GAIL seeks to import 1.3 million mt/year of ethane for upcoming cracker

MOSCOW (MRC) -- India's state-owned gas utility company GAIL India plans to import ethane from countries including the US, for its upcoming USD5 billion joint-venture Andhra Pradesh petrochemical plant, according to TPS with reference to GAIL's announcement on Monday.

GAIL is seeking 1.3 million mt/year of ethane for 15 years for its JV ethane cracker with India's Hindustan Petroleum Corp Ltd (HPCL), located on the east coast of India beginning 2022, the company said.

HPCL, exploration company Oil India Ltd (OIL), GAIL India, France's Total and the Lakshmi N Mittal Group signed a memorandum of understanding in 2007 to look at the feasibility of setting up a 15 million mt/year refinery and petrochemical project in Visakhapatnam (Vizag), Andhra Pradesh. In 2009, the INR 500 billion(USD7.36 billion) project was put on hold amid weak petrochemical demand, with most partners pulling out.

The refinery was designed to process sour and heavy crudes which are cheaper than low-sulphur sweet crude oil, while the petrochemical plant was originally conceived to use naphtha from the refinery as feedstock, but will now use natural gas as a feedstock instead, according to the company.

GAIL will be the second company in India after Reliance Industries (RIL) to import ethane.

RIL plans to import 1.5 million mt/year of ethane annually from the US to substitute its current propane imports, and a portion of the naphtha used for ethylene production. These imports could start as early as end-2016. RIL has executed storage and capacity agreements for liquefaction of ethane with a North American terminal and has also ordered six VLECs (Very Large Ethane Carriers) for transporting ethane to India.

We remind that, as MRC reported earlier, The Brahmaputra Cracker and Polymer Limited (BCPL), also known as the Assam gas cracker project, was partially commissioned in early July 2015. Three units of the petrochemical plant - the gas sweetening unit (GSU), C2+recovery unit and polypropylene unit (PPU) were commissioned. The ethylene cracker unit and linear low density polyethylene (LLDPE)/high density polyethylene (HDPE) unit were almost near completion then and were expected to be ready in two months.

The gascracker project is a joint venture in which GAIL holds equity share of 70%, while OIL, NRL and the state government hold 10% stake each. GAIL and BCPL have already inked a deal for marketing petrochemical products produced at the plant. There are also plans to export polymer and finished products to countries like Bangladesh, Myanmar, Bhutan, Nepal and China.
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Amcor buys Chinese film unit from British Polythene

MOSCOW (MRC) -- Australian packaging company Amcor Ltd. is buying BPI China, the Chinese subsidiary of British Polythene Industries plc, for USD13 million, said Plasticsnews.

An Amcor statement said BPI China has one plant in Xinhui, in southern China, with state-of-the-art blown film and flexographic printing lines. It produces flexible packaging products for export and domestic customers. Amcor has 10 flexible packaging plants in China, including four in southern China.

China and complement its existing business by providing additional scale and talent. "It will broaden Amcor's capabilities in China to include flexographic printing and reduce future capital expenditure requirements." Amcor Managing Director and CEO Ron Delia said: "China continues to be an attractive market for flexible packaging globally and this is an excellent opportunity to support our continued expansion in the important southern region."

British Polythene Industries (BPI), headquartered in Greenock, Scotland, said BPI China’s product range includes bakery and fresh produce packaging for the retail market, disposable aprons for the health-care sector and high-performance stretch film for transit protection. Its website said customers include "major name clients" in Europe, North America and Australasia, and companies with significant offshore operations in China.

BPI did not respond to Plastics News’ request for comment on its reasons for selling the China subsidiary.

BPI China’s website, which does not yet acknowledge the ownership change, said BPI China was established in 1993 and has an annual capacity of 12,000 tons.

As MRC informed before, Amcor acquired Uniglobe Packaging Ltd. last year and before that Alcan Packaging — which included operations in India — in 2009. Amcor has plants in Daman, Chaken and Haridwar, India. Amcor Limited is an Australian-based multinational packaging company. It operates manufacturing plants in 42 countries. It is the world's largest manufacturer of plastic bottles.

Amcor manufactures rigid and flexible plastic packaging products for the food, beverage, health care, home and personal care, and tobacco packaging industries. It has annual sales of USD10 billion and employs 29,000 across more than 180 sites in 43 countries.
MRC

Lukoil to bring Iranian oil to Romanian refinery

MOSCOW (MRC) -- Iran is on track to raise oil production by 500,000 bpd after the lifting of sanctions this month and has already sold 6 supertankers with additional crude to buyers in Europe and Asia, a Iranian oil source said, reported Reuters.

