LDPE prices began to go up in Russia

MOSCOW (Market Report) -- The period of long price cuts in the Russian low density polyethylene (LDPE) market is over. The price situation has radically changed in the market since mid-March, prices began to rise gradually, according to ICIS-MRC Price report.

LDPE prices went down in the Russian market since last September under the pressure of weak demand and excessive supply of polymer. Prices for some grades had reached their minimum by February and even fell below prices of its export counterpart to be shipped to several markets. The situation has begun to change gradually to the opposite direction in the LDPE market since March, the downward price trend gave way to growth.

The spring increase in LDPE prices is traditional in the Russian market and is caused by seasonally stronger demand and scheduled shutdown for maintenance at Kazanorgsintez, one of the largest producers. This year does not seem to be an exception. The Kazan producer intends to shut down its production capacities for almost a one-month turnaround on 13 April.

Higher delivery costs also might affect LDPE prices for the end user in the near future. The traditional spring restrictions on road freight transportation will come into force for movement on regional roads in some regions from late March. Such restrictions led to a 50% increase in delivery costs in some regions a year earlier.

There was no deficit of LDPE in the market, but market participants said there were temporary restrictions on shipments by some producers. Besides, some companies began to prepare for a "season of high demand". And if demand for LDPE was very weak in the first two weeks of March, then a serious recovery has been registered in the market since the middle of the week.

There was also information in the market about some producers' plans to significantly increase their prices next week. Some market participants do not rule out a price rise of up to Rb5,000/tonne.

LDPE prices reached their bottom in the market in late February, and prices of 108 grade polyethylene (PE) were at Rb75,000/tonne, CPT Moscow, including VAT. Prices of this PE grade went up to Rb77,000/tonne CPT Moscow, including VAT, or higher as of mid-March.
MRC

BP Technology Outlook 2018

MOSCOW (MRC) -- BP published the second edition of the BP Technology Outlook. The report explores five areas where BP believes technology can play a game-changing role: Energy efficiency; digital; renewable power; energy storage; and decarbonized gas, Hydrocarbonprocessing.

In order to meet demand, the energy industry uses technology to find, produce and convert primary energy resources including oil, natural gas, coal, uranium for nuclear power, biomass, solar and wind.

From the earliest oil wells to the latest wind turbines, technology developments have driven advances in the way that energy is discovered and produced – and many more developments are anticipated in the decades ahead.

Around 55 trillion barrels of oil and gas (measured in trillions of barrels of oil equivalent or Tboe) have been discovered around the world. Of these, we estimate that around one-tenth, or 4.9 Tboe, could be recovered using today’s technology. By applying evolving technology through to 2050, these recoverable volumes could be increased by more than one-third to around 7.3 Tboe. This volume is more than enough to meet the world’s projected demand to 2050 – estimated at 1.8 to 2.5 Tboe. However, exploration and technology development remains important in this sector to provide resource options that are more economical or have lower environmental footprints than some of the discovered resources. Oil and gas production from a reservoir declines naturally over its lifetime and our analysis supports the International Energy Agency’s estimate that investment of around $600 billion per year industry-wide could still be needed to produce sufficient oil and gas to satisfy demand – a figure which allows for impacts to oil and gas production from announced policies and pledges toward achieving the Paris Agreement.
MRC

ENI 2018-2021 Strategy: Refining & Gas

MOSCOW (MRC) -- Claudio Descalzi, Eni’s CEO, presented the company’s 2018-2021 Strategic Plan to the financial community, as per Hydrocarbonprocessing.

Following a successful transformation, Eni is stronger, more integrated and positioned well for further growth in the upstream sector. The mid-downstream businesses have been restructured to leave them more financially solid and therefore able to create value even in the presence of low price scenarios. The 2018-21 plan represents the natural evolution of the strategy implemented in previous years and is designed to increase the value of all businesses. On this basis, Eni intends to increase the 2018 dividend to EUR0.83 per share, fully paid in cash. The distribution policy will be progressive and based on underlying earnings and free cash flow growth.

In Refining Eni aims to achieve strong growth in the Plan period with an EBIT of EUR900 million in 2021 and a cumulative free cash flow in 2018-21 of more than EUR2 billion.

