RBN Energy

Refinery distillation units separate crude oil into light, medium and heavy fractions. After that, refiners start performing chemical reactions using catalysts — materials that accelerate chemical reactions — to change the oil’s natural molecules into the forms needed in modern fuels. In recent years, refiners have stepped up their efforts to recycle those catalysts to improve their profitability and environmental performance. In today’s RBN blog, we explain how catalysts, which were formerly disposed of as hazardous waste, are increasingly being recycled and reused in refineries. 

Analyst Insights

Analyst Insights are unique perspectives provided by RBN analysts about energy markets developments. The Insights may cover a wide range of information, such as industry trends, fundamentals, competitive landscape, or other market rumblings. These Insights are designed to be bite-size but punchy analysis so that readers can stay abreast of the most important market changes.

By Jeremy Meier - Friday, 6/14/2024 (3:00 pm)

US oil and gas rig count declined for the second consecutive week, falling to 590 for the week ending June 14, a decline of 4 vs. a week ago according to Baker Hughes.

By Martin King - Friday, 6/14/2024 (2:45 pm)

As of June 14, Baker Hughes reported that the Western Canadian gas-directed drilling rig count rose one rig to 55 (blue line in left hand chart below) and one less than a year ago.

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Daily Energy Blog

A great deal of attention has been heaped on the carbon-capture industry over the past couple of years, from its inclusion in major federal legislation such as 2021’s infrastructure bill and last year’s Inflation Reduction Act, plus all sorts of recently announced carbon sequestration projects. Still, there are plenty of concerns that the technology is not fully baked, that many of the projects are not ready for prime time, and that few have the practical know-how to deploy carbon capture and sequestration (CCS) at scale. But what if there was a company that has been doing carbon sequestration for a very long time — decades in fact? And what if that company has built out a huge carbon dioxide (CO2) collection, distribution and sequestration system on the Gulf Coast along with concrete plans for a massive expansion of this network to capture a lot more manmade, “anthropogenic” CO2, not in decades but in just a few short years? A company like that would be pretty much the ideal acquisition candidate for a cash-flush multinational with big ESG goals and strategies, right? As we discuss in today’s RBN blog, that is just what is happening with ExxonMobil’s acquisition of Denbury, a deal that will create today’s undisputed leader in CCS.

U.S. production of hydrogenated renewable diesel (RD), made from soybean oil and animal fats like used cooking oil, is growing faster than expected. That may sound like good news for the renewable fuels industry, but it comes with the fear that the rapid growth might trigger a sudden crash of Renewable Identification Number (RIN) prices that — if it happens — would rock the market. In today’s RBN blog, we have a go at describing what that might look like.

Discussions about electric vehicles (EVs) often focus on the additional demands they will put on the power grid in future years, with concerns about the grid’s reliability and ability to meet peak demand often taking center stage. There’s no doubt that a widespread transition to EVs would pose real challenges, but utilities in California and elsewhere are also starting to think creatively about how to transform those challenges into an opportunity — although there are significant hurdles to clear along the way, including the needed buy-in from EV owners. In today’s RBN blog, we explain California’s so-called duck curve, show how certain EV solutions aim to address some of the power grid’s current problems, and look at some ways to get EV drivers to become active (and willing) participants in a vehicle-to-grid (V2G) initiative, which increasingly looks like an essential element in any long-term plan.

The Renewable Identification Number (RIN) has long served as the tool used to force renewable fuels like ethanol and soybean oil into the U.S. gasoline and diesel supply. A creation of the Renewable Fuel Standard (RFS), RINs act as a subsidy that enables the production of renewable fuels that would not otherwise be economically justified. RIN prices are set by the usual workings of supply and demand, but chatter has bubbled up recently in the renewable fuels ecosystem that prices for a particular variety of RIN could be headed for a crash. In today’s RBN blog, we explain what’s behind the talk about RIN prices.

Around the world, there’s a strong push to put aviation on a more sustainable footing and reduce the industry’s greenhouse gas (GHG) footprint. Increasing the production of sustainable aviation fuel (SAF) — a close cousin of renewable diesel (RD) — is key to this effort. But while the economic case for producing RD in the U.S. has been compelling for some time thanks to government subsidies, the returns on investment for producing SAF appear more dubious, despite a seemingly generous production tax credit for SAF in the Inflation Reduction Act (IRA). As we discuss in today’s RBN blog, the incentive for making jet fuel is likely too small — and too short-lived — to overcome the higher cost of production for SAF compared to RD, and additional incentives may be needed to spur meaningful increases in SAF production.

It has become abundantly clear over the past couple of years that energy transition isn’t going to be a straight line leading directly to abundant carbon-free power and a net-zero world. All sorts of obstacles have popped up, indicating that the energy industry’s trilemma of availability, reliability and affordability not only clash with each other, they can also conflict with environmental priorities. The challenge is being felt now in Hawaii, where a commitment to expanding energy production from renewable sources and tamping down the use of fossil fuels while also keeping prices under control and reducing pollution is turning out to be no easy feat. In today’s RBN blog, we look at Hawaii’s recent efforts to phase out coal- and oil-fired power generation, why that’s turned out to be easier said than done, and what it all means for environmental performance and energy prices.

Clean ammonia, produced by reacting either “blue” or “green” hydrogen with nitrogen, is emerging as one of the most highly touted low-carbon energy sources of the future, thanks largely to massive tax incentives provided by the Inflation Reduction Act (IRA). Skeptics may question the extent to which clean ammonia — and clean hydrogen, on which it’s based — can realistically take market share from natural gas and coal as leading power-plant fuels over the next 20 to 30 years, but there’s a lot to be said for them and, as wind- and solar-power developers have already come to appreciate, billions of dollars in governmental support can do wonders. In today’s RBN blog, we continue our look at the growing list of U.S. clean ammonia projects now under development.

