Genoil Inc. has announced that they, in collaboration with Beijing Petrochemical Engineering Co Ltd, have secured a US$5 billion Letter of Intent (LOI) for the funding of a 500,000 barrel per day bunker fuel desulphurisation and upgrading project that will be located in the Middle East.
The funding, from one of the largest banks in China cited in the LOI, will cover the project cost. The project will see the implementation of Genoil’s proprietary technology producing 500,000 barrels per day of low sulphur crude oil.
Genoil says that this project illustrates how their technology has the capacity to support the shipping industry in solving the challenge of meeting regional and global ECA compliance in the midst of a concern around pending shortfalls of distillate fuel compliant with the current International Maritime Organization’s (IMO) MARPOL Annex VI regional regulations. The issue of distillate supply and pricing hikes will be further amplified if the proposed global sulphur cap of 0.5% is fully legislated by 2020.
The desulphurisation technology is able to produce low-cost, compliant low sulphur fuel oil (LSFO) from refinery residue without the need for blending, and to be priced much more competitively than marine gasoil (MGO).
While refineries are facing the considerable capital expenditure to produce more middle distillates, the industry has also not found a cost effective way to remove sulphur from fuel oil or refinery residue. Genoil say that their technology addresses this problem and can produce LSFO at up to 75% less cost.
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