Asia oil buyers turn to US in hunt for cheap supply

MOSCOW (MRC) — Asia is set to ramp up crude oil imports from the United States in late 2017 and early next year, with buyers searching out cheap supplies after hurricanes hit US demand for the commodity at a time of rising production in the country, said Reuters.

As many as 11 tankers, partly or fully laden with US crude, are due to arrive in Asia in November, with another 12 to load oil in the United States later in October and November before sailing for Asia, according to shipping sources and data on Thomson Reuters Eikon.

US West Texas Intermediate crude benchmark stands at its largest discount in years against the Atlantic Basin's Brent, with local appetite curbed as US refineries are still pushing to get back on track in the wake of hurricanes such as Harvey.

"Between November and January, there is a very big volume of US crude heading to Asia," said a Chinese trader who has bought 4 MMbbl of medium-sour US oil to arrive in December. He declined to be identified as he was not authorized to speak with media.

The price-spread between the two crudes had already pushed US crude exports to a record 1.98 MMbpd by late September, according to the Energy Information Administration in the United States.

Exports in the next two to three weeks could hit 2.2 MMbpd, Marco Dunand, chief executive of trading house Mercuria, said last week. That has also been driven as some Asian governments look to diversify supply sources and reduce trade surpluses with the world's top economy. India joined China, Japan and South Korea when it imported its first US crude in October.

And high premiums for Middle Eastern grades of crude are also stoking Asian appetite for US supplies. "US medium sour grades can replace most Middle East grades and the light sweets may replace some African crude," said the Chinese trader.
MRC

Turkey arrests four people over explosion at Tupras refinery

MOSCOW (MRC) — Turkish authorities arrested four people over Wednesday's explosion in a storage tank at a Tupras refinery which killed four people, the state-run Anadolu news agency said, as per Reuters.

The explosion occurred following maintenance work at the refinery in the western Turkish province of Izmir, wounding two other workers, but had no impact on production.

On Thursday, authorities had detained seven people over the blast, of which four have been formally arrested and three have been released on probation.

The report gave no details of what charges the four may face.
MRC

Hengyi opens Singapore trade office for Brunei oil-petchem project

MOSCOW (MRC) — Privately-run Chinese company Hengyi Group has started a trading office in Singapore to buy crude and trade oil products from its USD3.4 B Brunei project, company officials said on Monday, as per Hydrocarbonprocessing.

The office will also handle third-party trading and use derivatives to hedge risks, said Michael Zhang, managing director of the trading arm Hengyi Industries International Pte Ltd. The refinery-petrochemical project will be mechanically completed by the end of 2018 and start operations in the Q1 2019, Zhang said.

The project, at Brunei's Pulau Muara Besar island, includes a 175,000-bpd refinery that will produce gasoline, diesel and jet fuel. The complex also houses an aromatics plant to produce 1.5 MMtpy of paraxylene (PX) and 400,000 tpy of benzene.

Hengyi also signed in September a memorandum of understanding (MoU) with Brunei's Economic Development Board to expand the project in a second phase.

The expansion includes a 14 MMtpy (281,150 bpd) refinery and units to produce 1.5 MMtpy of ethylene and 2 MMtpy of PX, the company said last month.

The second phase is estimated to cost USD12 B, Qiu Jianlin, chairman of Zhejiang Hengyi Group, told the industry at the Singapore office's opening ceremony on Monday.
MRC

ADNOC brings subsidiaries together in new brand identity

MOSCOW (MRC) -- The Abu Dhabi National Oil Company (ADNOC) has launched its new unified brand, bring together the company’s various subsidiaries under a common identity in a move designed to highlight the scale of its business and its contributions to the UAE’s economy, as per ArabianBusiness.

According to ADNOC, the unified brand will also help create a more integrated and progressive corporate culture, in which each company will maintain operational autonomy under a centralised governance model.

The launch event was attended by more than 3,000 employees and a number of dignitaries including Suhail Mohammed Bin Farj Al Mazroui, Minister of Energy and Minister of State for Federal National Affairs Noura Bint Mohammed Al Kaabi.

"The ADNOC Group has been given a unique responsibility, which is to harness energy resources in the service of our nation. To ensure we continue to deliver on this responsibility we must constantly look for ways to further enhance and evolve our company and adapt to the demands of the global energy industry," said Dr. Sultan Ahmed Al Jaber UAE Minister of State and ADNOC Group CEO.

"We are confident that bringing the Group together, under one brand, will significantly enhance the visibility and positioning of ADNOC at a local, regional and international level, he added.

Additinally, Dr. Al Jaber said that the single brand identity "will increase our brand equity, reinforcing our 2030 integrated strategy to further unlock, enhance and create value."

Alongside the unveiling of ADNOC’s new identity, the company outlined a set of brand values that were identified and voted for by the company’s employees, which include encouraging a culture of inclusivity, working with partners and peers to leverage collective strengths, and being an efficient, performance driven company.

As MRC reported earlier, ADNOC plans to almost triple its petrochemical production to an annual 11.4 MMt by 2025 from 4.5 MMt at present, group chief executive Sultan Al Jaber said in November 2016.

Besides, ADNOC is targeting rapid growth in demand for its polymer products from China’s automotive industry and the country’s investment in gas and electricity infrastructure. The company is focused on market expansion in China and Asia, where demand for petrochemicals and plastics, including light-weight automotive components, essential utility piping and cable insulation, is forecast to double by 2040.
MRC

BPCL sells its first low sulfur diesel cargo for export

MOSCOW (MRC) — Indian oil refiner Bharat Petroleum Corp Ltd sold a low sulfur diesel cargo through an export tender for the first time as its refineries upgrade units and due to higher inventory of the fuel, three industry sources said on Monday, as per Reuters.

The state-owned refiner, which was once a net importer of diesel, is typically well-balanced with its diesel stocks and rarely ships the fuel out of the country. India’s refiners have increased their diesel output and upgraded their plants to meet the new Euro IV fuel standards, which set the sulfur content of diesel at 50 parts per million (ppm), that were adopted in April.

A spike in domestic inventory is also contributing to the rare exports of the fuel, one of the sources familiar with the matter said. "Diesel demand in September was more than expected, but in October it’s down...so stocks are more," the source said, adding that monsoon season was still ongoing in certain parts of India.

Monsoon rains typically curb diesel use for irrigation pumps. While BPCL has exported higher sulfur gasoil grades in the past, this is the first time the refiner is exporting the 50-ppm sulfur diesel grade through a tender, the source added.

BPCL may have one more diesel spot cargo to export in November, the source said. In its latest tender, BPCL sold a combination cargo comprising 15,000 t of 350 ppm sulfur diesel and 20,000 t of 50 ppm sulfur diesel for loading from Mumbai over Oct. 21 to 25, the sources said.

The cargo was sold to Unipec at a discount of about $1 a barrel to Singapore quotes, they added.
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