Is Your Gasoline Burning Out Faster?

(Trinidad Express, Sandhya Santoo, 7.Nov.2018) — Is super gasoline burning faster?

This is the claim by some motorists who are insisting that the fuel is burning faster, leading to lower mileage per litre and higher costs.

And many taxi drivers say that the Super gasoline is causing economic hardship. Some want the State to subsidize taxi drivers.

At the pumps, car owners would pay $4.97 for super gas, $5.75 for premium gas, and 3.41 for diesel fuel.

Vice president of the St Croix/ Barrackpore Taxi Drivers Association Narine Lochan said the fuel seems to be burning faster.

He said given the higher cost of super gas and premium, using regular fuel has become a preferred choice, despite the car manual recommendation that a certain octane of fuel be used.

“Super is burning out like water and we have to mix using regular gas because the cost is too much. We can’t get the distance we cover with the super now. What we need is for the government to subsidise taxi drivers. The gas is causing havoc to the taxi industry,” he said.

Lochan said the poor road conditions was adding to the woes.

He said many drivers have fewer passengers and attributed this to an increase in unemployment.

He said: “We seeing less people travelling because they are losing their jobs. Where we could get a lot of passengers during peak times, we seeing less and it’s not because there are new taxi drivers or “ph” drivers but it is because they are not travelling like they used to.”

Lochan said the use of Compressed Natural Gas (CNG) is not suitable for taxi drivers of the association given that there are limited CNG fuelling stations in south Trinidad.

“ By the time we go to fill our tanks with CNG and run a trip, we have to keep coming back to fill the tanks. You cannot keep running to the gas station three or four times a day. There isn’t enough stations that is even close for us to use and so you will not see many taxi drivers for our route using CNG,” he said.

The fuel being used at the pump was imported by State-owned oil refinery, Petrotrin, which received its first shipment of refiner fuel on October 27.

Sixteen shipments will be delivered over the next four months under an agreement with BP’s Latin America Integrated Sales and Trading Group.

Petrotrin Chairman Wilfred Espinet in a television interview this week said, “we do know for a fact that the fuels we imported are consistent in terms of the specifications of what we were producing in Trinidad and Tobago so there should be no effect”.

Espinet said the fuel brought in was a shipment of diesel.

Espinet said the fuel goes into an inventory and “although we may be transferring from tanks, there are times you are going to get residual in tanks that are going to mix with each other.”

President of the Petroleum Dealers Association Robin Naraynsingh said the statements being made are done so with limited and uninformed knowledge.

He said drivers must be cognizant of the size of the gas tanks, the millage and ensure that there is proper maintence of vehicles.

“They are saying things they don’t know. Every manufacture of a vehicle will tell you how much miles per gallon of fuel you get. They have to know what is the fuel consumption of their vehicles. If you say its burning out faster, are you doing city driving or highway driving? This thing is science, it’s not something you can just ‘feel’. Its burning faster, but faster to what?

People who are saying this have to be cognizant of what they are saying. What is their fuel consumption? How long you burn the engine for, the mileage.

Do proper maintenance, read the manual to car and learn about the fuel consumption of your vehicle.

The consuming public have to be more aware. Check vehicles if they are working properly, know that you are using the right octane level. If you buy regular you are using more,” he said.

***

#LatAmNRG

Santa Cruz Reports Sale of 200,000 Liters of Ethanol 92 In Four Days

(Energy Analytics Institute, Jared Yamin, 5.Nov.2018) — Commercialization of Bolivia’s new ‘Super Ethanol 92’ gasoline reached nearly 200,000 liters in the first four days after it was introduced in the department of Santa Cruz, reported the daily newspaper La Razón, citing National Hydrocarbons Agency (ANH) Director Gary Medrano.

***

#LatAmNRG

Related Stories

Bolivia To Kick Off Sale Of Super Ethanol 92 On Nov. 1

 

Bolivia To Kick Off Sale Of Super Ethanol 92 On Nov. 1

(Energy Analytics Institute, Jared Yamin, 30.Oct.2018) — Bolivia announced it expects to initiate sale of its new Super Ethanol 92 fuel on November 1, 2018. Santa Cruz will initiate the sales process from its 30 service stations.

By year end 2018, an estimated 300 service stations across Bolivia will sell the new fuel. By year end 2019, it is estimated that approximately 700 service stations will be geared up to sell the new fuel, reported the daily newspaper La Razón.

***

#LatAmNRG

Mexico’s Next Government Faces Bind In Pemex Ethane Deal

(Reuters, Diego Oré, 17.Oct.2018) — Mexico’s incoming government will soon inherit a costly dilemma over an ethane supply contract between national oil company Pemex and a consortium led by a unit of Brazilian builder Odebrecht.

Under the contract’s terms, Pemex has had to supply ethane well below current market prices.

A hydrocarbon that comes from natural gas, ethane is used to make ethylene, which in turn is used to make the common plastic polyethylene at the Braskem-Idesa plant near the Gulf coast port of Coatzacoalcos.

The plant is operated by the consortium in which Odebrecht’s unit Braskem has a 70 percent stake and Mexico’s Grupo Idesa holds the remainder.

Energy aides to President-elect Andres Manuel Lopez, who takes office Dec. 1, have said the contract is problematic, but have not yet said what the new government will do about it.

“The contract with Braskem is very damaging to Mexico’s interests,” Sen. Armando Guadiana, of Lopez Obrador’s Morena party and heads the Senate energy commission, told Reuters last week. Pemex is fully owned by the government.

The Braskem-Idesa consortium told Reuters last week it has no plans to void the contract.

If President-elect Lopez Obrador were to direct Pemex to cancel the contract, it would be forced to purchase from the consortium the sprawling Etileno XXI petrochemical facility currently valued at $1.26 billion (£956.43 million), according to a contract annex seen by Reuters.

Neither Pemex or Braskem responded to questions about the valuation.

Conversely, if the new government opted to stick to the deal, it could only hope for more favourable ethane prices that might reduce its losses.

MUTUALLY BENEFICIAL?

