Newsletter

On March 24th, the U.N. Intergovernmental Panel on Climate Change released the final portion of their sixth assessment report which summarizes the impact, risk, and opportunities associated with addressing and mitigating climate change.  Following recommendations laid out in previous reports, this version also stressed the need for major economic investments and the implementation of new technologies to mitigate the impacts of climate change. One of the specific recommendations has been the adoption of low-emission hydrogen, which has wide-reaching applications for abating carbon use in sectors where electrification is either difficult or impractical, like shipping, transport, and heavy industry.  Accordingly, hydrogen demand is expected to grow as the energy transition continues. The International Energy Agency (IEA) projects that hydrogen demand will grow from 87 million metric tons (MT) in 2020 to 500-680 million MT in 2050, and the International Renewable Energy Agency (IRENA) projects that hydrogen will account for 12% of the global energy demand by 2050.  Industry has taken note of these changes and has responded by increasing development of infrastructure projects to generate, store, and transport hydrogen.

As Traci L. Johnson, PE was nearing the end of her freshman year at Tulane University in New Orleans where she was studying chemical engineering, she didn’t know how she was going to spend her summer, but she knew it involved getting a job.

“At a family gathering, I learned that an aunt worked at a company that ‘hired engineers,’” Johnson recalled. “Soon thereafter, I was hired as summer help at International-Matex Tank Terminals (IMTT) answering phones and filing papers in what used to be known as the Engineering and Environmental Department of the company—not exactly technical work, but it beat working as a cashier at the school bookstore!”

Thankfully, Johnson was eventually given the opportunity to do more technical work under the supervision of the Environmental Manager.

“At that point, I was hooked and never looked back.”

A global push for decarbonization of the aviation sector, which accounts for over 2% of global energy emissions, has led to a considerable increase in demand for sustainable aviation fuel (SAF). SAF is a “drop-in” liquid hydrocarbon fuel made from renewable or waste resources which has lower greenhouse gas emissions than petroleum-based jet fuels and can be used in existing airplanes and engines.  Just last month Boeing announced that it will purchase 5.6 million gallons of SAF in 2023. To put this purchase in perspective, it is equivalent to 25% of all jet fuel used by Boeing in 2022. Similarly, United Airlines, along with 5 corporate partners, announced the creation of a venture capital fund focused on SAF production, accompanied by an initial $100 million investment. In response to the goal set by the Sustainable Aviation Fuel Grand Challenge (launched by the DOE, DOT, and USDA) of supplying enough SAF to meet 100% of aviation fuel demand by 2050, the Federal Government has also moved to increase SAF supply through several measures, including the creation of a SAF-specific tax credit in the Inflation Reduction Act of 2022. All of these efforts feed into a market trend that present an opportunity for liquid terminals.

William B. Lee III began his journey in the liquid terminals industry years ago in 1991 when he moved back in with his parents in Tulsa, Oklahoma. Lee was working for a temp agency as he worked to finish a history class as part of earning his chemical engineering degree from the University of Texas at Austin.

“I was assigned to work in the supply department at CITGO Petroleum and when my supervisors heard that I was soon to graduate, they circulated my resume to several other departments,” said Lee. “The Corporate HSSE group decided to hire me as an environmental specialist. Most of the initial work I did was related to air for CITGO’s Terminal and Pipeline Operations group. Over time, the terminal group decided to employ me directly as a regional EHS&S specialist.”

Today, as a Regional Environmental, Health, Safety, and Security (EHS&S) Manager for CITGO Petroleum, Lee enjoys that his role is extremely varied and always offering something new.

This is the first piece in the new Energy Transition section of the newsletter. This section will highlight news related to the role of terminals in the Energy Transition.

Led by the Port of Rotterdam Authority, a pre-feasibility study on the establishment of a large-scale ammonia cracker at the port is expected to release its first results soon.[1] The initiative, a joint effort between eighteen companies including Shell, BP, and ExxonMobil, aims to evaluate the cracking facility’s potential to convert imported ammonia into one million tons of hydrogen per year. If the findings are positive, the establishment of this facility would help meet Europe’s decarbonization and climate objectives, while driving demand for increased ammonia storage.