Aramco CEO affirmed commitment to downstream

(Arabian oil and gas) -- Khalid al-Falih, CEO of Aramco, affirmed the company's commitment to expanding its downstream assets, saying Saudi is currently slated to spend USD 90 billion on downstream development projects. Al-Falih, addressing the 20th World Petroleum Congress in Doha, Qatar, said Aramco intends to become one of the top-tier petrochemicals companies in the world ⌠within the next decade.


Aramco is changing to meet burgeoning domestic demand for electricity generation feedstock, the tilt to non-OPEC and unconventional production, and the global enthusiasm for gas.


Upstream development will continue, with Al-Falih confirming that Aramco is ⌠undertaking a massive exploration campaign, which will include exploration of the Red Sea, shale oil, and spending USD17 billion to develop the offshore Manifa field, which is due to reach production capacity of 900,000barrels per day in 2014 under an accelerated timetable.


The Manifa project has involved building artificial islands in the shallow water of the Persian Gulf, in order to realize onshore-drilling recovery and logistical efficiencies. The project is central to providing feedstock for Saudi's new heavy crude refineries being built in conjunction with Total and Sinopec.


Saudi Aramco also in its annual review said that it will deliver the Karan offshore non-associated gas development onstream nest year, ahead of its 2013 schedule. When fully operational in 2012, the project will produce 1.8 billion cu ft a day of raw gas.


MRC

Deceuninck acquired PVC recycling equipment from Verpola nv

(Deceuninck) -- Deceuninck acquires the PVC recycling equipment from the Bruges (B-Belgium) based company Verpola nv.
Combined with the existing recycling capacity at its PVC extrusion site in
Gits (B), Deceuninck increases its annual recycling capacity to 20,000 tonnes. The complete line will be integrated into the infrastructure of its existing raw material production unit in Diksmuide (B).


The total expenditure amounts to ┬3 mln. In time, this operation is anticipated to employ 13 staff. The recycling of post-industrial waste from Deceuninck window manufacturers is expected to become operational from Q2 2012. By the end of 2012, the recycling of end-of-life PVC windows from window and door installers will start.


MRC

Production of base polymers in Ukraine increased by 2.5 times

(MRC) -- In November, production of volume polymers in Ukraine made 29.8 thousand tonnes. Over the 11 months, output of base polymers in Ukraine made 276.6 thousand tonnes, according to MRC ScanPlast.


Last month Ukrainian producer Karpatneftechem (Lukoil group) increased polyethylene (PE) production up to 9 thousand tonnes that was almost by 2 thousand tonnes more than in October. In January-November, total volume of HDPE production in Ukraine made 93.3 thousand tonnes.


In November, Linik (TNK-BP group) increased output of polypropylene (PP). Last month total PP production increased to 8.3 thousand tonnes. Over the 11 months, total PP production in Ukraine made 85.4 thousand tonnes that was by 23% more, year on year. Such a low last year volume of PP production resulted from a long turnaround of the whole complex of oil refineries.

In November, production volumes of suspension PVC by Karpatneftechem (Lukoil Group) made 10.8 thousand tonnes. The Ukrainian producer loaded its PVC facilities not more than by 50%. Over less than seven months, Karpatneftechem produced about 76.5 thousand tonnes of PVC-S.


In November, Ukrainian producer Stirol produced 1.6 thousand tonnes of polystyrene, which was almost two times lower compared to October figures. In January-November, the company's output of polystyrene made nearly 21.4 thousand tonnes, which was by 37% more, year on year.


In general, over the 11 months, total output of base polymers by Ukrainian producers made 276.6 thousand tonnes that was by 153% more, year on year. Such growth of production volumes was provided by the launch of new capacities (PVC at Karpatneftechem), as well as increased production volumes at existing production sites.


MRC

Russian market of windows in 2011 grew by 3% - Alexander Stepanenko

(MRC) -- Objective assessment of the capacity of Russian market of translucent constructions and PVC profiles is actually impossible because of the hidden figures of economic activity. This was stated by Alexander Stepanenko, Director Veka Rus/Veka Ukraine, during his speech at the Polymers Summit - 2011, which was held by MRC with ICIS support.

As per Stepanenko, according to the estimates of the leading Russian producers of PVC profiles, members of the Union of Producers of Polymer Profiles (UPPP), the growth of Russian market of windows in 2011 has made only 3% year on year. The market volume of PVC constructures, taking into account the growth, will make about 28 million units. The total tonnage of PVC profiles will make about 470 thousand tonnes. In 2012 the market is not expected to grow.

Among the major trends in the market of PVC director of Veka Rus/Veka Ukraine noted the globalization of markets and the restructuring of sales patterns. According to him, 80% of sales are made through dealer network.

The dealers manipulate the suppliers and put big pressure on prices. In addition, dealers form a consumer market, imposing a product with low consumer quality, and have a bad influence on producers of windows.


The annual capacity of Veka Rus/Veka Ukraine Group exceeds 70 thousand tonnes of PVC profiles. The total foreign investments make 120 million euros.



MRC

To be competitive Russian producers need to have oil and gas prices at Asian level

(MRC) -- Russia's joining into the World Trade Organization (WTO) will bring almost all industries to new competitive level. This was stated by Sergey Arbuzov, General director of Europlastic at his speech at the Polymers Summit - 2011, which was held by MRC with ICIS support.

According Arbuzov, there will be great changes as for producers of plastics as well as for converters of polymers. In particular, Russia's joining to the WTO and the subsequent cancellation (decrease) of import duties will open borders to foreign products, either in a form of feedstock, or in a form of finished products.

With the opening of the borders, all market participants will face tough competition from foreign producers in pricing, product quality, cost of polymers production and products made from them. If the cost of production depends upon the major sources of feedstock of natural monopolies, then the competition in polymer processing depends on existing technologies and "know-how."


According to Sergey Arbuzov, to become competitive in price, producers will have to get the prices of oil, gas, electricity and transport at the Asian level, as well as get rid of marginal assets. As per CEO of Europlastic, it refers only to those producers who work with cutting-edge technologies, others will have to work with the subsidized feedstock.

Europlastic works with two operators, who provide warehousing services for the storage of up to 12 thousand tonnes of polymers, as well as with 5 companies, providing freight forwarding services. Company's monthly volume of purchases and sales of polymers makes on average 18-20 thousand tonnes amounting to rouble (Rb)1.3 billion monthly, including VAT 18%.

The main polymers supplied by Europlastic are polystyrene, polypropylene, polyethylene, PVC.


MRC