Asian spot ammonia prices are expected to remain firm

(ICIS) -- Asian spot ammonia prices are expected to remain firm for at least another month, supported by limited availability and healthy demand in the region, sources said on Monday. Spot supply from the Middle East - Asia's main source of ammonia - is tight even though production has increased in recent months with the start-up of SABIC's new 1.1m tonne/year Ma'aden plant in Saudi Arabia in February this year, they said.

Ammonia prices have been rising for more than three months and were last assessed at USD 555-575/tonne (EUR 389-403/tonne) CFR (cost and freight) Asia in the week ending 27 May, up by about 1.2% from mid-February, according to ICIS data.

Middle East spot material is snug as global ammonia demand is strong and most production has been committed to term customers, sources said.

Saudi producer SABIC is reported to be a sold-out position for June, even though its newly started Ma'aden ammonia unit is now running at full rates.

Japanese trading company Mitsui purchased one of the few June spot cargoes available from SABIC, a source said on the sidelines of the International Fertilizer Industry Association (IFA) conference in Montreal, Canada, which ran from 22-25 May.

MRC

(ICIS) -- US-based tyre producer Goodyear declared force majeure on styrene butadiene rubber (SBR) and other butadiene (BD) derivatives because its supplier is short of the monomer, the company said on Friday.

BD is a key feedstock for styrene butadiene rubber (SBR), used to make tyres, belts, hoses and numerous other products.

Domestic BD supply is tight because of an ongoing turnaround by one producer that is expected to last until the middle of June.

Other factors are the sales control from another producer following production issues earlier in the year and limited crude C4 exports from Libya in the first quarter. Crude C4 is the feedstock for BD.

The shortage has driven BD spot prices to the USD 2/lb (USD 4.409/tonne, EUR 3.130/tonne) mark, while contract nominations for the June BD settlement were USD 1.50-1.65/lb, according to ICIS.

MRC

(Plastemart) -- Hindustan Petroleum Corporation (HPCL) in talks with various entities in a bid to revive plans to set up a USD 10 bln refinery-cum-petrochemical project in Vizag. This project had been put on hold by a HPCL-led consortium in 2007. The company is presently in talks with Oil India Limited (OIL) and GAIL (India) and is also open to taking in a foreign partner to implement the project. The company plans to invest Rs.45.000 crore, mostly in refinery capacity additions, in six years beginning 2011-12.

HPCL's Vizag refinery capacity is being expanded while a new unit is being planned in Maharashtra. The company's 9 mln tons Bhatinda refinery in Punjab will be mechanically completed in August/September and will be fully commissioned by year-end.

MRC

(Bloomberg) -- Oltchim SA has made an offer to buy OMV Petrom SA (SNP)'s Arpechim refinery as Romania attempts to increase the company's appeal before selling its stake in the PVC maker. Oltchim is seeking to get cheaper raw materials for its petrochemical operations and boost investors' interest in the chemical company before its privatization, Chief Executive Officer Constantin Roibu said by phone today.

The company aims to conclude the deal before the government sells its majority stake in loss-making Oltchim by the end of the year, Deputy Economy Minister Karoly Borbely said in an interview.

Petrom, Romania's largest oil and gas company, said in March that it will permanently close Arpechim and convert the site into a crude oil and fuel storage facility after it failed to find a buyer for the outdated refinery. Oltchim already bought Petrom's petrochemical assets at the Arpechim refinery last year for EUR 13 million (USD19 million) and an undisclosed amount of debt restructuring.

Oltchim, which is based in Ramnicu-Valcea in southern Romania and has reported annual losses since 2007, would reduce raw materials costs by as much as 35 million euros a year after the refinery purchase, according to the CEO.

MRC

(Arabian Oil and Gas) -- Total announced that it has signed an agreement with CNOOC Middle East (Qatar) Limited, a wholly-owned subsidiary of CNOOC International Limited, to acquire a 25% interest in Qatar's Block BC (pre-Khuff) exploration license. CNOOC Middle East (Qatar) Limited will continue to be the operator with a 75% interest.

Located 130 kilometers east of the Qatari coast, the offshore block covers an area of 5,649 square kilometers, with water depths ranging from 15 to 35 meters.

Commenting on Total's participation in the Block BC EPSA, His Excellency Dr. Mohammed Bin Saleh AI-Sada, Qatar's Minister of Energy and Industry said ⌠We would like to welcome our long time partner, Total, into the Block BC EPSA, and we wish them and CNOOC all success with the exploration activities, which we believe are always enhanced when quality companies such as Total and CNOOC join efforts.

MRC