Under the terms of the 20-year-long contract, Pemex committed to selling ethane to Braskem-Idesa for 16 cents per gallon. When the contract was signed in 2010 market prices for ethane were three times that, at 50 cents per gallon.

Current ethane prices hover around 40 cents per gallon.

A Pemex spokesman said the contract, which took effect in 2016, “responded to the market conditions of that time.”

Before the facility began operations in 2016, Pemex produced more ethane than it needed, forcing it to inject excess supply back into its natural gas pipelines.

Pemex’s production of ethane this year averages 88,000 bpd, but this is now insufficient to supply its own Morelos and Cangrejera petrochemical facilities that require a combined 66,900 bpd, plus the Baskem-Idesa contract obligation of 66,000 bpd.

As a result Pemex was forced to turn to ethane imports this year for the first time as domestic oil and gas production continues to fall, costing Pemex some $50 million during the first half of 2018, according to Reuters calculations, due to the cost of imported ethane at market rates compared to the cheaper fixed price in the contract with the Braskem-Idesa consortium.

If Pemex is left without enough ethane, it would have to shut down the so-called cracking plants at its two petrochemical facilities, and the cost of re-starting them after being idled one week would be some $2.6 million, according to comments from the head of Pemex’s ethylene unit, Alejandro Cruz, at a board meeting in December.

In June, pricing agency Platts reported that Pemex entered into a $237.6 million contract with Swiss commodities trader Vitol to supply 720,000 tonnes of ethane to Pemex through 2020.

Both Pemex and Vitol declined to confirm the deal.

In 2016, Mexico’s federal auditor determined that Pemex ethane exports during a 10-month stretch of that year could have yielded the company more than $100 million had it not been for the Braskem-Idesa contract.

Using official data, Reuters calculated a similar $100 million opportunity cost in 2017.

Both Pemex and Braskem declined to comment on the calculations.

Braskem said the contract was mutually beneficial, arguing that it helps cut Mexico’s reliance on foreign plastics.

“We are not planning on undoing a positive contractual relationship that we’ve been building with Pemex and that brings benefits to all,” said Sergio Plata, head of institutional relations for the Braskem-Idesa consortium.

Rocio Nahle, Lopez Obrador’s pick to be Mexico’s new energy minister, has said the incoming government will review the Braskem-Idesa contract for possible signs of corruption, part of a broader energy contract review.

The consortium’s Plata said he was confident the contract will not be modified.

According to a transcript of a recent session of the board of directors of Pemex’s ethane unit, acting director Rodulfo Figueroa, admitted that supplying the gas is “the most serious problem” it faces.

Lopez Obrador’s incoming transportation minister, Javier Jimenez Espriu, is an alternate member of the Grupo Idesa board of directors but told Reuters the contract was reviewed by the separate board of the Braskem-Idesa joint venture.

Luis Miguel Labardini, a Mexico City-based energy consultant, said an even bigger problem for Pemex lies with whoever agreed to the contract’s terms in the first place.

“We should give the benefit of the doubt to whoever negotiated this contract that they didn’t act in bad faith,” he said. “But they were negligent.”

***

#LatAmNRG

Pemex Rolls Out New Fuel Additive To Protect Gasoline Engines

(Pemex, 11.Oct.2018) — Pemex introduced the new gasoline additive that will be added into Pemex Magna and Pemex Premium fuels, the additive will be promoted under the brand name of Pemex Aditec. This fuel additive is environmentally friendly, and will keep the engine up to 97 per cent free of dirt, to promote efficient combustion and higher-powered driving.

This Mexican technological innovation is a competitive advantage for the Pemex franchise, which comprises over 10,000 service stations throughout the country.

During the presentation of the product, led by Pemex Transformación Industrial Executive Director (Pemex Industrial Transformation), Carlos Murrieta Cummings, it was highlighted that this technology maintains engine pistons at peak performance and optimal working conditions, will allow emissions of polluting gases to decrease.

Technical Information about the fuel additive

The new Pemex fuel additive contains detergent agents that maintain the intake valves and injectors of the engine free of dirt. It optimizes the engine’s output, actively contributing to obtain peak performance and reducing polluting emissions.

The additive contains an antioxidant or prevention agent to prevent valves from rusting and deteriorating, as well as an anti-adhesive agent that prevents valves from getting stuck.

It also contains a solvent that contributes to maintain the stability of the compound when mixed with gasoline at different temperatures, to maintain its fluidity into the engine. Furthermore, it contains an emulsion prevention additive, an agent that reduces the formation of emulsions in the engine, as well as a corrosion inhibitor.

***

#LatAmNRG

Khan: No Fuel Supply Disruption

(Trinidad and Tobago Newsday, Julien Neaves, 26.Sep.2018) — Energy Minister Franklin Khan has assured there would be no disruption in fuel supply to the travelling public with the closure of the Petrotrin Refinery next Monday.

Khan was responding to a question in the House yesterday from Pointe-a-Pierre MP David Lee on the strategic steps to ensure the supply of fuel was not disrupted with the closure of the Petrotrin Refinery on October 1, in a phased manner.

Khan reported the country consumes 25,000 barrels of liquid fuel per day or 3.9 million litres, comprising of aviation fuel, diesel, super and premium gasoline and small amounts of regular.

He said the refinery would be closed on a phased basis in October and upon its closure there would be a 20-day supply of fuel from stock. Khan said steps are currently being put in place for the importation of fuel from international traders and request for proposals from 13 reputable international suppliers and traders were currently out.

Prime Minister Dr Keith Rowley also responded to a question from Lee that given Government’s offer to the Oilfield Workers’ Trade Union (OWTU) of a preferential option to purchase the Petrotrin refinery if the Prime Minister could indicate the other options Government intends to pursue if this offer is not accepted by the OWTU. Rowley said it was Government’s position the refinery would be excised as a separate entity from the rest of Petrotrin’s business and be an independent asset. He said at that stage if OWTU puts forward a proposal to Government, the union would be given the first option. “They have indicated some interest is being shown pertaining to that.”

