Indian oil refiner part-owned by Iranian company cancels Iran oil imports

MOSCOW (MRC) - India's Chennai Petroleum will stop processing Iranian crude oil from October to keep its insurance coverage once new sanctions by the United States against Iran go into effect, three sources familiar with the issue said, as per Reuters.

Iran's Naftiran Intertrade Co Ltd, a trading arm for state-owned National Iranian Oil Co, owns a 15.4 percent stake in Chennai Petroleum, which has two refineries with a total combined capacity of 230,000 barrels of oil per day (bpd).

In May, U.S. President Donald Trump pulled out of an international nuclear deal with Iran and announced new sanctions against the country, the third-largest producer among the Organization of the Petroleum Exporting Countries (OPEC). Washington is pushing allies to cut Iranian oil imports to zero once the sanctions on the petroleum sector startup on Nov. 4.

United India Insurance has informed Chennai Petroleum that its new annual policy that is set to take effect from October will not cover any liability related to processing crude from Iran, the three sources said. This has forced the refiner to cancel a scheduled loading of 1 million barrels in October, they said.

Indian insurers do not fall directly under the sanctions but need to hedge their own risk on the Western reinsurance market, which will not accept Iranian exposure.

"It is quite complicated.. reinsurers are quite apprehensive about extending cover for Chennai Petroleum," said one of the sources, who asked not to be identified because of the sensitivity of the issue.

Chennai Petroleum's reduced demand will further cut India's imports from Iran to about 10 million tonnes in October, lower than previous estimates reported by Reuters.
MRC

IMCD to acquire European speciality chemicals distributor Velox

MOSCOW (MRC) -- IMCD N.V. has announced that it has signed an agreement to acquire 100 % of the outstanding shares of Velox GmbH, a European distributor with a focus on raw material specialities and solutions for the plastics, composites, additives, rubber, and paints & coatings industries with headquarters in Hamburg, Germany, as per GV.

The transaction is subject to regulatory approval. Financial details were not disclosed.

Velox was established in 1993 and today has an extensive commercial network across Europe and long-standing relationships with global suppliers in the plastics, composites and other specialities markets. With approximately 225 employees in 18 countries, the company generated EUR 155 million revenue and a normalised EBITDA of EUR 5.4 million in 2017.

Piet van der Slikke, CEO of IMCD, commented: "This acquisition enables IMCD to further strengthen its position as distributor of speciality plastics and additives. Our portfolios very well complement each other, and we expect to be able to create more value for our suppliers and customers."

Francois Minec, General Manager of Velox added: "Joining IMCD will provide Velox with excellent opportunities to further develop and execute its strategy as a leading distributor to the plastics- and composite industries."

As MRC informed previously, in 2013, Arkema appointed Velox GmbH, Hamburg, Germany, as its exclusive distributor for the medical business development in Europe.
MRC

Wintershall of BASF to invest EUR2bn on Norwegian Continental Shelf fields

MOSCOW (MRC) -- German crude oil and natural gas producer Wintershall has revealed its intentions to invest about EUR2bn in exploration and development activities on its offshore Norwegian fields from 2017 to 2020, as per EnergyMarketPrice.

An announcement in this connection was made by the company’s CEO Mario Mehren during the Offshore Northern Seas (ONS) conference in Stavanger, Norway.

Mehren hinted that it was in the best interests of Europe to invest in working closely with reliable and proven supply countries, particularly Norway and Russia, for future energy security.

Mehren said: "Europe needs to be aware of its strengths and must tackle the new political and economic challenges in concert. Only through closely collaborating with our neighbors can we guarantee supply security today and in the future."

Wintershall plans to allocate nearly 35% of its global exploration budget on Norway. The German energy company currently holds more than 50 licenses in the country.

Wintershall, which had submitted a plan for development and operation (PDO) for the Nova field in North Sea to Norway’s Ministry of Petroleum and Energy in May, is expected to invest about EUR1.1bn alongside its partners in the offshore Norwegian project.

The Nova field, whose recoverable reserves are projected to be about 80 million barrels of oil equivalent, is expected to be brought into production in 2021.

In last December, Wintershall alongside its partners Petoro and Spirit Energy started production from the NOK15.3bn (USD1.85bn) Maria field in the southern Norwegian Sea.

Wintershall, which is owned by German chemical giant BASF, is also in the process of completing a merger with DEA, a subsidiary of LetterOne. The combined Wintershall DEA company is expected to be among the top five oil and gas producers in Norway, claimed Wintershall.

As MRC wrote before, in December 2017, BASF and LetterOne signed a letter of intent to merge their respective oil and gas businesses in a joint venture, which would operate under the name Wintershall DEA.
MRC

Mixer Compounds and Teknor Apex become new members of EuMBC

MOSCOW (MRC) -- Mixer Compounds and Teknor Apex have joined the European Masterbatchers and Compounders Association (EuMBC), which now counts 17 members, reported GV.

