Oil producers start to worry about rising prices

(hydrocarbonprocessing) -- As they prepare to meet with consumers at an energy summit in Kuwait, some of the world's top oil producers voiced concern that rising oil prices may backfire by jeopardizing a global economic recovery. The UK's Brent contract has risen by 17% since the start of the year amid tensions with Iran.

Saudi pipeline had been blown up pushed Brent prices to their highest level in about four years, leading to concerns they could return to levels not reached since 2008, when a record high of USD147/bbl was blamed for worsening a global recession.

Asked if an increase in oil prices to 2008 could endanger a global economic recovery, Angola's de Vasconcelos, whose country is the second largest crude-producer in Africa, said "I think so." A current price of USD125 a barrel for the Brent is already "a little bit high," he said.

Even Saudi Arabia, the world's largest oil exporter, is "slightly worried about recent oil price hikes as it's not based on market fundamentals". Indeed, while buoyant oil prices are boosting revenue for oil producers, they are also starting to realize further spikes could sharply hit demand for their crude and ultimately push prices into a downward spiral. Though producers have yet to hit the panic button, there are fears prices may be getting closer to the danger zone.

In its monthly report last week, OPEC said US oil consumption data for December showed the worst contraction observed since July 2009 and preliminary data for January and February 2012 has displayed similar drops.

For now, the decline in the west has been offset by Chinese purchases on international oil markets. But the Asian nation has been filling up its crude oil and products storage in January. That means it could draw into its stockpiles and cuts its imports if its finds global oil too pricey.

MRC

(chevron) -- Chevron said Tuesday its oil and gas production will inch up this year but it expects output to jump 20% in five years as massive liquefied natural gas (LNG) projects in Australia commence operations. Chevron officials noted that annual production could vary depending on oil prices.

During the company's annual meeting with analysts in New York, Chevron executives said production will rise 0.26% to 2.68 million bpd of oil equivalent this year, and to 3.3 million bpd of oil equivalent by the end of 2017.

Those estimates are up from 2.67 million bpd of oil equivalent it produced in 2011. The 2017 projection is based on an oil price average of USD79/bbl, the company said.

Chevron, based in San Ramon, Calif. and the second largest US oil company by market value after ExxonMobil, said annual production could vary depending on oil prices. The company has in place several share production sharing contracts with foreign governments that give more production to national oil companies - and less to international oil companies - when oil prices rise.

Light, sweet crude oil for April delivery on the New York Mercantile Exchange was 30 cents lower, at USD106.04/bbl, in a range of USD105.85 to USD107.13/bbl. Chevron's future growth will be driven by a handful of large oil and gas projects worldwide. The liquefied-natural-gas Gorgon project in Australia is on track to start production in 2014 and still expected to cost USD37 billion, the company said.

Construction of development wells is expected to start this year.
MRC

(DuPont) -- With effect from April 1, 2012, DuPont Packaging & Industrial Polymers has announced a price increase of Euro 0.20/kg on all grades of Ethylene Copolymer resins in the region Europe, Middle East and Africa.

This increase is effective from April 1, or as contracts allow. This increase is excluding DuPont Elvax EVA copolymer, which has been increased effective March 1st, 2012 as previously communicated.

Operating in approximately 90 countries, DuPont offers a wide range of innovative products and services for markets including agriculture, nutrition, electronics, communications, safety and protection, home and construction, transportation and apparel.
MRC

(plastemart) -- Technip has been awarded a front-end engineering design (FEED) contract by PETRONAS for its proposed refinery and petrochemical integrated development (RAPID) project located in the state of Johor, Malaysia. The contract is scheduled for completion in H2-2013. The contract is scheduled for completion in H2-2013. Financial terms have not been disclosed.

RAPID aims at building a world-scale integrated refinery and petrochemical complex by 2016 to answer the growing need for specialty chemicals and to meet demand for petroleum and commodity petrochemical products in the Asia-Pacific region. The proposed refinery will have a capacity of 300,000 bpd and will supply naphtha and liquid petroleum gas feedstock for the RAPID petrochemical complex, as well as produce gasoline and diesel that meet European specifications.

The petrochemical units, on the other hand, will enhance the value of the olefinic streams coming from the RAPID steam cracker by producing various merchant grade petrochemicals products such as polyethylene, polypropylene, synthetic rubbers and other petrochemicals products.

"This award builds on our long-term presence in Asia Pacific and confirms our leadership in the refining and petrochemical sectors," said Thierry Pilenko, CEO of Technip. "By combining the expertise and the teams of our operating centers in Kuala Lumpur (Malaysia), Paris and Lyon (France), we will be able to provide PETRONAS with the best technological solution and execution scheme."

MRC

(plastemart) -- Plans are progressing for a major Caustic Soda and ethylene dichloride (EDC) complex at Salalah Free Zone (SFZ). Promoters are set to break ground on the project before the end of 2012 and commission it by 2014-end. The project is being developed by Saltic FZCO (formerly known as Oswal Oman Caustic FZCO). Total investment in the venture is estimated at USD400-500 mln.

According to officials at Salalah Free Zone, the project has two key components: a 1,000 tons per day (tpd) capacity caustic lye plant alongside a 1,231 tpd ethylene dichloride facility. Significant progress has been made on the engineering design of the grassroots venture. Technology for the caustic soda plant will be provided by Chlorine Engineers Corporation of Japan, while Ineos of Europe will provide the know-how for the EDC facility. SNC Lavalin Engineering India and STX Korea have also been involved in the detailed engineering of the project.

Salalah Free Zone has earmarked around 80 hectares of land for the development of the complex against a 25-year lease (with extension options). Salalah Port Services (SPS) is reported to have signed an MoU with Saltic FZCO for access and use of its port facilities.

Likewise, provisional agreements committing up 150 MW of electrical power for the project have been reached, underlining the keen support extended by Dhofar's authorities towards the early and successful realisation of this important industrial investment.


MRC