Braskem is buying Dow Chemical's PP business

(Braskem) -- Braskem, the leading resin producer in the Americas, announced the acquisition of the Polypropylene Business from The Dow Chemical Company for USD 323 million. This transaction represents an important step in Braskem's growth strategy in the Americas and consolidates its polypropylene leadership in the U.S.

The assets involved in the deal include two manufacturing plants in the U.S. and two in Germany, with a total annual polypropylene production capacity of 2.3 billion pounds. The plants in the U.S. are located at Freeport, TX and Seadrift, TX, and will increase Braskem's polypropylene capacity by 50% in the region to an annual production capacity of 3.1 billion pounds. The two plants located in Germany, at the petrochemical complexes of Wesseling and Schkopau, have annual capacity of 1.2 billion pounds of polypropylene.

The transaction is expected to close by the third quarter 2011 pending regulatory approvals.

MRC

(SIBUR) -- SIBUR has bought JSC Acrylate - the only CIS-based producer of acrylic acid and its esters - from ATEK Group. JSC Acrylate's production site is located in the eastern industrial area of Dzerzhinsk, Nizhny Novgorod region, and is just 2km from SIBUR's facility, which provides JSC Acrylate with its basic raw material - propylene.

The production capacity of JSC Acrylate's plant is 25 KTa of ester grade acrylic acid, 36 KTa of heavy esters (butyl acrylate) and 10 KTa of light esters (methyl and ethyl acrylate).

⌠The acquisition of JSC Acrylate will help acceleratedevelopment of the market for acrylic derivatives in Russia and the CIS. We, together with our partners, are considering the possibility of increasing the output capacity and expanding the processing of products by JSC Acrylate, said Valery Andosov, Head of the Project Office for Specialty Chemicals and Polymers at SIBUR.

MRC

MOSCOW (MRC) -- A serious decline in overall imports of polypropylene (PP) in Russia in June and July as well as suspension of Tomskneftechem capacities for scheduled maintenance did not stabilize the prices in the market. Polypropylene prices continue to fall under the pressure of oversupply - according to the ICIS-MRC Price Report.

This year the market of homopolymer propylene turned out to be most vulnerable. In the first half-year, overall imports of PP-homo grew by 47% to around 60 KT, while export shipments of Russian producers reduced by 30%. All these factors led to the gradual accumulation of PP significant stocks at the producers as well as traders.

In June, Russian producers lowered prices in order to reduce PP imports and thereby balance the market. By the end of July, polypropylene imports had fallen significantly (imports from the country-supplier ╧1 -Turkmenistan - nearly halted), but the polymer oversupply in the market still remains high.

From July 19, Tomskneftechem's capacities (annual production - 130 KTa) stopped for 30-day maintenance. The seasonal factor led to the difficulties in polypropylene supply from Stavrolen (no rolling-stock and limited road transport). In late September, capacities in Budennovsk will be shut down for scheduled maintenance. Also in August, some Russian producers plan to increase export sales of polypropylene.

All of these factors can lead to a serious decrease of PP offer in the Russian market by the end of August. Meanwhile, this surplus continues to downplay prices. By the middle of this week the bid for the Russian raffia had been reduced to RUB 55.000 - 56.500/t, including VAT, FCA.

MRC

(Arabian Oil and Gas) -- BP has not ruled out major restructuring along the lines of the recently announced upstream/downstream split of ConocoPhillips, according to a Reuters report. The supermajor's CEO Bob Dudley said yesterday that BP will prosper either way once it gets beyond the current difficult transition period caused chiefly by giant liabilities arising from the Gulf of Mexico spill last year.

Speculation has grown in recent weeks as to whether BP might consider following ConocoPhillips (COP) in separating its exploration and production, or upstream, and refining and marketing, or downstream, divisions into different businesses.

This speculation has been fuelled by BP's Q2 results yesterday which undershot analysts' predictions and led shares down 2%.

MRC

(Arabian Oil and Gas) -- The Iraqi Oil Ministry has announced that the deadline for bids in the fourth round of exploration and production contracts will be either the 25 or 26 January 2012, according to the Iraq Oil Report.

The Oil Ministry is plowing ahead, despite objections from Iraq's MPs that no further progress should be made on awarding new contracts until after the suite of oil laws making their way through parliament have hit the statute books.

In addition to the 45 companies pre-qualified for the auction, 38 more firms filed applications with the Oil Ministry last month, reports Iraq Oil Report.

MRC