Page 8 - LatAmOil Week 43 2020

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Aramco unveiled the project in 2017, estimating a $7bn contract to buy US LNG, after pressure
at the time it would process 400,000 barrels per from the French government to seek cleaner
day (bpd) of crude to produce 9mn tonnes per supplies instead. But the US government also
year (tpy) of chemicals and base oils. That would plans to intervene to convince French officials to
make the complex the largest of its kind in the let the deal go ahead.
world. It was due to start up in 2025. France’s government, a minority shareholder in
However, Aramco and newly acquired sub- Engie, stepped in last month to prevent the com-
sidiary SABIC said last week they were consid- pany from agreeing a 20-year contract with US
ering integrating Aramco’s existing refineries LNG developer NextDecade, Politico, Bloomb-
in Yanbu with a mixed feed steam cracker and erg and various other outlets have reported.
derivative olefins units. The scope is being reas- According to Politico, the authorities’ main con-
sessed “to maximise the economic value while cern is the life cycle of the methane content of US
evaluating the optimal technical options and gas produced in West Texas and New Mexico.
market risks,” SABIC said in a filing. The gas was to come from NextDecade’s
The shift in plans comes as oversupplied oil planned Rio Grande terminal in Texas. Nex- Rosneft has
and petrochemicals markets force operators in tDecade was hoping to take a final investment
both areas to re-evaluate production projects. decision (FID) on the first of the 27mn tonne per scaled up plans
It marks the first time the crude-to-chemicals year (tpy) project’s several phases this year, but
scheme has been adjusted since the coronavirus pushed the move back until 2021. It is looking to for its already
(COVID-19) pandemic started. finalise contracts for at least 11mn tpy of offtake
Israel continues to increase ties with its Arab before giving the venture the green light. ambitious Vostok
neighbours in the energy sector. Israeli pipeline The US government intends to get involved, Oil project in the
firm EAPC on October 20 signed a preliminary according to the news agency, with Secretary of
deal to bring UAE oil to Europe. The oil would State Mike Pompeo leading a diplomatic push to Russian Arctic
flow through a 254-km pipeline linking the Red convince France to change its mind.
Sea city of Eilat with the Mediterranean port Meanwhile, Spain’s Repsol has become
of Ashkelon. The agreement comes after Israel the latest in a number of European refiners to
and the UAE normalised their relationship last announce plans to convert to biofuel produc-
month through a landmark peace deal. tion. It plans to build an advanced biofuels plant
Israeli-Arab relations have dramatically at its 100,000 barrel per day (bpd) refinery in
changed in recent years, amid shared concerns Cartagena.
about Iran and its efforts to expand Shia influ- Steep declines in demand caused by corona-
ence in the region. Tehran has also worsened ties virus (COVID-19) have left many refineries in
with some of its neighbours through its support Europe facing closure. But closing refineries is
for Yemen’s Houthi rebels. expensive, requiring the dismantling of heavy
equipment and pipelines along with land reme-
If you’d like to read more about the key events shaping diation. Converting sites to biofuel offers an
the downstream sector of Africa and the Middle East, alternative option.
then please click here for NewsBase’s DMEA Monitor.
If you’d like to read more about the key events shaping
Europe: Engie delays US LNG contract Europe’s oil and gas sector then please click here for
France’s Engie has reportedly delayed signing NewsBase’s EurOil Monitor.

P8 www. NEWSBASE .com Week 43 29•October•2020