Argus Marine Fuels. Latest News. Petrobras protests closure of Argentina refinery. Buyer for French refinery pulls out

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1 Argus Marine Fuels Issue Monday 11 March 2013 Latest News Market summary Petrobras protests closure of Argentina refinery Bunker fuel prices declined at most major European and Asia-Pacific ports as demand weakened and crude prices fell. Latin American and US prices lacked direction, and demand was mixed. Panama declined despite a busy Monday, and its premium to Houston narrowed to $4.5/t, leaving some suppliers on the side lines. The Argentinian unit of Brazilian state-controlled oil company Petrobras has appealed a 7 March judicial order to immediately shut its 30,500 b/d Bahia Blanca refinery in Buenos Aires province, citing environmental permitting concerns and a failure to complete a mandated renovation. Buyer for French refinery pulls out The French government s attempt to find a buyer for the 146,000 b/d Petit Couronne refinery in the north of the country has been set back by the loss of a potential new owner, and two others merging bids. Egyptian company Arabiyya Lel Istithmaraat will no longer be in the running to buy the refinery which was owned by insolvent Switzerland-based refiner Petroplus. Houston HS ex-wharf less Rotterdam delivered Vopak studies terminal at Long Beach hhh 10 Vopak Terminals will study the development of a deepwater crude and petroleum products terminal at the Port of Long Beach in southern California Dec 28 Dec 16 Jan 1 Feb 21 Feb HS 380cst bunkers and bulk fuel oil arbitrage New York Los Angeles Istanbul (LSFO) Hong Kong Fujairah +19 (HSFO) +28 (HSFO) (HSFO) Bulk fuel oil arbitrage swaps: month 1 less month 1 swaps: month 2 less month 1 swaps: month 3 less month 1 HS 380cst bunkers delivered, except North America and Panama Santos Buenos Aires Panama 11 Mar Rotterdam Houston Singapore Tokyo

2 Asia-Pacific Assessed bunker prices HS 380cst HS 180cst MGO Location Basis Low High Mid ± Low High Mid ± Low High Mid ± China Hong Kong delivered Qingdao delivered Shanghai delivered Asia-Pacific (other) Russian far east delivered South Korea delivered Singapore delivered Sydney delivered , , , Tokyo delivered Mideast Gulf and Indian Ocean Fujairah delivered , , , Khor Fakkan delivered , , , Mumbai delivered , , , Posted bunker prices HS 380cst HS 180cst MGO Location Basis Low High Mid ± Low High Mid ± Low High Mid ± Saudi Aramco Dammam Ras Tanura ex-wharf , Jeddah Yanbu Rabigh ex-wharf , Prices for high-sulphur 380cst fell across most ports in Asia- Pacific, tracking losses in fuel oil cargo values. Singapore - 180cst HSFO swaps less 380cst swaps 12 In Singapore, buying interest picked up with several suppliers receiving more enquiries than the previous session. Trades of delivered high-sulphur 380cst HSFO were heard done in the mid- $620s/t level after the close of assessment. A stem for mid-march delivery was heard done as low as less than $620/t but this could not be confirmed. Delivered offers were otherwise heard in the mid-$630s/t. Some suppliers said they were not in a hurry to slash offers on expectations of tightening on-specification bunker fuel cargoes. A significant portion of the arbitrage inflows into Singapore in March and April was expected to require further blending to meet retail grade. April s ex-wharf bunker premium was heard done at $4.25/t - $4.50/t over Mops 380cst compared to March s premium of around $3.50/t. Supply tightness at Brisbane on the east coast of Australia eased with fresh cargoes originating from key suppliers BP and Caltex heard available. But cargoes remained tight in Sydney, where suppliers were still struggling to cope with seasonally strong demand Dec 26 Dec 10 Jan 24 Jan 7 Feb 25 Feb 11 Mar Demand was slow to average at Tokyo Bay. Offers for highsulphur 380cst were in the mid-$670s/t range. Prices of high-sulphur 380cst fuel oil were unchanged from last Friday, despite slight losses in Singapore flat prices. Suppliers held firm on their offers despite thin buying interest. Sinopec is to receive a cargo of Singapore-origin cracked fuel oil at Zhoushan port in Zhejiang province on Wednesday. It will unload about 23,000t at Zhoushan and take the remainder 63,000t to Qingdao port in Shandong province. hh Page 2 of 8

