according to Maryland state data. This will lead to higher associated costs, but market sources say the region's supply chain flexibility, rail access and available stocks should mitigate near-term ethanol supply interruptions. Ethanol rail deliveries into the Baltimore market are expected to increase, offsetting the loss of barge supply for the duration of the port's closure. Railroads Norfolk Southern and CSX have rail access at the Port of Baltimore, while Kinder Morgan operates the primary transload terminal. US east coast ethanol stocks in March are at their highest monthly average since April 2020 at 8.76mn bl, according to the Energy Information Administration. By Payne Williams Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Ethanol constraints minor from Baltimore port closure
Ethanol constraints minor from Baltimore port closure
Houston, 27 March (Argus) — Ethanol flows in the US northeast may only see minor near term constraints following the closure of the Port of Baltimore due to the collapse of a bridge at the mouth of the waterway. Producers and other market participants expect longer local transit times for trucks carrying hazardous materials — including ethanol — because of the collapse of the Francis Scott Key Bridge, which carried nearly 12.4mn cars and trucks in 2023, according to Maryland state data. This will lead to higher associated costs, but market sources say the region's supply chain flexibility, rail access and available stocks should mitigate near-term ethanol supply interruptions. Ethanol rail deliveries into the Baltimore market are expected to increase, offsetting the loss of barge supply for the duration of the port's closure. Railroads Norfolk Southern and CSX have rail access at the Port of Baltimore. US east coast ethanol stocks in March are at their highest monthly average since April 2020 at 8.76mn bl, according to the Energy Information Administration. By Payne Williams 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