China says will eventually allow private companies to invest in oil storage

MOSCOW (MRC) — China will eventually allow private companies to invest in the country's oil and gas storage, the government said in a blueprint document for its energy sector that mainly underscored earlier pledges on reforming heavily monopolized oil and gas industries, said Reuters.

Beijing has previously said it would take steps such as pushing to open upstream oil and gas exploration to private companies, help split natural gas sales from gas pipeline operations and lift the output of higher quality oil products.

That comes as China pushes to overhaul state-owned enterprises, including with the introduction of so-called mixed ownership of state firms, as part of the most far-reaching reforms of its sprawling and inefficient state sector in two decades.

"We are expecting specific measures (on energy sector reform) to follow after the State Council releases this overarching guide," said Lin Boqiang, an academic specialized in energy at Xiamen University. "(But) this is the first time that China said it would encourage private capital in oil and gas storage facilities."

In the document released late on Sunday, the State Council said it would aim to ramp up government investment in the country's oil storage facilitates, while also allowing non-state firms to operate storage. It did not give further details.

China has been building underground caverns capable of holding a substantial chunk of its expanded strategic oil reserves by 2020, as it looks for new storage methods away from expensive and exposed above-ground tanks in crowded coastal regions.

The blueprint document also said the State Council would set up a "management system" to regulate crude import licenses. The rest of the paper mainly repeated earlier government plans on reforming the energy sector.
MRC

MOSCOW (MRC) -- The Cabinet Committee on Economic Affairs (CCEA) has approved a restructuring plan for loss making and sick Central Public Sector Enterprise Hindustan Organic Chemicals Ltd. (HOCL), a under the Department of Chemicals and Petrochemicals, reported ANINews.

The company, having units at Rasayani (Maharashtra) and Kochi (Kerala), has been making continuous cash losses since 2011-12, resulting in an acute shortage of working capital.

Most of its plants have remained shut for the last few years. It has not been able to pay regular salary and statutory dues to its employees since February, 2015.

The restructuring plan involves closing down the operations of all the non-viable plants at Rasayani unit of HOCL except the Di-Nitrogen Tetroxide (N2O4) plant which is to be transferred to ISRO on 'as is where is' basis, with about 20 acres of land and employees associated with the plant. The N2O4 plant is of strategic importance as it is the only indigenous source of N2O4 which is used as liquid rocket propellant by ISRO in the space launch vehicles.

The financial implications of the plan is Rs. 1008.67 crore (cash) which is to be met partly from sale of 442 acres HOCL land at Rasayani to Bharat Petroleum Corporation Ltd. (Rs.618.80 crore) and the balance (Rs.365.26 crore) through bridge loan from the government.

The funds will be used to liquidate the various liabilities of the company, including payment of outstanding salary and statutory dues of employees and repayment of government guaranteed bonds of Rs.250 crore due for redemption in Aug.-Sept. 2017.

The bridge loan amount, along with other government liabilities of the company, is proposed to be repaid to the government from the disposal of remaining unencumbered land and other assets of Rasayani unit.

The implementation of the restructuring plan will enable HOCL to close down the operations of non-viable plants at Rasayani unit, while transferring the strategically important N2O4 plant to ISRO to ensure continuity of manufacture and supply of N2O4 for ISRO's space programme. Interest and welfare of employees will be addressed by payment of all their outstanding salary dues.

Disposal of land assets, initially through sale of 442 acres to BPCL and subsequently of the remaining unencumbered land, will unlock the land assets for being redeployed for economically productive investments and thereby creating new employment generation opportunities.

As MRC informed earlier, in 2016, state-run Hindustan Petroleum Corp. Ltd. (HPCL) received environmental clearance from Indian officials to expand its Visakhapatnam refinery in Andhra Pradesh from 8.33 MMtpy to 15.0 MMtpy.
MRC

MOSCOW (MRC) -- The global chemical company Oxea has concluded an upgrade of its carboxylic acids production facility in Oberhausen, Germany. As a result, Oxea has enhanced the production output of short-chain fatty acids (SCFAs), such as propionic acid, butyric acid, and isobutyric acid, said the producer on its website.

