BP to expand its petrochemical presence in Korea

MOSCOW (MRC) -- BP and Lotte have agreed on a major expansion of production capacity at their joint venture Lotte BP Chemical Company Limited facility in Ulsan, South Korea, said Hydrocarbonprocessing.

The expansion is expected to add 100,000 tonnes a year (tpa) of acetic acid capacity by May 2019 through debottlenecking, and to double the current 200,000 tpa vinyl acetate monomer (VAM) capacity with the addition of a second VAM plant by the end of 2020. The new expansion will bring total production capacity of the site to over 1 million tpa.

Nigel Dunn, BP petrochemicals vice president for acetyls, said: "This project demonstrates our ability to execute low capital cost debottlenecks to meet customer needs. Building on the long-standing success of our partnership with Lotte, this expansion will allow us to continue to meet Korea’s growing demand for these key petrochemicals."

Soo-Young Huh, vice chairman of Lotte, said: "We are pleased with the successful launch of this project, based on the track record of manufacturing excellence of Lotte BP and expect it to strengthen the partnership between BP and Lotte."

The expected investment of USD175 million will be funded by the joint venture.
MRC

UK engineer Wood wins work for new ADNOC refinery project

MOSCOW (MRC) -- Wood Group has received a contract from Adnoc Refining to deliver pre-front-end engineering and design (pre-FEED) services for a new refinery proposed to be built in Ruwais, Abu Dhabi, UAE, said Hydrocarbons-technology.

The new refinery will have a capacity of 600,000bpd of crude oil and be designed to have full conversion capability. It will also support integration with the existing petrochemicals infrastructure in Ruwais.

The latest contract represents a key milestone as Adnoc expedites the delivery of its AED165bn (USD45bn) expansionary downstream strategy.

"This is a major milestone in the future growth plans of Adnoc Refining."

Adnoc Refining CEO Jasem Ali Al Sayegh said: “Today marks a significant step towards fulfilling Adnoc’s strategy of developing the largest integrated refinery and petrochemicals complex in the world. We are delighted to partner with Wood and to have their global expertise available to us. This is a major milestone in the future growth plans of Adnoc Refining."

The USD8m contract also requires Wood to provide licensor selection, site master plan development, the scope of work for the FEED phase, as well as an engineering, procurement and construction (EPC) schedule and cost estimate.

Wood Group Specialist Technical Solutions CEO Bob MacDonald said: "This pre-FEED award allows us to partner with ADNOC in developing a world-scale state-of-the-art facility – a flagship development for the UAE.

"This contract also enables us to expand our footprint in the Middle East and supports our commitment to developing and enhancing local engineering capabilities in Abu Dhabi."

Last May, Adnoc unveiled plans to add a 600,000bpd refinery at Ruwais. By 2025, the total refining capacity at Ruwais is planned to be increased to 1.5Mbpd.
MRC

BASF oil JV Wintershall DEA to slash almost one in four jobs

MOSCOW (MRC) -- Wintershall DEA, the planned oil and gas joint venture between BASF and LetterOne, will cut almost one out of four jobs once the merger is approved and completed some time during the first half of the year, said Reuters.

Around 1,000 full-time positions, out of a pro-forma total of 4,200, will be eliminated in a “socially compatible manner,” BASF’s Wintershall unit said in a statement on Thursday.

About 800 of the job cuts will be in Germany and about 200 in Norway, it added.
MRC

Pertamina plans investment increase to double refinery capacity

MOSCOW (MRC) -- Indonesian state energy company PT Pertamina is planning capital expenditures of USD4.2 billion this year and will raise it to USD7 billion in two years as part of plans to double its oil refinery capacity, reported Reuters with reference to chief executive Nicke Widyawati.

Pertamina is under pressure from the government to expand its downstream production to reduce imports of refined oil products, which creates a trade deficit that weighs on the Indonesian rupiah.

"Starting from 2021, we will invest around USD7 billion per year as these refineries (developments) are in progress," Widyawati said in a meeting with journalists late on Thursday.

Pertamina plans to double its refining capacity to 2 million barrels per day (bpd) in 2026 from around 1 million bpd currently, Widyawati said, to meet national fuel demand of around 1.4 million bpd.

Pertamina expects to import 351,000 bpd of gasoline this year, up from 324,000 bpd in 2018, according to a company presentation during the meeting.

The company is currently working on at least seven refinery projects, including the new Bontang and Tuban refineries and the upgrading of the Balikpapan and Cilacap plants.

To finance the investment, Finance Director Pahala Mansury said Pertamina has the capacity to raise funds through borrowing, but the company is actively looking for partners for certain projects.

"We are looking for investment partners. These are big investments and the return may take a while," Widyawati said.

Meanwhile, Pertamina is targeting USD58.85 billion in revenue in 2019, up from USD56.06 billion in 2018.

As MRC informed earlier, in September 2018, Eni and PT Pertamina (Persero) signed in Porto Marghera, at Eni Green Refinery, a Memorandum of Understanding further expanding the relationship into green refinery.

Pertamina is an Indonesian state-owned oil and natural gas corporation based in Jakarta. It was created in August 1968 by the merger of Pertamin (established 1961) and Permina (established 1957). Pertamina is the world's largest producer and exporter of liquefied natural gas (LNG).
MRC

Aruba asks US to lift sanctions affecting refinery financing

MOSCOW (MRC) -- Aruba is asking the United States to lift financial sanctions blocking a Citgo Petroleum Corp oil refinery from financing an overhaul project, which has led to job cuts on the Caribbean island, reported Reuters with reference the nation’s prime minister.

Prime Minister Evelyn Wever-Croes said at a media briefing that the United States initially ruled out a relaxation of sanctions, which this month led to a halt on a USD685 million renovation project that was started in 2016.

The island government is expecting a final answer this week on its request to allow between USD15 million and USD20 million be invested in the project, Wever-Croes said, adding that the money would allow for the recall of the workers.

Citgo, as a unit Venezuela’s state-run oil company, Petroleos de Venezuela SA, is subject to financial sanctions imposed by the United States on the country’s government and PDVSA, designed to oust Venezuela’s socialist president, Nicolas Maduro.

Citgo Aruba Refining signed a 15-year lease with the government of Aruba, agreeing to refurbish and reopen an idled 209,000-barrel-per-day refinery. That work was halted earlier in February and employees laid off because of the US sanctions.

A Citgo Petroleum spokeswoman did not immediately respond to a request for comment.

A first round of sanctions on Venezuela and PDVSA in 2017 had caused delays to the project.

As MRC informed before, in late January 2019, Citgo Petroleum Corp idled the small gasoline-producing unit at its 157,500-barrel-per-day (bpd) Corpus Christi, Texas, refinery for economic reasons. The 13,000-bpd FCCU 1 was shut for "non-operational reasons" the company said in a notice filed with the Texas Commission on Environmental Quality. The sources said FCCU 1 was not profitable for the refinery to operate.
MRC