The Inflation Reduction Act (IRA), which became law several months ago, may have an enormous impact on the U.S. energy landscape over the long run, but many of its key provisions, including the much-discussed tax credits for electric vehicles (EVs), have been missing one big thing: rules of the road. Federal agencies such as the Department of Energy (DOE), the Environmental Protection Agency (EPA) and the Treasury Department are responsible for implementing and enforcing laws passed by Congress, which are not only lengthy and complex, but often leave out important details. That’s where federal rulemaking comes into play, filling in the details and addressing questions left unanswered in the original legislation. In today’s RBN blog, we look at how the rules surrounding the New Clean Vehicle Credit (NCVC) are taking shape, the detailed steps that automakers will have to take to meet new sourcing and content requirements, and what it all means for prospective EV buyers.

There’s been a lot written about the federal government’s plan to provide billions of dollars in financial support to create a limited number of regional hydrogen hubs but not a lot of insight about how those hub proposals are being crafted to meet the Department of Energy’s (DOE) selection criteria. The details and strategies behind those plans have been hard to come by because few of the initial concept papers were made public while others remain a mystery, even months after the first informal winnowing of candidates. One exception is the Leading in Gulf Coast Hydrogen Transition (LIGH2T) hub proposal being prepared by a consortium that includes a large group of states, some key commercial partners, several universities and the National Energy Technology Laboratory (NETL). In today’s RBN blog, we look at what we know about the LIGH2T proposal, which will submit a full application by the April 7 deadline, and how it addresses three key factors likely to play a role in the selection process.

The buzz and activity around renewable diesel (RD), a chemically identical “drop-in” replacement for traditional petroleum-based diesel, continues to grow. The goals with RD, which is produced from renewable feedstocks, are to reduce the need for petroleum and to lower life-cycle greenhouse gas (GHG) emissions — critical steps in meeting climate agendas in many countries. Canada recently enacted legislation designed to promote the domestic production of RD as part of a broader emissions-reduction strategy. In today’s RBN blog, we take a tour of the newly emerging RD production sector in Canada and examine whether it could one day replace imports from the U.S.

As the push for decarbonization in the transportation sector gathers momentum, electrofuels — also known as eFuels, which are produced by using electricity to combine the hydrogen molecules from water with the carbon from carbon dioxide (CO2) — are beginning to attract attention as an alternative fuel with three important selling points in today’s environment. First, eFuels are available now and can be made with current technology, although there is a lot of room for future improvements and growth. Second, because they are considered drop-in replacements, they are essentially indistinguishable from the fossil-based conventional fuels in use today, which means they can be used without any changes to the existing energy infrastructure. Third, they can capitalize on a rapidly growing set of hydrogen and CO2 suppliers eager to secure a diversified set of offtakers. In today’s RBN blog, we look at HIF Global’s approach to eFuels production, its demonstration plant in Chile and its big plans for Texas and beyond.

U.S. production of renewable diesel (RD) is rising fast and production of sustainable aviation fuel (SAF) will soon follow suit, driven largely by federal and state incentives. But U.S. demand for both RD and SAF is growing at a more measured pace, mostly because they are throttled by a number of other governmental policies, including the level of blending mandates set by the Environmental Protection Agency (EPA). As we see it, the net effect of this disconnect between domestic supply and demand will be the U.S. becoming a net exporter of RD this year and a net exporter of SAF in 2025 — but only after a spike in SAF imports in 2023-24. Yes, it’s complicated, but with public-sector policies impacting both sides of the supply/demand scale, did you really expect it wouldn’t be? In today’s RBN blog, we look at two more energy products the U.S. will be exporting.

The lack of successful projects has long been a thorn in the side of the carbon-capture industry, with a few high-profile cases falling short of expectations for a variety of economic and technological reasons. When looking for a prime example of how a highly touted (and taxpayer-supported) project can still fall short, the Petra Nova facility southwest of Houston, which completed its three-year demonstration period shortly before being shut in 2020, often comes to mind. But now it’s just a few months away from getting another shot, courtesy of its new owner and recovering oil prices. In today’s RBN blog, we look at the impending restart of the Petra Nova project, how falling oil prices overshadowed its technical successes, and its importance to the carbon-capture industry.

It’s not the most accurately named piece of legislation, but that doesn’t mean the Inflation Reduction Act (IRA) might not have an outsized impact on everything from electric vehicles (EVs) and hydrogen production to greenhouse gas (GHG) emissions and carbon-capture projects. There’s plenty of potential for things to happen in the long run, but before then, a lot needs to get done — including the rules and regulations that will guide the IRA’s implementation. In today’s RBN blog, we look at why the IRA remains a work in progress, the critical role that rulemaking will play, and potential impediments to the law’s long-term success.

When carbon dioxide (CO2) is captured and stored deep underground, a process known as carbon capture and sequestration (CCS), it’s supposed to remain there permanently. Although much of today’s emphasis is on moving carbon-capture projects from aspirational to operational, there are long-term challenges to making sure those emissions stay put away for good, even if the odds of a significant leakage are considered remote. In today’s RBN blog, we look at the common risk factors for carbon-capture projects, explain why a site’s post-injection care-and-monitoring period can last for several decades, and detail the leakage risks that project planners must be prepared to handle.