2011年4月3日星期日

Really? 2 Million Metric Ton of D2 L0.2-62(GOST 305-82) per month?


My friend CL has been looking for business opportunities in the Petroleum Trade for six years . He has contacted numerous brokers who claim to have the ability to supply millions of metric tons of Russian D2 L 0.2-62(GOST305-82). Normally, the deal would involve monthly delivery either by vessel or by pipeline to Tank Farms in Rotterdam. There would be a procedure o how to transact and how to pay but never too clear on the delivery. These are not the issues we are addressing in this posting. There is one issue we wish to clear before we go into details on the procedures or the payment. These issue will be addressed in subsequent postings. This friend of mine is excited about a recent "opportunity" whereby someone who claims to be the translator for GAZPROM in China tells him that an arrangement can be made, through this so called translator, with GAZPROM to supply 2 million Metric Tons of D2 L 0.2-62(GOST305-82) per month for 36 months. The price is extremely attractive and is in the region of Platt's price less 20 to 25 %. You can imagine how excited my friend can be if you work out briefly the amount of profit that can be generated per month based on 2 million Metric Ton.
My friend works hard on this deal and approaches potential joint venture parties who might support him on the funding. One of the party asks about the quantity of diesel that Russian refineries as a whole produce in a month. My friend has no idea and therefore turn this question to me. To get the answer, I turn to the report produced by British Petroleum. (http://www.bp.com/productlanding.do?categoryId=6929&contentId=7044622).

From the report and look up the Oil section, we can determine that the total refinery capacity of Russia is 5616 K Barrel per day or roughly 0.8 Million Metric Ton per day or 24 Million Metric ton per month assuming that the Russian refineries work non-stop throughout the month(very doubtful assumption knowing that Russian Refineries are among the oldest).

For each Barrel of Crude oil, roughly 9.2 percent of the refinery output is Diesel. If Russian refineries can process 24 Million Metric Ton of Crude oil per month, the maximum amount of diesel produces will be 9.2% of 24 Million Metric Ton which is 2.2 Million Metric Ton. I tell my friend that this so called the translator for GAZPROM in China is definitely a scam because there is no way for GAZPROM to be able to deliver 2 million Metric Ton of D2 per month to him knowing that the whole of Russia can only produce 2.2 Million Metric Ton per month and there are many types of diesel. On the same token, one can immediately deduced that all the so call deals available on different trading portals on the internet are scams if they claim to be able to supply unbelievably large quantity.

2011年1月21日星期五

Is Colonial JP54 Aviation Kerosene coming from Russia?




A large number of Jet Fuel trading deals are posted onto various internet trading sties everyday. Most of them would refer to large quantity of "jet fuel" from Russian Refineries meeting JP54 Aviation Kerosene standard. You can use your own judgement on whether these deals are real or scam. Some fundamental facts and knowledge could probably help you to make those judgements and may be avoid major loss in time or money. Russian Kerosene standards are published as GOST 10227-86 consisting of several products with different properties. Extracts of these standards from the World Jet fuel Specifications handbook by Exxon Mobile are attached for reader's reference. You would probably noticed that Colonial JP54 is not a Russian specification and no Russian refineries ever produce them not to mention large quantity of them. If Russian refineries do not produce this product, one would wonder how can someone can supply either SPOT or contract billions of barrels of this product. We are not talking one person but many deals posted on the internet everyday saying that they can supply billion of barrels of Russian origin Colonial JP54 Jet Fuel.

Colonial JP 54 Kerosene


Colonial Grade 54 Kerosene was mentioned in most of the Jet Fuel deals on the Internet. It is usually referred to as Russian Origin JP54 Jet Fuel or Aviation Kerosene. The true of the fact is JP54 is not a Russian standard. It is not of Russian origin but of US origin. Colonial JP 54 Kerosene is supplied by Colonial Pipelines in the United States. It is not a jet fuel and is not used by either the commercial jet liners or Military aircraft. Attached is extracted from the World Jetfuel Specification published by ExxonMobile.

2011年1月20日星期四

Jet Fuel

Aircraft engines, from powerful piston engines to jet turbines, have always required a more sophisticated form of fuel generally referred to as Aviation fuel. Aviation fuel is a specialized type of petroleum-based fuel used to power aircraft. It is generally of a higher quality than fuels used in less critical applications such as heating ground transportation, and often contains additives to reduce the risk of icing or explosion due to high temperatures, amongst other properties. Fuel is rated according to its level of octane. High amounts of octane allow a powerful piston engine to burn its fuel efficiently, a quality called "anti-knock" because the engine does not misfire, or "knock." At that time, high-octane aviation gas was only a small percentage of the overall petroleum refined in the United States. Most gas had no more than an 87 octane rating. In the 30’s, Shell started to develop 100-octane fuel (commonly called Aviation Gasoline or AvGas) and began to modify its refineries to make mass production of high-octane fuel possible. As a result, when the United States entered the war in late 1941, it had plenty of high-quality fuel for its engines, and its aircraft engines performed better than similarly sized engines in the German Luftwaffe's airplanes. Engine designers were also encouraged by the existence of high-performance fuels to develop even higher-performance engines for aircraft.

