Sulfur glut

Maureen Lorenzetti

Reducing fuel sulfur is a clear industry priority. Figuring out what to do with that extra sulfur once refiners remove it isn't. Yet. But some chemical marketers think it should be an industry concern.

According to the Sulfur Institute (TSI), unless new markets are developed or existing ones are expanded quickly, global sulfur supplies could exceed demand by about 5 million tons by 2010, more than doubling current oversupply levels.

"With less income from by-product sulfur, oil and gas companies will be looking at higher net costs of production—a cost that could trickle down to consumers," said TSI Pres. Bob Morris.

"Practically speaking, the leading manufacturers in any industry need to take a proactive role in market development. We need the energy companies to step forward and get more involved with sulfur," he said.

Possible markets
Traditionally, the phosphate fertilizer industry has been the world's biggest sulfur consumer, accounting for about 50% of demand. Sulfur is also used extensively in the metal and fiber industries, as well as for chemicals, paints, plastics, rubber products, paper, medicines, and some detergents. Asphalt, concrete, and sulfur fertilizers are emerging high-volume markets, according to TSI.

As yet, industry response to the sulfur glut has been underwhelming. But sulfur marketers caution that even if US policy-makers opt to stall impending low-sulfur rules, the issue will not go away. They point to the higher-sulfur crudes multinational companies are now producing outside the US.

The US Geological Survey says that sulfur is being recovered at a growing rate from refineries that are being reconfigured to handle high-sulfur crudes from Mexico and Venezuela. Canadian production is also expected to grow significantly, particularly with new production from oil sands projects.

Even an international incident of sorts occurred because of high-sulfur crude, TSI says. To gain leverage in a contract dispute, Kazakhstan government officials threatened to impose up to $70 million in environmental fines against ChevronTexaco Corp. for storing sulfur near the company's Tengiz oil field.

Regulatory considerations
The US Environmental Protection Agency repeatedly has pledged to maintain its low-sulfur highway diesel rules, which require 80% of highway diesel to meet new standards by mid-2006. EPA is also planning to back an oil industry-sought, phased-in approach to desulfurizing nonroad diesel fuel and will promote an as-yet-unspecified trading program. But sulfur experts say that possible action will not solve the problem. Outside of EPA, regulators within and outside the US are taking steps to reduce sulfur in fuel.

The European Union says motor fuels must be nearly sulfur-free after 2009. Regulators there are counting on an emissions-credit trading system and tax incentives to encourage the sale of the more-expensive lower-sulfur gasoline and diesel.

And in the US, New York is one of several states considering a plan to lower sulfur in both highway fuel and heating oil.

Related Articles

Baseline water testing rule to remove ambiguity in Wyoming


Wyoming has adopted a rule that calls for operators to perform baseline testing of area groundwater before and after drilling.

GAO: Scant information exists about NEPA analyses’ costs, benefits

04/15/2014 Little information exists about the costs and benefits of analyses required under the National Environmental Policy Act, the Government Accountabil...

DOE lets ConocoPhillips Alaska resume LNG sales to non-FTA countries

04/15/2014 The US Department of Energy approved a ConocoPhillips Co. subsidiary’s request to resume exports of LNG to countries not having a free-trade agreem...

EPA white papers offer hint of methane, VOC emissions

04/15/2014 The US natural gas industry received a preview of a new regulatory push on Apr. 15 when the Environmental Protection Agency published white papers ...

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!


Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected