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South Korea’s oil and gas demand declines
SOUTH KOREA
SOUTH Korea’s oil and gas demand is in decline, with the country re-embracing nuclear and coal in the power sector while introducing policy measures curbing demand for transportation fuels. The country’s gasoil consumption shrank by 20% year on year in September to 10.86mn barrels, S&P Global Platts reported this week citing state-owned Korea National Oil Corp. (KNOC) data. This was, the news service noted, the sharpest contraction in demand since con- sumption dropped 25.8% y/y in June 2008. Gasoline demand, meanwhile, slid 15.8% y/y to 5.76mn barrels.
Tougher environmental regulations, such as banning older diesel-fuelled trucks from city centres, will hurt gasoil demand going forward. Higher retail gasoline prices following Seoul’s move to scrap tax cuts for transportation fuels on September 1 have also deterred shoppers and are likely to continue doing so. Furthermore, the country’s slowing economic growth, which the International Monetary Fund (IMF) has revised to 2% for this year from its previous outlook of 2.6%, will also squeeze demand for auto fuels.
At the same time, South Korean demand for liquefied natural gas (LNG) is projected to con- tract over the next five years. While demand hit
an all-time high of 44mn tonnes in 2018, Reuters reported this week that analysts anticipated a dip in the years ahead as new nuclear and coal-fired power generation comes online.
One nuclear reactor came online in August, another is due to start up this year and three more are due online by 2024, Reuters said citing data from Korea Power Exchange. The newswire added that seven large coal-fired power plants were set to start operations by 2022.
Nuclear reactors accounted for 27.4% of the country’s power generation in the first eight months of the year, up from 22.3% a year ago, Reuters said citing data from Korea Electric Power. Gas power generation eased from 27.6% to 25.1% in the same timeframe.
Changing power supply patterns have already seen LNG imports fall 8.3% y/y to 29mn tonnes, according to customs data. Energy consultancy Wood Mackenzie, meanwhile, predicts a 9% drop in the country’s full year imports.
“As we move through the early 2020s, LNG will come under pressure in the power sec- tor as new coal-fired power capacity starts up and imports will fall towards 36mn tonnes per annum,” senior Wood Mackenzie analyst Lucy Cullen said.™
India’s IOC advances plastics-oil conversion research
INDIA
STATE-RUN refiner Indian Oil Corp. (IOC) has reportedly completed the first phase of research into converting waste plastics into synthetic oil and is now planning to develop commercial processes. IOC’s research into the liquefaction of plastic waste over the last few years will allow it to install conversion facilities at its downstream complexes, news service IANS reported on November 3.
“The initial research on plastic liquefaction has been encouraging. We now have to take this research to the proof stage, which will also help us develop processes for commercial extrac- tion of oil from plastics waste,” IANS quoted an unnamed company official as saying. The source did not say what technologies the company was pursuing, but the process of pyrolysis – heating plastic waste without oxygen to produce a syn- thetic oil – is well established.
Company chairman Rajiv Singh was quoted as saying that while the company was developing plastic liquefaction technology, it was also inves- tigating other waste solutions.
These include lining road surfaces using a mixture of bitumen and single-use plastics waste, and the company has launched a special grade of bitumen made with plastics waste – CRMB 55P. The company has also developed soluble bitu- men packaging from single-use plastic waste.
IOC is also seeking to convert used cooking oil (UCO) into fatty acid methyl esters (FAME), which can then be used in the production of biodiesel. India’s UCO-biodiesel potential is estimated at 3.5mn tonnes per year (tpy).
The development of commercial liquefaction systems would see India join countries such as China and Japan, where efficiency levels range between 38% and 63%. The technology could represent a major breakthrough for India in terms of dealing with its plastic waste generation, which the Central Pollution Control Board esti- mates at around 25,940 tonnes per day.
The head of US chemical giant Dow, Jim Fit- terling, told Plastics News last month that he was confident that the petrochemical sector could find an answer to the waste plastics issues.™
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w w w . N E W S B A S E . c o m Week 45 13•November•2019