Petrobras Braces For Attacks On Refineries

By Charles Kennedy - Jan 09, 2023

Brazil’s state oil major Petrobras has stepped up security at its refineries in response to threats of attacks on the infrastructure, Reuters has reported, citing unnamed sources.

The threats come as supporters of Brazil’s previous president, Jair Bolsonaro, stormed Brazil’s Congress, the presidential palace, and the Supreme Court this weekend. The riots first erupted following the narrow victory of President Ignacio Lula da Silva over Bolsonaro in October and have been going on since then.

"These vandals, who we could call ... fanatical fascists, did what has never been done in the history of this country," President Lula said. "All these people who did this will be found and they will be punished."

Petrobras, meanwhile, issued a statement over the weekend saying that all its units were operating as usual, adding that "Petrobras is taking all the preventative protective measures required, as a standard procedure."

"Besides monitoring the status of protests in these structures, we remain alert and in coordination with other ministries and states to ensure the supply," said the Mines and Energy Minister of the Lula government, Alexandre Silveira, as quoted by Reuters.

According to the news agency’s unnamed sources, Petrobras refineries in the states of Sao Paulo, Rio de Janeiro, and Parana are among the potential targets of the rioters.

President Lula da Silva’s victory has not been good news for Petrobras shareholders. Lula’s plans involve turning Petrobras into a renewable energy major, which caused a plunge in Petrobras’ stock price when he took office earlier this month.

There’s more, too. In his inauguration speech, President Lula vowed increased government intervention in the economy to stimulate growth. He also said that Petrobras, along with the national development bank, BNDES, should be the biggest drivers of this growth, suggesting there won’t be much independence for either in decision-making.

By Charles Kennedy for Oilprice.com

 

30 Billion Investment Will Keep Norwegian Gas Output High For Years

By Tsvetana Paraskova - Jan 09, 2023

Norway will continue to pump the current high volumes of natural gas for at least another five years as operators have pledged $30.3 billion (300 billion Norwegian crowns) to develop new fields and extend the lifetimes of producing fields, the Norwegian Petroleum Directorate said on Monday.  

“These are remarkable investments for the future. This will help ensure that Norway can continue to be a reliable supplier of energy to Europe”, said NPD Director General Torgeir Stordal.  

“Only rarely have we seen so much oil and gas produced on the Norwegian shelf as was the case last year – and only rarely have we seen such significant investment decisions,” the NPD said in its yearly overview of the production and investment activity on the Norwegian Continental Shelf.

In 2022, Norway’s gas production was 9 billion standard cubic meters higher compared with 2021. Gas now accounts for more than half of production from the shelf, the Norwegian authority said.  

“Production is extremely high, and it will continue to grow in the years to come. Gas production is projected to remain at around 2022 levels for the next four to five years,” the directorate said.

The consistently high production has been the result of the higher number of producing fields, as several start-ups took place last year, as well as older fields producing longer and producing more than previously expected, according to the NPD.

Natural gas production in Norway, which supplies around 25% of the gas consumed in the EU and the UK, was expected to rise by 8 percent in 2022 compared to 2021, government estimates showed at the end of 2022.

In the summer of 2022, Norway’s authorities approved applications from operators to boost production from several operating gas fields, to allow higher gas production as its key partners, the EU and the UK, scrambled for gas supply ahead of the winter.

Last year, Norway became Germany’s single-largest natural gas supplier, overtaking Russia, as total German gas imports dropped by 12.3% compared to 2021, the German Federal Network Agency, Bundesnetzagentur, said last week. Norway provided 33% of the gas Germany imported last year, followed by Russia, whose share fell to 22% for last year, compared to a 52% share in 2021, the German regulator said.   

By Tsvetana Paraskova for Oilprice.com

GLOBALIZATION IS FORDISM

India Becomes World's 3rd Largest Car Market

By ZeroHedge - Jan 09, 2023

India has officially booted Japan out of the number three spot in the global automotive market. Latest industry data, reported on by Nikkei, shows that for the first time ever, India is now the third largest global auto market. 

For 2022, the country's new sales came in at 4.25 million units, based on preliminary results from the Society of Indian Automobile Manufacturers. This figure tops Japan's 4.2 million units for the year. Japan's sales in 2022 were down 5.6% from 2021. 

Between January and November, India had delivered 4.13 million new vehicles. The total hits 4.25 million after adding December's sales volume reported Sunday by Maruti Suzuki, India's largest carmaker, the report says. And sales volume in the country is expected to rise: there are still year-end results and sales figures for commercial vehicles that have yet to be included into the 2022 totals. 

