Oman plans IPOs for downstream energy firms

MOSCOW (MRC) -- Oman plans to offer shares in some state-owned downstream energy companies to the public, partly to raise money as low oil prices pressure its finances, Omani Oil and Gas Minister Mohammad bin Hamad al-Rumhy said on Thursday, reported Reuters.

The companies include Salalah Methanol Co and a drilling company, Rumhy told reporters without naming the drilling firm or giving any financial details.

Oman has been considering privatization of a wide range of state firms for several years but has not yet moved ahead with the program, and Rumhy did not say when the initial public offers might take place.

Salalah Methanol, founded in 2006, is owned 90% by state-run Oman Oil Co and 10% by Takamul Investment Co, and has a methanol production capacity of 3,000 tpd, according to its website.

As MRC informed before, Oman Refineries and Petroleum Industries Company (Orpic) plans to raise capacity of its polypropylene (PP) plant to 340,000 tpa of high quality PP from 200,000 tpa. The plant is part of the government's vision to develop the petrochemical industry. It is also part of the efforts made by the Sultanate to diversify sources of national income and benefit from gas production.
MRC

MOSCOW (MRC) -- Leading Gulf oil producers Saudi Arabia and Kuwait gave the clearest signal yet that OPEC plans to extend into the second half of the year a deal with non-OPEC producers to curb oil supplies, reported Reuters.

Consensus is growing among oil producers that their supply restraint agreement should be extended after its initial six-month term, but there is as yet no agreement, Saudi Energy Minister Khalid al-Falih said on Thursday.

"There is consensus building but it's not done yet," he told reporters on the sidelines of a conference in the United Arab Emirates. Asked about non-OPEC producer Russia, Falih replied: "We are talking to all countries. We have not reached an agreement for sure, but the consensus is building."

Kuwait's oil minister Essam al-Marzouq, at the same event, said he expected to see an extension of the agreement.

"We have a noticeable increase in compliance from non-OPEC, which shows the importance of extending the agreement," Marzouq said.

"Russia is on board preliminarily. Compliance from Russia is very good. Everyone will continue on the same level," he said.

If OPEC and non-OPEC oil producers decide to extend their six-month agreement, the cuts may become less deep as oil demand is expected to be stronger for seasonal reasons in the second half of 2017, Marzouq said.

He said OPEC would extend the deal if there was consensus among non-OPEC producers, and that producers were always looking for more non-OPEC members to join the agreement.

One African country has expressed interest in joining, Marzouq said, without identifying it.

OPEC is keen that non-OPEC play its part in reducing world inventories to support a price rise that has stalled near USD55 a barrel. Crude is up from lows last year below USD30.

OPEC meets on May 25 to discuss extending supply curbs with non-OPEC countries that total 1.8 MMbbl daily, two-thirds of that from OPEC.

Falih said there was "an initial agreement" that the oil cuts may need extending to drain high global inventories. He said talks were ongoing.

"Our target is the level of inventories. This is the main indicator for the success of the initiative," Falih said.

While inventories held at sea and in producer countries have dropped, they remain stubbornly high in consumer regions, particularly in Asia and the United States.

The International Energy Agency said last week that inventories in industrialized countries were still 10% above the five-year average, a key gauge for OPEC.

Omani Oil and Gas Minister Mohammad bin Hamad al-Rumhy said a "quite high" number of producers favored extending the supply restraint agreement.

"The number of countries that are supporting the extension I think would be quite high, percentage-wise," Rumhy told reporters.

However, Iraq may seek to be exempt and ask to boost its own output, the leader of the nation's Shi'ite ruling coalition Ammar al-Hakim told Reuters.

Speaking in Cairo, Hakim cautioned that Baghdad could ask to be exempted from taking part in the supply curbs as the nation needed its oil income to fight Islamic State.

"Given these sensitive circumstances, it is the right of Iraq to hope for an exemption by the other OPEC member states and have an opportunity to increase its production," Hakim, an influential cleric, said in an interview late on Wednesday.

"But we are with the principle of reducing the overall OPEC supply to lift prices."

As MRC informed before, Russian crude imports to China rose in early 2017 as the country's independent, or teapot, refiners had expanded their diet to include the Urals grade. Russia could expand its market share in China, the second-largest oil consumer, this year after a drop in Brent prices relative to Middle East crude benchmark Dubai opened the arbitrage for Russian Urals to head east. Russia topped Saudi Arabia as the biggest crude seller to China in 2016.
MRC

MOSCOW (MRC) - Ukraine's imports of polyethylene (PE) decreased to 59,300 tonne in first three months of this year, down 5% year on year, compared to the same period of 2016. The decrease in imports accounted for the deliveries of low density polyethylene (LDPE) and high density polyethylene (HDPE), according to MRC DataScope.