Lee asked if there were any other proposals but Rowley said he was not aware Petrotrin was in receipt of other proposals but interests have been expressed if the asset becomes available.

***

Jamaica: Gas Prices Down $0.72, Diesel Down $0.35

(Jamaica Gleaner, 12.Sep.2018) — Gas prices are to go down by $0.72 tomorrow Thursday, September 13

The state-owned oil refinery, Petrojam, says E-10 87 will sell for $137.82 per litre and a litre of E-10 90 will sell for $140.65.

Automotive diesel oil will go down by $0.35 per litre to sell for $140.50.

The price of Kerosene will move down by $0.28 with that fuel to sell for $123.22.

In the meantime, propane cooking gas will go down by $0.35 to sell for $58.73, while butane will go down by $0.62 to sell for $64.75 per litre.

Retailers will add their mark-ups to the announced prices.

***

Mexican Fuel Consumption 778 Mb/d: Jan.-Jul. 2018

(Energy Analytics Institute, Jared Yamin, 3.Sep.2018) — During the first seven months of 2018, the average consumption of gasoline in Mexico was 778,000 barrels per day, or 124 million liters per day.

Of the total, approximately 659,000 barrels per day, or 85% of total consumption, corresponded to Pemex Magna, while the remaining 119,000 barrels per day, or 15% of total consumption, corresponded to Pemex Premium, announced Pemex in a Twitter post.

During the same time period, consumption of diesel was approximately 339,000 barrels per day or 54 million liters per day, according to the state oil company.

***

Kamla Floats Guyana Help for Trinidad Refinery

(Stabroek News, 2.Sep.2018) — Trinidad Opposition Leader Kamla Persad Bissessar has raised the prospect of Guyana oil being used to rescue the beleaguered Petrotrin refinery but Prime Minister Keith Rowley last evening said the aged facility had no reasonable prospect.

Defending the decision by his government to close the over 100- year-old refinery, Rowley yesterday said he had no choice as the climbing debt was too much to saddle his country’s taxpayers with.

“Petrotrin was overburdened with debt. The net debt at financial year-end 2015 amounted to TT$11.4 billion,” Rowley told the twin-island nation in an address which was live streamed.

According to the Trinidadian Prime Minister, “Left as it is, Petrotrin will require an immediate TT$25 billion cash injection just to stay alive” and “there is no way that the company can find this money” as “no financier will lend it because the company simply will not be able to repay such an additional loan.”

He believes that it would be more feasible for the country to focus on exploration and production and export the 40,000 barrels of oil equivalent per day it produces and import the 25,000 barrels it needs for consumption.

“Today with a refining capacity of 140,000 barrels per day, the local production available for refining is 40,000 barrels. We really depend, mostly, on a daily importation of 100,000 barrels per day, which we refine at a significant loss.”

He would later add, “We consume less than 25,000 (barrels) of refined products. It makes far more sense to export the 40,000 that we produce and import what we need. Each barrel will be sold externally on the open market.”

Last week Tuesday it was announced that Petrotrin’s refining and marketing operations would be shuttered. With TT$8 billion in losses in the past five years and a bullet payment of US$850 million due in 2019, Petrotrin chairman Wilfred Espinet had said that terminating its refining and marketing operations and retrenching 1,700 permanent and casual employees was the only way to save the company after 100 years of operations in the industry. Petrotrin also owes the Trinidad Government more than TT$3 billion in taxes and royalties.

Rowley’s position last evening came even as that country’s former Prime Minister, Persad Bissessar called on him to pursue negotiations with Guyana to refine its oil there in order to save the company.

“I understand Guyana has found another well … can we not group in some way and find a way to work together as a CARICOM where we can help them refine their oil,”  she told reporters on Saturday at her Legal Clinic Siparia Constituency Office and which was reported by the Trinidadian newspaper Newsday. Guyana won’t begin pumping oil before 2020.

“I am calling on him to let good sense prevail to be very cautious in making such a drastic and dangerous move, this will have a ripple effect throughout the economy and the country…of course they (Guyana) will build their own refinery but we have one and many of the units in the refinery at Petrotrin are new, so a lot of money has been invested on the refinery side and now they are shutting it down. It is total nonsense,” she added.

Currently, it is still unclear what the Guyana Government would do with its share – 12.5%  – of profit oil from 2020 onwards, from its agreement with ExxonMobil but one government official said that several options are being explored.

One Minister yesterday said that it “Is an ongoing discussion and several workshops and engagements have been held. The options are to ask Exxon or to market, do our own marketing or take our share in kind and send it for refining somewhere. Several proposals have been received and the final decision-making process will be guided by the Department of Energy.”

Stake

Sources have told this newspaper that it has been suggested to the government that Guyana “takes a stake in the Petrotrin refinery and in this way acquire a strategic asset.” In that way, according to one source, Guyana could have its share of oil from the agreement with ExxonMobil and affiliates refined closer to home and secure jobs for persons in both countries.

But while it is still too early to tell what the Guyana and Trinidad governments will decide, a source said, “Guyana may gain a controlling or sizeable share and develop refining capacity and meet many of the outcomes from having a refinery without having to pay as much. Additionally, we can ensure that a percentage of labour is Guyanese who will have to be trained and also we can address some CARICOM integration goals.”

Last evening, the Trinidad PM  made no mention of Guyana or even hinted at restarting the refinery although he said that Petrotrin’s refinery assets would be placed in a separate company.

“We largely operate a business that is largely dependent on foreign oil inputs. All the other refineries in the region that had this same business model, Aruba, Curacao and St Croix have long since closed because they saw it as not a viable business,” Rowley said.

“Our Pointe-à-Pierre refinery is 101 years old and has reached the end of its commercially viable days it is now at a state where it is haemorrhaging cash and the cost of rehabilitating it is way more than its potential to ever be potentially viable, competitive or sustainable. The only commercially sound and viable option is to close the refinery, export Petrotrin’s oil and to import products,” he also noted.

