Unipetrol to strengthen its position in petrochemical sector

MOSCOW (MRC) -- Czech downstream oil group Unipetrol (PKN Orlen's affiliate) expects petrochemicals to become the largest source of revenue for the company in 2013-2017, according to PKN Orlen's press release.

Unipetrol wants to use the favourable market conditions to reinforce its position on the petrochemical market and optimise its operations.

Thus, the company is preparing a number of modernisation projects: construction of new polyethylene and DCPD units, de-bottlenecking of polypropylene production. It also intends to continue the restructuring process (revamping of the residual oxidation unit (POX), possible closure of the ammonia unit).

By 2017, the Company plans to increase the capacity utilisation of the pyrolysis plant by 13%, and improve sales of petrochemical products by 11%, to 1.4m tonnes.

Based on estimates, average annual LIFO-based EBITDA should reach CZK 3.3bn (up by CZK 1.4bn compared with 2012). Capital expenditure (including expenditure on investments in the power segment) will amount to CZK 2.7bn in 2013-2017 on an average annual basis. Average annual operating cash flow (FCF) will improve from CZK 1.1bn in 2009-2012 to CZK 1.5bn in 2013-2017.

Unipetrol , a.s. is a group of companies operating in the petrochemical industry in the Czech Republic. In 2005 Unipetrol became a part of the PKN ORLEN Group, the largest oil processor in Central Europe. The UNIPETROL Group is oriented mostly towards oil processing, fuel distribution and petrochemical production. In all of these business areas the Unipetrol Group is among the key players both in the Czech Republic and on the Central European market. The Group ranks among the leading firms in the Czech Republic in terms of its revenues, and employs almost 4,000 people.
MRC

Chevron Phillips exploring ways to expand in the Middle East

MOSCOW (MRC) -- Chevron Phillips Chemical Co., the petrochemical venture of U.S. oil producer Chevron Corp. (CVX) and refiner Phillips 66 (PSX), is exploring ways to expand in the Middle East, including building a new plant, said Bloomberg.

The U.S. partnership would consider setting up a site on its own or in a joint venture, and the "entire" region is under consideration, Benny Mermans, head of Europe and Africa at Chevron Phillips Chemical’s international operations, said in an interview at a petrochemical conference in Frankfurt.

The chemical company’s owners are "very supportive" of growth plans, Mermans said. Woodlands, Texas-based Chevron Phillips, also known as CPChem, is already spending about USD5 billion on a new ethylene plant, or cracker, and two factories making polyethylene in Baytown, Texas, to take advantage of cheap natural gas, which is used as a raw material as well as an energy source.

"Look at our ownership structure," Mermans said. "We represent a fair share of their net income. By having that support, by creating margins, that provides us with a lot of legroom” for gaining resources for growth.
Chevron Phillips has three joint ventures in the Saudi Arabian industrial city of Jubail as well as partnerships in Qatar in Messaieed and Ras Laffan, Melanie Samuelson, a spokeswoman at the U.S. company, said in an e-mail.

Expansion would be financed by the chemical business itself, and Chevron Phillips would tap capital markets for further cash should the need arise, Mermans said.

Availability of cheaper shale gas in the U.S., extracted by the hydraulic fracturing process known as fracking, means that Europe is being "squeezed on all sides," Mermans said. The company will focus on more specialty chemicals in the region and is expanding a plant in Tessenderlo, Belgium, to add sulfur-based organic products.

In the U.S., Chevron Phillips is the first company in more than a decade to build an ethylene plant, Mermans said. The cracker, which will produce 1.5 million metric tons of the gaseous chemical a year, is on schedule to start operations in 2017, with the company’s board expected to give final approval in the third quarter, he said.

Dow Chemical Co. (DOW), the largest U.S. chemical maker by sales, and Exxon Mobil Corp. (XOM), the biggest U.S. oil company, have said they plan similar-sized ethylene plants in Texas.
"It’s a race," Mermans said. "CPChem is well placed to be first."

MRC

QP, Qapco sign tech licence deals for Al Sejeel project

MOSCOW (MRC) -- Qatar Petroleum and Qatar Petrochemical Company signed technology licence contracts for the multibillion dollar Al Sejeel petrochemical complex with Univation Technologies for the polyethylene technology and Dow Chemical Company for polypropylene technology, said Gulf-times.

QP and Qapco had signed the Heads of Agreement (HoA) to jointly develop the mega-petrochemical complex in Ras Laffan in February 2012.

QP and Qapco hold 80% and 20% equity interest respectively in the project.

The Al Sejeel Petrochemical Project is scheduled for completion in 2018 and will feature a world-scale mixed-feed steam cracker, with the original mixed feedstock of ethane, butane, and naphtha, thus allowing extra flexibility and diversity in terms of products.