Oxea manufactures butyric and propionic acid in Animal Feed (AF) quality. These products are used as building blocks for feed materials that are free from antibiotic growth promoters, so called AGP-free feed. SCFAs from the upgraded unit in Oberhausen are handled under GMP+ B2 (Good Manufacturing Practice) and have received HACCP (Hazard Analysis Critical Control Point) certification to address requirements primarily in the animal feed sector.

"The recent investment substantially increases global supply reliability for our customers. It enables additional units to produce our short chain fatty acids, and significantly improves the overall output of acids across our multisite, multi-products acids platform," said Dr. Oliver Borgmeier, Vice President Operations Derivatives Europe & China at Oxea.

"This upgrade at our Oberhausen site is just the first step towards further enhancement of our carboxylic acid capabilities in the short- and mid-term. We will further strengthen Oxea’s comprehensive carboxylic acids portfolio across all products and markets, which also include lubricants and synthetic fluids, ingredients for personal care applications, and paint and coating additives," said Cristobal Ascencio, Executive Vice President Derivatives.

Oxea is a global manufacturer of oxo intermediates and oxo derivatives, such as alcohols, polyols, carboxylic acids, specialty esters, and amines. These products are used for the production of high-quality coatings, lubricants, cosmetics and pharmaceutical products, flavorings and fragrances, printing inks and plastics.
MRC

MOSCOW (MRC) -- Chevron Phillips Chemical Company LLC has expanded its Tessenderlo, Belgium plant by debottlenecking its production unit for Ethyl Mercaptan (EM) and Tetrahydrothiophene (THT), as per Hydrocarbonprocessing.

Construction began in November 2016 and the expansion commenced operations in May 2017. This expansion increased production capacity for these products by 65%.

"Demand for EM and THT continues to grow around the world. This debottleneck builds on our already well-established production platform at Tessenderlo, allowing this Chevron Phillips Chemical site to continue to be a premier manufacturing location for organosulfur products, along with our Borger, Texas plant," said Stephen Landry, Chevron Phillips Chemical’s Specialty Chemicals Business Manager.

Chevron Phillips Chemical’s Tessenderlo facility produces sulfur chemical intermediates, including mercaptans, sulfides and polysulfides. Tessenderlo products are used in a wide range of end-use applications such as polymer modifiers, agricultural chemicals, mining and ore processing, gas odorization, water purification, pharmaceuticals, lubricant additives and the reduction of coke formation.

As MRC wrote previously, in July 2016, a USD36.8bn expansion of the Tengiz oilfield in Kazakhstan, the largest investment by private sector oil companies this decade, was given the go-ahead by Chevron of the US, bucking the trend of delays and cancellations resulting from the slump in crude prices since mid-2014.

Chevron Corporation is an American multinational energy corporation. One of the successor companies of Standard Oil, it is headquartered in San Ramon, California, and active in more than 180 countries. Chevron is engaged in every aspect of the oil, natural gas, and geothermal energy industries, including hydrocarbon exploration and production; refining, marketing and transport; chemicals manufacturing and sales; and power generation.
MRC

MOSCOW (MRC) — China's ethanol exports soared in April from the same month the year before and imports slowed to a trickle, the latest sign that Beijing's drive to ramp up local output is upending trade flows in the world's fastest-growing biofuel market, said Reuters.

China has been pushing to erode a domestic glut in corn supply through steps such as using the grain to churn out ethanol or other products like biodegradable plastics.

The country exported 13,540 m3 of ethanol in April, up over 1,000% from a year earlier and 18% higher than the month before, data from the General Administration of Customs showed on Tuesday.

Traders said the reintroduction of an export rebate last year had revived foreign sales.

"This year there's a tax rebate of 13% and processors have subsidies," said a manager familiar with ethanol trade at trading company Zhejiang Materials. He declined to be identified as he was not authorized to speak with media.

In the first four months of the year, ethanol shipments jumped to 42,701 m3, exceeding the total for the whole of 2016.

Saudi Arabia remained the top buyer of the fuel in April, accounting for 66% of cargoes. Meanwhile, China imported just 23 m3 of ethanol last month, as a big hike in taxes at the end of 2016 hit overseas purchases.
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