The government of the US Virgin Islands last month approved a proposed US$1.4-billion operating agreement between itself and Arclight Capital Partners LLC, Boston, to restart the former Hovensa Refinery at Limetree Bay, St Croix. The refinery is scheduled for opening by the end of 2019. With an initial crude processing capacity of about 200,000 barrels per day according to the USVI government, the investment is expected to create 1,200 local jobs during construction and as many as 700 permanent jobs upon restarting the facility. The Hovensa refinery was a joint venture between Hess Corporation and Petroleos de Venezuela until it closed in 2012.

Rowley said that the Petrotrin model has outlived its usefulness and it was now time to accept that and equip the company to stand the test of the ever changing global economy.

“Petrotrin’s model has become obsolete and uncompetitive and its operating practices are inefficient. The company was nowhere in line with global industry standards and best practices. In fact the company’s operations are identified as being among the most inefficient in the world. The company if left as it is would continue to operate at a loss at a rate of aboutTT$2B a year. It is not a viable option, to do so is to saddle future generations with a huge debt burden. If not dealt with now, the negative effects will get worst and it simply cannot work. To break even would cost TT$7B and would involve significant staff cuts and an ultra-low sulphur refinery,”

He believed that the “Gross mismanagement of the national patrimony within the last decade” such as many cost overruns and delays in projects for the company  was part of the reason government is now saddled with the large debt.

A committee, headed by TT’s former Energy Ministry Permanent Secretary, Selwyn Lashley, had reported on the dismal state of the company since 2016 and the report showed that in addition to receiving huge subsidies from the state, Petrotrin was not paying its fair share of taxes collected to government.

“Taxes and royalties owed to Government amounted to $3.1 billion as at February 28, 2017. The company was not complying with the tax laws and even when it collected taxes from companies that paid their taxes to Petrotrin for onward transmission to the Ministry of Finance, Petrotrin was huffing and utilizing those monies in its own operations.”

“Money that should be turned over to the Ministry of Finance is held within the company and that is illegal,” he added.

***

Brazil’s Energy Agency Opts for Argus Prices

(Argus Media, 30.Aug.2018) — Brazil’s National Agency of Petroleum, Natural Gas and Biofuels (ANP) will start using prices published by leading global energy and commodities price reporting and news agency Argus to set a government diesel subsidy.

ANP has announced that it will, from 31 August, adopt Argus delivered prices for diesel in the ports of Itaqui, Suape, Santos and Paranagua to calculate import parity prices as part of a formula that will also take into account local storage and logistics costs.

A countrywide truck drivers’ strike in May sparked by rising diesel prices led the Brazilian government to cap wholesale prices and offer temporary subsidies to diesel producers and importers. The subsidy programme ends on 31 December.

Argus Media chairman and chief executive Adrian Binks said: “We are delighted that ANP has decided to switch to Argus prices to support this important piece of regulation. Staff from our Rio de Janeiro office, which we opened six years ago, have been working with the government and market participants to develop pricing mechanisms suitable for their needs.”

***

PDVSA Leaves Argentine Gas Station to Fend for Itself

(Reuters, Luc Cohen, 15.Aug.2018) – As Venezuela’s state-owned oil company PDVSA saw its finances devastated by low oil prices and mismanagement, it funneled millions of dollars to Petrolera del Conosur (PSUR.BA), a loss-making Argentine gas station operator it controls.

PDVSA decided to cut off the support payments late last year, according to a person familiar with Petrolera del Conosur’s operations, as the once-proud icon of Venezuelan oil production struggled with declining output aggravated by a worsening economic crisis.

The transfers had totaled $89 million between 2013 and 2017, according to a Reuters review of filings with Argentina’s securities regulator, years that coincided with a frustrated effort by Venezuela to extend the petro-diplomacy it employed in the Caribbean to the southern cone of Latin America.

Profitability was likely never the true goal of Venezuela’s Argentina foray, said David Mares, a political science professor at the University of California, San Diego. In 2006, late President Hugo Chavez unveiled a plan to transform PDVSA from a commercial company to a domestic and international political tool.

Before oil prices crashed in 2014, Venezuela’s government used PDVSA to fund social programs at home and provide countries in the region with cheap fuel to promote its socialist model and push back on United States influence.

The most well-known example is Petrocaribe, a program through which Venezuela sends crude and fuel to Caribbean countries on generous credit terms or through barter deals. But Chavez also signed deals with governments elsewhere in the region, including Argentina and Uruguay, to sell fuel and invest in energy infrastructure.

“The idea of having a series of gasoline stations in Argentina would fit in that context. It’s to show the Bolivarian revolution benefits people at the ground level,” Mares said. “The surprise is that they’ve lasted so long, because PDVSA is broke, the country is broke.”

PDVSA in 2006 purchased a 46 percent stake in Conosur from Uruguay’s ANCAP, which it boosted to a controlling 94 percent in 2010. PDVSA’s website still boasts of a goal to run 600 stations in Argentina to gain a market share of 12 percent in the country.

Conosur’s struggles come as some of PDVSA’s other overseas ventures, most launched through a wave of overseas expansion in the 1980s or as part of Chavez’s attempts to use “oil diplomacy,” have been scaled back or shuttered.

One of the most emblematic is Hovensa, a refinery in the U.S. Virgin Islands operated jointly with Hess Corp (HES.N), that filed for bankruptcy in 2015.

‘STRATEGIC ALLIANCE’

Since 2013, Conosur has posted hundreds of millions of pesos in annual losses. Fuel sales at its PDV Sur and Sol-branded stations have plunged 86 percent, as it struggled to compete with rivals like state-owned YPF (YPFD.BA), which produce their own crude and refine their own fuel.

PDVSA also strove to become an integrated player in Argentina, but efforts to acquire upstream and refining assets never worked out, the person said.

Neither PDVSA nor PDVSA Argentina, the subsidiary that owns the Conosur stake, responded to requests for comment.

And in a sign of how Venezuela’s economic crisis has derailed its ambitions to challenge U.S. diplomatic and financial power through regional energy integration, Conosur has not notified Argentina’s stock watchdog of any payments from PDVSA since Dec. 29, 2017.

