meeting with the cee noias- bratislava, 20 th april 2015 alessandro bartelloni, policy director...
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Meeting with the CEE NOIAs- Bratislava, 20th April 2015Alessandro Bartelloni, Policy DirectorFrancisca Melia, EU Relations Manager
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
1. Overview of key issues on the EU agenda.
2. Energy Union.
3. Competitiveness, with a focus of Fitness Check and Refinery Forum.
4. EU Refining Industry “Champions”
5. Coordination of actions Brussels/ Member States- State of play and feedback.
Proposed agenda items
Page 2
Overview of key issues on the EU agenda
o Overview European Institutionso FuelsEruope “Priorities 1”o Transport 2030o ETS Reformo REACHo MCPD
1.
Overview European Institutions: EU Commission
Transport & SpaceSlovenian, LiberalBackground: Former Vice-President
Miguel Arias Cañete
Climate Action & EnergySpanish, EPPBackground: Agriculture Minister; former MEP
Maroš ŠefčovičVice-President Energy Union
Slovak, Social-democratBackground: EU Commissioner for Inter-institutional Relations
Elżbieta Bieńkowska
Internal Market, Industry, Entrepreneurship & SMEsPolish, Liberal-ConservativeBackground: Former Deputy Prime Minister Karmenu Vella
Environment, Maritime Affairs & FisheriesMaltese, Labour PartyBackground: Former Minister for TourismKarmenu Vella
Violeta Bulc
Overview European Institutions: EU Parliament
ENVI Committee
ITRE CommitteeManfred WeberGuy Verhofstadt
Gianni Pitella
Page 6
Taxation
Sites
Energy and
climate policy
Transport
Products
Air Quality
1. New climate & energy framework for 2030
2. ETS: Market Stability Reserve
3. ETS: Carbon leakage list
1. Transport policy post 2020
1. FDQ 7a2. Biofuels / ILUC3. Sulphur in marine fuels
1. National Emission Ceilings (NEC) Directive
2. Emission for Middle Combustion Plant (MCP) Directive
1. IED: BAT conclusions on industrial emissions for refining of mineral oil
2. IED implementation period (4 years): derogations
1. Custom classification of Atmospheric Residue
Priority1
Future of refining
1. Competitiveness, Ref Forum, Fitness Check
REACH
In red: new items vs. last IMP
Overview of priority 1 items
1. REACH
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
• FuelsErope is currently developing a narrative paper on Transport 2030 policy, the final deliverable to be a position paper, to be used as a basis for discussion with the Institutions. The preliminary assessment points at two policy options:
1. Inclusion of the Transport sector in the EU ETS scheme;
2. Different set of measures to achieve the CO2 reduction targets in 2030.
The 2 options are not mutually exclusive. FuelsEurope will continue exploring the possibility to integrate both in a different time perspective.
Transport 2030: Status of work (1)
• CONCAWE engaged in air quality impact study of EURO 6 norms.• The EU Commission has launched a public consultation on the review of 2011
Commission Transport White Paper:- Consultation period: 10.03.2015 till 02.06.2015. We need to coordinate
our response with the process of the definition of the post 2020 position on transport.
• The EU Parliament (Committee Transport and Tourism) has launched an own initiative on the review of the 2011 Commission Transport White Papers.
Cooperation with ACEA: 1. FuelsEurope was invited by ACEA to the multi-stakeholder process “Joining
forces to tackle the road transport CO2 challenge’’. Four work-streams: fuel options; ITS / the ‘connected car’; transport infrastructure; and driver behaviour. First meeting on fuel option 14th April.
2. Joint communication initiative on diesel emissions and air quality in cities (in initial phase, to be evaluated).
Transport 2030: Status of work (2)
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
ETS Reform: share of GHG emissions(bln tons)
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Meeting with the CEE NOIAs- Bratislava, 20th April 2015
ETS Reform: current carbon leakage protection for Refining insufficient & declining
Objective Probability of success(Secretariat assessment)
Board comments
TOP PRIORITIES
Refining to remain (fully) eligible Requested addition of a new § in high-level principles
Free allocation must not be capped (No CSCF): installations subject to CL receive 100% allowances at the benchmark(1)
Difficult but key
MEDIUM PRIORITIES
CL protection to cover both direct and indirect costsBenchmark based on the average of the 25% most efficient installations
Some doubts expressedReassess later if still part of our objectives
Activity-based approach to free allocation
ETS Reform: FuelsEurope advocacy objectives
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
1. EU Refining Industry will be at risk of carbon leakage and must receive adequate protection.
2. Move to an activity-based approach to make sure that free allocation is better tailored to the needs of each installation and to avoid problems over under-/over-allocation.