"EuMBC is delighted to welcome two new companies. It is great to see our membership growing constantly. Mixer Compounds and Teknor Apex give our association an even more important voice in Europe. We are looking forward to working together with the two new members on common goals," stated EuMBC president Marc Cornu, Ampacet.

As MRC wrote previously, in May 2018, Teknor Apex announced that it had developed a series of flexible PVC injection moulding compounds that have been used successfully in automotive window encapsulation.

Mixer SpA is an Italian compound producer, focusing on compounds for cable insulation, jacketing and bedding to improve the fire resistance of the final cable and using both rubber and thermoplastics compounds.

Teknor Apex is an European/American compounder with six divisions: Teknor Color, Vinyl, Thermoplastic Elastomer, Engineering Thermoplastics, Chemicals and Garden Hose.
MRC

Mexican new government may halt oil auctions indefinitely - document

MOSCOW (MRC) -- Mexico’s incoming government is considering indefinitely suspending auctions for oil and gas projects, and giving state-owned Pemex authority to pick its own joint-venture partners rather than holding competitive tenders, according to policy guidelines seen by Reuters.

The document, drafted by energy advisers to leftist President-elect Andres Manuel Lopez Obrador, also recommends forging closer ties with leading oil producer cartel OPEC while withdrawing from the International Energy Agency (IEA), which represents the interest of oil-consuming countries.

It was not clear to what extent the guidelines would translate into formal policy after Lopez Obrador takes office in December. They would be a sharp break with outgoing President Enrique Pena Nieto’s 2013 constitutional overhaul, which opened up production and exploration to private oil companies.

Since ending Pemex’s decades-long monopoly, Pena Nieto’s government has forecast hundreds billions of dollars in investment from over 100 new contracts awarded to mostly foreign and private oil companies. The new guidelines would return greater responsibility for the sector to the government.

"The terms for formalizing partnerships or associations will be established by Pemex’s board of directors, according to the law," states the 33-page document. The guidelines call for "an indefinite suspension of international exploration and production auctions".

The document confirms the next government’s intention to review how contracts were awarded under Pena Nieto’s energy policy, especially reasons why signature bonuses were not required for some licenses awarded by oil regulator, the National Hydrocarbons Commision (CNH).

Lopez Obrador vigorously opposed the reform, but his broad coalition is divided over the issue. Business-friendly aides back greater private investment in the oil and gas sector while more nationalist allies oppose it. Rocio Nahle, Lopez Obrador’s designated energy minister, is a critic of the outgoing government’s policy, but incoming chief-of-staff Alfonso Romo supports the opening to the private sector.

While the outgoing administration has sought to grant private producers total control over how to market their oil, the new guidelines would give the government more say over oil trading, with the intention of "supporting domestic supply."

In June, production from projects won at auction by private and foreign oil companies plus Pemex’s Ogarrio and Cardenas-Mora joint ventures, was about 54,000 bpd of crude, according to CNH data.

These volumes are small compared with Pemex’s July crude output of 1.84 million bpd, but the state-run company has been unable to reverse a decline in output since 2005.

Lopez Obrador aims to boost Mexico’s oil production by a third to 2.5 million barrels per day (bpd), as well as increase very low refinery processing rates and build at least one new refinery.

But his advisors have not been clear when explaining what will happen with Pemex joint ventures, one of the few strategies the firm has successfully implemented to attract investment.

An early sign of Lopez Obrador’s rejection of current energy policy was his call during the campaign to suspend two auctions scheduled for the autumn, including tenders to pick new equity partners for Pemex.

The auctions have been pushed back to February and it was not clear if Lopez Obrador will allow them to proceed.

The guidelines say Pemex’s exploration and production tie-ups would be postponed “until the scheme is modified and (partnerships) are registered in a long-term strategic plan."

Pemex has so far secured partnerships for the USD11-billion deepwater Trion project as well as in the onshore fields Ogarrio and Cardenas-Mora in the southern Gulf coast state of Tabasco.

The document states the incoming government is also considering leaving the IEA and would explore "the possibility of a closer approach and better coordination" with the Organization of the Petroleum Exporting Countries (OPEC).

As MRC wrote earlier, in June 2018, Petroleos Mexicanos disclosed the results of the bidding process for the rehabilitation and commissioning works to be carried out on the H-Oil Plant located in the Miguel Hidalgo refinery in Tula, in the state of Hidalgo. This project will increase the production of ultra-low sulphur gasoline, in compliance with environmental regulations in effect, and the handling of crude oil for production of other fuels, such as diesel and jet fuel.

Pemex, Mexican Petroleum, is a Mexican state-owned petroleum company. Pemex has a total asset worth of USD415.75 billion, and is the world's second largest non-publicly listed company by total market value, and Latin America's second largest enterprise by annual revenue as of 2009. Company produces such polymers, as polyethylene (PE), polypropylene (PP), polystyrene (PS).
MRC