3 Europe and Africa Assessed bunker prices HS 380cst LS 380cst HS 180cst MGO Location Basis Low High Mid ± Low High Mid ± Low High Mid ± Low High Mid ± Africa Canary islands delivered Cape Town delivered , , , Durban ex-wharf , , , Russia Murmansk delivered Novorossiysk delivered St Petersburg delivered Europe (other) Algeciras delivered Antwerp delivered Barcelona ex-wharf Genoa ex-wharf Gibraltar delivered Hamburg delivered Kali Limenes delivered , , , Istanbul delivered Malta delivered Piraeus delivered Rotterdam delivered Trieste ex-wharf Bulk fuel oil prices Low High Mid ± Rotterdam 1pc fuel oil fob barge Rotterdam 3.5pc fuel oil fob barge Bunker fuel prices declined at most major European ports on Monday as demand weakened and crude futures traded little changed. Houston HS ex-wharf less Rotterdam delivered hh Demand was reported to be soft or holding steady at most ports. The biggest price declines were at Barcelona, where high-sulphur 380cst lost $9/t and high-sulphur 180cst sank by $14/t. Last week Barcelona had been benefiting from demand displaced from other ports in the Mediterranean as strong winds shut down Gibraltar and Algeciras; with conditions returning to normal on Monday, demand declined again at Barcelona. Traders at Gibraltar said most services were fully operational, but with some delays as the tail end of last week s backlog was dealt with. Prices continued to climb at Cape Town amid tightening supplies. Traders said only one major producer was offering fuel oil at the South African port after Chevron said none would be available until further notice. Chevron s refinery was due to be shut down for maintenance until 8 March. A trader stemmed 500t of high-sulphur 180cst at Cape Town at $725/t Dec 28 Dec 16 Jan 1 Feb 21 Feb 11 Mar Prices also climbed at St Petersburg, but trading volumes remained low. Traders are waiting for the results of passenger cruise lines tenders; during the May-September period about 200,000t of marine fuels are forecast to be sold at the port. A buyer stemmed 1,000t of low-sulphur 380cst and 50t of marine gasoil (MGO) at nearby Ust-Luga for $575/t and $890/t, respectively. MGO prices dropped at most ports across Europe, dragged down by weakness in bulk gasoil futures. The sharpest decline was $8/t, at Genoa and Trieste. Page 3 of 8

4 North America Assessed bunker prices HS 380cst LS 380cst HS 180cst MGO Location Basis Low High Mid ± Low High Mid ± Low High Mid ± Low High Mid ± Atlantic coast Halifax ex-wharf , , , Montreal delivered , , , New York ex-wharf , , , Philadelphia ex-wharf , , , Gulf coast Houston ex-wharf , , New Orleans ex-wharf , , , West coast Los Angeles ex-wharf , , Portland ex-wharf , , , San Francisco ex-wharf , , , Seattle ex-wharf , , , Vancouver ex-wharf , , , US bunker prices were mixed on Monday, with small gains seen in Houston and a slight decline in New Orleans, bringing the two markets to effectively the same range. Overall inquiry in Houston picked up on Monday and highsulphur 380cst firmed by $2/t. Offers were heard as low as $610/t from two suppliers, although one of the two may have had a logistical advantage in charging a lower price. Indications were also heard at $620/t but no stems were heard at those levels. One supplier was offering MGO at $1004/t, but sold nothing. In New Orleans prices softened by $2.50/t for high-sulphur 380cst. A combined stem was seen - 300t of high-sulphur 380cst at $614/t and 250t of low-sulphur 380cst at $708/t. A 200t lot of low-sulphur 380cst sold at $708/t. In San Francisco prices gained by $7/t on Monday. A 1,400t stem of high-sulphur 380cst went for $645/t and a 380t stem of low-sulphur sold at $784/t, both for delivery 16 March. In Los Angeles a 1,000t stem of high-sulphur 500cst sold overnight Sunday at $636/t for delivery 17 March. Bulk fuel oil prices $/bl Low High Mid ± USG No. 6 oil 3pc NYH No. 6 oil 1pc HS 380cst bunkers - Fujairah less Rotterdam Dec 28 Dec 16 Jan 4 Feb 21 Feb 11 Mar hh Bulk HSFO - US Gulf less Singapore In Savannah a 900t stem of high-sulphur 380cst was seen at $635/t, a $10/t premium to assessed New York prices. New York remained flat. Despite thin inquiry, suppliers did not lower their offers hhh Dec 26 Dec 14 Jan 31 Jan 21 Feb 11 Mar Page 4 of 8

5 Latin America Assessed bunker prices HS 380cst LS 380cst HS 180cst MGO Location Basis Low High Mid ± Low High Mid ± Low High Mid ± Low High Mid ± Atlantic coast Buenos Aires delivered , , , Montevideo delivered , , , Caribbean Cartagena delivered , , , Panama canal ex-wharf , , , Pacific coast El Callao delivered , , , Guayaquil delivered , , , Libertad delivered , , , Quintero/Valparaiso delivered , , , San Antonio delivered , , , Posted bunker prices HS 380 LS 380 HS 180 MGO Location Basis Low High Mid ± Low High Mid ± Low High Mid ± Low High Mid ± Petrobras - valid from 14:00, 8 March 2013 Bahia Blanca delivered , , , Paranagua delivered , Rio de Janeiro delivered , Santos delivered , Salvador delivered , Suape delivered , Tubarao delivered , Vitoria delivered , PdV - valid until 9:00, 12 March 2013 Venezuelan ports ex-wharf/ ex-pipe , Latin American bunker prices lacked direction on Monday, with demand mixed. Panama had the cheapest high-sulphur 380cst at $617/t, and Buenos Aires had the cheapest low-sulphur 380cst at $623/t. Panama high-sulphur 380cst was assessed $7/t lower from Friday. Monday s demand, which is normally a high of the week, did not disappoint. One supplier heard about 20 inquiries by early