US scraps legal protections for migratory birds
President Donald Trump's administration has finalized a rule that will allow oil companies, wind farm owners and other industries to kill an unlimited number of migratory birds without facing any federal penalties.
The new rule, published today, would re-interpret the Migratory Bird Treaty Act of 1918 so that the government could only seek penalties for the illegal hunting of birds, rather than unintentional deaths from industrial activity. The change will save oil producers and other industries money by allowing them to abandon best practices to avoid bird deaths, such as covering open-air oil pits with nets, the US Fish and Wildlife Service said in a study published in November.
The rule is one of the last industry-friendly changes to environmental laws the Trump administration is pushing through in its last weeks in office. If the new policy had been in place in 2010, BP could have avoided paying $100mn in fines for the large numbers of birds killed in the wake of the the Deepwater Horizon oil spill.
Oil producers feel they have been unfairly targeted under the law, since most migratory bird deaths are caused by buildings and electrical lines. Power lines kill more than 31mn birds each year, while oil pits kill 750,000 and wind turbines kill 230,000. Wildlife officials only investigate about 57 cases each year and prosecute only some of those, according to federal data, typically in cases where birds are killed multiple times at the same location.
The final rule will not go into effect for 30 days, well after president-elect Joe Biden is sworn into office on 20 January. Biden last month vowed to halt or delay "midnight regulations" that have not already taken effect. That would offer a chance for the Biden administration to start legal efforts to stop the regulatory change from taking effect.
A federal judge last year already threw out the Trump administration's first attempt to re-interpret the Migratory Bird Treaty Act, after finding there was "nothing" in the text of the law to suggest the Trump administration's new interpretation was correct. That could offer grounds for activists to challenge the rule in court. The US Congress could also vote to scrap the rule, under a law named the Congressional Review Act, if there is support from a majority of members in the US Senate and the US House of Representatives.
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Vancouver Aframax rates at 6-month lows ahead of TMX
Vancouver Aframax rates at 6-month lows ahead of TMX
Houston, 23 April (Argus) — An oversupply of Aframax-size crude tankers on the west coast of the Americas in anticipation of the Trans Mountain Expansion (TMX) pressured Vancouver-loading rates to six-month lows on 19 April. With the 590,000 b/d TMX project expected to commence commercial service on 1 May, shipowners have positioned more vessels to be on the west coast to satisfy anticipated demand in Vancouver, but that demand has yet to materialize, leaving the Aframax market oversupplied for now, market participants said. Aframax rates from Vancouver to the US west coast began falling in mid-to-late March as an increase of ballasters added to tonnage in the region, helping drop the rate to ship 80,000t of Cold Lake on that route to $1.50/bl on 19 April from $2.55/bl on 21 March, according to Argus data. The rate held at $1.50/bl on 22 April, the lowest since 2 October and just 3¢/bl higher than the lowest rate since Argus began assessing the route on 21 April 2023. Similarly, the Vancouver-China Aframax rate also fell to a six-month low of $6.59/bl for Cold Lake on 19 April, down from $7.78/bl on 2 April, according to Argus data. In addition to the ballasters, two Aframaxes — the Jag Lokesh and the New Activity — are hauling Argentinian crude to the US west coast and are expected to begin discharging on 3 and 6 May, respectively, according to Vortexa. The Argentinian port of Puerto Rosales is mostly restricted to Panamaxes but can accommodate smaller Aframaxes. Downward pressure from across canal A recent slump in the Gulf of Mexico and Caribbean Aframax market, due in part to falling Mexican crude exports to the US Gulf coast , has exerted additional downward pressure, a shipowner said. "Though markets at each side of the (Panama) Canal are different, softer sentiment looms in the region," the shipowner said. Last week, a charterer hired two Aframaxes for west coast Panama-US west coast voyages, the first at WS102.5 and the second at WS95, equivalent to $12.71/t and $11.78/t, respectively, as multiple shipowners competed for the cargoes. The Vancouver Aframax market typically draws from the same pool of vessels as the west coast Panama market. For example, the Yokosuka Spirit , one of the Aframaxes hired to load in west coast Panama, discharged a Cold Lake cargo in Los Angeles on 21-22 April after loading in Vancouver in mid-March, according to Vortexa and market participants. By Tray Swanson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
USGC LNG-VLSFO discount to steady itself
USGC LNG-VLSFO discount to steady itself
New York, 23 April (Argus) — The premium for US Gulf coast (USGC) very low-sulphur fuel oil (VLSFO) to LNG is expected to linger but not widen this spring, maintaining interest in LNG as a bunkering fuel. US Gulf coast LNG prices slipped from a premium to a discount to VLSFO in March 2023 and have remained there since. The discount surpassed 200/t VLSFO-equivalent in January (see chart). Both LNG and VLSFO prices are expected to remain under downward pressure due to high inventories, which could keep the current LNG discount steady. The US winter natural gas withdrawal season ended with 39pc more natural gas in storage compared with the five-year average, according to the US Energy Information Administration (EIA). Henry Hub natural gas monthly average prices dropped below $2/mmBtu in February, for the first time since September 2020, Argus data showed. The EIA expects the US will produce less natural gas on average in the second and third quarter of 2024 compared with the first quarter of 2024. Despite lower production, the US will have the most natural gas in storage on record when the winter withdrawal