To do this, Eni will undertake the following actions:
• Supply and asset optimization in refining activity;
• Restart of the Sannazzaro EST plant by the end of 2018;
• An increase of the "green" refining capacity: the bio-refinery in Gela will be operational by the end of 2018 and the second phase of development of Venice completed by 2021;
• Consolidate leading marketing position in Italy, leveraging new sustainable mobility initiatives.
Gas and Power will grow thanks to the following actions:
• Accelerated development of the LNG portfolio, which will reach 12 million tons per year of contracted volumes in 2021, and 14 million by 2025, also through the enhancement of the equity component, increasing from 30% in 2017 to 70% in 2021;
• Enhancement of the gas portfolio in Europe;
• Growth in the retail sector in Europe, which provides for around 11 million customers in 2021, an increase of 25% compared to 2017. Targeting an additional 11 million customers by 2021.
These actions will allow the business to remain structurally positive in the future, achieving EBIT of 800 million in 2021, of which 60% referred to retail and up over the 300 million of 2018. Free cash flow cumulative of 2018-21 of 2,4 billion euros.
MRC

Statoil to rebrand as Equinor in green energy push

MOSCOW (MRC) - Norway’s Statoil plans to change its name to Equinor, reflecting its commitment to become a broad energy company rather than one focused only on oil it said, as per Reuters.

Equinor is a combination of “equi”, the starting point for words like equal, equality and equilibrium, and “nor” for Norway, the company said.

“Reflecting on the global energy transition and how we are developing as a broad energy company, it has become natural to change our name,” Statoil CEO Eldar Saetre said in a statement. Rebranding would cost up to 250 million Norwegian crowns (USD32.5 million), he later told a news conference.

Statoil, which is headquartered in the port city and oil industry hub of Stavanger, has come to symbolize Norway’s rise in the past half-century to one of the world’s richest nations.

Local newspaper Stavanger Aftenblad ran a straw poll asking readers whether they liked the name change, with 4,730 people saying “no” and 809 saying “yes”.

The proposal will be put to the annual general meeting on May 15, but Statoil said it already had the backing of the Norwegian state, which has a 67 percent stake in the company.

“The decision reflects that Statoil is developing itself into a broad energy company in line with global developments in the energy sector,” Oil and Energy Minister Terje Soeviknes told Reuters.

Statoil said it expects to invest 15-20 percent of capital spending by 2030 in what it calls new energy solutions, up from about 5 percent last year.

Saetre declined to say how much Statoil was planning to spend on renewables in 2018, but the company has said previously that spending for renewable and low-carbon solutions are expected to total USD500 million to USD750 million from 2017 to 2020 and USD750 million to USD1.5 billion for the 2020-2025 period.

Statoil developed the world’s first floating offshore wind park off Scotland and is looking to install others off countries including the United States and Japan.
MRC

PetroChina Daqing resumes operations at LLDPE plant in China

MOSCOW (MRC) -- PetroChina Daqing Petrochemical has restarted operations at a linear low density polyethylene (LLDPE) plant following a brief maintenance, as per Apic-online.

A Polymerupdate source in China informed that the company has resumed operations at the plant on March 8, 2018. The plant was taken off-stream for maintenance on March 5, 2018. Currently, the plant is operating at normal rates.

Located in Daqing, China, the plant has a LLDPE production capacity of 60,000 mt/year.

As MRC informed previously, PetroChina has nearly doubled the amount of Russian crude being processed at its refinery in Dalian, the company’s biggest, since January 2018, as a new supply agreement has come into effect. The Dalian Petrochemical Corp, located in the northeast port city of Dalian, is expected to process 13 million tonnes, or 260,000 bpd of Russian pipeline crude this year, up by about 85 to 90 percent from last year’s level. Dalian has the capacity to process about 410,000 bpd of crude. The increase follows an agreement worked out between the Russian and Chinese governments under which Russia’s top oil producer Rosneft will supply 30 million tonnes of ESPO Blend crude to PetroChina in 2018, or about 600,000 bpd. That would represent an increase of 50 percent over 2017 volumes. The additional oil sent to Dalian is about 120,000 bpd and will make up the bulk of the Russian increases.

PetroChina Company Limited, is a Chinese oil and gas company and is the listed arm of state-owned China National Petroleum Corporation, headquartered in Dongcheng District, Beijing. It is China's biggest oil producer.
MRC