afternoon. Three high-sulphur 380cst deals were seen 300t at $619/t for delivery 14 March, 800t at $618/t for delivery 17 March, and 150t at $618/t. Indications were heard as low as $615/t. A combined stem was also heard 80t of high-sulphur 380cst at $630/t and 15t of marine gasoil (MGO) at $1035/t. One supplier was offering MGO as low as $,1020/t. A 150t lot of low-sulphur 380cst sold at $705/t. Panama s premium to Houston for high-sulphur 380cst narrowed to $4.5/t from $13.5/t on Friday. At least two suppliers remained on the side lines, unable to compete. Another supplier was said to be selling at unusually low prices, either looking to free up storage for new deliveries or to exit the Panama market altogether. Demand in Buenos Aires was busy. Low-sulphur 380cst assessments dropped $1/t to $623/t amid strong competition among suppliers. Indications were as high as $640/t but no stems were heard at these levels. By contrast, Petrobras Bahia Blanca s posted prices remained flat. Despite low demand, Petrobras has kept prices steady since 8 Febraury. Petrobras Brazil posted prices remained unchanged from Friday for most of the day. Posted prices dropped $5/t in the afternoon amid quiet demand. El Callao was assed $1/t lower. Demand was weak. A 400t stem of high-sulphur 380cst sold at $685.5/t. Page 5 of 8

6 Latest News Petrobras protests closure of Argentina refinery The Argentinian unit of Brazilian state-controlled oil company Petrobras has appealed a 7 March judicial order to immediately shut its 30,500 b/d Bahia Blanca refinery in Buenos Aires province, citing environmental permitting concerns and a failure to complete a mandated renovation. Petrobras Argentina says it has fulfilled all demands of the relevant authorities and operates under the current environmental norms. The company has requested the lifting of the preventative measure that ordered the closure of the Dr Ricardo Eliçabe refinery as soon as possible so it can resume operations while the case makes its way through the courts. Petrobras Argentina is working with the relevant authorities with the goal of normalizing the operations in the Bahia Blanca refinery as quickly as possible. In the meantime, the company said it reaffirms its commitment with fulfilling all environmental requirements and operational security norms. The Bahia Blanca court ordered the plant preventively closed last week until it can get its environmental papers in order and complete work demanded by provincial environmental authorities in The refinery s environmental certificate expired in 2009 and its permit to discharge gaseous effluents expired in 2003, according to court documents. An explosion at Bahia Blanca killed one worker and injured another in August This is not the first time a refinery has been forced to stop operating in Argentina on environmental grounds. In September 2007, Argentina s government ordered the closure of Shell s 110,000 b/d Dock Sud refinery in Buenos Aires province. The company was able to reopen the refinery a week later after presenting a $60m cleanup plan. The Shell case was seen as part of a long-standing conflict between the government and Shell and was carried out through a resolution by the environment secretariat. In contrast, the Petrobras closure was ordered by a provincial court as a result of a lawsuit filed in April of last year by someone who lives close to the refinery. Buyer for French refinery pulls out The French government s attempt to find a buyer for the 146,000 b/d Petit Couronne refinery in the north of the country has been set back by the loss of a potential new owner, and two others merging bids. Egyptian company Arabiyya Lel Istithmaraat will no longer be in the running to buy the refinery which was owned by insolvent Switzerlandbased refiner Petroplus. A representative of Arabiyya Lel Istithmaraat in France released a statement saying the company could not see a way to restart the refinery. The significant complexity of the project, allied to the time frame given by the ongoing judicial process, is too great to control the risks involved and present a viable industrial project, said the firm. The company had previously stated it had funds in place to buy the facility, deciding to enter the race for Petit Couronne only 24 hours prior to the bid deadline, which was on 5 February. The firm said it had studied Petit Couronne for four months previously and had its French spokesman give a potential restart date of the third quarter this year. The firm said it was eyeing a five-year modernisation plan for the plant which would have included recruiting additional workers. Despite the late entry of the company into the bidding process French minister for industrial regeneration Arnaud Montebourg had said he was backing the plan. The loss of Arabiyya Lel Istithmaraat means only three bidders remain for the plant. From the original five