Oriental Energy to start up new PP plant next year

MOSCOW (MRC) -- Oriental Energy is in plans to start a new polypropylene (PP) plant, reported Apic-online.

A Polymerupdate source in China informed that the plant is likely to be started in mid 2014.

Located in Zhangjiagang, China, the plant will have a production capacity of 400,000 mt/year.

As MRC informed previously, Zhenhai Refining & Chemical Co (ZRCC) is in plans to shut a polypropylene (PP) plant for maintenance turnaround in May 2014. The duration of the shutdown could not be ascertained. Located in Ningbo, Zhejiang province in China, the plant has a production capacity of 250,000 mt/year.

Another Chinese petrochemical producer - Shaoxing Sanyuan Petrochemical shut its PP plant for maintenance turnaround on November 20, 2013. It is likely to remain off-stream for around one month. Located in Shaoxing, Zhejiang province, the plant has a production capacity of 200,000 mt/year.
MRC

Pemex nets Spanish yard stake

MOSCOW (MRC) -- Pemex has firmed up a deal to acquire a majority stake in a shipyard in Spainish north-western Galicia region, said Upstreamonline.

The state-run oil giant has taken a 51% slice in Barreras shipyard, confirming reports earlier this year that the deal was imminent. Mexico City-headquartered Pemex said the deal was aimed at reviving the Spanish shipbuilding industry as well as servicing the Mexican oil industry.

Spanish daily El Pais reported before the summer that Pemex was considering signing a letter of intent to take the 51% stake in Barreras. Pemex said last September its PMI unit had signed two contracts for flotels, one to be built at the Hijos de J Barreras shipyard in Vigo and state-owned yard Navantia in north-western Spain. The reported value at the time was USD392 million.

The company added last year that it also planned to contract 14 tugs, seven to be built in Galicia and seven in Mexican yards. The plans are part of a broader programme of at least USD800 million for the company to revamp its fleet.

On 15 April, Mexican president Enrique Pena Nieto and Galician government president Alberto Nunez Feijoo met to "strengthen a strategic alliance" between the two entities with an eye to investment of up to USD240 million in the state oil company's fleet, according to Galicia.

The arrangement could help lead to the contracting of new vessels, Conde said at the time.

Founded in 1892, the Barreras shipyard is mainly concerned with the construction of offshore vessels, ferries and roll on-roll off vessels.

As MRC wrote before, Pemex Petroquimica and Mexichem entered into a joint venture, which will enable greater competitiveness of the domestic petrochemical industry in the global market through the integration of a new company, which will create value to the chlorine-vinyl Chain. The joint venture includes a cash investment and assets contribution up to the amount of USD518 million, of which PEMEX will participate with USD228 million in assets while Mexichem will contribute with both, USD90 million in assets and USD200 million in cash in order to modernize the Pajaritos complex.

Pemex, Mexican Petroleum, is a Mexican state-owned petroleum company. Pemex has a total asset worth of USD415.75 billion, and is the world's second largest non-publicly listed company by total market value, and Latin America's second largest enterprise by annual revenue as of 2009. Company produces such polymers, as polyethylene (PE), polypropylene (PP), polystyrene (PS).
MRC

Duma 'nod' for LNG export shift

MOSCOW (MRC) -- The upper house of Russian parliament, the State Duma, approved on Wednesday legislative amendments to allow rivals of state-run Gazprom to export seaborne liquefied natural gas, said Upstreamonline.

The measure, which has still to be rubber-stamped by President Vladimir Putin, effectively ends Gazprom’s monopoly on LNG shipments, though the gas giant will still have exclusive rights to pipeline exports that are mainly to Europe.

The Kremlin is looking to open the door to other LNG exporters such as Russia’s second-largest gas producer Novatek and state-owned oil company Rosneft, which is seeking to expand its position in the gas market, as Gazprom has been slow to develop its own projects.

The amended law restricts Rosneft's LNG exports to those produced from offshore deposits. Russia aims to double its current global LNG market share of 4.5% by 2020 but is facing increasing competition from major suppliers in Qatar and Australia, as well as emerging players Tanzania and Mozambique that have recently made big offshore gas discoveries.

