Sinopec proposes to fully finance Sri Lanka refinery

Spanish Market: Condensate, Crude oil, Oil products
14/03/23

Chinese state-owned Sinopec has proposed to fully finance the construction of a refinery in Hambantota district in Sri Lanka, the island nation said on 13 March.

Representatives from Sinopec presented Sri Lankan president Ranil Wickremesinghe with a proposal, and also confirmed their "readiness to invest in the import, storage, distribution, and marketing of fuel to cater to Sri Lanka's energy requirements", the president's media division said on 13 March.

The Sri Lankan government had last month invited expressions of interest to set up an oil refinery and oil product processing plant near the strategic Hambantota port. Interested parties are expected to build, own and operate the refinery. The government expects the export-oriented project to have a minimum capacity of 100,000 b/d.

During the discussion with the Sinopec representatives, the Sri Lankan government had taken a "principled decision" to expand the distribution of fuel, which will commence soon, the president's media division said.

Sri Lanka has been dealing with its worst foreign exchange crisis since gaining independence in 1948, resulting in fuel, food and power shortages. The country consumes 110,000 b/d of oil products but only produces around 35,000 b/d from its ageing 50,000 b/d Kelaniya refinery. Sri Lanka is completely dependent on crude imports, and its inability to pay for these during the continuing foreign exchange crisis has led to frequent shutdowns at Kelaniya and fuel shortages. Sri Lanka's retail fuel market is currently dominated by state-controlled importer Ceylon Petroleum (Ceypetco) and fellow fuel importer Lanka IOC, the Sri Lankan subsidiary of Indian state-controlled refiner IOC.

Other potential energy sector investments were also discussed with the Sinopec representatives, Sri Lankan minister of power and energy Kanchana Wijesekera said on 14 March, but did not provide further details.

Officials from Sinopec as well as Chinese state-owned shipping firm China Merchants are on a visit to Sri Lanka to "enhance cooperation and further investment on petroleum and chemicals, trade, and port and industrial park operations", the Chinese embassy in Sri Lanka had said on 12 March, without disclosing further details.

China Merchants Port, a subsidiary of China Merchants, is the majority owner of Hambantota International Port, which operates the deepwater port. Sri Lanka handed control of Hambantota port to China under a 99-year lease in December 2017 after being hit with crippling debts to Beijing.

Sinopec created a Sri Lankan unit, Sinopec Fuel Oil Lanka, in 2019, and began considering investing in a refinery at Hambantota port. Sinopec commenced operations at the oil depot in Hambantota port in April 2020, refuelling its first ship. The port also received its first bunker fuel cargo that month.

By Pranav Joshi

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10/11/25

Cop: IMO pushes forward with carbon pricing

Belem, 10 November (Argus) — External politics rather than any failure of the International Maritime Organization (IMO) led to the delay in adopting a greenhouse gas (GHG) emissions pricing mechanism for global shipping, proposal supporters said on Monday. IMO members last month voted to delay the adoption of the Net-Zero Framework (NZF) by a year, despite some of those backing the delay previously supporting the carbon pricing system. The October gathering was "not a typical IMO" meeting, IMO secretary general Arsenio Dominguez said during a side event at the UN Cop 30 climate talks in Belem, Brazil. "We were affected by the global geopolitics that we all face right now. We're not immune to it," he said. Dominguez also sought to assure critics of the vote that the IMO is not backing down from the proposal, citing ongoing work to address some questions that member states raised during last month's meeting. "My message to you is very clear, don't judge IMO for what happened last October. Don't think that IMO stops there because we don't," he said. Dutch climate envoy Jaime de Bourbon Parme struck a similar tone, telling the audience that while the delay may give supporters a "sense of failure" very few countries last month argued the NZF should not be adopted. "I know the Netherlands and many other countries were ready to sign, however, the meeting went a very different direction," he said. While Dominguez and the Dutch prince did not single out any country for causing the delay, many NZF supporters have put the blame on the US. In the days leading up to the vote, the administration of US president Donald Trump threatened to retaliate against countries that back the proposal with measures such as visa restrictions, new port fees or sanctions on officials that sponsor "activist-driven" climate policies. The Trump administration "went outside the rules of engagement," said Andrew Forrest, non-executive chairman of Australian mining company Fortescue, calling US actions before the vote a form of "thuggery." By Michael Ball Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