groups interested in restarting the refinery another pair of potential purchasers have merged bids. Libya s Murzuq Oil and a group of Swiss financiers Terre International are joining together to convince the French authorities of their ability to run Petit Couronne. None of the five original bids, which were received by the commercial court overseeing the refinery s bankruptcy proceedings, were deemed legally admissible as they lacked sufficient financial and technical detail. The bidders now have until 16 April to submit further details to the court. The refinery ceased production on 15 December after the expiry of a crude supply arrangement with Shell. Vopak studies terminal at Long Beach Vopak Terminals will study the development of a deepwater crude and petroleum products terminal at the Port of Long Beach in southern California. The site would have an estimated annual throughput of 21-55mn bl of oil, and would be connected by pipeline to other oil and petroleum product distribution facilities and oil refineries. The Port of Long Beach is near over 600,000 b/d in refining capacity run by BP, Valero, Tesoro and Phillips 66. The port is also home to two BP terminals and one Tesoro terminal. Vopak has submitted a letter of intent to study a 28- acre site on the port s Pier T for a liquid bulk terminal for petroleum tanker ships. The terminal would be the fourth crude terminal at that port and the first built since As part of the agreement, the port would receive at least $2.9mn per year in revenue once the terminal is constructed. It would take up for four and a half years to conduct a full environmental review, design, permit and also build the site, according to the Port, which said it would conduct about Page 6 of 8

7 $37mn worth of dredging and other waterside improvements. Vopak would invest $120mn in land-side improvements for the first phase of construction. There would be up to three construction phases. The port estimates it unloads 200mn bl of crude every year. China s refinery runs fall back from record high China s refinery runs were 9.98mn b/d in the first two months of this year, up on the same period a year earlier but below the record high set in December, according to Argus calculations based on preliminary data from China s national statistics bureau (NBS). Crude runs in January-February were 452,000 b/d or 4.75pc higher than in the same period last year. This is 1.7pc or 175,000 b/d below the record 10.15mn b/d in December, based on preliminary NBS data. The NBS releases January and February data together because the week-long lunar new year holiday, which can fall in either month, often skews year-on-year comparisons. Net crude imports in January and February were 5.56mn b/d, flat compared with the same period of last year, according to preliminary customs data. Phillips 66 Sweeny restart to take several days Refinery crews may need several days to restart Phillips 66 s 247,000 b/d refinery in Sweeny, Texas, following a site-wide power outage. A third-party power disruption yesterday shut down several process units and forced the flaring of benzene, hydrogen sulfide and sulfur dioxide beginning yesterday at 11am ET. Power has been restored and we re in the process of restarting the refinery, which we expect to take several days, spokesman Rich Johnson said. Venezuela s interim president vows to visit China Acting Venezuelan President Nicolas Maduro, the designated heir to late President Hugo Chavez, said that following the country s 14 April presidential elections his first official visit as Venezuela s new elected president would be to China. Very soon, after our country goes to elections, we will go (to Beijing) with our triumph in hand to ratify in the name of the spirit of our commander Chavez this path of cooperation with China for 100 years more, Maduro said during a meeting on 8 March with a Chinese delegation headed by national development and reform commission president Zhan Ping. Energy minister and PdV president Rafael Ramirez also will visit China in the coming weeks to strengthen the Venezuelan state-owned oil company s strategic relations with state-run CNPC, Maduro said. Since 2008, China Development Bank (CDB) has granted Venezuela s government and PdV over $40bn in cash-for-oil loans to fund infrastructure projects. China s total commitment to Venezuela since 2008, including CNPC s joint ventures with PdV and CDB s loans to Venezuela, total over $100bn, according to the energy ministry. Maduro did not mention fresh loans from CDB after his 8 March meeting in Caracas with Chinese officials. But Maduro s top priority with China, assuming he wins next month s presidential elections, is to persuade CDB officials to release up to $8bn in fresh loans that were negotiated in first-half 2012 but were held up due to Chinese concerns over how the funds are spent in Venezuela. PdV and CNPC currently