3. The CSCF must be discontinued after 2020, as it penalises even most efficient ETS installations. Installations must receive 100% protection at the benchmark.
4. Carbon leakage protection must cover both direct and indirect costs.
5. The benchmark should be based on the average of the 25% most efficient installations (currently based on the 10%).
ETS Reform: FuelsEurope key recommendations on post-2020 carbon leakage provisions
Page 12
Legislative proposals to be submitted after adoption of the MSR proposal.
• COM:- Maintain regular exchanges with Commissioner Cañete & DG CLIMA:
Alliance meeting took place with Commissioner Cañete on 19/02. Cabinet will prepare a questionnaire specifically and individually for EIIs in late March to
ask for views on reform proposals. The responses will then be consolidated and the Alliance will be invited to a follow up meeting.
- Build support from and create alliances with other DGs (most importantly DG ENTR and Commissioner Bienkowska): Transformation of the existing High Level Group on steel into a HLG on energy-intensive
industries’.
• COUNCIL:- ETS reform not yet an official discussion item in the Council.- However, FE can engage the Council on ETS reforms in the context of the Energy
Union debate.
• EP:- Back to fundamentals! Need to “educate” MEPs about carbon leakage (e.g. Issue of
passthrough).- Secretariat considering an EEF event.
ETS Reform: Key advocacy actions between March & publication of COM proposal
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
• Concawe’s main goals for REACH are to:
1. Sustain the safe use of Petroleum Substances (PS) with no unwarranted restrictions.
2. Support Registrant Companies to comply with REACH & CLP in the most efficient way, and in so doing, consider total cost for Companies, not just Concawe cost.
3. Achieve a workable approach that takes into account the complexity of PS UVCBs.
4. Work collaboratively with the regulators (ECHA, COM, MSs) to reconcile the requirements of REACH with the complexity of Petroleum Substances.
REACH: Goals
• Main objectives:- Help gain support for Concawe’s workplan, agreed with ECHA, amongst the
Commission and Member States.- Have Member States take a workable approach to the SVHC(1) roadmap:
The key concern is not to have a large number of Petroleum Substances on the priority list.- An Implementing Regulation on SIEF that does not alter the approach taken by
the Association, regarding categories and cost sharing.- Positioning on wider issues - RAIG believe that REACH is wider than Concawe’s
work plan and that other aspects could benefit from advocacy. Such issues: Review of REACH: an opportunity, if it moves in the right direction; a risk if NGO pressure
leads to more severe regulations. Implementation issues: concern that REACH is unevenly implemented in the EU. Intensity of
audits varies across Member States, as do costs/penalties and the policing of non-compliance.
- Stakeholder engagement: use FuelsEurope’s networks and expertise to educate stakeholders about how important REACH is and propose ways forward:
A key example of this is Member States, it is important to explain how much REACH could affect our industry and their economies.
Another example is other associations, particularly those dealing with related substances.
REACH: Advocacy
(1) Substances of Very High Concern
• EPPA, a consultancy specialising in industry-Member State relationships, set up a series of visits with key national contacts to discuss REACH:- These visits are focused on contacts with national members of key
REACH bodies such as CARACAL and Member State Committee.
• FuelsEurope, alongside Concawe have been attending these meetings, including nationally-based companies and NOIAs whenever possible:- These meetings aim to present industry concerns, on a European and
national level, about the future of REACH.- The hope is that such meetings will be the starting point for further
contacts with national authorities, particularly for the NOIAs, so FuelsEurope has a role in following up the discussions effectively and keeping parties informed about the latest developments.
REACH: current FuelsEurope activity, Member State visits
• Five “dimensions”, with energy security as the leading one:
1. “Energy security”.2. “Internal energy market”.3. “Energy efficiency”.4. “Decarbonisation of the economy”.5. “Research and Innovation”.
