Sasol secures USD4B in financing for new Louisiana ethane cracking project

MOSCOW (MRC) -- Sasol has announced the completion of a USD4 billion credit facility for its ethane cracker and derivatives at its existing site in Lake Charles, Louisiana, reported Hydrocarbonprocessing.

"Securing this financing facility is another key milestone in advancing a defining project for the company," said Paul Victor, acting chief financial officer of Sasol.

"The support from a large number of international financial institutions is a testament to Sasol's strong standing within the global financial markets," he added.

A syndicate of 18 international banks and other financial institutions are lenders for the credit facility.

As MRC wrote before, in October, Sasol announced its final investment decision relating to the USD8.9 billion petrochemical complex, which consists of an ethane cracker that will produce 1.5 million tpy of ethylene. The complex will also comprise six chemical manufacturing plants, enabling infrastructure and utility improvements.

The remainder of the funds required for construction will be raised in a phased manner from a variety of potential sources, according to company officials, including surplus cash available in the group. Additional funding will be announced as it is secured.

We also remind that in June 2014, Sasol Chemicals North America and INEOS Olefins & Polymers reached final investment decision to form a 50/50 joint venture to build an HDPE plant in La Porte, Texas. The ethylene required for the production of the HDPE will be supplied by Sasol and INEOS in proportion to their respective ownership positions.

Sasol Limited is an integrated energy and chemical company based in Johannesburg, South Africa. It develops and commercialises technologies, including synthetic fuels technologies, and produces different liquid fuels, chemicals and electricity.
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MOSCOW (MRC) -- Huang Haidong misses the flush times in 2010 when his refinery in eastern China couldn’t produce diesel fast enough to fill the trucks lined up outside, as per Hydrocarbonprocessing.

"There was a fuel shortage," said Huang, who works as a supply manager at one of 40 "teapot" or small, privately-held plants that dot Shandong province. "We ran our units at more than 80% at that time and still couldn’t meet demand. But things changed after the expansion frenzy."

Huang’s plant cut processing rates by half over the past four years as China’s refining capacity expanded 33% and economic growth slowed in the world’s second-largest oil consumer. While the country can process about 13.4 million bpd of crude, the International Energy Agency in Paris estimates demand this year will be just 10.3 million.

Oil’s 46% plunge since June has benefited Chinese consumers with the lowest gasoline prices since 2010, yet provided little solace for refiners. The added refining has led to losses at privately-owned plants for the first time since 2008, according to ICIS-C1 Energy, a Shanghai-based consultant.

Profits at state-owned refineries, including those operated by China Petroleum & Chemical Corp., are also shrinking. Moody’s Corp. expects demand growth to slow to between 3% and 5% next year from as much as 10% in 2010 to 2012.

China, which trails only the US in fuel consumption, added about 723,000 bpd of processing over the past four years, ICIS-C1 estimated. With economic growth forecast at 7.4% this year, the slowest rate since 1990, fuel demand is set to decelerate.

Capacity will increase to 14 million bpd by the end of 2015, according to China National Petroleum Corp., the country’s biggest energy company. That’s about 78% of what’s currently available in the US, data compiled by Bloomberg show.

China will add 500,000 bpd of capacity in 2015 and another 602,000 bpd in 2016, according to ICIS-C1. That’s equivalent of adding each year a new refinery the size of ExxonMobil’s Baytown plant in Texas, the biggest refining complex in the US.

China already is starting to divert an increasing proportion of crude imports into emergency reserves. The nation probably resumed strategic stockpiling in November amid the global oil-price slump, official data show. Brent crude declined to USD58.50/bbl on Dec. 16, the lowest in more than five years. Futures traded at USD60.69 at 11 a.m. London time on the ICE Futures Europe exchange.

Refiners are expected to adjust plant expansion schedules to their outlook for fuel consumption, meaning they can delay projects to avert a refining glut, according to Citigroup.

In Quanzhou, a southeastern port city, Sinochem Group began operating a refinery in January that’s slated to be expanded by a third in three years. The nation’s fourth-largest oil company will more than double the facility’s 241,000-bpd capacity over 10 years, according to Du Sanwang, a marketing manager at the plant.

The companies are seeking to compete with teapot plants, which Shandong-based consultant SCI International estimates sell fuel that’s about 20% cheaper than state refiners. Huang’s facility, known as Shandong HRND Petrochemical Co., turns fuel oil into mostly naphtha and diesel. It can process 40,000 bpd and produces "very clean" diesel that meets the China-V emission standard, he said.