The choice to cut off support amounts to a formal abandoning of the upstream goals in favor of strengthening the existing network as part of a restructuring of the company, said the person, speaking on condition of anonymity because they were not authorized to speak publicly.

“The supports were rational when the goal was the whole supply chain,” the person said, adding the company was in talks for a strategic alliance with a fuel supplier to access cheaper refined products, rather than depending on the spot market.

That deal could be necessary to keep the company alive without PDVSA’s support.

The company posted a 177.5 million peso loss in 2017, and warned on Dec. 20 that PDVSA’s transfers had helped it avoid being dissolved in accordance with the requirements of an Argentine corporate law for companies that run out of capital.

Since then, losses have accelerated, to the tune of 226 million pesos in the first half.

Conosur’s struggles have dashed many employees’ hopes that PDVSA’s takeover would signal a new era of prosperity at the chain, which had also struggled under Uruguayan ownership.

“We saw it as a panacea,” said one former employee, laid off earlier this year with around a dozen others. “But it was more or less the same.”

Additional reporting by Alexandra Ulmer in Caracas and Marianna Parraga in Mexico City; Editing by Bernadette Baum

***

Venezuela Petrol Prices Need to Rise to Stop Smuggling

(Reuters, Deisy Buitrago and Brian Ellsworth, 14.Aug.2018) – Venezuela’s heavily subsidised domestic gasoline prices should rise to international levels to avoid billions of dollars in annual losses due to fuel smuggling, president Nicolas Maduro has said.

“Gasoline must be sold at an international price to stop smuggling to Colombia and the Caribbean,” Mr Maduro said in a televised address on Monday.

Venezuela, like most oil producing countries, has for decades subsidised fuel as a benefit to citizens.

But the country’s fuel prices have remained practically flat for years despite soaring hyperinflation the International Monetary Fund has projected would reach 1,000,000 per cent this year.

For the price of a cup of coffee, a driver can fill the tank of a small SUV nearly 9,000 times

That means that for the price of a cup of coffee, a driver can now fill the tank of a small SUV nearly 9,000 times.

Smugglers can make considerable profits reselling fuel in neighbouring countries.

Mr Maduro said the government would still provide “direct subsidies” to citizens holding the “fatherland card,” a state-issued identification card that the government uses to provide bonuses and track use of social services.

He said the subsidy was only available to those who registered their cars in a vehicle census being conducted by the state.

***

Venezuela Petrol To Rise to Int’l Levels

(Energy Analytics Institute, Ian Silverman, 13.Aug.2018) — The price of Venezuela’s subsidized petrol, long one of the cheapest in world, is set to rise.

Effective August 20, 2018, the price of Venezuela’s petrol will cost the same as in international markets, reported PDVSA in an official statement, citing comments from Venezuela’s President Nicolás Maduro.

The decision to raise the price of petrol comes as Venezuela tries to reduce annual loses estimated at $18 billion due to the contraband of the product to neighboring countries from Aruba to Colombia, among others.

***

How Far Can Venezuela Go In Raising Gas Price?

(AFP, Esteban Rojas, 5.Aug.2018) – In Venezuela’s inflation-hit economy, a single US dollar can buy 3.5 million liters of gasoline — an absurdity that the government says it will tackle with a hike in the cost of state-subsidized fuel.

But just how far can President Nicolas Maduro go without getting his fingers burned?

Subsidized gas

Maduro announced on July 29 plans to adjust the price of gasoline and regulate sales based on the so-called “fatherland card,” an electronic card that provides access to subsidies. As a first step the government began a census of motor vehicles, set to end on Sunday.

A liter of 91-octane gasoline currently costs one bolivar, while 95-octane gas costs six. By contrast, a single egg in Venezuela’s hyperinflation ravaged economy — estimated by the IMF at one million percent in 2018 — costs 200,000 bolivars.

A dollar on the country’s black market is currently trading at 3.5 million bolivars.

Experts say the retail price of gasoline covers just between two and four percent of its cost of production.

Maduro has kept details of the fuel price adjustment under wraps, but he said that “we are paying to throw it away … we need to move to a rational usage.”

Yet talking openly about cutting the gasoline subsidy has been a taboo since the 1989 riots known as the “Caracazo,” which were triggered by a rise in fuel prices and left 300 people dead in Caracas and towns surrounding the capital.

Even though the iconic late leader Hugo Chavez questioned the rock-bottom prices of state-subsidized fuel during his term in office between 1999 and his death in 2013, even he never touched them.

In 2016, Maduro authorized the first price hike in 20 years, but only by between 1.328 percent and 6.566 percent, which made no impact on the derisory prices.

The new adjustment will come at a time of profound stagnation, in an economy that has not stopped shrinking since 2014.

Inflationary subsidies

Fuel subsidies have cost the Venezuelan government $10 billion a year since 2012, petroleum expert Luis Oliveros told AFP.

That has created a such a gaping hole in the budget that the government has tried to fill by printing more money, which in turn has created even higher inflation, Oliveros said.

“It is a lie that increasing the price of fuel is an inflationary measure,” he said. “The subsidies are hyperinflationary.”

The situation has only been made worsen by the drop off in oil production from 3.2 million barrels a day in 2008 to 1.5 million in 2018.

That is why the operating capacity of refineries has fallen and gasoline imports have risen.

In a perverse twist, there has been a decrease in the demand for fuel because 90 percent of Venezuela’s public transport vehicles are out of operation because there cannot buy spare parts to keep them on the road, according to unions.

Venezuela imports 33,600 barrels of gasoline and 36,000 barrels of diesel a day from the United States, according to the US Energy Information Agency.

Maduro has yet to explain what happens to consumers who do not have a state-issued “fatherland card.”

With wages ravaged by hyper-inflation, it is unlikely prices will get anywhere near international levels. If they did, however, filling a gas tank would cost a Venezuelan two years of their minimum-wage income.

“Prices are so far behind that no matter how big the increase in terms of percentage, they will still remain low,” said Henkel Garcia, director of the Econometrica consultancy group.