Energy Union Package, published on 25th February 2015
Why is it important? It will be a “blueprint” for the energy and climate regulations that this Commission will develop during its 5 year term.
• Analysis and key concerns: - Climate and Environment are strong elements and risk taking a
higher stand than the objective of growth & jobs & competitiveness. - The focus is essentially on Electricity and Gas, with no mention of oil /
oil products (other than a minor reference the Stocks Directive under Security of Supply).
- Explicit statement on the need to limit the dependence on fossil fuels which are furthermore described as an “old technology” and “outdated business model”.
- The Package does not outline a detailed plan / strategy to meet its objectives, nor does it mention any kind of timetable, and it does not either describe how it will ensure that the “transition” will continue delivering the required affordable and sustainable energy for EU economy and businesses.
- Some positive elements (EU internal market for electricity, importance of energy efficiency and of security of supply) but, as FuelsEurope said in its press release, an “incomplete package”.
Energy Union Package, published on 25th February 2015
• FuelsEurope first reaction and advocacy plan:- Press release “Energy Union or Electricity Union? An incomplete package “. - Communications with selected MEPs for a possible official Parliamentary Question.- Letter to PermReps and input to NOIAs for addressing their MSs in view of the Energy
Council (5th March) and Environment Council (6th March). - Seek alliances as appropriate (BusinessEurope, Energy Intensive industries, ...).- The Package is being discussed in Council, with the target to have it approved in June
2015.- FuelsEurope is preparing a comprehensive outreach plan towards MEPs, Commission and
Member States in coordination with the NOIAs.
Energy Union Package, published on 25th February 2015
Vice-President ŠefčovičMiguel Arias
CañeteClimate Action & EnergyDG ENER
DG CLIMA
Karmenu Vella
Environment
Violeta Bulc
TransportDG
MOVE
Elżbieta Bieńkows
ka Internal
Market & Industry DG GROW
Cecilia Malmstr
öm Trade
[...]
• The last period in the Barroso Commission, following the economic crisis, saw a switch in focus from ENVI / Climate to Jobs and Economic Growth.
• The new Commission has had a less than encouraging start in Energy & Climate:- VP Sefcovic key concern seems to be security of supply (i.e. gas) and
reduced dependency on Russia.- Comm. Arias Canete is cautious in his first steps and seeks consensus (he
needs to demonstrate his distance from any interest in the oil industry).- The new GROW Commissioner (Bienkowska) does not have the rank within
the Commission and – so far - the experience to effectively support industry the way Tajani did.
- The easy to sell argument of “green growth” receives plenty of attention by the COM.
• The new EU Parliament, similar to the old one, has some “green-oriented” components which strongly supports the “green growth” argument.- Particularly worrying is the S&D group, which seems to focus more on
environment and green economy that on the defence of the existing industry and jobs.
Key questions to address: has the wind changed?
• EU has a big focus on climate issues (the “global warming” topic):- The Commission and France in particular will be strongly instrumental in the
December climate talks in Paris.
• Energy Union ignores the role of oil:- The Commission omits to refer to oil and oil refined products in the Energy Union
proposal.
• Oil prices fell sharply:- Experts, NGOs and alternative energy Stakeholders very vocal and proactive to take
action against fossil fuel and use the opportunity of cheaper oil to suggest increasing the “carbon tax” (or similar) on fossil fuels and increasing the price of fossil energy.
• Growing calls by major EU cities to limit or ban diesel cars:- Paris, London, Madrid & others in Norway announced their intention to limit the
traffic or even ban diesel vehicles from the city centres.
• The Climate Change, Air Quality and Oil & Gas Import Bill are used as undisputable truths in support of strong measures.
• Continued call from NGOs and other stakeholders to move away from oil in transport.
What do we see and hear?
To ensure that competitiveness of the manufacturing, energy intensive industry – and refining among them – remain at the centre of the policy debate?
Implement our advocacy plan, consisting as said before in an outreach plan addressing the EU institutions in cooperation with the NOIAs.
• Initial contact made with DG Energy - DG Ristori, Director Wörsdörfer; Secretary General Hololei; MEPs Gardini, Valean.
The Board supports a higher profile communication approach to accompany the Energy Union advocacy plan.
