Petrobras rebounds as output estimates boost trade prospects

MOSCOW (MRC) -- Petrobras rebounded from the biggest slump in four months after Brazil’s state-run crude producer forecast increased oil exports and fuel output, said Hydrocarbonprocessing.

After posting an unexpected second-quarter profit decline on higher fuel imports and lower oil exports, Petrobras said in a presentation on Aug. 11 that sales to overseas markets probably would surge 51% in the second half while refinery production would rise 4%. That signals a reduction in losses from selling imported fuel at below global prices.

"There’s a lot of new oil we’ll have in the coming weeks and months," Jose Formigli, who heads exploration and production, said on Aug. 11 on a conference call with analysts. Petrobras, based in Rio de Janeiro, rallied 4.3% to close at 20.14 reais in Sao Paulo after tumbling 4.2% on Aug. 8.

Earnings of the biggest crude producer in ultra-deep waters has disappointed analyst in three of the past four quarters. Crude exports fell 14% in the second quarter from a year ago while an increase in fuel output wasn’t enough to prevent a 56% surge in imports, which are sold at a loss because of price caps. President Dilma Rousseff’s government, which controls Petrobras with a majority of voting shares, has prevented the company from increasing prices enough to erase import losses as it seeks to keep inflation in check.

The fuel subsidy policies have weighed on the shares, which have lost investors 37% in the past four years, making it the worst performer of the 20 most valuable major oil producers. The company’s fuel imports jumped to 407,000 bpd in the quarter, from 261,000 a year earlier. Daily crude exports fell to 308,000 bbl from 359,000.

In today’s presentation, Petrobras said it expects crude exports to average 250,000 bpd in the second half. Output at the company’s pre-salt fields reached a record 546,000 bbl on July 13. Net income fell 20% to 4.96 billion reais ($2.2 billion), or 38 centavos a share, from 6.2 billion reais, or 48 centavos, a year earlier. That trailed the 55-centavo average of 12 analysts’ estimates compiled by Bloomberg.

Petrobras plans to boost domestic crude output 7.5% this year as it connects wells to production equipment in deep waters of the Atlantic. The company’s domestic output rose 2% in July from the prior month to 2.049 million bpd as it increased production at two new platforms. This month it surpassed 2,100 bpd as the company added wells to new platforms, Formigli said. A combination of equipment delivery delays, unplanned maintenance at offshore platforms and faster-than-expected declines at the company’s legacy fields in the Campos Basin has left production little changed since 2010.

As MRC wrote before, Brazilian state-run energy giant, Petroleo Brasileiro SA or Petrobras ( PBR ) has awarded two ultra-deepwater contracts to the project management, engineering and construction company, Technip ( TKPPY ). However, the value of the contracts has not been disclosed.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

MOSCOW (MRC) -- High summer temperatures can cause cracks during the drying stage of industrial flooring concrete. MasterKure 111WB from BASF prevents this and takes effect a step earlier than conventional curing compounds, as per the producer's press release.

Summertime construction can be treacherous: With regard to concrete floors, this is particularly true for the phase between pouring and subsequent surface smoothing, known as floating or power troweling. Even at environmental temperatures of 20 degrees Celsius, 50% relative humidity and wind velocities of 20 kilometers per hour, fresh concrete loses about 0.6 kilogram water per square meter and hour during that stage. This can lead to drying cracks, known as early-age shrinkage cracks. Furthbasfer consequences may include additional costs for repairs or even customer complaints.

MasterKure 111WB from BASF can prevent all this: A highly effective, non-solvent-based, sprayable evaporation inhibitor, the product is used during the intermediate curing stage of industrial flooring concrete. This means that it takes effect a step earlier than conventional curing compounds – usually, these can only be applied onto the matt-dry concrete surface some five hours after placing.

The principle is simple: MasterKure 111WB prevents the water film, created when the concrete has initially settled after placement, from evaporating. Experts call this the “bleeding” of the concrete. MasterKure 111WB forms a barrier of active-component molecules which strongly inhibits the evaporation of the water film. This is particularly relevant with regard to modern concretes and their lower water-cement ratios and finer cements. The use of MasterKure 111WB results in an about 80% reduction of water evaporation during the first four hours compared to untreated concrete, largely preventing the occurrence of early-age shrinkage cracks.

The extremely thin layer of MasterKure 111WB on the surface also has another benefit as it works extremely well as a troweling aid: When the concrete is treated with the power trowel later on, MasterKure 111WB acts like a lubricant, thereby facilitating the entire troweling process. Thus, the product is not only an outstanding evaporation inhibitor but also an effective troweling aid. In this way, MasterKure 111WB optimally supports the typical finishing process of concrete floors.

As MRC wrote before, BASF Shanghai Coatings Co., Ltd. has inaugurated its new automotive coatings plant at the Shanghai Chemical Industry Park in Shanghai, China. The expansion of its automotive coatings production capacity with an investment of around EUR50 million further strengthens BASF’s presence in China and its position as a leading coatings supplier to the automotive industry.

BASF is the world’s leading chemical company. Its portfolio ranges from chemicals, plastics, performance products and crop protection products to oil and gas. BASF had sales of about EUR74 billion in 2013 and over 112,000 employees as of the end of the year.

MRC

MOSCOW (MRC) -- The Korean SK Chemicals holding company intends to become a resident of the petrochemical cluster in Primorye, as per press release of official site of the Primorsky Territory Administration.

