STAR oil refinery to reduce Turkey dependence on imports, says Erdogan

MOSCOW (MRC) -- A new USD6.3 billion refinery set up by the Azeri state oil company in Turkey will reduce Ankara’s dependence on imports for processed oil products, reported Reuters with reference to President Tayyip Erdogan.

The new plant could also help to ease some of the pain from Turkey’s currency crisis, given that the lira’s 35 percent slump this year has driven up costs for the country’s energy companies and forced them to increase electricity and natural gas prices for both households and industrial customers.

Speaking at the opening ceremony of the SOCAR Turkey Aegean Refinery (STAR) in the Aegean coastal province of Izmir, Erdogan hailed the plant as Turkey’s biggest step yet in Turkey’s drive to meet its energy needs.

"This is aimed at saving around USD1.5 billion annually in oil product imports and the reduction of foreign dependence for oil products," he said.

SOCAR Turkey aims to make an acquisition in natural gas distribution in 2019, a senior executive of the company told Reuters on Friday, adding that an offer has been made to German energy company EWE.

The STAR refinery, which is wholly owned by Azeri state oil company SOCAR, will increase Turkey’s 28.1 million tonne annual oil processing capacity by a third, according to official data.

Producing diesel, jet fuel, LPG, petroleum coke and xylene, the plant will supply 25 percent of Turkey’s processed oil product needs, SOCAR’s website says.

The plant will still obtain raw oil from international markets, SOCAR officials said.

SOCAR is the principal partner in the Trans-Anatolian Natural Gas Pipeline (TANAP), which will carry natural gas from the Caspian Sea to Turkey and Europe. It also owns petrochemicals company Petkim and the Petlim container terminal in Turkey.

Other efforts to improve Turkey’s energy security include a recently announced tender for operation rights of three new solar power plants and the privatization of seven coal fields in an attempt to boost production.

As MRC wrote before, in February 2018, Maire Tecnimont S.p.A. announced that its main subsidiaries Tecnimont S.p.A. and KT-Kinetics Technology S.p.A. - had signed with the Client SOCAR (State Oil Company of Azerbaijan Republic) Heydar Aliyev Baku Oil Refineryan EPC contract (Engineering, Procurement and Construction) as an important part of the execution of the Modernization and Reconstruction works for the Heydar Aliyev Baku Oil Refinery, in Azerbaijan.

SOCAR, which is keen on expanding operations in the retail oil products market abroad, is involved in exploring oil and gas fields, producing, processing, and transporting oil, gas, and gas condensate, marketing petroleum and petrochemical products in the domestic and international markets, and supplying natural gas to industry and the public in Azerbaijan.
mrcplastg.com

MOSCOW (MRC) - Refining company Phillips 66 was awarded a tender to supply Mexico’s Pemex with at least four 350,000-barrel cargoes of U.S. Bakken crude for November delivery, the refining company said, as per Reuters.

The purchase, which will be the state-run company’s first crude import in over a decade, was requested last week to cover needed oil supply for Pemex’s 330,000-barrel per day Salina Cruz refinery amid Mexico’s falling production of light grades.

A previous attempt by Pemex to import U.S. Light Louisiana Sweet (LLS) crude failed in early October due to a narrow delivery window and an outdated price reference, according to traders and the company.

Pemex urgently needs to secure a source of foreign light crude to increase its refineries’ low processing rates. In August, the firm produced 789,500 barrels per day (bpd) of fuel, about half of its total capacity, according to official figures.

Pemex requested up to six 350,000-barrel cargoes of Bakken crude, a type of U.S. shale oil, but it awarded four, the company said. It did not disclose the name of the winner or the price agreed.

"We are currently in the process of signing the contracts," Pemex said in a press release. Traders with knowledge of the offer’s results said on Monday that Phillips 66 had won the contract. The company confirmed it in the evening.

The Bakken crude for Pemex is expected to be transported by pipeline from North Dakota to U.S. Gulf ports. Phillips 66 Partners, a unit of Phillips 66, has a 25-percent stake in the Bakken Pipeline system, which includes the Dakota Access Pipeline and another pipeline that can transport up to 520,000 bpd of oil to Beaumont, Texas.

"Phillips is looking for tankers to start deliveries as soon as possible," one the traders said.
MRC

MOSCOW (MRC) -- SOCAR, the largest direct foreign investor in Turkey, launched its USD6.3-billion SOCAR Turkey Aegean Refinery - STAR Refinery, which will provide a large portion of oil products demand in the local market with 10 million tons of annual oil processing capacity, as per Hydrocarbonprocessing.

In the coming years, SOCAR's new refinery will be a solid contribution to the economies of Azerbaijan and Turkey.SOCAR’s USD6.3-billion STAR Refinery, one of the largest investment projects in Turkey, was inaugurated on October 19, 2018 in a ceremony held in Aliaga, Izmir. Alongside the refinery SOCAR has also launched its other projects - Petlim Container Terminal, Petkim Wind Power Plant and its regional head office. President Ilham Aliyev of the Republic of Azerbaijan, President Recep Tayyip Erdogan of the Republic of Turkey, government officials of the two countries and numerous guests have attended the inauguration ceremony.