As MRC wrote before, China ended in September 2014 its anti-dumping duties on styrene-butadiene-rubber (SBR) imports from Russia, Japan, and South Korea, effective Monday, September 8, the Ministry of Commerce said over the weekend. In 2009, China extended its 4-38% anti-dumping duties on SBR imported from the countries by five years.
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MOSCOW (MRC) -- DuPont Co. is moving to the suburbs after an activist shareholder criticized its ownership of the landmark DuPont Building once visited by luminaries such as Charles Lindberg and John F. Kennedy, as per Hydrocarbonprocessing.

Executive offices will relocate to its Chestnut Run Plaza campus from downtown Wilmington, Delaware, effective July 1, the company said today in a statement. DuPont’s performance chemicals unit, which is being renamed Chemours Co. and spun off, will own the building and use it as temporary headquarters.

Trian Fund Management, the activist investor seeking two seats on DuPont’s board, highlighted the building in a September letter as symbolic of the company’s waste. The DuPont Building, which has served as its headquarters for 107 years, also houses the Hotel DuPont and a 1,250-seat theater. DuPont said the move will support management collaboration while saving money.

The Chestnut Run facility is about 4 miles (6 kilometers) west of the current headquarters. DuPont in 2012 added 220,000 square feet of office space at Chestnut Run, where the company has had a presence for more than 60 years.

As MRC reported earlier, Borealis AG is buying out DuPont Co.’s two-thirds share in their Specialty Polymers Antwerp NV joint venture. No purchase price was disclosed. Wilmington, Del.-based DuPont will continue to sell ethylene vinyl acetate (EVA) and acrylate copolymers made at the JV’s plant, which is in Zwijndrecht, Belgium.

DuPont is an American chemical company that was founded in July, 1802. The company manufactures a wide range of chemical products, leading extensive innovative research in this field. The company is the inventor of many unique plastics and other materials, including neoprene, nylon, Teflon, Kevlar, Mylar, Tyvek, etc. DuPont was the developer and main producer of Freon used in the production of refrigeration equipment.
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MOSCOW (MRC) -- Unipetrol welcomes the decision of the Office for the Protection of Competition regarding transaction in Ceska rafinerska, reported the company on its site.

The decision of the Office for the Protection of Competition is not yet effective.

Transaction is an opportunistic acquisition with the aim to gain full control over decisions in Ceska rafinerska, especially in the area of capital investments. The completion of transaction will also increase security of feedstock supplies for Unipetrol’s petrochemical business development.

Unipetrol currently owns 67.555% of the Ceska Rafinerska’s share capital after acquisition of Shell’s shareholding interest at the beginning of 2014. After completion of the transaction, Unipetrol shareholding interest will increase to 100%, making Unipetrol the sole shareholder of the Ceska Rafinerska.

CESKA RAFINERSKA, a.s. operates refineries in Litvinov and Kralupy, currently the only two running refineries in the Czech Republic.

As MRC wrote before, in Q3 2014 Unipetrol Group posted very good results and significantly increased its profitability. Company recorded operational profit (EBITDA LIFO) of CZK 2.304 bn. Net profit reached CZK 1.399 bn(USD64.5million). Revenues increased y/y by 37% to CZK 34.041 bn in 3Q14.

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

MOSCOW (MRC) - Ukraine may introduce an additional 5% import duty on polymers and products made of them, from 1, January 2015, according to a text of the bill imposed by the Government to the Verkhovna Rada and published on the website of the Parliament.

Cabinet registered the bill "On the balance of payments of Ukraine" (N156) and "On amendments to the Customs Code of Ukraine" (N1563) in the Verkhovna Rada on 23, December. According to the draft law, the import of food products (product groups 1-24, according UKTVED) will be imposed by an additional duty of 10%, the rest goods (group 25-97) - at the rate of 5%. Polymers and products made of them belong to the group 39.

In addition, the rate of 10% government introduces for the goods imported into the territory by Ukraine nationals.
The duties will be introduced during 12 months, "regardless of the country of origin of the goods and trade agreements concluded by Ukraine."

The government will release vital goods from the duties collection: natural gas, steam coal, the fuel for nuclear power plants, oil and petroleum products, gold and precious metals, humanitarian aid.

In the explanatory memorandum the Government notes that the introduction of such temporary import charges corresponding to the position of the WTO, as the balance of payments of Ukraine significantly deteriorated.

As MRC reported earlier on 10 December, the Ukrainian parliament submitted a bill to increase the import duty on suspension polyvinyl chloride (SPVC) to 6.5% from 1, January 2015.
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