are developing PetroUrica, a 450,000 b/d Orinoco extra-heavy crude oil production and upgrader project in the oil belt s Junin 4 block. PdV and CNPC are also joint venture partners in the 120,000 b/d Sinovensa crude blending facility at the Venezuelan company s Jose complex in Anzoategui state. The companies also have joint ventures to develop the Intercampo and Caracoles oil fields in Zulia state, and the Zumano oilfield in Anzoategui. PdV and CNPC aim to quadruple their current joint upstream production from 200,000 b/d in 2012 to over 800,000 Expanded Latin American Coverage Argus has recently expanded its coverage of Latin American crude, refined products, ethanol and LPG markets as part of Argus Latin Markets. The improved service includes a comprehensive list of 40 price assessments for actively traded energy commodities as well as insightful market data and analysis on the rapidly changing global oil markets and trade flows. Contact us at moreinfo@argusmedia.com for more information. Page 7 of 8

8 Argus Marine Fuels Issue Monday 11 March 2013 b/d by 2017, Maduro said. PdV and CNPC also are partnered in China to build and operate three refineries with a combined processing capacity of 800,000 b/d. Zhan gave Maduro and Ramirez official assurances that China remains fully committed to strengthening the energydriven relationship between the two countries, Chinese diplomatic officials in Caracas said. New cash-for-oil loans were not discussed at the 8 March meeting between Maduro and the Chinese delegation headed, they said. PdV s current capital spending plans would double Venezuela s official crude oil production capacity to 6mn b/d by 2018, mainly by developing seven joint ventures with a combined 2.4mn b/d of new Orinoco extra-heavy crude capacity. CNPC s current joint ventures with PdV account for 470,000 b/d of existing and planned future production, including PetroUrica, Sinovensa and the upstream ventures in Zulia and Anzoategui. PdV is also in ongoing negotiations with CNPC and Sinopec that could result in at least two additional joint ventures to develop another 800,000 b/d of upstream capacity in the oil belt. Maduro today officially registered his candidacy for the presidency with the National Electoral Commission (CNE) for the 14 April poll, in which he will face opposition leader and Miranda state governor Henrique Capriles, who is expected to register his candidacy later today. I am not Chavez, but I am his son, said Maduro upon registering his candidacy, reminding voters that Chavez had invoked them to support him. Argus DeWitt Global Toluene Market Review for This study provides comprehensive analysis of the global toluene market for producers, refiners, consumers and traders at a time of great change in the global markets. Request more information at petrochemicals@argusmedia.com. Argus Marine Fuels is published by Argus Media Inc. Registered office Argus House, 175 St John St, London, EC1V 4LW Tel: Fax: sales@argusmedia.com ISSN: Copyright notice. All rights reserved. All intellectual property rights in this publication and the information published herein are the exclusive property of Argus and and/or its licensors and may only be used under licence from Argus. Without limiting the foregoing, by reading this publication you agree that you will not copy or reproduce any part of its contents (including, but not limited to, single prices or any other individual items of data) in any form or for any purpose whatsoever without the prior written consent of Argus. Petroleum illuminating the markets Trademark notice ARGUS, ARGUS MEDIA, the ARGUS logo, ARGUS MARINE FUELS, other ARGUS publication titles and ARGUS index names are trademarks of Argus Media Ltd. Visit for more information. Disclaimer The data and other information published herein (the Data ) are provided on an as is basis. Argus makes no warranties, express or implied, as to the accuracy, adequacy, timeliness, or completeness of the Data or fitness for any particular purpose. Argus shall not be liable for any loss or damage arising from any party s reliance on the Data and disclaims any and all liability related to or arising out of use of the Data to the full extent permissible by law. Publisher Adrian Binks Chief operating officer Neil Bradford CEO Americas Euan Craik Global compliance officer Jeffrey Amos Commercial manager Karen Johnson Editor in chief Ian Bourne Managing Editor, Global Cindy Galvin Managing Editor, Americas Jim Kennett Editor: Stefka Ilieva Tel: bunkers@argusmedia.com Customer support and sales: support@argusmedia.com Technical support: technicalsupport@argusmedia.com Argus Media Inc, Houston, US Tel: Argus Media Inc, New York, US Tel: Argus Media Inc, Washington DC, US Tel: London, UK Tel: Astana, Kazakhstan Tel: Beijing, China Tel: Dubai Tel: Moscow, Russia Tel: Rio de Janeiro, Brazil Tel: Singapore Tel: Tokyo, Japan Tel: