Congratulations to IMO MEPC for Disregarding the World with the 0.5%S DIKTAT for 2020

IMO MEPC did it again...totally disregarding the will of the people, and imposing a minority view, "deciding" to implement the 0.5% S global cap starting in 2020, no matter what.

What, there is no enough affordable 0.5% S fuel to be had in 2020? Don't want to hear bad news (Saw nothing, heard nothing!).

Just like the circus of the American presidential elections, we had the spectacle of IMO MEPC EU-centric London meeting pushing its EU-biased, politically-correct driven agenda, and acting like "Little Hitlers" in jamming down the throat of the world their favorite bunker fuel spec.

Congratulations, IMO MEPC, you successfully pushed an agenda that will be disregarded in the rest of the world. You can bask in the glory of your decision which your extremists in your EU territorial waters will enjoy by paying higher prices, while we, the troglodytes in the rest of the world will ignore "your" specs, enjoy the savings and the additional business, and invent new ways to avoid your territorial waters.

Half of 2016 Gone - Where Are Oil Prices Going?

Humans are by nature optimists - all is going to be OK, but is it?

Look where we are in July 2016:

Oil production going strong while demand has slowed down. Why?

Iran has pushed the “pedal to the metal”, producing as much as it can trying to recapture its old customers. Saudi Arabia is not sitting still, lowering prices to counteract Iran. The hoped-for US production slowdown is wishful thinking (0.6MBPD out of 10MBPD is a drop in the bucket), and clever shale operators can still make a buck at $30/bbl.

Meanwhile, the US and EU economies are stagnant, hounded by corrupt politics, incompetent politicians, and revolt of the middle class. Hence BREXIT and Donald Trump and Bernie Sanders. The good thing about the US presidential race is that all this was exposed clearly due to efforts by the “outcast” unconventional candidates. Unfortunately, there is no clear-cut outcome, hence more uncertainty…

The other parts of the world aren’t in better shape: Venezuela, Libya, Nigeria, rest of Africa are mostly basket cases, and so are Irak, Syria, and Afghanistan. The Middle East is a “clash of civilizations” cauldron ready to erupt, China has been hit by the slowdown in the West and unsure of where it’s going, and so are the “Asian Tigers”. Russia is trying to assert itself, and Mr. Putin isn’t going to be scared by West’s “messages” (this how we go to war today: we send “messages”, very scary!). A former bright light, Brazil, is disintegrating. One of the truly bright lights is India, but one out of many hasn’t enough pull by itself.

The Crystal Ball

Is it dismal? In the short term  (2016-2017), yes. So what is this going to do to oil prices? They will oscillate around $50/bbl + 20%. So far, the first half of 2016 confirmed this.

People that hang on to market’s every nickel-and-dime up or down (and secretly praying that the prices will go up, up, up…) are just deluding themselves. So, plan accordingly for 2016-2017. Of course, all the bets are off if another war erupts in this highly combustible mix.

Any Miracles?

There is some reason for optimism: the world’s population is mostly young (under 30 years old), well versed in social media and communication and plugged-in the news – the great equalizer. The other truth: “nobody lives forever”. However, the impact of younger generation, time constant wise, is unknown: how long will it take until “I am mad as hell, and won’t take it anymore”? Most likely, decades…

Robust Prediction of Gasoline Properties Using Spectroscopic Methods Dynamically Corrected with Lab Data

Spectroscopic methods for measuring in-line blended gasoline have many advantages over conventional on-line analyzers, such as very fast, very precise measurements, simultaneous multiple parameter measurements, and very high reliability, at a reasonable cost. Spectroscopic analysis methods in this paper refer only to FTIR, Raman, and Magnetic Resonance Analysis.

The major shortcomings of using spectroscopic methods or any inferential model-based  parameter determination are:

·       Inaccurate inferential model predictions of parameters of interest, e.g. gasoline octane values,

·       Lack of a practical, how-to guide to build simple but reasonable inferential (chemometric) models.