Social ‘blackmail’

Economist Luis Vicente Leon said the government will use greater subsidies in the “fatherland card” system to ensure that fuel is affordable for all cardholders.

According to the opposition, this card is designed for the Socialist government to broaden its support base, which has been weakened by the economic crisis and longstanding shortages of food, medicine and basic goods.

The 12 million Venezuelans with the cards — a third of the population — systematically receive food vouchers.

“If they are already using food and medicine as a form of blackmail, then why not gasoline?” said Oliveros.

***

Pemex Inaugurates 1st Petrol Station with New Image

(Pemex, 1.Aug.2018) – The CEO of Pemex Transformación Industrial stated that the new concept will help the franchise maintain its leadership in the national market​

The first “Flagship” service station of the Pemex franchise, located in the colonia Centro in the municipality of Atizapán Santa Cruz, State of Mexico, was inaugurated today with the purpose of improving the commercial model and renewing the processes of the Petróleos Mexicanos franchise.

During the event, the CEO of Pemex Transformación Industrial (Pemex Industrial Transformation), Carlos Murrieta Cummings, stated that this opening introduces the new concept to maintain the franchise’s leadership in the national market and materializing the evolution of the Pemex gas station network.

Murrieta Cummings reported that a total of 45 service stations will be incorporating the new image this year, 37 will be remodeled and eight will be new.

Our goal, he said, is to comply with the highest service standards, offering the client our experience, reliability, modernity and innovation. The new image breaks with conventions and projects the new Pemex: a highly competitive company in an open market.

On the other hand, Carlos Eduardo Gómez, CEO of the Tianguistenco S.A. de C.V. service stations, stressed that Pemex has complied 100 per cent with the benefits to franchise holders announced in November during the presentation of the new franchise model.

He said that since his gas station began using the new image in mid-June, sales have doubled. “Pemex is the best option in the fuel market,” Gómez said.

Municipal President Javier Guadalupe Pérez Arcadio and the representative of the construction company Deportigas S.A. de C.V, in charge of the remodeling project, Jorge Garduño, were also present at the event.

The new design of the franchise reflects an eagle in full flight, a strong, agile leader extending its wings to meet new challenges.

***

Venezuela Gasoline Price Likely to Rise

(Energy Analytics Institute, Piero Stewart, 27.Jul.2018) – The price of gasoline in Venezuela is likely to increase.

For some services such as gasoline, there will be a relative increase in price, reported the daily newspaper El National, citing Ecoanalítica Director Asdrúbal Oliveros.

“It’s as if they were decreeing an unannounced increase in many of the services, and that has a significant impact not only on daily life, but also on inflation that will be generated,” said Oliveros.

Venezuela has long subsidized the price of the country’s gasoline and diesel, which has allowing its citizens to enjoy the world’s cheapest fuel prices. In 1989, increases in foodstuffs and fuel prices provoked nationwide protests, which eventually led to rise of the late President Hugo Chavez.

“The increase in gasoline will push up demand for cash since a rise in gasoline prices will force citizens to seek out more paper money,” he warned.

***

Hiking Gasoline Won’t Fix Venezuela’s Fiscal Problem

(Energy Analytics Institute, Piero Stewart, 27.Jul.2018) – Hiking the price of gasoline in Venezuela won’t fix the OPEC country’s fiscal problem.

That’s according to recent statements from an opposition leader.

“Although the price of fuel has to be raised, it will not be enough to solve the [country’s] fiscal problem,” reported the daily newspaper El Nacional, citing deputy and economist Angel Alvarado.

Venezuela needs worldwide financial assistance, including help from the International Monetary Fund (IMF), said Alvarado.

“That’s why the National Assembly Constituent, which is illegal, must be dissolved to recognize the National Assembly and call for free elections,” he affirmed.

***

Jamaican Gas Prices Down by $0.21 per Litre

(Jamaica Gleaner, 13.Jun.2018) – Gas prices are to go down by $0.21 effective Thursday, June 14.

The state-owned oil refinery, Petrojam, says E-10 87 will sell for $132.12 per litre and a litre of E-10 90 will sell for $143.95.
Automotive diesel oil will down by $0.16 per litre to sell for $130.15.

The price of Kerosene is to go up by $0.18 with that fuel to sell for $112.92.

In the meantime, propane cooking gas will go down by $0.20 to sell for $48.29, while butane will go up by $1.27 to sell for $53.13 per litre.

Retailers will add their mark-ups to the announced prices.
***

Pemex Lets Contract for Tula Refinery

(Oil and Gas Journal, Robert Brelsford, 11.Jun.2018) – Mexico’s Petroleos Mexicanos (Pemex), through its processing subsidiary Pemex Transformacion Industrial (formerly Pemex Refinacion), has let a contract to a partnership of Saipem SPA and Mexican subsidiary Saimexicana SA de CV for works to be carried out on the heavy oil (H-Oil) plant at Pemex’s 215,100-b/d Miguel Hidalgo refinery in Tula, Hidalgo state.

As part of the contract—valued at $39.23 million—Saipem will perform rehabilitation and commissioning works at the H-Oil plant, which currently processes amounts of pure diesel and produces hydrodesulfurized diesel with low sulfur content that are sent in bulk to the catalytic plants, as well as obtaining other products, like diesel, sour gas, dry gas, and acid, Pemex said.

The proposed rehabilitation project will upgrade the H-Oil plant to increase production of ultralow-sulfur gasoline in compliance with environmental regulations and expand handling of crude oil for production of other fuels, such as diesel and jet fuel, the operator said.

Upon launch of the tender seeking bids for the project in March, Carlos Trevino Medina, Pemex’s chief executive officer, said he expected the rehabilitated H-Oil plant to be completed by yearend.

Broader transformation

The H-Oil rehabilitation project comes amid the ongoing reconfiguration of the Tula refinery Pemex began in 2014 (OGJ Online, Nov. 18, 2015).