Alexey Starichkov, the Director of the Department of International Cooperation an Tourism Development of the Primorsky Territory had a meeting with Kim Dae-Su, the Managing Director of the Department of SK Chemicals (the Republic of Korea) global business. The parties discussed petrochemical cluster of Primorye forming progress and a possibility of Korean holding company involving.

According to Alexey Starichkov, the anchor project of a future cluster in the Partizansk district will be “EPCC” company. Also, the Administration of Primorye together with the largest world developer – Singaporean Jurong corporation – will create a site near the “EPCC” plant, which will create re-refining products.

Mr. Kim, in his turn, noted that SK Chemicals today intends to expand business building up production in the Far East of Russia, and the petrochemical cluster in Primorye is an appropriate site for this purpose.

He told that SK Chemicals today is one of the biggest South Korean companies of petrochemical industry and film production, and also holds world leading positions in production of polyols, propylene oxides and polyurethane.

In particular, in Primorye SK Chemicals intends to create products required in automobile manufacturing.

Alexey Starichkov noted that on the basis of Sollers company it is planned to manufacture 75 thousand of motor-cars per year by 2016. Also car parts manufacturing will be conducted on the company basis.

In addition to that in 400 kilometers from Primorye it is located the world leader of motor-car production – the Chinese city Changchun. Over one million of motor-cars is manufactured there per a year.

As MRC wrote before, SK Chemicals will launch a joint venture (JV) with Japan's Teijin Chemicals for developing, producing and marketing a super-engineering plastic, polyphenylene sulfide (PPS). The proposed JV will set up PPS resin production plants to manufacture 12,000 tons per year (tpy) of PPS by 2015. The companies are also considering expanding the manufacturing capacity to 20,000tpy during the second phase of the project.

SK Global Chemical Co., Ltd. develops, produces, and supplies olefins, such as ethylene, propylene, butadiene, MBTE, and butene-1; aromatics. The company also provides polymers, including linear lower, medium, and high density polyethylene products; and home, impact, and random polypropylene products. It serves customers in South Korea and internationally. The company was founded in 1962 and is based in Seoul, South Korea with a sales office in Shanghai, China. SK Global Chemical Co., Ltd. operates as a subsidiary of SK Innovation Co., Ltd.
MRC

MOSCOW (MRC) -- Huntsman Corporation announced that it experienced an unplanned manufacturing disruption on a production unit at its facility in Port Neches, Texas, as per the press release of the producer.

There were no injuries resulting from the incident. The disruption occurred on Thursday August 14 and was caused by equipment failure.

The Port Neches facility manufactures methyl tertiary butyl ether (MTBE), propylene oxide (PO) and propylene glycols (PG). The manufacturing disruption also impacts internal PO supply to downstream MDI systems, amines, surfactants and propylene oxide derivatives. The affected unit is expected to be off-line for two to three weeks, with an estimated negative impact of USD30 million EBITDA for Huntsman’s Polyurethanes and Performance Products divisions.

It is yet to be determined whether this will impact the planned maintenance scheduled for the first half of 2015.

As MRC wrote before, the performance products division of Huntsman will expand its global polyetheramines (PEA) capacity by a minimum of 15% as a result of debottlenecking three of its PEA manufacturing plants globally.

Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated chemicals with 2012 revenues of over USD11 billion. Our chemical products number in the thousands and are sold worldwide to meet the needs of consumers and manufacturers serving a broad range of end markets. We operate more than 75 manufacturing and R&D facilities in 30 countries and employ approximately 12,000 associates within our 5 distinct business divisions.
MRC

MOSCOW (MRC) - Imports of high-density polyethylene (HDPE) to the Russian market fell by 13% in the first seven months of this year.
The greatest decrease in imports occurred for polyethylene film, according to MRC DataScope report.

Russia's HDPE imports seasonally increased to 30,600 tonnes in July. Total HDPE import in Russia decreased to 155,200 tonnes in January - July 2014, compared to 177,500 in the same time a year earlier. The greatest reduction occurred for film HDPE, while the imports of blow moulding and injection moulding polyethylene, on the contrary, increased.

Structure of HDPE imports in the country looked as follows.

Russia's imports of pipe HDPE exceeded 10,000 tonnes in July, compared with 8,400 tonnes in June on the back of the seasonal factor.
Russia's pipe HDPE imports totalled 42,600 tonnes in the first seven months of the year, up by 2% year on year.

Russia's imports of HDPE for extrusion coating of large-diameter pipes decreased almost twofold to 3,200 tonnes in July, compared with 6,100 tonnes in June. Total imports of HDPE for extrusion coating of large-diameter pipes in Russia were 35,700 tonnes in the first seven months of the year, down 20%.

July imports of injection moulding and blow moulding HDPE grew to 5,400 tonnes and 5,100 tonnes respectively. Russia's imports of injection moulding and blow moulding HDPE in the first seven months of the year totalled 29,300 tonnes and 24,400 tonnes, up 3% and 11%, respectively.

July imports of film HDPE in Russia on the the back of the shortage grew three times to 5,700 tonnes, from 1,900 tonnes in June. Total imports film HDPE in Russia were 16,000 tonnes in the first seven months of the year, down 48% year on year.

Russia's imports of HDPE in other sectors of consumption (cable extrusion, rotational molding, etc.) declined to 7,200 tonnes in the first seven months of the year, compared with 7,900 tonnes year on year.


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