European gasoline cracks hit 18-month high

10/11/25

European gasoline cracks hit 18-month high

London, 10 November (Argus) — European gasoline margins to crude hit an 18-month high on Monday. Benchmark non-oxy gasoline barge premiums to Ice Brent crude futures were $22.11/bl at Monday's close, surpassing seasonal peaks during the 2025 and 2024 summer driving seasons and the highest since 7 May 2024. Non-oxy barge refining margins have averaged $18.59/bl to date in October, the highest for the period since 2022 when global demand began returning following the Covid-19 pandemic. Ambiguity about the future of Russian firm Lukoil's subsidiary Litasco and its European refining and product assets has supported European gasoline cracks. The US blocked trading firm Gunvor's bid for the assets, throwing the future of Litasco's downstream European operations in doubt. Prices were already underpinned by European refinery maintenance and tighter prompt supply availability, according to traders. Gasoline barge loading delays have been reported since late September-early October, limiting the amount of product making its way into storage. Cracks have also been supported recently by refiners pivoting to diesel production to capture strong distillate margins, a trader said, as the global diesel pool is shrunken by lower Russian export loadings. Europe appears to be rolling back the amount of gasoline made available for export. Cargo loadings from the EU, UK and Norway for overseas destinations in the first 10 days of November were the the lowest daily rate on record for the period at 736,000 b/d, according to Kpler. This was down from 844,000 b/d in 1-10 October. And Europe has imported 104,000 b/d of gasoline to date this month, the highest for the period since August 2024, to tackle elevated prompt supply tightness. This is reflected in $45/t backwardation in the Eurobob oxy swap structure, between the balance of the November swap and the front-month December swap on Monday. West African buying interest may be waning, however. Nigeria's 650,000 b/d Dangote refinery cut its asking prices for gasoline on Friday, probably closing the arbitrage window from Europe to its second-largest export market. This may weigh on non-oxy barge refining premiums. Paper indications are still pricing in a drop in Eurobob oxy cracks month-on-month until January. By George Maher-Bonnett Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

EPA does not update court on biofuel timing: Correction

10/11/25

EPA does not update court on biofuel timing: Correction

Corrects government shutdown's impact on court deadlines, and updates with new information throughout. New York, 10 November (Argus) — President Donald Trump's administration did not update a court on its timeline for finalizing new biofuel blend mandates, as a partial government shutdown slows down court cases and regulatory work. Biofuel groups Clean Fuels Alliance America and Growth Energy have repeatedly sued the administration over its delays, hoping that a court will require the Environmental Protection Agency (EPA) to set new biofuel quotas before year-end. Judge Timothy Kelly of the US District Court for the District of Columbia ordered the administration to provide an update on its timeline by 7 November. But in a filing that evening, the biofuel groups said they had not heard back from government lawyers. No timing update was provided. "It is the understanding of Clean Fuels and Growth Energy that counsel for defendants may currently be furloughed," they told the court. Kelly ordered the update before the ongoing partial government shutdown began. The DC district court later said in a general order that it would give the government more time to respond across all civil cases because of the funding lapse. Government lawyers had previously warned courts that the shutdown would sideline critical officials and make it hard to meet deadlines. But the government's lack of response to biofuel groups in the case is still raising fears of more prolonged delays updating a program that is important for producers of ethanol, renewable diesel and other biofuels and is popular among powerful farm-state Trump allies in Congress. EPA told Argus it was reviewing comments on its plan to make oil companies offset past program exemptions and "continues to work on final regulations" to establish new blend mandates. In past cases over biofuel program deadlines, biofuel groups and federal officials have negotiated new timelines or judges have ordered EPA to act by a set date. Clean Fuels said it would continue to ask the DC court to expedite the case and require the agency to publish a final regulation by year-end. Under the Renewable Fuel Standard, EPA requires oil refiners and importers to annually blend different types of biofuels or buy credits from those that do. The program is crucial for the production margins of ethanol, renewable diesel and other biofuels and is popular among powerful farm-state Trump allies in Congress. EPA — required by law to set new mandates 14 months in advance of a new year — is late setting new quotas for 2026 and 2027. Even before the shutdown, the Trump administration told the DC court that developing a complicated plan to offset the impact of small refinery exemptions meant it might not be able to finalize new blend mandates until next year . Biofuel advocates fear that further delays would mean less ambitious final quotas, another hurdle for biorefineries that have cut run rates this year and for farmers hurting from this year's tariff fights. EPA has indeed been more cautious in the past when finalizing retroactive mandates since oil companies have less notice on volumes they must bring to market. Lawyers and lobbyists who closely track the program have also told Argus that delays raise the chance that major program updates — like a plan to halve program credits for fuels made abroad or from foreign feedstocks — are at least pushed back. Oil refiners have argued the half-credit idea is illegal and questioned how EPA could roll out a new feedstock tracking system in a matter of weeks. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Blending raises WTI quality concerns

10/11/25

Blending raises WTI quality concerns

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Rising German gasoil prices pressure demand

10/11/25

Rising German gasoil prices pressure demand

Hamburg, 10 November (Argus) — Inland heating oil and diesel prices in Germany rose last week, driven by a rally in Ice gasoil futures. The increases curbed buying interest from consumers. Ice front-month gasoil futures climbed above $800/t on 7 November — their highest since early July 2024. The rise equates to about €7.30/100 litres. National average prices for heating oil and diesel in Germany increased at a more moderate pace, up by around €4/100l, but still reached their highest since late June. Gasoline prices saw a smaller increase of about €1.40/100l. Traders said higher prices are deterring buyers. Subdued demand also explains the smaller rise in domestic prices compared with futures. High domestic refinery utilisation is helping cap inland price increases in Germany, with only the 187,000 b/d Godorf refinery currently in partial shutdown. Calculated German greenhouse gas (GHG) costs for diesel fell by nearly €1/100l last week, further weighing on prices. The drop reflects lower prices for hydrotreated vegetable oil (HVO) and GHG certificates. Arbitrage conditions for US gasoil exports to Europe worsened in October. But the arbitrage window reopened last week as Ice futures rose, potentially allowing US flows to Europe to resume in the coming weeks — assuming fundamentals remain stable. By Johannes Guhlke Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Sinopec proposes to fully finance Sri Lanka refinery

Related news posts

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European gasoline cracks hit 18-month high

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