• Building on but more assertive and proactive than the plan approved by the Board in 2014.
How can we ensure there is better balance?
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Europe cannot afford to have more stringent regulations in addition to high cost
Page 25
Source: Solomon Associates Source: TOTAL
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Cumulative cost impact of EU legislation in 2020
6.0
6.5
7.0
7.5
8.0
8.5
9.0
9.5
10.0
10.5
11.0
11.5
12.0
Baselineopex
ETS IED REACH RED SLFD(MFD)
Estim
ated
cost
to EU
refin
ers (
$/bb
l)
2020Low cost scenario
6.0
6.5
7.0
7.5
8.0
8.5
9.0
9.5
10.0
10.5
11.0
11.5
12.0
Baselineopex
ETS IED REACH RED SLFD(MFD)
Estim
ated
cost
to EU
refin
ers (
$/bb
l)
2020High cost scenario
The cumulative cost of meeting all these legislative challenges in 2020 is in the region of 2.5 - 4 $/bbl (including annualised investment costs)
Source: Concawe, “The estimated forward cost of EU legislation for the EU refining industry”
Page 26
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
• Situation of refining under pressure: We supported/cooperated FC initiative from the start to analyse the competitive situation of EU refining and the cumulative impacts and overlaps of legislation: Ongoing consultation & Member states key role.
• Key to learn lessons from the past & contribute to Better Regulation:- Refining Fitness check, if done properly: a timely and solid blueprint to
regulate better: draw lessons from the past, make recommendations for the future.
- FC as part of Juncker Commission’s priorities on Better Regulation and Competitiveness.
• Refining FC should not become “a paper tiger”: The situation of refining calls for urgently assessing & addressing its competitiveness. - Better and cost efficient legislation is a must for industry.- Fitness Check should lead to smarter regulation that does not
overburden this strategic industry.
Refining Fitness Check
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Fitness Check
• What is at stake? - Adequate and relevant picture of the impact of EU legislation on refining
competitiveness, with recommendations for corrective measures for upcoming legislation.
• Status: - Commission produced all the Fitness Check draft chapters on specific
Directives / made them available to all stakeholders: Not just a “technical” document: all involved Commission services submitted
comments (mostly aiming at defending “their” directives), and very vigilant for these to stay integrated in final version.
Extensive piece of work: a thorough analysis by Concawe and FuelsEurope to assess both technical robustness and possible collateral impacts for ongoing and future advocacy.
Cooperation with COM ongoing but our support only granted if key concerns duly addressed: Set of “red lines” agreed with ReCIG.
- Consultation on horizontal chapters (cumulative costs, international competitiveness and conclusions) foreseen mid-March.
- Final COM report including policy recommendations foreseen for early June.
• 17 March 2015: informal bilateral meeting with DG GROW, DG Energy and JRC: Presentation of our set of “red lines”.
Refining Fitness Check
Fitness Check
• General remarks:1. Scope of the Study (Request not to cover only the specific time frame of
the period 2000-2012, ignoring major changes/burden already in place/agreed upon) & availability of data for the period post 2012 (such as CONCAWE study "The estimated forward cost of EU legislation for the EU refining industry”, Report no. 11/14, Dec. 2014).
2. Inconsistency of the treatment of Cost/Benefit analysis.3. Cost assessment of the impact of regulation for the refining
industry: Request for measured impacts to be put in relation to net margins.
4. Cost pass through:a) Cost pass-through not a relevant criteria to assess the risk of carbon
leakage.b) Assumption that refining is able to pass its indirect costs to final
customers based on scarce literature, lacking verified data.
5. Rigor and accuracy of literature and studies used is not demonstrated.
• “Red lines” per chapter.
“Red lines” agreed by ReCIG
Fitness Check
• Calendar of next steps and advocacy:- ISSG meeting with COM and Member States in the week of 20th April.- Refining Forum on 18th June.- Finalisation of FC end of June 2015.
• Advocacy:- FuelsEurope and Concawe to receive an updated text of the Directives
from DG GROW following the bilateral meeting of 17th March; depending on the written outcome we will need to decide whether a sufficient number of our “red lines” has been taken into account.
