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Energy Transfer Partners and Satellite Petrochemical USA have formed a JV to build a new export terminal on the US Gulf Coast.
The new facility will provide ethane to Satellite for consumption at their ethane cracking facilities in China.
The JV, Orbit Gulf Coast NGL Exports, will also construct a 20-inch ethane pipeline originating at ETP's Mont Belvieu Fractionators that will make delivers to Orbit's ethane export terminal on the US Gulf Coast as well as domestic markets in the region.
At the terminal, Orbit will build 800,000 barrel refrigerated ethane storage tank and a 175,000 barrel per day ethane refrigeration facility. Energy Transfer will be the operator of the Orbit assets.
Additionally, Energy Transfer will construct and wholly own the infrastructure that is required to both supply ethane to the pipeline and load the ethane on to the VLECs destined for the ethane crackers in China's Jiangsu province.
It is anticipated that the Orbit export terminal will be put in service by the fourth quarter of 2020.
As part of these agreements, Energy Transfer and Satellite also executed agreements for the sale of ethane at the terminal. Energy Transfer will provide Satellite with 150,000 barrels per day of ethane under a long-term, demand-based agreement. Energy Transfer will also provide storage and marketing services for Satellite.
Petrochemical Corporation of Singapore has inaugurated its new naphtha import facility.
The $80 million facility includes eight storage tanks totalling 240,000 m3, a 120,000 DWT liquid berth capable of handling large vessels transporting naphtha and its associated facilities.
PCS is a company jointly owned by Japan-Singapore Petrochemicals Company and Shell Petrochemicals.
Akira Yonemura, PCS managing director, says: 'Petrochemicals remains a competitive business with its growing demand being matched by a number of new capacity additions in this region, particularly China and also in the US.
'Our new naphtha import facilities gives us more opportunities for feedstock optimisation and hence further strengthens our competitiveness. It will also help to ensure that PCS continues to be a reliable and competitive supplier to all our customers with smooth and stable operations.'
Kinder Morgan Canada has completed two additional tanks at the Base Line Terminal ahead of schedule.
This follows the successful completion of the first four tanks and commencement of service in January 2018. The two new tanks – five and six of 12 – started operations on March 13.
The two tanks add an additional 800,000 barrels of crude storage to the 1.6 million barrels currently in operation.
The facility is a 50-50 crude oil merchant terminal joint venture with Keyera in Sherwood Park, Alberta. Once complete it will provide a total of 4.8 million barrels of crude storage and will be comprised of 12 tanks, all of which are fully-contracted with long-term, firm take-or-pay agreements with creditworthy customers.
The remaining six tanks are expected to be completed in the third and fourth quarter of 2018.
It is connected by pipeline to Kinder Morgan's Edmonton-area terminals and is capable of sourcing the majority of crude streams handled by Kinder Morgan.
Summit Power International and Mitsubishi have signed a MoU to develop a $3 billion LNG-to-power project in Bangladesh.
The MoU between Summit Corporation, a subsidiary of Summit Power, Mitsubishi Corporation and its subsidiary Diamond Gas International stipulates that the parties will develop an integrated LNG onshore receiving terminal with a regasification capacity of up to 1,500 million cubic feet per day, two gas turbines and high voltage transmission lines and the import of LNG.
Muhammed Aziz Khan, chairman of SPI, says: 'This MoU will help SPI support Bangladesh's fast-growing energy, power and technology needs.
'It will be a strategic fit for SPI to leverage Mitsubishi's LNG and LNG-to-Power expertise as well as understanding of Mohekhali and Bangladesh's power needs.'
Alwin van Aggelen, CEO of A-Risc, explains how terminals can deal with new scenario analyses and risk assessment requirements for PGS 29
Storage terminals in the Netherlands must comply with the PGS 29 requirements for the storage of flammable liquids in above ground cylindrical tanks.
Like all Dutch guidelines for hazardous substances, the PGS 29 is currently in the process of being updated using a standardised risk-based approach.