QP and Qapco said the selection of the licensors was a highly strategic landmark and highlights the evolution of the project.

With the signing of the technology agreements, the Al Sejeel plants will be designed to produce 2.2mn tonnes per year (tpy) of polymers, including polyethylene and polypropylene resins.

Al-Sada said: "We firmly believe that the development of the downstream petrochemical sector will create countless opportunities for the production of new intermediate and derivative products."

The Al Sejeel project is part of Qatar’s large-scale expansion of the petrochemicals sector to support diversification and growth of the Qatari economy as the country has announced that it will raise its petrochemical output to 23mn tpy by 2020.

The petrochemical complex will produce ethylene, high-density polyethylene (HDPE), linear low-density polyethylene (LLDPE), polypropylene, butadiene and py-gasoline.

Qapco chairman Hamad Rashid al-Mohannadi said, "The Al Sejeel Petrochemical Project represents a pioneering initiative as it is the first time that two Qatari entities will build and develop together a petrochemical complex of this scale. Over the past years, Qatar and the country’s petrochemical sector in particular have built tremendous capabilities, developed a talented national workforce, and acquired strong technical and operational expertise to develop and implement strategic projects such as Al Sejeel."


MRC

Technip awarded FEED contract for a new biomass-to-liquid plant in Finland

MOSCOW (MRC) -- Technip was awarded by Forest BtL Oy a contract, worth approximately EUR5 million, for the front-end engineering and design (FEED) of a new second generation biomass-to-liquid (BTL) plant to be built on Ajos island, Finland, said Technip.

This plant will produce approximately 140,000 tons of biodiesel and naphtha from wood and by-products from the wood-processing industry. This feedstock has many advantages as it is not used for human food, it does not jeopardize the existing local biomass usage and has a low CO2 footprint.

Technip will develop the process design package of the hydrogen production unit of the plant, based on its steam reformer proprietary technology, and will prepare the FEED for the hydrogen production, Fischer-Tropsch synthesis and refining units.

Technip's operating center in Lyon, France, together with the Group's hydrogen technology center in Zoetermeer, The Netherlands will execute the contract, which is scheduled to be completed in the first semester of 2014.

The Ajos BtL project is supported by the European Union NER300 funding program for innovative renewable energy technologies. This project will be an industrial first and will reinforce Technip's leading position on new generation biofuels projects.

Biomass-to-liquid or BTL is a new generation biofuel, consisting of a multi-step process to produce liquid biofuels from biomass. Main technological steps are gasification, syngas cleaning and Fischer-Tropsch synthesis.

As MRC wrote before, Technip won FEED work on Sibur Russia PE project. The first contract concerns a linear low/high density gas phase polyethylene plant. Meanwhile, the second deal is for a high density slurry phase polyethylene plant, the company said. Each plant will consist of two parallel production trains with a total capacity of 1.5 million tpy of polyethylene.

Technip is a world leader in project management, engineering and construction for the energy industry.Present in 48 countries, Technip has state-of-the-art industrial assets on all continents and operates a fleet of specialized vessels for pipeline installation and subsea construction.
MRC

Oil demand in developing world surges

MOSCOW (MRC) -- Oil demand in developing countries surpassed that of wealthy nations for the first time ever in April, a US report revealed on Tuesday, in the latest demonstration of how rapid growth in Asia has upended trade and increased competition for resources, said Upstreamonline.

Led by surging growth in China, oil demand outside the wealthy nations' club of the Organisation of Economic Co-operation and Development (OECD) has jumped by almost 50% in the last decade, hitting 44.5 million barrels per day in April, the US Energy Information Administration (EIA) said.

Oil demand in developing countries "was higher than consumption in OECD countries for the first time in history", the EIA said in its monthly Short Term Energy Outlook, which pegged demand at 44.3 million bpd for April in OECD countries.

While the data for April may be a seasonal blip, with oil demand in Western Europe and the US generally diminishing in the spring, 2014 should cement the developing world as the majority consumer of the world's oil, the EIA said.

Ten years ago, the developing world consumed just two-thirds as much oil as wealthier countries, historical data from the EIA show. Countries in the OECD have also reduced consumption in response to higher prices and environmental concerns.

The changing patterns in global oil demand has pushed countries like China into new strategic and economic alliances.

The pace of China's oil demand growth appears to be slowing, however, the EIA said, forecasting consumption would increase by between 420,000 and 430,000 bpd this year and next, compared with an average of 520,000 bpd between 2004 and 2012.

As MRC wrote earlier, the OPEC oil cartel forecast its 2012 global oil daily demand of 88.63 million barrels
per day. Where in 2011, demand was 87.77 million bpd, according to OPEC figures.
MRC