Addressing the event, SOCAR President Rovnag Abdullayev spoke about the STAR project: ''Today is a historic day for us. Because we are launching the STAR Refinery, foundation of which was laid by the leaders of the two countries on October 25, 2011. The STAR Refinery, built and equipped with the world's latest technologies, helps the integration of our petrochemical business and therefore has a strategic importance for our company. The refinery, with annual processing capacity of 10 million tons of crude oil, will make a significant contribution to the economy of Azerbaijan and Turkey''.

STAR Refinery will strengthen Petkim's and SOCAR’s market power in the Mediterranean region. It will produce naphtha, the main crude material for Petkim, and considerably reduce Turkey's dependence on imports. STAR Refinery will process various types of oil, which is an indication of the refinery’s competitive edge.

R. Abdullayev said SOCAR would continue investments in Turkey after the inauguration of the Refinery. He expressed gratitude to Turkish and Azerbaijani leaders, as well as other state and government officials, to TSGI alliance, the major contractor of the project, international financial institutions involved in financing the project, and everyone who contributed to the construction process of the refinery.

STAR Refinery will meet a quarter of Turkey's oil products demand.

STAR Refinery will help to reduce the current trade deficit in Turkish petrochemical sector, one of the largest oil consumers in Europe, the Middle East and Africa. It will produce oil products such as naphtha, xylene, diesel, aircraft fuel and LPG. The refinery, which has Turkey's first Strategic Investment Promotion Certificate, employed 19,500 workers from 14 countries, including 3,000 engineers at the peak stage of the construction. 1100 professionals will permanently work at the refinery after its launching. Shareholders of the project are SOCAR (60%) and the Ministry of Economy of Azerbaijan (40%).

The Petlim Container Terminal, with a capacity of 1.5 million TEU, is one of the 3 largest ports in Turkey. Around $400 million has been invested in the terminal.

SOCAR's renewable energy project PETKIM Wind Power Plant has a capacity of 51 MWT. The investment in this project totaled 55 million euros. The energy plant connected to Turkey's energy network will significantly contribute to meeting the energy needs of SOCAR in Aliaga.

As MRC wrote before, in the first half of March 2018, Petkim shut its cracher in Turkey owing to a technical glitch. Located at Aliaga in Turkey, the cracker has an ethylene production capacity of 585,000 mt/year and propylene production capacity of 240,000 mt/year.

SOCAR, which is keen on expanding operations in the retail oil products market abroad, is involved in exploring oil and gas fields, producing, processing, and transporting oil, gas, and gas condensate, marketing petroleum and petrochemical products in the domestic and international markets, and supplying natural gas to industry and the public in Azerbaijan.

Petkim is the leading petrochemical company of Turkey. Specializing in petrochemical manufacturing, the company produces ethylene, polyethylene, polyvinyl chloride, polypropylene and other chemical building blocks for use in the manufacture of plastics, textiles, and other consumer and industrial products.
MRC

MOSCOW (MRC) -- ExxonMobil is likely to brought on-stream its No. 1 cracker following a maintenance turnaround, as per Apic-online.

A Polymerupdate source in Singapore informed that the company has planned to restart the cracker this week. The cracker was shut for maintenance on September 3, 2018.

Located on Jurong Island in Singapore, the No. 1 cracker has an ethylene production capacity of 900,000 mt/year.

We remind that, as MRC informed before, in December 2016, Mitsubishi Heavy Industries, Ltd. (MHI) received an order for supply of systems to support a large-scale polyethylene production train for ExxonMobil's Beaumont Polyethylene plant. The new production train is slated to be completed in 2019, and will produce 650,000 tons of polyethylene per year.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.
MRC

MOSCOW (MRC) -- China’s refinery throughput hit a record daily high in September as some independent plants restarted operations after prolonged shutdowns over summer to shore up inventories amid better fuel demand and robust margins, reported Reuters with reference to data.

China’s crude oil throughout rose to 12.49 million barrels per day (bpd) in September, up from 11.85 million bpd in August, according to Reuters calculations based on National Bureau of Statistics data.

The higher processing rate came as China raised its crude oil imports to a four-month high.

Year-to-date processing volumes rose 8.1 percent on a year earlier to 452.54 million tonnes, or 12.1 million bpd, the data showed.

China’s September domestic crude oil production fell 2.4 percent on a year earlier to 15.18 million tonnes, or 3.69 million bpd, according to the data.

Output in the first nine months came in at 141.13 million tonnes, down 1.9 percent from a year earlier. That equates to 3.77 million bpd.

Refinery output is expected to rise further in the fourth quarter as several state refiners resume operations after scheduled major overhauls.

These include PetroChina’s 130,000-bpd Daqing refinery in the northeast and the newly upgraded 200,000-bpd Huabei plant.

Natural gas production rose 8.5 percent in September from a year earlier to 12.2 billion cubic meters (bcm). Output for the year to date was 116.2 bcm, up 6.2 percent.

PetroChina has stepped up drilling at top gas field Changqing, which makes up about a quarter of the national total, and is aiming for record output this year to help meet a winter demand spike.
MRC