One of the reasons for this risk-based approach has been to create a structure where it is clear why a requirement is there, what the objective of the requirement is and if sufficient risk reduction is provided by the requirements.
It also provides a good foundation to support the review and acceptance of alternatives that might be equivalent in terms of function and level of risk reduction. And, not restricting opportunities for innovation and technology development.
Understanding the risk
The core of the new approach is the use of scenarios describing all potential incidents that can occur when storing flammable liquids in tanks. Utilising the BowTie methodology, scenarios are described from cause to consequence, including the impact of the consequence.
For example; overfilling leading to a loss of containment, followed by the formation of a vapour cloud and, when ignited, a vapour cloud explosion with potential for multiple fatalities/injuries, extensive damage and escalation to nearby installations.
To ensure all credible scenarios are covered, the causes are categorised by category based on the PGS 6, e.g. over pressure, under pressure, internal corrosion, external corrosion, external impact, environmental conditions, human actions, etc. These are validated against tank incidents where available.
Each of the scenarios is assessed using a standardised risk matrix to determine the risk of a scenario and to determine if it should be included in the PGS standard. The scope of all the PGS standards, and thus also the PGS 29, is limited to the medium and high-risk scenarios.
To ensure the PGS 29 covers most of the installations, the scenario analyses has been done based on predefined tank typicals (cone roof tank, cone roof tank with inner float, tank with outer float and tank with outer float and dome), typicals for water- and landside loading and unloading (barge/sea-going vessels, railcars and trucks) and for terminal piping.
Besides scenarios for these typicals, specific scenarios are developed in relation to activities that can be performed within a tank such as mixing, adding additives and butanising.
How the risk should be managed
A second new element for the PGS new style, besides the use of scenarios, is the way the requirements are structured through a combination of goal-based requirements and prescriptive requirements.
First level of requirements are the goal based requirements, the so-called ‘Doelen’ (objectives). Per scenario, the different objectives for managing that scenario are formulated. When translated to the BowTie methodology, the objectives are synonym with the barriers.
Example – Overfilling scenario:
Objective 1 – Ullage control
Ensure remaining capacity within tank is sufficient for the planned manipulation, includes the plan for switching to another tank during manipulation when required.
Objective 2 – Alarms and operator action
Operational level control during filling of the tank to prevent the filling of the tank above the high level.
Objective 3 – Independent overfill protection
Independent overfill protection on high-high level to prevent the overflowing of the tank.
These objectives describe the different barrier functions that should be in place to prevent a scenario from happening or to mitigate the consequences of the scenario when it happens.
The second level of requirements are the so-called ‘maatregelvoorschriften’ (prescriptive requirements). Where the objectives describe the ‘what’, prescriptive requirements are describing the ‘how’. Or in BowTie terms, the barrier elements. Distinction is made between primary requirements describing required items or equipment, and secondary requirements that support the primary requirements.
For example, a primary requirement to prevent escalation of a fire is to have a stationary tank cooling system for certain type of tank/product combinations. Secondary requirements supporting this are requirements for the capacity of the tank cooling system and for testing and maintenance of the tank cooling system.
This structure also provides a framework where alternatives for the (prescriptive) requirements can be acceptable, as long as the objectives for each of the scenarios are met.
Although the PGS 29 new style is still under development, it is already possible to draw the conclusion that the PGS 29 wile become much more relevant for storage terminals.
All requirements within the current PGS 29 are really challenged in relation to the scenario they belong to. It looks like certain requirements will be removed because they are not managing a risk that is relevant for the PGS 29.
Other requirements are going to be rewritten because the scenario was not properly addressed by the requirement, e.g. it is too limited in respect to the scenario, or it needs to be re-worded to obtain a proper linkage from scenario to objective to requirement.
But also, most likely new requirements will be defined for scenarios currently not sufficiently addressed or are not addressed at all.