"The decision to increase the line-up of exporters of natural gas in the form of LNG must secure an increase in Russia's share of the gas market," according to an upper house document cited by Reuters.

Lawmakers had earlier said the law would come into force next year, three years before the first new LNG plant is launched.

Novatek is building the plant, due on stream in 2017, as part of the Yamal LNG project in West Siberia where it is partnered by Total and China National Petroleum Corporation.

Rosneft, which is Russia’s leading oil producer, aims to raise its gas output to 100 billion cubic metres by 2020 with plans to build a liquefied natural gas plant jointly with ExxonMobil on Sakhalin island in Russia's far east.

The Pacific island already hosts the country’s only LNG plant, which is operated by Gazprom in partnership with Anglo-Dutch supermajor Shell.

Meanwhile, Novatek this week signed a memorandum of understanding with Italy’s Eni to jointly participate in future offshore projects in the Mediterranean Sea.
MRC

German chemical sector targets US for investment

MOSCOW (MRC) -- Germany is becoming less attractive as a hub for chemical activity, with many of the nation's companies targeting the US for new investment, said Hydrocarbonprocessing.

German companies invested EUR3.2bn in new chemical plants or expansions in the US a year ago, up 54% from the prior year. The US now accounts for 41% of the German industry’s foreign investments, up from 28% in 2005.

Overall, the year 2012 marked the first time since 2001 that foreign investments from German companies exceeded domestic investments.

"Our chemical companies are facing significant pressure in Germany, because of the increases in energy costs," said VCI general manager Utz Tillmann. "Abroad, and particularly in the US, the firms obviously find better conditions for their production, helping them to preserve their competitiveness."

VCI said that Germany’s electricity costs are 2.5 as high as the US, while natural gas prices are about three times as high. If Germany wants to increase its domestic investment, the country needs to ensure that its plan to exit nuclear power and build up its renewables sector remains affordable for producers, Tillman said.

Otherwise, the development could turn into a trend, he warned. On the whole, foreign investments from Germany’s chemical industry rose 25% to EUR7.7 billion in 2012, while domestic investment stagnated at EUR6.3 billion.

As MRC wrote before, Linde Group has been awarded a contract to build a natural gas terminal in the town of Emden in northern Germany. The deal is worth around EUR 260 million. The contract was awarded by Norwegian state-owned company Gassco AS on behalf of Gassled joint venture.
MRC

Poland draft shale law 'ready by year's end'

MOSCOW (MRC) -- Poland new environment minister said his ministry will draft a law to regulate the exploration and extraction of shale gas in the country and send it to the government for approval by year's end, said Upstreanonline.

Maciej Grabowski has made it a priority to speed up uncoventional devlopment in the country that has some of the largest potential shale resources in Europe. Poland is eager to be able to supply its own energy needs to be less reliant on Russian imports.

Grabowski says passing clear hydraulic fracturing regulations will make it easier for companies to invest in shale in Poland. "I believe that one can achieve environmental goals by tying them to economic goals in a way more friendly for investors," Reuters quoted Grabowski as saying.

"We would like the law facilitating investment in shale to be passed as soon as possible to reduce the potential risk for investors," he said. Grabowski said the long-anticipated law on shale gas taxes would be prepared separately by the finance ministry.

Companies have begun an exodus from Poland amid unclear regulations and mixed well results. US supermajor ExxonMobil made the most high profile departure to date, abandoning concessions earlier this year. Marathon Oil and Talisman Energy followed suit. Other global players like Chevron and ConocoPhilips have stayed on, however.

Grabowski said Poland must drill three to four times more exploration wells to know if shale can be developed commercially. "200 to 250 wells will allow us to find out if commercial extraction is realistic," he was quoted as saying.

But he also warned that pending European Union plans to regulate - or even ban - fracking could pose problems to Poland's shale prospects. He said Poland is ready to defend its right to exploit its shale reserves. "I know what is happening in Brussels, some concern is warranted," Grabowski said. "If there is need we will act in an unambiguous way on many front lines and create coalitions to back our position."
MRC