·       Lack of a simple methodology to dynamically correct the predicted parameter value of an imperfect inferential model by comparing it with a credible value, e.g. Lab

This paper addresses these problems with a robust solution and scheme for reliable gasoline (or any fuel) blend property parameter prediction (chemometric) model development method, and dynamic correction of the model parameter prediction with Lab data.

The scheme is based on well-known principles of inferential model-based prediction of process stream quality in place of a real parameter measuring device, e.g. octane knock engine. The model output is corrected periodically with Lab data to within the ASTM reproducibility of that parameter.

The described approach has been used since 1960’s with the advent of practical process control computers to implement composition control without using on-line property analyzers [1], and later to validate octane knock engines and NIR-type spectroscopic analyzers since 1986 [2, 3], and is a derivative of tank quality integration used in in-line blend property control since its inception in 1965 [4].

The scheme is valid for:

·       * Any fuel blending (gasoline, diesel, bunker), or any mixture of liquids

·     *   Any parameter for which an inferential model can be developed, e.g. AKI, RVP, etc.

·       * In-line fuel blending scheme, either rundown blending or component tank blending

    

     Get a copy of full paper at  http://www.refautom.com/NewsDB/Robust-r.pdf

Global 0.5% Sulfur Bunker Spec and Brexit

What’s the connection, you say? It is the blatant disregard of the will of the people by the political elites, not just the European Commission, but in case of bunkers, also the International Maritime Organization (IMO).

The British elites and their Oxford cliques, including the Prime Minister (and his family) pushed a flood of EU rules and regulations down the throat of British people while enriching themselves by avoiding taxes and money laundering  (according to the leaked Mossack-Fonseca Panama papers).  The British man-in-the-street resented the perpetuation of the same Oxford-inbred clique and rejected the “more of the same” recipe by voting to leave the EU.

Are the Brits alone? No. France is making similar noises with the National Front and Marine LePen, and even Francois Hollande mentioned Frexit,  and then Holland, Denmark,…the dominoes are clearly visible…

And then there is the good old USA…where Mr. Trump and Bernie Sanders are riding high in the middle class revolt against more of the same corrupt and dishonest political elite that strangled the US since 1950’s …buying elections, increased taxes, lip service, no job creation, treating war veterans like garbage,  impoverishment of the middle class, etc.

The IMO, an agency of the UN, is considering imposing a global 0.5% Sulfur spec for marine bunker fuel either in 2020 (IMO-preferred) or a bit later, 2025. 

The global 0.5% Sulfur spec is being set not by logical and rational techno-economic considerations, but by political considerations of unelected members of IMO, driven by the same EU-centric bureaucrats paid by the EU taxpayers, in the name of progress and environmental consciousness. 

Damned be the consequences!  Higher consumer prices for goods transported by ships, putting out of business ship owners with older vessels, and more unemployment in the marine bunker fuel business.  Just what the EU and the world needs...fewer jobs!

Just like the Brexit, come 2020, many people outside EU and US ECA waters will avoid calling at these ports, and completely ignore the IMO global specs by continuing use of the cheapest high Sulfur bunker fuel possible. This will be the undoing of the IMO.

Scrubbers as abatement method to lower SOX emission work, but at $4 to $5 million a piece plus maintenance headaches and costs are an expensive temporary “band-aid”.  

A good solution is a combination of gradual switch to 1%S fuel for a couple of years, perhaps switching to 0.5% S gasoil by 2025, and by increasing engine efficiency to burn less fuel.

Ara Barsamian

Reminder - Reserve Your Seat Today! Rotterdam Gasoline and Diesel Blending Course (May 23-25, 2016)

Reminder - Reserve Your Seat Today! Rotterdam Gasoline and Diesel Blending Course (May 23-25, 2016)

This deceptive green gizmo is an octane knock engine! If you blend 50,000 bbls of gasoline, about 1 billion US Dollars worth of gasoline pass through its guts !!! And, it requires tender loving care like a Stradivarius violin…

Now, for the serious part: the world-famous Gasoline and Diesel Blending course is exceptionally timed to deal with low crude oil and product prices, including valuing blendstocks, pricing off-specs, and using blend optimizers to "squeeze" the last drop of money out of a blend.