China led the global market in 2021 with 26.27 million vehicles sold and the U.S. came in second with 15.4 million vehicles sold. India's market has been volatile over the last few years, the report notes. 4.4 million vehicles were sold in 2018, but volume plunged back below 4 million vehicles in 2019 as a result of a credit crunch. 

After Covid, vehicle sales fell to under 3 million as the country locked down. A recovery started in 2021, approaching 4 million units, leading the country to its accelerated growth in 2022. The country is still dealing with the residual effects of the semiconductor shortage that shocked the industry during the Covid. Aftershocks of the shortage continue to work their way out of the supply chain heading into 2023. 

Most vehicles sold in the country were gas based, which includes some hybrid vehicles. While EVs are driving sales in places like China and the U.S., they have yet to be adopted in any meaningful fashion in India yet, the report says. 

Still, British research firm Euromonitor estimated that only 8.5% of Indian households owned a passenger vehicle in 2021. The country's population of 1.4 billion is expected to keep growing until the early 2060s.

By Zerohedge.com

Russian Lukoil To Sell Strategic Italian Refinery To Trafigura-Backed Company

By Charles Kennedy - Jan 09, 2023

In its first major overseas asset sale following Russia’s invasion of Ukraine and subsequent Western sanctions, Lukoil, Russia’s second-largest oil company, has agreed to sell its Italian ISAB refinery to a Cypriot company backed by Geneva-based commodities trader Trafigura. 

The deal will see Lukoil’s 100% subsidiary, Litasco S.A., sell the ISAB refinery to Cyprus-based G.O.I. Energy Limited, a private equity firm backed by Trafigura, according to a statement on Lukoil’s website. The deal value was not disclosed. 

According to Lukoil, the transaction is expected to be completed by the end of March this year upon fulfillment of “certain conditions precedent including receipt of necessary approvals of competent authorities, particularly the Italian Government”. 

ISAB encompasses a large petrochemical complex in Italy, which combines refining, gasification and electricity cogeneration plants. 

Cyprus-based G.O.I Energy is run by Israeli Green Oil CEO Michael Bobrov, according to Reuters, while Green Oil holds a major stake in Bazan Group, Israel’s largest refiner. 

The deal will allow Western-based Trafigure to handle oil supplies for the Italian refinery, should the Italian government agree to the sale. 

ISAB is an important strategic asset for Italy, refining approximately one-fifth of Italy’s crude oil, according to Reuters. As of December 5th, in line with the European Union ban on Russian seaborne crude, the ISAB refinery is no longer permitted to import Russian oil. 

In early December, the Italian government said it was considering direct state intervention to keep the refinery running after December 5th, noting that ISAB had been forced to rely fully on Russian oil because banks halted financing and guarantees for other oil purchases, Reuters reported. 

Lukoil also owns a network of some 230 branded gas stations in the United States, distributing in 11 states. 

At the beginning of Russia’s invasion of Ukraine, these gas stations garnered much media attention, with vague calls for boycotts. Those calls, however, dissipated by the end of March, when it became clear that boycotting them would harm the American franchise owners. 

By Charles Kennedy for Oilprice.com

US Judge Dismisses Lawsuit About Big Oil Conspiracy

By Charles Kennedy - Jan 10, 2023

A federal judge has dismissed a lawsuit brought to a California court last year by a group of individuals claiming the Trump administration and U.S. oil producers colluded with Russia and Saudi Arabia to keep oil and gasoline prices high.

Defendants named in the lawsuit included the American Petroleum Institute, Chevron, Exxon, Occidental Petroleum, Phillips 66, and Energy Transfer.

The plaintiffs—about two dozen of them—alleged that the defendants conspired with Saudi Arabia and Russia, with the help of the Trump administration, to keep the prices of oil and fuels high.

The suit cites events from 2020, when Russia and Saudi Arabia temporarily locked horns and flooded the market with oil, causing prices to plunge. The plaintiffs also cite a statement made by API chief Mike Sommers, who said that “What we have here is . . . a supply shock because of the decision by Russia and the Saudis to flood the market with oil. Ultimately the solution here is to work in a diplomatic way to make sure that oil markets are well balanced.”

The statement is taken by the plaintiffs to mean it was made at the instigation of the companies named as defendants and that it prompted API’s Sommers to seek consultation with the White House on remedying the matter.

The plaintiffs also targeted President Donald Trump for taking part in the conspiracy, citing a couple of tweets from April 2020, when the President first hailed lower fuel prices resulting from the price war between Russia and Saudi Arabia, only to do a U-turn a few days later and suggest that an end to that production conflict would be good news for everyone, especially the U.S. oil industry.

In his ruling, Judge Jeffrey White said, as quoted by Courthouse News Service, that “The allegations include specific foreign policy decisions allegedly made by the Trump administration in furtherance of the alleged conspiracy.”

“The court lacks jurisdiction over a complaint that 'requires and inquiry into' whether foreign nations entered an agreement with defendants at the behest of the President of the United States,” he also wrote.

By Charles Kennedy for Oilprice.com

Shell Nearly Sold Its Norwegian Oil And Gas Assets In Late 2022

By Tsvetana Paraskova - Jan 10, 2023, 

Shell held talks last year with the biggest UK North Sea producer Harbour Energy to sell its oil and gas fields offshore Norway and some mature assets offshore the UK, but a deal ultimately couldn’t be reached due to price volatility, company sources told Reuters on Tuesday. 

Shell, as well as other majors, have worked in recent years on streamlining asset portfolios to focus on the most profitable projects. Back in 2021, Shell said that its oil production peaked in 2019 and is set for a continual decline over the next three decades as it looks toward the renewables side of the business. Shell said its carbon dioxide emissions also likely peaked—a year earlier, in 2018.  

The UK-based supermajor and Harbour Energy were in the advanced stages of talks for the sale at the end of 2022, according to Reuters’ sources.

Just then, Norway had ramped up its natural gas production and become the single largest gas supplier to Europe’s biggest economy, Germany. Yesterday, the Norwegian Petroleum Directorate said that Norway would continue to pump the current high volumes of natural gas for at least another five years as operators have pledged $30.3 billion (300 billion Norwegian crowns) to develop new fields and extend the lifetimes of producing fields.  

Shell, which has been present in Norway since 1912, would have been the latest supermajor to quit the region. U.S. majors Chevron and ExxonMobil exited operations on the Norwegian Continental Shelf in 2018 and 2019, respectively.

Now Wael Sawan, Shell’s new CEO who succeeded Ben van Beurden on January 1, is not currently reviewing the Norwegian assets, according to two Reuters’ sources. 

Apart from oil and gas assets, Shell’s business in Norway includes participation in the Northern Lights carbon capture and storage (CCS) project together with Norway’s Equinor and France’s TotalEnergies. Northern Lights is Norway’s first license for CO2 storage on the Shelf. 

By Tsvetana Paraskova for Oilprice.com

Philippines Supreme Court Voids Major International Oil And Gas Deal

By Tsvetana Paraskova - Jan 10, 2023

A 2005 deal for oil and gas exploration in the South China Sea signed by the Philippines with companies from China and Vietnam is illegal, the Philippine Supreme Court ruled on Tuesday, saying the country’s constitution bars foreign firms from exploring Philippine natural resources.

The ruling, 14 years after an appeal was lodged, could make talks between China and the Philippines on energy exploration in non-disputed parts of the South China Sea more complicated, according to Reuters.

The long-running dispute in the South China Sea involves territorial claims by China as well as Vietnam, the Philippines, Taiwan, Brunei, and Malaysia. China has territorial claims to about 90 percent of the South China Sea, which has put it at odds with its neighbors.

A court in The Hague in 2016 ruled against China’s claims and in favor of the Philippines. China, however, has not acknowledged the ruling, which has heightened tensions in the area. Instead, it has continued with its agenda, according to which most of the sea is Chinese waters. 

China and the Philippines agreed at the end of 2019 to pursue joint oil and gas exploration in the South China Sea.

The South China Sea may hold 28 billion barrels of oil, according to an estimate from the U.S. Geological Survey from the mid-90s. Since then, with improvements in technology, this figure could have increased substantially.

However, in June 2022, the Philippines ditched talks with China on a potential joint exploration for oil and gas in the South China Sea due to sovereignty issues and constraints in the Philippines’ constitution.

Because of the Chinese claims over most of the South China Sea, the Philippines has struggled to find partners willing to engage in the exploration of resources in the basin.

By Tsvetana Paraskova for Oilprice.com

Stellantis seals batteries material deal with Element 25
Reuters | January 9, 2023 | 

Stellantis italian headquarters Turin (Stock Image)

Carmaker Stellantis has signed a deal with Australian miner Element 25 for the supply of manganese sulphite for batteries for its electric vehicles (EVs), the two companies said on Monday.