And finally, the PGS 29 new style will have a much better alignment with current operational risk management practices within storage terminals. Instead of a set of disconnected requirements the PGS 29 new style provides a structured approach for managing the risks. It can be used as starting point for describing the storage terminal specific scenario’s and how these are managed.
van Aggelen will be speaking more about the new structures for PGS 29 on the third day of the StocExpo Europe conference on March 22. For more information, and to register to visit, visit www.stocexpo.com.
NGL Energy Partners and Magnum Liquids have formed a JV focusing on the storage of natural gas liquids and refined products.
The JV combined NGL's Sawtooth storage facility, a natural gas liquids storage facility with 6.1 million barrels of capacity in five existing salt caverns, with Magnum's refined products rights and adjacent leasehold.
NGL will sell an interest in Sawtooth to Magnum for $45 million in cash due at closing.
Magnum will contribute its right, title and interest in certain leasehold and other assets located at the site, which will be utilised to expand Sawtooth's existing operations and allow for the addition of refined products storage at the facility.
NGL will own approximately 67.6% of the joint venture and Magnum will own the remaining 32.4% at closing.
Mike Krimbill, NGL's CEO: 'We are very excited to bring together NGL's Sawtooth natural gas liquids storage asset with the refined products storage rights and commercial expertise of the Magnum team.
'This new joint venture will allow Sawtooth to utilise existing capacity to store refined products with very minimal capital requirements. It will also accelerate the earnings potential and broaden the scope of services offered at the facility.'
The USD Group is expanding its network of refined products terminals with an additional two facilities in Central Chihuahua, Mexico.
The Ciudad Cuauhtémoc terminal development is expected online by mid-2018 and will include manifest rail and truck transloading capabilities, as well as land for expansion.
Additionally, the company is formalising plans for a second refined products distribution terminal in the Central Chihuahua area, which will feature unit train, tank storage and truck loading capabilities.
The planned terminals are expected to 'meaningfully improve the distribution of refined products across the state of Chihuahua, which includes approximately two million residents and one of Mexico's most concentrated and productive agricultural and mining hubs.
Steve Magneess, vice president, business development, says: 'Along with the Querétaro terminal, our expansions into the Central Chihuahua area demonstrates our commitment to improving the delivery of critical products across the region.
'We believe our network of scalable terminals will enable our customers to more efficiently meet the rapidly growing demand for refined products in Mexico.'
Both terminals will be serviced by Ferromex railroad, a subsidiary of Grupo Mexico Transportes, with access to all North American Class 1 railroads.
Total oil product stocks in Fujairah were 16.712 million barrels as of Monday, March 8, up 4.6% on the week, after heavy distillates rebounded from last week's record lows, according to latest data from the Fujairah Energy Data Committee, or FEDCom.
Stocks of heavy distillates and residues jumped 34.3% on the week to 6.5 million barrels. This is after stocks tumbled a week earlier to a record low of 4.84 million barrels, S&P Global Platts Analytics said in a report. Bunker demand in Fujairah was reported as firmer, with market sources noting that inquiries and trade volumes have picked up in recent days. Fuel oil cargoes moving from the Middle East to Asia in March are estimated at 2 million mt, down from volumes of around 2.5 million mt in January and February, sources said.
Lower arbitrage volumes are consistent with the narrower spread between Singapore and Fujairah cargo prices since around mid-February. Meanwhile, stocks of light distillates fell 9.3% to 7.642 million barrels, the data showed. The Middle East petrol market showed some improvement, with both time spreads and cash premiums seeing some improvement on the week, the report said. Spring refinery maintenance is expected to tighten global supply balances, although weakness in the US petrol complex continues to weigh on sentiment, it added.
Stocks of middle distillates also fell 5.2% to 2.571 million barrels, staying rangebound on refinery maintenance in the Middle East and tepid demand fundamentals in Asia and Europe. Premiums for FOB Arab Gulf gasoil 500 ppm were at a 12-month low Tuesday.
Middle East jet export barrels remain well supported by demand from Asia, East Africa, and Europe. The Singapore market has recently seen heavy buying drive prompt jet fuel cash differentials to a 10-year high, but demand is expected to wane during the April-May shoulder season. Demand for jet kerosene stocks in the Gulf remained consistent, with the Emirates General Petroleum Corp. heard seeking 50,000 mt of jet A-1 fuel for mid-April delivery to Jebel Ali.
