Preem Archives • SwedeInternational

Preem gets a pass

Another hinder for Preem’s expansion bites the dust
pic: Preem.se

Last August, in this post, it was discussed how the government was going to be the deciding party regarding whether or not Preem, Sweden’s largest fuel company, would be allowed to build an even bigger oil refinery on the west coast – and oh, by the way, become Sweden’s biggest – numero uno by far – source of CO2 emissions. For a refresher on this issue, check out the post.

Meanwhile, since that decision in August, Preem made some changes to its bid, reducing the size of its expansion and by that, the amount of CO2 emissions. According to DN, today’s ruling by the Land and environmental court (mark- och miljööverdomstolen) said two important things that strengthen Preem’s argument to build:

the climate policy framework that parliament agreed upon in 2017 serves as a guideline for climate policy, yes – but it has no legal weight in granting or not granting permits in single operational cases, and
the so-called stopping rule in the Swedish Environmental Code (miljöbalken) cannot be applied to carbon dioxide emissions from an activity already covered by the EU emissions trading system.

Having said this, the ball is now firmly in the government’s court. The court has said that there is no previous ruling, or law, or agreement that prevents Preem’s expansion. It will be completely up to the government to say yes or no to Preem.

Of course the Green party will be opposed, and they are officially a part of the government. But the real decision-making rests with the Social Democrats and it could be a tougher call there. Preem’s expansion means Swedish jobs at a time when Swedish jobs are really needed. And, if Preem doesn’t refine this oil, the argument goes, someone else will – and that someone is not going to be nearly so clean about it as Preem would be. On the other hand, the environment. And, if someone else refines the oil then at least it isn’t in (or on) Sweden’s hands.

One option for the government is to drag out the decision for so long that Preem and/or Sweden loses interest. Or the government can hope that something else happens that makes the question go away (though be careful what you wish for). Perhaps taking a page from Tegnell’s playbook could be a way to go – make a decision and stand by it regardless of whether it’s the right thing to do or not.

16 sep. – oil prices start ticking

A drone attack by Huthi rebels in Yemen, backed by Iran, hit oil production facilities in Saudi Arabia last Friday and caused a production stop to the tune of 5.7 million barrels per day. Or putting it another way, halting 6% of the world’s oil supply (). Something fun to do might be to sit outside a gas station and watch the price of a liter gas (and diesel) flicker up and down as the extent of the strike damage filters up to us here in Sweden.

The Swedish Energy Agency, energimyndigheten, states that Sweden imports about 22 million cubic meters of crude oil a year, mostly from the North Sea and Russia. We also have some heavy duty refining companies (see Preem blog here) making us, believe it or not, also an exporter of refined petroleum products. Be that as it may, the drone strike has led to the highest single-day oil price increase, in Sweden, ever ().

But it doesn’t stop there. All those Wish orders from China clogging up PostNord? China, but also India and South Korea, import huge amounts of oil from Saudi Arabia. The increase in cost makes manufacturing and transport even more expensive. Eventually, that makes the price we pay here also more expensive. Even if there is no shortage of petroleum in the world, and most countries have even a certain back-up supply, the hit makes things uncertain and unstable – two “un”s that spell turbulence.

Although the Huthi rebels have taken responsibility for the drone attack, there remain some doubts as to whether or not they could really have done it. Worst would be if they prove they can by doing it again. It also puts an extreme damper of the worst kind on Sweden’s hopes of helping mediate an end to the war. Since Margot Wallström has left the building at Arvfurstens palats it’s unlikely that our new Minister for Foreign Affairs Ann Linde will pick up the glove. It looks like she wouldn’t find any interested parties over there anyway.

Fri. 23/8 – locals ask for help on Preem

The government gave notice today that they will make the final decision on whether or not Preem will be allowed to expand their business in Lysekil as planned. Preem is Sweden’s largest fuel company, refining 18 million cubic meters of crude oil every year. It also is the third largest source of carbon dioxide emissions in Sweden, and the expansion would make them the number one emission source. Some estimates have Preem’s expansion raising Sweden’s total CO2 emissions by three percent (svt.se).

Preem’s plan is to build a new refinery that would process crude oil to gas and diesel fuel with reduced sulfur content. About 150 new jobs would be created, according to Preem, and the refinery would be handle its emissions with carbon collections and storage efforts. Preem says that they are a way more environmentally friendly company than any another company who would otherwise process the oil would be.

Preem originally got the ok to go ahead from the court of property and environmental affairs (mark- och miljödomstolen). Soon afterwards, however, the decision was appealed by not only a slew of private citizens but also by the Swedish Society for Nature Conservation (Naturskyddsföreningen). Now, both the Conservation Society and the Swedish Association of Local Authorities and Regions (Svenska Landsting) want the government to take it out of the hands of local authorities, and decide how to handle it at the state level.

Green Party leader and vice Prime Minister Isobella Lövin welcomed the chance, saying that the government has a responsibility to live up to the climate law. This law, passed in 2017, requires the government to push environmental policies that adhere to climate goals passed by parliament. Since the parliament has decided that Sweden will have zero CO2 emissions by 2045, Preem’s timetable might be tight: There are several preliminary instances to go through first, and the government won’t get near the question until earliest next year.

Meanwhile, the question still divides Lysekil. While many say that thinking Preem or Lysekil is going to save the world is ludicrous, others believe it’s still important to take a stand. Preem’s spokesperson Dani Backteg says Preem welcomes the government to make a decison: ”It’s obviously a complex question.”