The source, familiar with export operations, said three supertankers with additional volumes of crude have been sold to buyers in Europe and three to Asian customers for delivery in February.

Trading sources said Litasco, the trading arm of Russia's Lukoil, looked set to become the first buyer in Europe since the lifting of sanctions.

The Swiss trader will deliver 1 million bbl of Iranian Light grade to Lukoil's Petrotel refinery in Romania, loading at Iran's Kharg Island terminal on February 5.

"Iran raised its crude oil production by at least 500,000 bpd and the market will see it in the next few days," said the Iranian source, who is familiar with export operations.

"(There are) three contracts finalized with European customers... Iran is also talking with its traditional customers in Asia, especially India."

Iran has promised to begin regaining market share lost during years of curtailed output after European sanctions on its oil industry were lifted this month.

As MRC reported previously, OAO Lukoil Holdings, Russia's No. 2 oil producer, will invest USD1 billion in the oil firm Samara-Nafta to increase production. Lukoil acquired Samara-Nafta from Hess Corp. this month for USD2 billion as part of a strategy to stabilize and increase oil production. Lukoil has for years fought declining output at its main, Soviet-era fields in Western Siberia. The investment in Samara-Nafta will increase production by between 5% and 7% over the next five years from 2.5 million tonnes a year, Prime news agency cited the company as saying.

LUKoil, a Russian-based company, is one of the global leaders in the production and refining of crude oil and gas resources. The world's largest privately owned oil and gas company, measured by proven oil reserves, LUKoil has operations in over 40 countries.
MRC

Shell to sell 51% stake in Malaysia-listed SRC for USD66.3m

MOSCOW (MRC) -- Royal Dutch Shell plc has agreed to sell its shareholding in the Shell Refining Company (SRC) in Malaysia to Malaysian Hengyuan International Ltd (MHIL), as said Therakyatpost.

The sale of its 51% shareholding in the refining company is for USD66.3 million (RM275.2 million) and the transaction is expected to complete in 2016, subject to obtaining regulatory approval. In a statement, Shell said it is MHIL’s intention for SRC to invest in the upgrades needed to meet the Euro 4M and Euro 5 requirements for fuel sold in Malaysia.

"Shell Malaysia Trading will ensure security of supply to its retail and commercial customers in Malaysia and honour other existing commitments through an existing comprehensive supply strategy that includes a long term offtake from SRC."

It said the SRC stake sale is consistent with Shell’s strategy to concentrate its global downstream footprint and businesses where it can be most competitive. "Malaysia continues to be an important country for Shell. Shell is the leading retail fuels and lubricants provider and continues to invest in growing these businesses in the country."

It said other recent downstream divestments include the sale of downstream businesses in Australia and Italy; a number of retail sites in the UK; and the initial public offering of, and further drop downs to Shell Midstream Partners LP.

Shell has also agreed to the sale of its marketing business in Denmark and Norway, its LPG businesses in France and a 33.24% shareholding in Showa Shell Sekiyu KK.

As MRC informed earlier, Royal Dutch Shell signed a deal with Iraq worth USD11 billion to build a petrochemicals plant in the southern oil hub of Basra, boosting the country's aim to become a major regional energy player and diversify its income.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.
MRC

US-based Eastman plans to sell excess ethylene, intermediates

MOSCOW (MRC) -- US-based Eastman Chemical is seeking options to off-load its excess ethylene excess ethylene and other olefin intermediates in the US, reported TPS with reference to the company's announcement.

Eastman has four crackers in Longview, Texas, which are able to produce ethylene and propylene. The company is seeking to monetize its excess ethylene as well as olefin intermediates, according to Eastman CEO Mark Costa.

"We enter 2016 well positioned to benefit from our strong portfolio of specialty businesses... however, we face increasing challenges including stagnant global economic growth, the collapse in the price of oil, and weakening currencies in Asia and Europe," Costa said.

"In this environment, we are taking decisive actions to accelerate our innovation and market development activities and significantly increase our cost reduction efforts," he added.

As MRC reported before, Eastman Chemical Co.’s Tritan-brand co-polyester business continued to grow, with 35 mln pounds of capacity added late 2014 and a second plant on the horizon.

Eastman (headquartered in Kingsport, Tennessee, USA) is a global specialty chemical company that produces a broad range of products found in items people use every day. With a portfolio of specialty businesses, Eastman works with customers to deliver innovative products and solutions while maintaining a commitment to safety and sustainability. Its market-driven approaches take advantage of world-class technology platforms and leading positions in attractive end-markets such as transportation, building and construction, and consumables. Eastman is a global specialty chemicals company with 15,000 employees worldwide. The firm posted sales of USD9.5 billion in 2014.
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