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02.01.2013  |  Thinnes, Billy,  Hydrocarbon Processing Staff, Houston, TX

Keywords: [Bakken] [Phillips 66] [Bayway refinery] [AFPM] [biofuel standard] [US EPA] [recycle] [storage terminal] [gas to liquids]

Bakken oil destined for New Jersey

Phillips 66 has signed a five-year contract to use Global Partners LP’s rail transloading, logistics and transportation system to deliver crude oil from the North Dakota Bakken region to the Phillips 66 Bayway refinery in New Jersey. The terms of the contract include a take-or-pay commitment from Phillips 66 to receive approximately 91 million barrels of crude oil over the contract term, which equates to approximately 50,000 bpd. The contract will utilize Global’s network of loading facilities and offloading terminals. Phillips 66 is one of the first energy companies to move shale crude to the East Coast. Last year, the company expanded its capability to deliver shale crude to its refineries by truck, rail, barge, ocean going vessels and pipeline.



The American Fuel and Petrochemical Manufacturers (AFPM) has petitioned the US Environmental Protection Agency (EPA) to waive the 2012 cellulosic biofuel mandate, citing a lack of domestic supply available for commercial use. The AFPM said the EPA Moderated Transaction System (EMTS) demonstrates that there has been, and continues to be, an inadequate domestic supply of cellulosic biofuel. In 2011, American refiners were required to use 6 million gallons of cellulosic biofuel to meet the EPA-established mandate, yet according to EMTS, zero cellulosic biofuel was actually produced. To date in 2012, just 20,069 gallons of cellulosic biofuel has been produced, all of which was exported. This amount falls far short of the EPA-mandated 10.45 million ethanol-equivalent gallons of cellulosic biofuel. In addition, since the cellulosic biofuel that actually was produced was exported, refiners cannot use credits generated from these biofuels for complying with the federal mandate. The AFPM has stated that if the EPA fails to grant the waiver, refiners will be forced to pay several million dollars for a product that does not exist. The industry group further believes that this mandate is a hidden tax on the refining industry and is not what Congress intended when it incorporated the waiver provisions into the RFS.

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