March PE imports into Ukraine decreased to 19,500 tonnes, contrary to the experience of the past, compared to 21,500 tonnes a month earlier. Local companies decreased purchases of LDPE and low density polyethylene (LDPE). In general, January-March imports into Ukraine totalled 59,300 tonnes compared with 62,600 tonnes year on year; supply of LLDPE and ethylene-vinyl-acetate (EVA) increased.

Structure of PE imports over the reported period was as follows.

Imports of HDPE into Ukraine increased in March, despite the low demand in some processing segments, the final figure was about 9,000 tonnes against 6,800 tonnes in February. Local companies increased their purchasing of film and pipe grade HDPE. Overall HDPE imports of HDPE exceeded 24,000 tonnes in the first quarter of 2017 versus 30,000 tonnes a year earlier, shipments of film grade HDPE fell by almost a third, deliveries of injection moulding PE decreased by 20%.

March imports of LDPE decreased to 4,500 tonnes against 6,600 tonnes, resulting from a significant reduction of export quotas from Russian and Middle Eastern producers. Overall LDPE imports exceeded 16,300 tonnes over the stated period, down by 8% year on year.

Last month's LLDPE imports were 4,100 tonnes, compared to 6,700 tonnes in February, shipments of film grade PE fell by almost 2 times.
Overall LLDPE imports grew to 14,900 tonnes in January-March 2017 from 12,800 tonnes a year earlier. The main increase in demand was provided by producers of film products and cable-conductor products.

Imports of other PE grades, including ethylene-vinyl-acetate (EVA), totalled 4,100 tonnes over the stated period, compared to 2,000 tonnes a year earlier.


MRC

MOSCOW (MRC) -- US-based paints and coatings group PPG Industries added pressure to its increasingly hostile attempt to take over rival AkzoNobel by sending an open letter to Akzo shareholders, said Dutchnews.

The letter added fuel to the fire ahead of Akzo’s planned announcement of its new corporate strategy in London on Wednesday. In the two-page document, PPG chairman Michael McGarry once again outlined his belief that combining the two companies would have great benefits for both.

McGarry also revealed that PPG approached Akzo in 2013 and discussed plans to merge the companies, adding Akzo was not interested and did not react at the time. Nor has Akzo reacted to PPG’s two bids for the Dutch company made since 2 March. PPG’s second, sweetened offer valued Akzo at EUR22.4bn. Refusing any discussion, Akzo termed PPG’s offer ‘too low and too risky’ and said it substantially undervalues the company.

McGarry said PPG had made 50 acquisitions in the past 15 years and all were now well integrated into the group. PPG has five production facilities in the Netherlands, with a total payroll of 1,000. Akzo employees and unions have said they feared job losses with a PPG takeover.
MRC

MOSCOW (MRC) -- Technology, engineering and project management company Neste Jacobs and refinery and petrochemical group Unipetrol have signed an agreement for Neste Jacobs to perform a comprehensive energy efficiency study of Unipetrol's Litvinov oil refinery in Czech Republic, reported Hydrocarbonprocessing.

The energy efficiency study will be performed by utilizing Neste Jacobs' proprietary NAPCON energy performance analysis, that is a combination of high level process know-how and modeling skills, pinch-technology, equipment expertise and automation solutions. Neste Jacobs' energy analysis with a modular approach will identify the feasible improvement potential and create an action plan to implement the improvements.

The study will review existing energy consumption and production within the refinery process units. This includes pinch-analysis to identify opportunities to improve heat integration of the process. This is combined with fired heater optimization to maximize the benefits. On top of energy efficiency, the study includes waste water optimization assessment to minimize the water usage and recycling of waste water.

"We are happy to provide our extensive energy efficiency and water management knowledge in the form of an energy study for Unipetrol's refinery in Litvinov," said Jarmo Suominen, CEO of Neste Jacobs. "Our excellent project team will provide systematic study to Unipetrol to discover solutions, which are both practical and lucrative."

As MRC informed before, in October 2016, Neste Jacobs and Borealis signed an agreement for Neste Jacobs to perform an energy screening for all production units at Borealis’ site in Porvoo, Finland. Neste Jacobs utilized its unique NJe2 technology, part of Neste Jacobs proprietary NAPCON offering for the project. The project started in autumn 2016 and the recommendations will be implemented in the upcoming projects.

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