- An “High Level Letter” has been sent to the Commission top officers (Canete, Bienkowska, Timmermans, Day), expressing our main reasons of concern
− DG GROW Calleja Crespo indicated openness to follow up on our concerns, and asked us to meet his staff.
− Deputy SEC GEN Hololei has also been met and made aware of our concerns.
Next steps
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
• Biannual event highly appreciated by Member States and industry.• Convenes various services of Commission, MSs, MEPs , Industry, and other
stakeholders.• Refining Forum (21 May 2014): First joint written request- UK, Germany, Italy
and NL:- Permanent Forum for Refining important for strategic dialogue on European refining. - Request for Member States’ active involvement: MS studies/recommendations on
refining to be integrated in a structured process through the refining fitness check: A working group to be created: One of the main activities would be to integrate the outcomes
of Member States’ studies on refining into the Fitness Check. Security of Supply to be included in the scope of the working group.
- All relevant services of the Commission in charge of files with significant impact on refining (e.g. DG CLIMA, DG ENVI, etc,) to be a integral participants the Refining Forum.
• Refining Forum (11 Dec 2014): 2nd joint request-UK, Germany, Ireland, Poland, France & Italy:- Formal call for robust fitness check as objective reference for forthcoming
legislation. - Request to be associated to a working group analysing findings of Fitness Check.- Called for an alignment with existing national fitness check (Greece, UK, Italy). - Request for a specific Refining Forum to be dedicated to the Refining Fitness check
in 1st Q 2015 it to be continued beyond the Refining Fitness check.
• Next Refining Forum will take place mid-June 2015.
Refining Forum
Page 32
• The Champion Network is a new advocacy technique for FuelsEurope, with the following main features.
• The concept: build a network of local or regional key politicians and professionals in the energy sector with a potential interest in refining and energy issues and who can act as champions.
• Profile of the ‘champion’ (two baskets): 1. Experts: A variety of profiles: University professors, researchers at
different Institutes (IFP, Clingendael)2. Politicians: be it local, regional or EU (MEPs) who have a potential
interest and affinity for our industry who are willing to be active on behalf of our industry and support us or our events and activities.
The “Champions”
- Geographical criteria:
Trying to have at least 1 champion from the 4 major regional refining clusters: 1)UK, Ireland; 2)Western-Southern Europe; 3)Germany and Baltic States: 4)Eastern Europe
- Objectives:
1. Present ourselves towards the ‘champions’ (make use of the Welcome Pack) alone or in cooperation with the NOIAs or the MC;
2. Find out what the ‘champion’ is working on.
3. Explore with the ‘champion’ possible means of cooperation;
4. Propose a cooperation in the form of an invitation to one of our upcoming events in 2015 - 2016
FuelsEurope165, Boulevard du Souverain 1160 Brussels - BelgiumT: +32 2 566 91 00
www.fuelseurope.eu
Follow us:fuelseurope@fuelseuropefuelseurope
THANK YOU FOR YOUR ATTENTION
[email protected]@fuelseurope.eu
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Per unit of primary consumption, oil, gas and coal are net contributors to government, while government policies lead to very large transfers to solar power
Wind and solar receive relatively high revenues from government, measured in per barrel of oil equivalent (boe) of energy consumed
Per boe net government revenues from oil ($124); gas; ($49); coal ($22); wind (-$13); and solar power (-$722)
EU28 + Norway Net Government Revenues and Mandated Transfers per boe (2011):
Note: Upstream oil and gas revenues allocated in proportion to production value, resulting in slightly higher allocation to oil.
Source: NERA
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Page 39
FuelsEurope represents 43 Member Companies ≈ 100% of EU Refining
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Who is FuelsEurope?
Page 40
FuelsEurope was known until June 2014 as Europia, which was formed in 1989 to represent the interests of Companies conducting refinery operations in the EU with the EU Institutions .
FuelsEurope is a division of the European Petroleum Refiners Association, an AISBL operating in Belgium. The association, whose members are all 43 companies that operate petroleum refineries in the European Economic Area in 2013, is comprised of FuelsEurope and Concawe divisions each having separate and distinct roles and expertise but consolidated for efficiency and cost-effectiveness.
