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Petrobras H-Bio Production On Hold
19 January 2008
Reuters. Although Petrobras has adapted four refineries to produce H-Bio renewable diesel (earlier post) using mineral and vegetable oil, it has yet to start mass production due to the high price of soy oil.
Petrobras downstream director Paulo Roberto Costa, interviewed as part of the Reuters Global Agriculture and Biofuel Summit late Tuesday, said a refined soy oil price of $180 per barrel by far exceeded a regular diesel price of $104 a barrel.
“H-Bio has been designed as an alternative fuel, so we have to analyze the economic part all the time. We have the installations ready at the refineries ... but it makes no sense producing H-Bio now,” he said.
The H-Bio process obtains renewable diesel fuel through the hydrogenation of a mixture of vegetable oil and mineral oil (a byproduct of petroleum refining).
Last year, Petrobras said that it would start commercial production by the end of 2007.
January 19, 2008 in Brief | Permalink | Comments (2) | TrackBack (0)
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Posted by: gr | January 20, 2008 at 12:51 PM
Energy speculators may be a big part of why you see high prices and volatility in general. This seems like a part of the deregulated market system that is suppose to be an incentive for greater production.
Posted by: sjc | January 23, 2008 at 08:46 AM
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This is strange. The market is awash in soy oil (record 30 million metric tons) AND the prices of that oil are artificially high. Futures traders are speculating soy oil toward an equivalent of home heating oil - driving prices upwards to $.35 per pound. While US midwest biodiesel plants operate at full capacity, Petrobas, a petrolium company holds production up waiting for spot prices to fall - holding biodiesel off the market.
The cost of a pound of soy oil has risen from $.13/pound to over $.33/pound in part on "green gold" speculation. The rough numbers should yield a barrel of soy oil at 10lb/gallon x .30 x 42 = $126.00