Start-up of Vietnam Nghi Son oil refinery delayed to 2018

MOSCOW (MRC) -- The commercial start-up of Vietnam's new USD7.5 B Nghi Son oil refinery will be delayed to 2018, from an initial expected start-up in the third quarter of this year, according to a notice on a government website., said Reuters.

The 200,000 bpd oil refinery is now planning to start commercial operations in the Q1 2018, according to a notice on the website for Deputy Prime Minister Vuong Dinh Hue and a source close to the matter. Trouble with a mechanical test on some of the refinery's components set back test runs at the plant, causing the delay, according to the notice.

A spokesman for Nghi Son did not immediately reply when contacted by Reuters. The start-up delay should defer an expected decline in product margins until after Nghi Son starts operating, said Nevyn Nah, an oil analyst with consultancy Energy Aspects.

"The impact on margins will be shifted to mid-2018 if the refinery is commissioned in first quarter of next year," he said.

Vietnam's imports of oil products were expected to fall after Nghi Son began operations. The delay of additional fuel supplies in Asia could be good news for refiners, a trader with a North Asian refinery said.

Still, it could weigh on the crude oil market, a Singapore-based crude trader said. The refinery was expected to take delivery of its first crude oil in May and send out its first oil products by the third quarter of the year, the company said in February.

The plant is Vietnam's second refinery and will process Kuwaiti crude oil to produce liquefied petroleum gases, gasoline, diesel, kerosene and jet fuel, mainly for the domestic markets.

Kuwait now has less demand for its crude after shutting its 200,000 bpd Shuaiba refinery in April and this is expected to continue until Nghi Son starts, four crude traders said.

Nghi Son Refinery sent out requests to shipbrokers earlier this month to charter 27 very large crude carriers, ships capable of carrying 2 MMbbl of oil each, over July 2017 to June 2018 to transport crude from Kuwait to the refinery, according to a tender document seen by Reuters.

Japan's Idemitsu Kosan and Kuwait Petroleum International each own 35.1% of Nghi Son Refinery and Petrochemicals, while PetroVietnam has 25.1% and Mitsui Chemicals 4.7%.

Vietnam's existing Dung Quat refinery meets about 30 percent of domestic demand.
MRC

MOSCOW (MRC) -- Total, Europe’s third-largest oil company, has inaugurated its revamped Carling - Saint-Avold petrochemical complex in eastern France following three years of transformation works, said the producer on its site.

In September 2013, Total announced that it would adapt the Carling site, investing close to EUR200 million to upgrade existing facilities and build new, higher value-added units to access to high-potential markets. The Carling - Saint-Avold complex has been turned into a leading polymer production site in Europe.

"Announced in 2013, the Carling upgrade project has been successfully completed. I would like to thank the teams that made this model evolution possible. I am proud to say that Total has fulfilled its pledge," said Chairman and Chief Executive Officer of Total Patrick Pouyanne.

The adaptation of the Carling - Saint-Avold complex did not involve layoffs or compulsory staff transfers During the transformation, Total supported contractors and kept its promises to customers and employees.

As MRC reported previously, on 5 October 2015, Total closed its remaining steam cracker in Carling, in the Lorraine region of eastern France. The cracker was the second steam cracker closed at the site. The company shut down its first cracker in 2009. The closure was part of Total's plan to adapt its Carling petrochemical platform with the development of new activities in the growing polymers and hydrocarbon markets.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
MRC

MOSCOW (MRC) -- MOL Group announced its financial results for Q1 2017. In the first quarter all business segments – Upstream, Downstream, Consumer Services, Gas Midstream – managed to increase their contributions compared with the same period of the previous year, said the producer on its website.

Upstream EBITDA surged year-on-year by 50% and reached USD 219mn capitalizing on higher oil prices and the very competitive asset base. Production remained stable at 111,500 barrels of oil equivalent per day.

Downstream posted an all-time high first quarter clean CCS EBITDA delivering USD 324 mn, which is 15% higher than in the same period of the previous year. The growth was the result of much improved asset availability (and thus strong volumes and yields) and fairly supportive margins in both refining and petrochemicals.

Consumer Services also reported the best ever first quarter achievement with an EBITDA increase of 17% year-on-year. The USD 55mn result was due to stronger fuel sales volumes and higher non-fuel contribution. Motor fuel consumption rose 5% year-on-year in the Central Eastern Europe region, providing a supportive environment.

The Gas Midstream segment, a stable contributor to MOL Group’s overall results, reached USD 70mn EBITDA in the first quarter, up 4% year-on-year. Chairman-CEO Zsolt Hernadi commented the results: "The first quarter was an excellent start to the year 2017 with all our business segments posting robust earnings growth, as we were able to fully capture the benefits of a supportive external environment on the back of our systematic efficiency improvement efforts and low-cost, high-quality asset base. Downstream had its best ever Q1 on much improved asset availability and strong margins, Consumer Services (Retail) continued its impressive ascent, while Upstream successfully captured the benefit of higher oil prices and a very competitive cost base. These achievements provide a strong foundation for the rest of the year as we plan to deliver again at least USD 2bn EBITDA and pass major milestones in the implementation of our MOL Group 2030 strategy."

MRC

MOSCOW (MRC) -- Shanghai Petrochemical, part of Sinopec, has restarted its two polypropylene (PP) units following a maintenance turnaround, as per Apic-online.

A Polymerupdate source in China informed that the company has resumed operations at both the units on May 10, 2017. The units were under maintenance from April 20, 2017.

Located in Shanghai, China, the units have a production capacity of 100,000 mt/year each.

As MRC informed previously, in June 2016, Rosneft and China Petrochemical Corporation (Sinopec Group) signed a Framework Agreement on joint pre-feasibility study of the project related to the construction and operation of a gas processing and petrochemical complex in East Siberia. In the event of successful outcomes as stipulated by the Framework Agreement, it is supposed to create a joint venture between Rosneft and Sinopec in 2017.

The project will meet the growing demand for polyethylene and polypropylene in Russia and in China. It is assumed that the annual capacity of the new complex near the administrative center of Boguchany District will be 5 BCM of gas yielding up to 3 mln tons of polymers and petrochemical products primarily for sale on the Russian and Chinese markets. The resource base of the project comprises Rosneft oil and gas fields of Yurubcheno-Takhomsky cluster in East Siberia.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group's key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.
MRC

MOSCOW (MRC) -- Austria's OMV has posted better-than-expected profits for the three months to 31 March at EUR816 million with strong contribution from both the upstream and downstream sectors, said Pipelineme.

The upstream segment helped boost results with a stronger production levels with OMV reaching a ten-year-high quarterly production of 335 kboe/d and decreased the production cost further to below USD 9/boe.

Rainer Seele, CEO and Chairman of the OMV Executive Board said: “OMV had a successful start to 2017 with very good operational and financial performance."

On the downstream side OMV said that its petrochemical business and Borealis strongly contributed to this favourable result.

Seele added: "OMV continued on its path of value-added growth and signed an agreement to acquire a 24.99 per cent interest in the Yuzhno Russkoye gas field in Russia at the beginning of March, 2017. At the same time, OMV signed the sale of its Turkish subsidiary, OMV Petrol Ofisi, to the Vitol Group. On April 24, OMV and four other European energy companies signed financing agreements for the Nord Stream 2 pipeline project."

Looking to the rest of the year OMV said that production is expected to be lower in the following quarters due to planned maintenance activities. The Austrian oil and gas firm expects total production at 320 kboe/d in 2017. With production in Libya expected to contribute on average 10 kbbl/d in 2017.
MRC