 What makes it world-famous? The experience of the Course Director, me, Ara Barsamian – President and CEO, Refinery Automation Institute, USA; ex-Exxon Group Head, Blending & Oil Movements R&D, Senior Member AIChE, ASTM, ISA, IBIA, and world’s foremost expert on gasoline, diesel, and bunker fuel blending

Learn how to make a profit in $20/bbl oil environment…With the deal done, prepare for Iran’s oil flood

·       Blend various components into more than 25 different finished gasoline and diesel grades by optimizing blend recipes to maximize profit

·       Learn how to decide to “Buy or Not To Buy” blend components

·       NEW! Calculate Gasoline and Diesel fuel blend component prices when not available

·       NEW! Calculate discounts for off-specs

·       Calculate Non-Linear Properties: Octane, RVP, Distillation, DI, TVL, Viscosity, CP/CFPP, Ignition Quality, Specific Energy, and more…

·       Cut costs by blending directly to ship using API 1640 practice

·       Dispute resolution using ISO4259 and Test Method Precision

·       Using biofuels: Ethanol, BioDiesel, and Renewable Diesel

·       Manage inventories using Multi-Blend Optimizers to reduce inventory

·       Use blend component database and arbitrages to establish backup export markets when oil hits $20/bbl

Registration for Gasoline and Diesel Fuel Blending:

http://www.cconnection.org/Event.php?id=15

Free: 800+pages blending coursebook + 34 blending software programs, including blend optimizer (demo), blendstock price calculator, data bases of blend components and world-wide specifications.

Detailed Course Content here: http://www.refautom.com/NewsDB/Gasoline.pdf

I hope to see you at the course in beautiful and exciting Rotterdam!

Reminder - Reserve Your Seat Today! Rotterdam Bunker Fuel Blending Course (May 19-20, 2016)

Reminder - Reserve Your Seat Today! Rotterdam Bunker Fuel Blending Course (May 19-20, 2016)

 This deceptive curved silver gizmo and nearby boxes are a self-contained and approved Mass Flow Meter (MFM) package for custody transfer! Besides speeding up loading by about 3 hours, it provides custody-transfer precision to deter cheating!!! And, it is rugged: does not requires tender loving care like a Stradivarius violin..

Now, for the serious part: the world-famous Bunker Blending course is exceptionally timed to deal with low crude oil and product prices, including valuing blendstocks, pricing off-specs, and using blend optimizers to "squeeze" the last drop of money out of a blend.

 What makes it world-famous? The experience of the Course Director, me, Ara Barsamian – President and CEO, Refinery Automation Institute, USA; ex-Exxon Group Head, Blending & Oil Movements R&D, Senior Member AIChE, ASTM, ISA, IBIA, and world’s foremost expert on gasoline, diesel, and bunker fuel blending

 Learn how to make a profit in $20/bbl oil environment…Prepare for Iran’s imminent oil flood

·       Blend various components into more than 15 different finished Bunker grades by optimizing blend recipes to maximize profit

·       Learn how to decide to “Buy or Not To Buy” blend components

·       NEW! Calculate Bunker fuel blend component prices when not available

·       NEW! Calculate discounts for off-specs

·       Calculate Non-Linear Properties: e.g. Viscosity, Compatibility

·       Cut costs by blending directly to ship using API 1640 practice

·       Dispute resolution using ISO4259 and Test Method Precision

·       Manage inventories using Multi-Blend Optimizers

Registration for Marine Bunker Fuel Blending:http://www.cconnection.org/Event.php?id=16 

Free: 500+pages blending coursebook + 17 blending software programs, including blend optimizer (demo), blendstock price calculator, data bases of blend components and world-wide specifications.

Detailed Course Content here:http://www.refautom.com/NewsDB/Bunker.pdf

AICHE-NJ Seminar: Gasoline Blend Optimization via Linear & Non-Linear Programming Optimizers

This paper is a summary of the presentation at AIChE-NJ Section on April 26, 2016. You can download it here.