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The Forum > Article Comments > Saudis expand price war downstream > Comments

Saudis expand price war downstream : Comments

By Gaurav Agnihotri, published 29/7/2015

As if being the world's biggest exporter of oil was not enough, the desert kingdom is now looking to conquer the refining sector as it has quickly become the fourth largest refiner in the world.

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Extracting oil may be as low as a dollar a barrel for the Saudis and ten for the Russians, with the international cost of recovery averaging out at 3-4 dollars a barrel?

I'm glad there's massive new competition in refining; given the last time oil prices were this low we were paying less than a dollar a litre at the bowser?

Given we're not and only have around a week's reserve; we're probably being seriously ripped off by the multinational fuel cartels?

I mean when have we seen a genuine price war in this country between fuel suppliers; rather than a seriously stage managed fuel cycle?

We need to take our own gas and oil corporation out of mothballs, so we can hire a few tankers and start importing finished fuel from the Saudis or whoever we damn well like.

And given Australian sweet light crude leaves the ground as a virtually sulphur free almost ready to use diesel, they should be tasked with exploring and exploiting more of that wherever it is found?

We could do worse than follow the Saudi's pragmatism and build a few refineries here, which could be very simple utilities doing only what is needed to turn traditional Australian sweet light sulphur free crude into the cleanest lowest sulphur diesel in the world!?

Besides, almost every transport option can be retuned to run on NG!?

The refining sweet light crude is simple and only requires some rudimentary cycloning, followed by chill filtering, followed by the addition of 4.7% methanol, to make the best diesel in the world.

Methanol is made passing NG through a simple catalyst, which knocks off a few hydrogen atoms from the methane molecule, thereby creating a liquid methanol (fine petrol/avgas substitute) that needs no pressure/chilling to keep it liquefied!

Both NG and its condensates leave the wellhead at sub zero temperatures; meaning, we needn't use anything else to provide the chill factor in the chill filtering process!

Which should allow the least costly processing or value adding in the world!?

We can be pragmatists too, hopefully, occasionally?
Posted by Rhrosty, Wednesday, 29 July 2015 10:32:27 AM
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Rhosty, methanol is too toxic to be used as a petrol substitute, and ethanol has a better energy density anyway. Also I'm pretty sure that when making diesel from crude oil, you don't add 4.7% methanol (I think that's the figure for some kind of vegetable oil). And Australia does not have sulfur free crude.
Posted by Aidan, Wednesday, 29 July 2015 12:27:43 PM
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