Peru may not be prepared to accommodate demand for 0.5pc sulphur marine fuel starting in January 2020.
An International Maritime Organization (IMO) marine fuel regulation will reduce the maximum sulphur content of marine fuels burned in international waters from 3.5pc down to 0.5pc beginning in January 2020. The sulphur content of residual fuel oil produced from the state-owned refiner PetroPeru is about 1.2-1.3pc. Peru is long residual fuel oil, but short diesel, which can be used to blend down the sulphur in the resid to meet the 0.5pc regulation. This could drive down availabilities of marine fuel in El Callao, Peru’s main bunkering port, in 2020.
Ecuador meets 40-50pc of its diesel demand needs via imports. Data from Peru’s Ministry of Energy and Mines showed the country produced 57,652 b/d diesel, consumed 112,991 b/d, and imported 73,694 b/d during the first nine months of 2017. US Energy Information Administration data showed that Peru meets nearly all of its diesel imports needs from the US. The country imported 73,250 b/d from the US from January through August.
Peru sold 3,181 b/d of residual fuel oil for local bunkering in the first nine months of the year. Replacing heavy bunker fuel demand with distillate fuel in 2020 may not be feasible, considering the expected global increase in distillate price, and Peruvian bunker sales could decline.
State-owned PetroPeru is in the process of upgrading its Talara refinery. The project will increase Talara’s crude processing capacity from 65,000 b/d to 95,000 b/d. The upgrade includes the installation of a flexicoker, which will increase diesel output. Earlier this month the company noted in a press release that Talara’s upgrade is 65pc complete. The upgrade will reduce the country’s diesel imbalance prior to 2020. But Peru is expected to remain short diesel.
PetroPeru’s diesel production was down in the first nine months of 2017 compared with the same period last year. Diesel output declined by 38pc to 11,410 b/d at the Talara refinery, by 23pc to 8,793 b/d at the 12,000 b/d Conchan refinery and by 3pc to 2,417 b/d at the 10,500 b/d Iquitos refinery. By contrast, diesel production from Repsol’s 117,000 b/d La Pampilla refinery in Lima was up by 14pc to 36,698 b/d in the first nine months of the year.
Source: ArgusPrevious Next
There Is a Steady Growth in the Number of Indian Seafarers Employed: Dr. Malini V. Shankar, (IAS), Director General of Shipping
India Shipping and Offshore Summit