Tag Archives: Petroleum

EIA Releases New Btu to kWh Energy Conversion Factor

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The US Energy Information Agency, EIA, has just released a new energy conversion relationship for the British thermal unit (Btu) and the kilowatt-hour (kWh). It is 3412 Btu/kWh.

On September 26, 2023, we released our primary report on recent and historical energy statistics, the Monthly Energy Review (MER). Beginning with the September 2023 MER, we have updated the way we calculate primary energy consumption of electricity generation from noncombustible renewable energy sources (solar, wind, hydroelectric, and geothermal). We will now calculate consumption of noncombustible renewable energy for electricity generation using the captured energy approach, which applies a constant conversion factor of 3,412 British thermal units per kilowatthour (Btu/kWh), the heat content of electricity. This approach is a change from our current methodology, called the fossil fuel equivalency approach. The captured energy approach is more consistent with international energy statistics standards than the fossil fuel equivalency approach.

EIA Monthly Energy Review

I post this kind of petroleum-related information with the hope that more people will pay attention to large-scale energy in general and oil & gas in particular. It is fashionable to pooh-pooh the petroleum sector for several reasons but, like it or not, it is one of the pillars of civilization. If we are going to be steering it in some particular direction, we should know a bit more about it.

There is a great deal of fascinating technology in oil & gas extraction and refining. The funny thing is that when you learn more about a subject, the more level your viewpoint on it will become, to the plus or minus side.

ExxonMobil Evolving with Declining Gasoline and Diesel Demand

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An article by Kevin Crowley, Bloomberg News, 9/23/23, reports that ExxonMobil Corp. has already begun to adapt to the decline in demand for gasoline and diesel as the switch to electric vehicles and renewable energy progresses. ExxonMobil operates the largest oil refining network in the world with 13 refineries presently in operation. It sold 5 refineries in the last 4 years in order to focus on cost cutting and improvements in performance of the highest performing facilities. ExxonMobil’s interest in refining dates back to the early days of its progenitor, Standard Oil Company, founded by John D. Rockefeller.

The oil majors are not blind and deaf to the swing towards the replacement of gasoline and diesel powered vehicles. In the case of ExxonMobil, they are planning on switching to production of petrochemical feedstocks in their refineries. They expect that their high-performance chemicals will see 7 % growth per year. Exxon believes the key to its success will be in chemical products. These chemicals are used in manufacturing of industrial and consumer products, from lubricants to pharmaceutical raw materials. Many of the ingredients you see in consumer products have their beginning as crude oil flowing out of the ground somewhere.

New oil refining capacity set for 2023

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Since 2019, the US has lost over 1 million barrels per day of oil refining capacity, according to Energy Intelligence. On top of this, 2023 will see an additional loss of 268,000 barrels per day refining capacity with the closure of the LyondellBasell refinery in Houston, TX. Loss of oil refining capacity translates directly into greater scarcity of fuel distillates, which exerts upward pressure on retail fuel prices.

But, there is good news as well. In 2023 there will be a combined 505,000 barrel per day uptick in refinery capacity according to Energy Intelligence. ExxonMobil will see an increase in capacity at its Beaumont, TX, refinery. Valero Energy will be adding two coker and sulfur recovery trains to increase their heavy sour crude oil throughput to provide a 55,000 barrel per day increase in fuels output at their Port Arthur, TX, plant.

The controversial Limetree Bay refinery in St. Croix in the US Virgin Islands, now owned by West Indies Petroleum Limited and Port Hamilton Refining and Transportation, LLLP, is scheduled to reopen, but information is scarce. Formerly the Hovensa facility, a joint venture of Hess Corp. and Petroleos de Venezuela SA, this refinery processed Libyan and Venezuelan crude and has supplied much of the US gulf coast. According to Energy Intelligence, the refinery is thought to be able to restart and produce 200,000 barrels per day. However, the former Hovensa facility has a recent history of losses, Clean Air Act violations and a bankruptcy sale. It doesn’t sound like the situation has fully played out yet.