Global sulphur cap to impact operations at Petrojam
With the International Maritime Organisation (IMO) imposing a 0.5 per cent global sulphur cap on marine fuels effective January 1, 2020, Petrojam’s sale of heavy fuel oil will be restricted, according to the state owned oil refinery.
The move by the IMO is expected to significantly reduce the amount of sulphur oxide emanating from ships and should have major health and environmental benefits for the world, particularly for populations living close to ports and coasts.
In this regard, Petrojam says its medium-term strategic objectives are being reviewed to position the refinery to meet regional energy needs.
This was reported in the Jamaica Public Bodies which was tabled yesterday in the House of Representatives.
Earlier this month, the Jamaica Public Service Company (JPS) reported that it will decommission all its plants that run on heavy oil, (HFO), a programme that will extend beyond 2020 even as the company takes steps to switchover to liquefied natural gas as its main fuel source.
This means that the JPS will gradually reduce its purchase of HFO from Petrojam.
At present, 22 per cent of the electricity supplied by the light and power company is produced with natural gas.
The company projects to increase its use of natural gas to more than 50 per cent by the time HFO is taken offline at the end of 2020.
Petrojam says its operations will continue to be affected primarily by occurrences in the world oil market.
Global demand for petroleum products are projected to increase marginally during the period, despite the gains in transportation efficiency and the use of alternative sources of energy.
The state owned oil refinery says it will be seeking to secure quality crude oil from other regional suppliers in Brazil, Ecuador and Colombia, owing to the unavailability of supplies from its Venezuelan counterpart, PDVSA.
The Jamaican government is seeking to acquire the 49 per cent shares owned by PDVSA in Petrojam. A bill was tabled in Parliament by Prime Minister Andrew Holness yesterday to give effect to that decision.
Titled the Compulsory Acquisition (Shares in Petrojam Limited) Act, 2019, the bill will pave the way for the compulsory acquisition of the shares held in Petrojam by persons other than the Petroleum Corporation of Jamaica.