Union says Shell dragging feet in refinery contract talks

MOSCOW (MRC) - The United Steelworkers union (USW) said Shell Oil Co is delaying progress on important issues in negotiations for a new national agreement covering 30,000 U.S. refinery and chemical workers, according to sources familiar with the talks, said Hydrocarbonprocessing.

"We look forward to the bargaining process working through to its completion and a conclusion that can be satisfactory with all parties," Fisher said.

Shell, the U.S. arm of Royal Dutch Shell Plc, is the lead negotiator for refinery, petrochemical and pipeline companies in talks to replace the current contract that expires on Feb. 1.

The sources said talks between the two sides have become heated over a USW proposal to replace non-union contract workers, who perform much of the maintenance and overhaul of equipment in refineries, with union members.

The union has warned Shell there will be no extension of talks past the expiration date, as was done in contract talks prior to 2015 when failure to reach an agreement led more 7,000 workers at 12 refineries and three chemical plants to walk off their jobs.

Most of the strikes in 2015 ended within two months but continued at some locations for nearly six months.

In addition to an 8-percent-per-year wage increase for hourly workers, the union also wants the new three-year pact to provide for the replacement of 10-percent-a-year of non-union contractors with USW members.

Contract workers at refineries are employed by companies hired by the plant owners to do the maintenance work.

Negotiations for the new contract began on Jan. 16. USW-represented refinery workers make about USD40 an hour after four years on the job.

USW members have granted authority to union officials to call a strike if negotiations are unsuccessful.
MRC

MOSCOW (MRC) -- Indonesian state energy company PT Pertamina said it has signed agreements with Italian oil company Eni SpA to develop a so-called green refinery in Indonesia and to process a palm-based fuel mixture in Italy, reported Reuters.

Pertamina said in a statement, it has signed a head joint venture agreement for the planned refinery in Indonesia that would produce fuel completely derived from crude palm oil (CPO) and a term sheet for CPO processing in Italy.

Pertamina also signed an agreement to allow it to process CPO at Eni’s refinery in Italy to produce hydrotreated vegetable oil (HVO), which can be used as a mixture in diesel fuel.

The two companies are also in talks to potentially produce HVO in Indonesia.

The two companies had previously agreed to conduct studies of potentially converting three of Pertamina’s refineries into green refineries to produce palm-based diesel as Indonesia boost efforts to soak up excess palm supply in the country.

As MRC informed previously, in February 2018, Italy’s Eni and France’s Total discovered a promising natural gas field off Cyprus. Eny said then that the find looked geologically similar to the mammoth Zohr field off Egypt.

Eni is an Italian multinational oil and gas company headquartered in Rome. It has operations in in 79 countries, and is currently Italy's largest industrial company with a market capitalization of EUR68 billion (USD 90 billion), as of August 14, 2013. The Italian government owns a 30.3% golden share in the company, 3.93% held through the state Treasury and 26.37% held through the Cassa depositi e prestiti. Another 39.40% of the shares are held by BNP Paribas.

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

MOSCOW (MRC) -- Bosnia’s sole oil refinery Brod said it had halted operations this month for an overhaul which may take a year, reported Reuters.

The refinery, which is majority owned by Russia’s Neftegazinkor, a unit of state-owned oil company Zarubezhneft, was shut on Jan. 9 to assess the works needed to restore the refinery to full capacity, a spokeswoman for Brod told Reuters.

Petar Djokic, energy minister for Bosnia’s autonomous Serb Republic, where the refinery is located, told local media on Thursday that production may resume next year.

In the meantime, demand would be covered through imports from Serbian oil company NIS, majority owned by Russia’s Gazprom Neft, he added.

The refinery was hit by a blast in October which killed one worker and injured nine. The results of the inquiry into the cause of the explosion have not been made public.

Auditors have warned that the refinery, which processes 1.2 million tonnes of crude a year, may face liquidity problems after it piled up losses and its liabilities exceeded assets.

Brod has dismissed those claims.

As MRC wrote before, in October 2017, Russian oil producer Gazprom Neft, through its subsidiary Naftna Industrija Srbije (NIS), started construction of a new deep conversion complex (DCC) at its Pancevo Refinery in Serbia with an investment of over EUR300m. The new complex will be equipped with delayed coking technology. It is anticipated to be ready in 2019 and will help NIS to start production of petroleum coke (pet coke) which is currently not done in the country.

The Gazprom subsidiary holds 56% in NIS, an oil and gas company in which the Serbian government is a major shareholder.
MRC

MOSCOW (MRC) - Mexican national oil company Pemex will oversee the process to pick the company that will build a new multibillion-dollar oil refinery in the southern Gulf Coast state of Tabasco, Energy Minister Rocio Nahle said, as per Reuters.

President Andres Manuel Lopez Obrador has pledged to fast-track the construction of the new refinery in Dos Bocas, Tabasco, to boost lagging domestic production of gasoline and diesel, and wean the country from a growing dependence on imported fuels.

"It will be a restricted auction because we’re going to invite serious, specialized companies," Nahle said at an energy conference in Mexico City.

The minister, who also serves as president of the Pemex board of directors, added that the invitation-only process will allow the government to prohibit the participation of international firms that have "histories of corruption."

Nahle did not say when the Pemex auction would be conducted, or which firms were being considered.

Pemex’s recently approved 2019 budget allocates almost USD2.5 billion for the refinery, which aims to be able to process 340,000 barrels per day (bpd) of heavy crude.

Lopez Obrador has said that the total price tag for the facility will be approximately $8 billion, and would mark Pemex’s seventh domestic oil refinery.

The company also has a 50 percent stake in the Deer Park refinery in Texas operated by partner Royal Dutch Shell.
MRC

MOSCOW (MRC) -- Thailand's PTT Plc and Bangkok Industrial Gas Co. (BIG) have formed a joint venture to build the "first" air separation unit (ASU) that will use cold waste from the regasification of liquefied natural gas in Map Ta Phut, Thailand, as per Apic-online with reference to BIG's announcement.

The project, expected to require an investment of around USD47-million, will be capable of producing over 450,000 t/y of liquid oxygen, nitrogen and argon using advanced technology. Operations are scheduled to begin in 2021.

According to BIG, the new plant will bring "tremen-dous" environmental and energy efficiency benefits, such as reducing carbon dioxide emissions by 28,000 t/y and by reducing chilled water waste emissions from PTT's operations in the gulf.

The joint venture is owned 51% by PTT and 49% by BIG.

As MRC informed previously, PTT started commercial operations at its new 400,000 mt/year metallocene C6 linear low density polyethylene plant at Map Ta Phut, Thailand, in the first quarter of 2018.

PTT Global Chemical is a leading player in the petrochemical industry and owns several petrochemical facilities with a combined capacity of 8.45 million tonnes a year.
MRC