The agreement marks another step in efforts by Stellantis to secure long-term supplies of raw materials essential for electric vehicles as carmakers prepare for a surge in global demand for EVs in the transition towards cleaner motoring.

Stellantis, the world’s third-largest carmaker by sales, has previously signed deals with GME Resources for supply of nickel and cobalt sulphate and with Vulcan Energy Resources and United States-based Controlled Thermal Resources (CTR) for lithium hydroxide.

Related Article: Manganese batteries market may face deficit in 2024

Based on the five-year binding agreement announced on Monday, Element 25 will supply Stellantis with high-purity manganese sulphate monohydrate to be used in battery packs.

Shipments, for a total of 45 kilotons, are expected to begin in 2026, with options to extend term and volumes.

No financial details for the deal were provided.

Element 25 will source the material from its Butcherbird project in Western Australia and plans to construct a processing facility in the United States. Stellantis, meanwhile, will make an equity investment in Element 25, the two companies added in a statement.

“Our commitment to a carbon net-zero future includes creation of a smart supply chain to ensure we meet our customers’ desire for EVs,” Stellantis CEO Carlos Tavares said.

Stellantis, formed through the merger of Fiat Chrysler and Peugeot maker PSA, wants 100% of its European passenger car sales and 50% of its US passenger car and light-duty truck sales to be battery electric vehicles by 2030.

(By Giulio Piovaccari; Editing by David Goodman)

Startup’s satellite technology could change weather forecasting for mining

Amanda Stutt | January 6, 2023 |

Image from Tomorrow.io.

Tomorrow.io, a Boston-based climate and weather intelligence company has been making news headlines with its technology and is partnering with miners to schedule blasting operations, monitor routes and highways and put protocols in place to protect workers from extreme weather, based on its forecasts.


For the past 40-50 years companies that once comprised the private weather industry would repackage data from the US National Oceanic and Atmospheric Administration (NOAA) and its predecessor agencies to sell it. NOAA is a public data model which was not built for regional forecasts or mass alerts and does not cover remote locations well.

Its data, by the time it reaches people, is already three days old.

Tomorrow.io said its technology can refresh data every three hours and plans to launch 30 satellites equipped with meteorological radar that can monitor ocean activity many weather stations aren’t able to decipher until it hits the coast.

Last month, the six-year-old company was named a leader among climate risk analytics providers. It has raised $260 million and has a team of over 40 data scientists. Its three founders met in the Israeli air force.

Rei Goffer, co-founder and its chief strategy officer, recalls piloting an F-16 with a “super generic” one-page report listing winds and cloud patterns, without any specifics for his route or aircraft.

“It’s a little more technical than what you’d see on TV,” he told Bloomberg. “That’s the state of the art in weather.” The veterans formed their company to tailor forecasts for specific industries that depend on predictable weather, such as airlines and sports leagues. Tomorrow.io aggregates existing data—from weather stations and sensors slapped on buoys and balloons—and mixes in other signals it collects from cell towers and car windshield wipers, an approach the company calls the “weather of things.”

It has built its own proprietary network of weather forecasting technology, satellites equipped with radar, for a fraction of the cost of a regular satellite and about the size of a mini-fridge.

This year, it will deploy two more satellites adding to the one already in space. It is collaborating with NOAA and the satellites were funded in part by a $19 million grant from the US Air Force.

“It’s a changing of the tides – it’s the next generation of climate impact,” Dan Slagen, Tomorrow.io’s chief marketing officer told MINING.com. “Climate security is the new cyber security.“

Sample dashboard with insights on when to not blast, increase in dust. Image from Tomorrow.io.

“We’ll be the only company in the world with that, and additionally the only company that is able to really look in depth at remote parts of the world such as South America, Australia and Africa. Right now we basically don’t have access to real time weather forecasting over the oceans.”

“We’ve been able to basically translate weather data into weather insights,” Slagen said.

“We work with mining companies to identify specific job use cases that are impacted by weather and how to get around them so they are not impacted anymore,” Slagen said. “It’s a changing of tides – the next generation of climate impact.”

Monica Leal, director of mining sales said the technology signals a new generation of sustainable mining.

“Weather costs this industry millions – we need to have better systems in place,” she said.

“Companies are trying to reach sustainability goals by 2030 or 2050, but what can we do in the short term – what can we do now to decrease risk and to increase operational efficiency? This is where we come in.”

(With files from Bloomberg)