First announced in 2013, the two-phased Tula refinery reconfiguration project is intended to generally modernize crude oil processing, increase efficiency with which vacuum residue is converted into high-value fuels, expand production of higher-value products, increase refining margins, and reduce fuel-oil handling problems at the site, Pemex said in its latest annual report.

While Phase 1 of the project was about 27% completed by yearend 2016, certain works were delayed and rescheduled—including construction of an 86,000-b/d delayed coking plant and associated installations necessary for its operation—due to budgetary constraints.

As of Mar. 31, construction of the coker plant was 60% completed, and Pemex currently is evaluating funding alternatives through alliances and strategic partnerships to complete construction, the operator said.

With Phase 1 of Tula’s reconfiguration now scheduled to be completed by 2020, Phase 2 of the project—which covers construction of additional processing installations as well as modernization and integration of existing units—is slated for completion in 2022, Pemex said.

Once completed, Pemex said it expects modernization of the Tula refinery will enable the site to increase production of refined products to 220,000 b/d from 154,000 b/d, increasing the refinery’s overall performance by more than 40%.

***

Venezuelan Ranchers Affected by Gasoline Shortages

(Energy Analytics Institute, Jared Yamin, 19.May.2017) – In recent weeks, a reported 66 companies in Venezuela dedicated to the collection of milk have closed their doors and stopped distribution activities due to problems receiving fuel, reported the daily newspaper El Nacional, citing Leonardo Figueroa, president of the Ranchers Association of Táchira state.

“We don’t have gas-oil or gasoline,” said Figueroa during an interview with Union Radio. “Transport operations are paralyzed and if the situation isn’t resolved soon it could cause a crisis worse than what we are living due to the scarcity [of just fuel].” Táchira state is a major producer of milk in Venezuela, he added.

***

Venezuela Not Selling Gasoline in Pesos

(Energy Analytics Institute, Aaron Simonsky, 15.May.2017) – Venezuela expects to receive between $120,000 and $150,000 per day from the sale of its gasoline along the Colombian border, reported the daily El Nacional citing Economist Aldo Contreras. However, since initiating the process on January 2, 2017 to commercialize its gasoline along the border in Colombian pesos, the Venezuelan government has yet to register a sale in pesos.

The sale of Venezuelan gasoline along the Colombo-Venezuelan border was envisioned by the government of President Nicolas Maduro to cut down on contraband and boost foreign export revenues.

***

Mexico’s Fuel Consumption in January 2017

(Energy Analytics Institute, Fidencio Casillas, 12.Mar.2017) – Mexico consumed 193 million liters of fuel in January 2017, state oil company Petróleos Mexicanos (Pemex) Gasolinera wrote in a twitter post. Of the total consumption, approximately 130 million liters or equivalent to 817,000 barrels per day (67 percent of total consumption) corresponded to PEMEX Magna and PEMEX Premium grade gasolines. The remaining 63 million liters or equivalent to 396,000 barrels per day (33 percent of total consumption) corresponded to PEMEX Diesel.

***

Mexico’s Gasoline Price Lowest in LAC Region

(Energy Analytics Institute, Fidencio Casillas, 16.Jan.2017) – The average gasoline price in Mexico, the largest Spanish speaking country in the Americas, is still the lowest amongst select countries in the Latin American and Caribbean (LAC) region.

Mexico’s average gasoline price of 15.9 Mexican pesos per liter remains the lowest among select countries in the LAC region, according to data published by state oil company Petróleos Mexicanos S.A. de C.V. (Pemex). Uruguay, with an average gasoline price of 29.3 Mexican pesos per liter, is the Southern Cone country in the LAC region with the highest average gasoline price, followed thereafter by Cuba in the Caribbean and then Belize in Central America.

Country ——————— Gasoline Price in Mexican Pesos per Liter

Uruguay ——————– 29.3

Cuba ———————— 27.3

Belize ———————- 24.4

Brazil ———————– 23.7

Dominican Republic —- 23.3

Chile ———————– 23.1

Argentina —————– 23.1

Costa Rica —————- 20.2

Peru ———————— 20.2

Paraguay —————— 20.0

Honduras —————— 19.6

Nicaragua —————– 19.0

Mexico ——————– 15.9

Source: Pemex

Gasoline prices in Mexico increased — effective as of January 1, 2017 — as part of a plan by the government to boost fuel prices in line with international oil prices, said Mexican President Enrique Pena Nieto in a speech broadcast on Mexico’s Televisa television station.

***

Mexico’s Double-Digit Gasoline Price Increase

(Energy Analytics Institute, Fidencio Casillas, 5.Jan.2017) – The prices of gasoline in Mexico is set to increase gradually and up to 20 percent on average, effective January 1, 2017, although the increases were originally planned to take place in 2018, reports La Radio del Sur.

With the stipulated price increases the different octane grades of gasoline in Mexican pesos per liter will reach the following price ranges:

– Magna 87 octane: currently 13.98 pesos, to increase 18.2 percent to 16.52 pesos – Premium 93 octane: currently 14.81 pesos, to increase 24.2 percent to 18.40 pesos – Diesel: currently 14.63 pesos, to increase 17.8 percent to 17.24 pesos

In Mexico’s principal cities the price increases will be higher than the national average, La Radio reported. In cities such as Mexico City, Puebla, Monterrey and Guadalajara, the price increases will be higher as well as in certain municipalities such as the state of Mexico as revealed by Mexico’s Regulatory Energy Commission (CRE by its Spanish acronym).

Puebla will be the city with the highest gasoline prices as of January 1, 2017. In this city, located about 131 kilometers southeast of Mexico City, the price of Magna gasoline will reach 16.59 Mexican pesos per liter, up 18.7 percent or 2.61 pesos compared to 13.98 pesos before the implementation of the price increase.

The new gasoline prices in Mexico will now surpass prices in other selected countries as follows: USA (13.67 pesos/liter), Colombia (14.61 pesos/liter), Bolivia (10.77 pesos/liter), and Iraq (13.05 pesos/liter), according to La Radio.

***

EP PetroEcuador Lays Out Goals for 2016

(Energy Analytics Institute, 27.Jun.2016, Clifford Fingers III) – EP PetroEcuador revealed some of its goals for 2016, reported the state company in an official statement.