season begins in November, says the EIA. As a result, the agency forecasts the Henry Hub spot price to average less than $2/mmBtu in the second quarter before "increasing slightly" in the third quarter. EIA's forecast for all of 2024 averages about $2.20/mmBtu. US Gulf coast VLSFO is facing downward price pressure as demand falls and increased refinery activity signals a potential supply build . Rising Gulf coast refinery activity was likely behind some of the drop in prices. Gulf coast refinery utilization last week rose to 91.4pc, the highest in 12 weeks and up by 0.9 percentage points from the prior week. US Gulf coast suppliers are also eyeing strong fuel oil price competition from eastern hemisphere ports such as Singapore and Zhoushan, China, importing cheap Russian residual fuel oil. In general, LNG's substantial discount to VLSFO has kept interest in LNG for bunkering from ship owners with LNG-burning vessels high. The EIA discontinued publishing US bunker sales statistics with the last data available for 2020. But data from the Singapore Maritime & Port Authority, where the LNG–VLSFO discount widened to over $200/t VLSFOe in February, showed Singapore LNG for bunkering demand increase 11.4 times to 75,900t in the first quarter compared with 6,700t in the first quarter of 2023 and 110,900t for full year 2022. By Stefka Wechsler US Gulf coast LNG vs VLSFO $/t VLSFOe Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
India’s Chhara LNG terminal faces commissioning delay
India’s Chhara LNG terminal faces commissioning delay
Mumbai, 23 April (Argus) — Indian state-owned refiner HPCL's 5mn t/yr Chhara LNG import terminal is again facing delays in receiving and unloading its commissioning cargo, a market source told Argus . Fender failure at the terminal has caused problems in berthing the LNG vessel. The fender acts as a buffer or cushion between the ship hull and the dock, and prevents damage as a result of contact between the two surfaces. HPCL on 22 April issued a tender offering the commissioning LNG cargo , which is onboard the 160,000m³ Maran Gas Mystras. The vessel is currently laden offshore the terminal and ready to redeliver to another Indian LNG terminal on 25-30 April, according to HPCL. The company is seeking bids at a fixed price, and custom duty has already been paid by the firm. Indian firm Gujarat State Petroleum (GSPC) facilitate HPCL's purchase of the cargo on 26 March, with the cargo for delivery over 9-12 April. HPCL has put up the commissioning cargo for auction, and it can be discharged from any alternative port in India. LNG terminals closer to Chhara include Indian state-controlled importer Petronet's 17.5mn t/yr Dahej, Shell's 5.2mn t/yr Hazira or state-owned gas distributor Gail's 5mn t/yr Dhabol LNG terminal. HPCL also has not awarded a tender that is seeking another early-May delivery cargo , which closed on 19 April. Commissioning of the Chhara LNG terminal has been delayed since September 2022 owing to pipeline issues. The terminal is the country's eighth LNG import facility, which would lift total regasification capacity to 52.7mn t/yr from 47.7mn t/yr currently. The pipeline runs from the terminal and connects the city gas distribution network from Lothpur to Somnath district in Gujarat. There has been a delay in opening the pipeline as it passes through the eco-sensitive zone of the Gir wildlife sanctuary for 25.816km, a government document shows. The facility was completed in February, but is set to be closed from 15 May-15 September ahead of the completion of a breakwater facility , which is required to ensure safe LNG tanker berthing during India's monsoon season. No specific timeline has been given for building the breakwater, but the terminal will be able to operate year-round once it is completed. By Rituparna Ghosh Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
TotalEnergies to fully own Malaysian gas firm SapuraOMV
TotalEnergies to fully own Malaysian gas firm SapuraOMV
Singapore, 23 April (Argus) — TotalEnergies has signed an agreement to acquire Sapura Upstream Assets' 50pc stake in Malaysian private gas producer and operator SapuraOMV, which will take TotalEnergies' total stake to 100pc. The acquisition will cost $530mn, subject to closing adjustments, with closing expected to take place in the second half of this year, said TotalEnergies. This latest deal follows a previous agreement that TotalEnergies signed in January with Austrian firm OMV to acquire its 50pc interest in SapuraOMV. This means TotalEnergies will own 100pc of SapuraOMV once both transactions are completed. "Following the transaction with OMV announced two months ago and this new transaction with Sapura Upstream Assets, TotalEnergies will have full ownership of SapuraOMV and become a significant gas operator in Malaysia," said TotalEnergies' chairman and chief executive officer Patrick Pouyanné. "The SapuraOMV assets are fully in line with our strategy to grow our gas production to meet demand growth, focusing our portfolio on low-cost and low-emission assets," he added. SapuraOMV in 2023 produced 500mn ft³ of gas, which was used to feed the Bintulu LNG plant operated by state-controlled Petronas, as well as 7,000 b/d of condensates. SapuraOMV holds 40pc and 30pc operating interests, respectively, in blocks SK408 and SK310, which are offshore Sarawak, Malaysia. Block SK408's Jerun gas field, which could hold up to 84.9bn m³, is on track to start up in the second half of this year. SapuraOMV also has interests in exploration licences in Malaysia, Australia, New Zealand, and Mexico, where there was a discovery on block 30 last year, with estimated resources of 200mn-300mn bl of oil equivalent. TotalEnergies holds interests in two production sharing contracts in Malaysia. It in June last year signed an agreement with Petronas and Japanese trading firm Mitsui to jointly develop a carbon capture and storage project in Malaysia as well as assess maturing depleted fields and saline aquifers for storage. The firms hope to develop a CO2 merchant storage service to help industrial customers in Asia decarbonise. By Prethika Nair Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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