A major problem with gasoline is that it has what is known as a low "flashpoint." This is the temperature at which it produces fumes that can be ignited by an open flame. Gasoline has a flashpoint of around 30 degrees Fahrenheit (-1 degree Celsius). This makes fires much more likely in the event of an accident. So engine designers sought to develop engines that used fuels with higher flashpoints.

The invention of jet engines created another challenge for engine designers. They did not require a fuel that vaporized (turned to a gaseous state) as easily as AvGas, but they did have other requirements. Instead of using gasoline, they chose kerosene or a kerosene-gasoline mix. The first jet fuel was known as JP-1 (for "Jet Propellant").

Different types of aircraft operations also demanded that specific types of fuel be available. When most of the aircraft were piston-driven, the US Navy carried AvGas, which had a low flashpoint and was therefore dangerous to have on board because it could easily catch fire. The advent of jets led the Navy to seek jet propellant that had a higher flashpoint than JP-1. Whereas most Air Force aircraft soon used a kerosene-gasoline mix called JP-4, which already had a higher flashpoint than standard AvGas, the Navy developed a fuel known as JP-5 with an even higher flashpoint than JP-4.

Aircraft operators are constantly refining their fuels to deal with specific performance concerns. The U.S. Air Force during the 1990s switched from JP-4 to JP-8 because it had a higher flashpoint and was less carcinogenic, among other things. By the mid 1990s, the Air Force further modified JP-8 to include a chemical that reduced the buildup of contaminants in the engines that affected performance. JP-8 has a strong odor and is oily to the touch, which makes it more unpleasant to handle and less safe in some ways. About 60 billion gallons (227 billion liters) were used worldwide by the late 1990s, with the U.S. Air Force, Army, and NATO using about 4.5 billion gallons (17 billion liters). It is also used to fuel heaters, stoves, tanks, and other military vehicles.

Commercial jet fuel is a type of aviation fuel designed for use in aircraft powered by gas turbine engines. It is a high-quality fuel, however, and if it fails the purity and other quality tests for use on jet aircraft, it is sold to other ground-based users with less demanding requirements, like railroad engines. Commercial jet fuel as well as military jet fuel often includes anti-freeze to prevent ice buildup inside the fuel tanks. The most commonly used fuels for commercial aviation are Jet A and Jet A-1 which are produced to a standardized international specification. The only other jet fuel commonly used in civilian turbine-engine powered aviation is Jet B which is used for its enhanced cold-weather performance.

Jet fuel is a mixture of a large number of different hydrocarbons. The range of their sizes (molecular weights or carbon numbers) is restricted by the requirements for the product, for example, the freezing point or smoke point. Kerosene-type jet fuel (including Jet A and Jet A-1) has a carbon number distribution between about 8 and 16 carbon numbers; wide-cut or naphtha-type jet fuel (including Jet B), between about 5 and 15 carbon numbers. Jet A specification fuel has been used in the United States since the 1950s and is only available in the United States, whereas Jet A-1 is the standard specification fuel used in the rest of the world. Both Jet A and Jet A-1 have a relatively high flash point of 38 °C (100 °F), with an autoignition temperature of 210 °C (410 °F). This means that the fuel is safer to handle than traditional avgas.

The primary differences between Jet A and Jet A-1 are the higher freezing point of Jet A (−40 °C vs −47 °C for Jet A-1), and the mandatory requirement for the addition of an anti-static additive to Jet A-1.

Like Jet A-1, Jet A can be identified in trucks and storage facilities by the UN number 1863 Hazardous Material placards. Jet A trucks, storage tanks, and pipes that carry Jet A are marked with a black sticker with a white "Jet A" written over it, next to another black stripe. The annual U.S. usage of jet fuel was 21 billion gallons (80 billion litres) in 2006.

Typical physical properties for Jet A and Jet A-1

Jet A-1 Fuel must meet the specification for DEF STAN 91-91 (Jet A-1), ASTM specification D1655 (Jet A-1) and IATA Guidance Material (Kerosene Type), NATO Code F-35.

Jet A Fuel must reach ASTM specification D1655 (Jet A)

Jet A-1

Jet A

Flash point

> 38 °C (100.4 °F)

Autoignition temperature

210 °C (410 °F)

Freezing point

<47°C(52.6°F)

<40°C (40°F)

Open air burning temperatures

287.5°C (549.5°F)

Density at 15 °C (59 °F)

0.775 kg/L to 0.840 kg/L

Specific energy

>42.80MJ/kg