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
FuelsEurope, the “new” EUROPIA, represents the downstream sector of the EU oil industry
Page 41
Refining Transport MarketingTransportCrude production
Crude exploration
Upstream Downstream
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
82 mainstream refineries were operating in the EU at end 2013
Source: Concawe
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
• Economic value: EU refining contributes annually:- €23bn added value to EU economy and €5B pa average investment.- Integration with €240bn turnover petrochemicals industry.
• Environmental responsibility: world class standards:- World class energy efficiency.- World class water, air emissions and product qualities standards.
• Reliable suppliers: - Oil fuels 90% of 270m cars and 34m trucks in EU today, & still 80% in
2035.- Supply disruptions extremely rare due to flexible, efficient refining and
distribution networks.
• Skilled jobs and technology: EU refining is a leading industry for:- 140 000 directly employed skill staff - in top 2 of EU industries.- Innovation in products and processes - in top 4 EU industries.
Significance of Refining to the EU
Page 43
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Page 44
Energy Union communication dismisses petroleum products as « old technologies » but EU Refining industry # 1 process innovation and among most innovative industries for products
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Figure: Skill and knowledge intensities (% of total employment)
EU Refining also benefits from a highly skilled workforce (2nd among EU manufacturing industries), with capability to innovate
Page 45
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Challenges: Refinery closures & Security of supply
According to estimates the closure of 1 refinery could lead to a loss of ~4500 jobs with overall GDP reductions of $2.2Bn*
15 refineries (102-87) shut-down 2008-2013 8% capacity decline
Estimated 10 000+ direct skilled jobs, at least 40 000 indirect jobs.
Sources: Capacity: IEA, Employment: CWE safety figures
The EU has further increased its dependency on import of diesel and jet fuel• To supply disruptions, for technical and / or
political reasons • To price spikes in tradable commodities • To lower negotiating power vs. the non-EU
suppliers A further decline in capacity exceeding the decline in product demand would make the EU economy even more vulnerable:
• Not all oil products are widely tradable commodities
• Cost of strategic stock would increase
Other considerations:
Page 7
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
We welcome the Council’s emphasis on the importance of ensuring stable, competitive and affordable energy prices
Page 47
Source: Solomon Associates
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Energy representing - about 60% of operating costs - is a strong incentive to achieve high energy efficiency
Page 48
Figure: Electricity generation efficiency
Source: Concawe
Future policies should first focus on those energy users, where progress can potentially be made at negative or low cost.
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Lower refinery emissions and cleaner fuels: refining has worked closely with the auto industry /made substantial investments to make environmental progress and meet regulatory requirements.
EU refining continues to make solid progress in environmental performance
Sulphur emissions from refineries reduced by 75% since 1979.
Sulphur free fuels have allowed vehicle exhaust emissions reductions to very low levels
Page 49
Source: Concawe
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
• ~70% of EU crackers are integrated with refineries (40 of 59).
• ~70% of their feedstock is refinery product; 85% of feedstock is naphtha.
• 26 million tons ethylene –> in total 40 million tons of chemicals.
• 20% of WW ethylene capacity (130 million tons).
• Also opportunity to integrate site management, facilities, utilities etc.
Refining and Petrochemicals very closely integrated
Page 50
Coal
Renewables
Natural Gas
Refining products
0 10 20 30 40 50 60 70
1.34
8.5
19.2
61.21
Petrochemical sector - feedstock
Series 1Volume in 1.000 t – material (feedstock) use only
Source: CEFIC
Meeting with the CEE NOIAs- Bratislava, 20th April 2015
Refinery closures & Security of supply
According to estimates the closure of 1 refinery could lead to a loss of ~4500 jobs with overall GDP reductions of $2.2Bn*
17 refineries shut-down 2008-2014 nearly 10% capacity decline
Estimated 10 000+ direct skilled jobs, at least 40 000 indirect jobs.
Sources: Capacity: IEA, Employment: CWE safety figures
The EU has further increased its dependency on import of diesel and jet fuel• To supply disruptions, for technical and / or
political reasons • To price spikes in tradable commodities • To lower negotiating power vs. the non-EU
suppliers A further decline in capacity exceeding the decline in product demand would make the EU economy even more vulnerable:
• Not all oil products are widely tradable commodities
• Cost of strategic stock would increase
Other considerations:
Page 51