A new $50 million jet fuel storage facility for the St. Louis Lambert International Airport to replace the current fuel facility.
STL Fuel Company, a consortium of airlines that manages, maintains and operates the existing system, which dates back to 1957, was given approval by the City of St. Louis to construct a more modern, environmentally-friendly fuel storage facility.
The replacement facility will be located on nearly eight acres of airport-owned property and will comprise three 722,000 gallons of aboveground fuel storage tanks and associated pumps, filters and other equipment, with a total minimum usable storage capacity of 1.89 million gallons. It also has room for expansion beyond that capacity.
The age of the current infrastructure, along with new environmental regulations affecting all fuel storage facilities led to the decision by the airline consortium to build a replacement facility.
Once the design is complete the company will have two years to complete the project, which will include building a fuel transfer line from the facility to the airport's terminals, which then routes the fuel to each airline gate.
Once construction is complete STL will close and decommission the existing fuel storage facility.
Jim Stevenson, Southwest Airlines fuel category manager and chairman of STL Fuel Company, says: 'This major capital project being undertaken by STL Fuel Company will allow us to build a replacement fuel storage facility that will be cleaner for the environment, safer for the operators, more cost-efficient for all users, and will result in state-of-the-art, robust infrastructure that will reliably take us into the future.'
Shell Midstream Partners has reported strong fourth quarter 2017 financial results as it concluded an important growth year.
The growth-oriented mainstream company reported net income of $86.4 million, compared to $72.6 million from the prior quarter, driven by the acquisition of Triton West and an EBITDA of $118.7 million, an increase of 28.5% from the third quarter.
During the quarter, the partnership completed the acquisition of strategic infrastructure assets from Shell for $825 million – representing its largest acquisition to date. As part of the acquisition, it also acquired Triton West, which owns five refined products terminals in the Pacific Northwest, Midwest and Gulf Coast.
John Hollowell, CEO, Shell Midstream Partners, says: 'This was an important year for Shell Midstream Partners. We continued to deliver against our strategy, taking steps to diversify our portfolio, both in terms of asset classes and geography, all while sustaining our growth promises.
'Specifically, we acquired approximately $1.5 billion of assets from Shell – all high quality, strategic midstream assets that play an integral role in connecting North America's energy infrastructure.'
Inter Pipeline's European storage segment suffered the effects of a weakening contango pricing environment for certain petroleum products in its 2017 financials.
The European storage business generated annual funds from operations of $97.6 million in 2017, down from $120 million in 2016 as a result of reduced activity and utilisation levels in the latter half of 2017.
However, annual capacity utilisation was strong across Inter Terminal's European operation, resulting in an average utilisation rate of 96% compared to 98% in 2016.
In the second quarter of 2017, Inter Pipeline placed 175,000 barrels of new chemical storage capacity into service at the Seal Sands terminal, backed by long-term storage contracts.
Total oil product stocks in Fujairah were 15.978 million barrels as of Monday, February 26, down 4.7% on the week, after heavy distillates fell to a new record low, according to latest data from the Fujairah Energy Data Committee, or FEDCom.
Stocks of heavy distillates and residues tumbled 20.1% to a new record low of 4.84 million barrels. Traders in Fujairah said bunker demand was currently poor, with an absence of bids and offers during the Platts Fujairah MOC process in recent days, S&P Global Platts Analytics said in a report.
‘The market is quite slow,’ a Fujairah-based trader said. Another said: ‘Demand is low and discussions are quiet now’. The premium for ex-wharf 380 CST bunker over cargoes fell to a six-week low of $5.84/mt Tuesday, the report said.
On the other hand, stocks of light distillates rose 2.7% on the week to 8.426 million barrels. Stock levels so far this year have averaged 34% higher than a year ago. In the Middle East, petrol market sentiment remained relatively unchanged due to tepid demand and ample supplies from the Mediterranean, the report said.