The goals for 2016 include, but are not limited to the following:

— Operation of product pipeline Pascuales Cuenca,

— Company restructuring,

— Construction of new building for EP PetroEcuador in the city of Guayaquil,

— Civil-mechanical remediation at the Gas de Bajo Alto Plant,

— Modernization of coastal oil and product pipelines,

— 100 percent operation of the Esmeraldas refinery (Editor’s note: goal achieved in 2015),

— Implementation of KBC best practices,

— Overhaul of the La Libertad refinery,

— Environmental overhaul of 76,000 cubic meters of soil,

— Laboratory certifications ISO 17025,

— Social compensation programs,

— Environmental auditing processes,

— Improvement in the quality of fuels,

— Optimization of the new Monteverde terminal (sanitary and chemicals),

— Remodeling and certification of all service stations,

— Port facilities – entrance of 40,000 metric-ton ship in Tres Bocas,

— Supply of ECOPAIS gasoline in more regions of the country (Machala, Los Ríos and Azuay), and

— Construction of the portable water projects.

***

Ecuador Permits Alcoholic Beverages at Service Stations

(Energy Analytics Institute, 21.Jun.2016, Clifford Fingers III) – Ecuador has decided it will allow its service stations to again distribute alcoholic beverages.

The distribution of alcoholic beverages at the stations will have some restrictions, reported the daily El Universo, citing Ecuador’s Interior Vice-Minister Diego Fuentes. The beverages cannot be consumed internally and products should have a ‘moderate alcoholic content. ‘

The government will also allow alcoholic beverages to be sold on Sundays. The sale of such beverages was restricted in 2010 as the Ecuadorian government sought to reduce the indices of violence and other insecurities while also trying to promote family union. The government also restricted the sale of alcoholic beverages between Monday and Saturday at so-called fun parks.

The move to sell alcoholic beverages on Sundays will allow Ecuador to “reactivate tourism and commerce in the country,” said Fuentes.

***

Pemex Gasoline Consumption At 22% of Total Vs. 8% in 2011

(Energy Analytics Institute, Fidencio Casillas, 5.Jun.2016) – The consumption of premium gasoline in Mexico has evolved favorably over the last six years with the Premium grade gaining territory on the Magna grade.

Between 2011 and 2016, the consumption of Pemex’s Premium grade gasoline within the Mexican border increased to 22 percent as of April 2016 compared to 8 percent in 2011, reported Pemex in a twitter post. Conversely, the consumption of the Magna grade gasoline was decreased to 78 percent compared to 92 percent.

Table 1: Consumption of Premium and Magna Gasoline in Mexico (% of Total)

Year —– Premium —- Magna

2011 —– 8% ——— 92%

2012 —– 11% ——– 89%

2013 —– 15% ——– 85%

2014 —– 18% ——– 82%

2015 —– 20% ——– 80%

2016 —– 22% ——– 78%

Note: Data for 2016 through April. Source: Pemex

***

PetroEcuador Gasoline Network of 276 Service Stations

EEnergy Analytics Institute, 1.Jun.2016, Clifford Fingers III) – EP PetroEcuador has a gasoline network comprising 276 service stations, reported the state company in an official statement.

PetroEcuador affiliates operated 215 of the service stations while PetroEcuador operated 7 alone. The state oil company also has 12 artisan fishery stations as well as 42 service stations located along the Ecuadorian borders.

Table: PetroEcuador Gasoline Stations in Ecuador

Service Stations ————— Units

EP PetroEcuador affiliate —- 215

EP PetroEcuador ————– 7

Border service stations ——- 42

Artisan fisheries ————— 12

Total Network —————– 276

 

LPG deposits ——————- 5

Source: EP PetroEcuador

***

Táchira Petrol Stations Sell 91 Grade Gasoline for Bs. 200/Liter

(Energy Analytics Institute, Jared Yamin, 1.May.2016) – Ten gasoline stations – which form part of Venezuela’s Exclusive and Special Service stations – are selling PDVSA’s 91 grade gasoline for 200 Venezuelan bolivars per liter and diesel for 170 Venezuelan bolivars per liter, reported the daily newspaper El Carabobeño.

The service stations are located in Boca de Grita, La Fría, El Piñal, Rubio, San Antonio and Ureña, reported the daily.

***

PetroEcuador Highlights Benefits of Esmeraldas Workover

(Energy Analytics Institute, 19.Apr.2016, Clifford Fingers III) – EP PetroEcuador stands to gain the most from the recent workover to the Esmeraldas Refinery, reported the state company in an official statement.

The primary benefit includes recuperating the 110,000 barrel-per-day capacity as well as increasing processing capacity, efficiency, and continuity while reducing the refining costs associated with the importation of refined products.

Other benefits to the workover include:

— Increasing the capacity of the FCC unit to 20,000 barrels per day from 18,000 barrels per day, thus boosting production of LPG and gasolines;

— Producing diesel with a lower sulfur content, resulting in a positive environmental impact and benefits to the health of citizens nearby;

— Save $305 million due to the reduction in derivative imports;

— Increase in the production of LPG by 250 tons/day, and gasoline by 5,600 barrels per day.

***

PetroEcuador Refineries Have 175 Mb/d Capacity

(Energy Analytics Institute, 5.Apr.2016, Clifford Fingers III) – EP PetroEcuador’s three refineries — Esmeraldas, La Libertad and Shushufindi — had a combined processing capacity of 175,000 barrels per day at year end 2015, reported the state company in an official statement.

The largest refinery is Esmeraldas, with a 110,000 barrel-per-day processing capacity. Followed thereafter by La Libertad (45,000 barrels per day) and finally Shushufindi (20,000 barrels per day).

Table: EP PetroEcuador Refineries in Ecuador (b/d/)

Refinery ———– Processing Capacity

Esmeraldas ——– 110,000

La Libertad ——– 45,000

Shushufindi ——- 20,000

Total Capacity —- 175,000

Source: EP PetroEcuador

***