Stocks of middle distillates rose 8% or 201,000 barrels to 2.712 million barrels. In the Arab Gulf, demand was stable while supply was capped by scheduled maintenance at refineries, a source said.
The cold weather front hitting parts of northern Europe could begin to draw some additional barrels towards the west, although a gasoil EFS value of minus $4.32/mt Tuesday remains unfavourable for arbitrage. In spot supply, Kuwait's KPC has sold 40,000 mt of 500 ppm gasoil for March 10-11 at a premium of 40 cents/b to the Mean of Platts Arab Gulf FOB Gasoil assessments.
Retaining its premium position at the world’s largest oil trading hub, the ARA has recently welcomed an influx of storage capital as the imports of petroleum products increases
However, with more EU-led environmental regulations emerging along with the potential need to meet the demand for a broader spectrum of product specifications, the region’s storage offering will need to diversify to meet these future challenges.
In an interview with Tank Storage Magazine, Paulo Nery, senior director, EMEA Oil, at Genscape says that while the ARA receives all types of refined products, its supply from the Baltics is slowly diminishing.
‘The largest import flows are fuel oil and diesel, and while Baltic flows – the largest supply region - declined toward the end of 2017, Baltic supply to the ARA region increased sharply in January with increased Russian output. And as ARA seemingly could not support all of that increase we saw Russian diesel and fuel oil diversifying to more and new destinations.
‘Distillate storage levels in ARA increased overall from about 4 million at the start of December to 4.7 million tons in early February, thanks to increased supply from east of Suez as well as Baltic.’
As a result of this demand, significant storage expansion projects are taking place at the Port of Antwerp thanks to a wave of multimillion euro investments.
Europe has already experienced a round of refinery consolidations as a result of shrinking demand and rising competitive pressures. As a result, imports to the region must increase.
Nery says that if there are further refinery consolidations in the future, increased imports are inevitable for Europe.
‘Diesel will continue to be supplied from the Baltics, US, Middle East and India but in increasing quantities as refining in those regions continues to strengthen and upgrade,’ he says.
‘This could also diminish Europe’s position as a key exporter of petrol to West Africa and the Americas.’
Nery identifies two key challenges facing the ARA in the future, namely increasing environmental regulations and growing blending requirements.
‘For both suppliers and producers, a future challenge will be increasing environmental regulations specifically regarding diesel. With the push to clean up emissions in major cities, it will be interesting to see how they handle the shift at storage terminals and refineries.
‘There may well also be increased need for blending operations to meet more diverse and changing specifications. For instance, we see less petrol going to West Africa and the US recently while more goes to the Middle East and Asia.’
Nery will be providing detailed market analysis across the ARA region in the morning of the first day of the StocExpo Europe conference at the Ahoy, Rotterdam from March 20 - 22. For more information visit www.stocexpo.com
Odfjell Terminals is extending and strengthening its existing jetty in Rotterdam to accommodate larger vessels.
Once complete, the jetty will be able to accommodate vessels of the LR2 (Long Range) size with a maximum of 160,000 dwt. The project is being carried out in close collaboration with the Port of Rotterdam.
Odfjell says this functionality will underpin the facility's mineral oil business and PID utilisation ambitions as ship sizes continue to increase. The terminal will be able to offer more possibilities to supply and store products in an efficient manner, for both existing and new customers.
The Port of Rotterdam is deepening the Nieuwe Waterweg and specifically the third Petroleumhaven where Odfjell is located to a depth of 15 meters. Both Odfjell and the Port Authority are jointly investing in attracting additional transhipment and storage customers to the port.
The jetty is expected to be complete by the last quarter of 2018.
Odfjell Terminals Rotterdam managing director Erik Kleine says: 'We are responding to the wishes of our customers to handle ever larger ships.'
Ronald Paul, COO of the Port of Rotterdam Authority, adds: 'The expansion fits with our policy to revitalise the Botlek area. This is why Rijkwaterstaat and the Port Authority are also deepening the Nieuwe Waterweg this year.