Oil and refined product inventories rise in week

MOSCOW (MRC) - U.S. crude, gasoline and distillate stocks rose last week, the Energy Information Administration said Reuters.

Crude inventories rose by 3.6 million barrels in the last week, compared with analysts’ expectations for an increase of 2.7 million barrels.

Crude stocks at the Cushing, Oklahoma, delivery hub fell by 1.016 million barrels, EIA said.

Refinery crude runs fell by 865,000 barrels per day, EIA data showed. Refinery utilization rates fell by 4.8 percentage points.

Gasoline stocks rose by 408,000 barrels, compared with analysts’ expectations in a Reuters poll for an 826,000-barrel gain.

Distillate stockpiles, which include diesel and heating oil, rose unexpectedly by 1.2 million barrels, versus expectations for a 1.1 million-barrel drop, the EIA data showed.

Net U.S. crude imports fell last week by 430,000 barrels per day.
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MOSCOW (MRC) -- Philadelphia Energy Solutions Inc, owner of the largest and oldest refinery on the US East Coast, is facing another financial crisis just months after emerging from a controversial bankruptcy, according to two sources and a Reuters review of court filings.

PES, which exited bankruptcy in August, saw its cash balance fall to USD87.7 million at the end of 2018, down from USD148 million just three months earlier, a USD61 million decline, according to a post-bankruptcy financial report filed late last month. The company entered bankruptcy roughly a year ago with USD43 million cash on hand, court documents show.

Refineries based on the East Coast suffer from difficult economics due to the cost of shipping crude oil from West Texas or Canada, but PES has had other problems at the plant in South Philadelphia including weak gasoline margins and high debt costs.

The company filed for bankruptcy in January 2018, blaming its woes largely on the costs of complying with the US Renewable Fuel Standard, a 2005 law that requires refiners to either blend biofuels like ethanol into fuel or purchase credits, called RINs, from competitors who do.

PES does not have those blending capabilities, so it has to pay for credits. But a Reuters analysis showed other factors played a role in the bankruptcy, including the withdrawal of more than USD590 million in dividend-style payments from the company by its investor-owners.

After filing for bankruptcy, the company was given a waiver for half of its USD350 million in liabilities related to biofuels credits by the US Environmental Protection Agency.

Poor gasoline margins have hurt the company’s bottom line as well. PES’s weak cash position forced the refiner to significantly scale back a planned USD90 million maintenance project that began in January, according to two sources familiar with the plant’s operations. Refiners perform maintenance to keep units operating reliably and safely, protecting themselves from costly unplanned outages.

"I am not surprised that they are economically struggling once again, but I didn’t expect it to happen so soon," Christina Simeone, a director at the Kleinman Center for Energy Policy, said.

In the last three months of 2018, while PES saw its cash balance fall by USD61 million, the compliance credits were trading at multi-year lows.

"They're having financial difficulties when RIN prices dropped 75 percent. It's pretty damming evidence against their bankruptcy claims that the RFS is the primary claim in filing bankruptcy," said Simeone, who authored a report last year that predicted the refinery would close by 2022 due to poor economics. The site has been home to a refinery since 1870.

PES spokeswoman Cherice Corley said the company declined to comment.

US East Coast refiners like PES lack access to cheaper crude that refiners in other parts of the country enjoy, which inflicts greater pain on the region’s industry when margins are low.

Delta Air Lines’ refinery in nearby Trainer, Pennsylvania, lost USD40 million in the fourth quarter. The company is considering selling the plant, sources recently told Reuters.

PES recently secured a USD50 million loan from Bardin Hill Investment Partners, formerly Halcyon Capital Management, one of the plant’s owners, two sources told Reuters. The company still has more USD700 million in long-term debt, most of which comes due in 2022.

Private-equity giant Carlyle Group LP rescued the 330,000 barrel-per-day refinery from closure in 2012, betting they could tap cheap shale oil out of North Dakota and turn a hefty profit.

The bet proved lucrative in the early years, but once the discount on North Dakota’s oil eroded due to better transport options, PES’s bottom line started to suffer.

Carlyle became a minority owner once the company emerged from bankruptcy. Deutsche Bank AG and Bardin Hill are the primary owners now. Bardin Hill did not respond to requests for comment; Deutsche Bank declined to comment.
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MOSCOW (MRC) -- The Rotork Client Support Programme (CSP) has been chosen by the Hengyuan Refining Company Berhad for the asset management of Rotork valve actuation equipment at its Port Dickson refinery, which is the leading refiner, manufacturer and supplier of petroleum products in Malaysia, said Hydrocarbonprocessing.

Rotork offers a tailor-made service program designed to increase reliability and availability of valve actuator and control products (Photo: Rotork)
Rotork offers a tailor-made service program designed to increase reliability and availability of valve actuator and control products (Photo: Rotork)

Awarded to Rotork Malaysia, the CSP will run for two years initially, with the option to extend to four. It is designed to meet the company’s specific needs, encompassing 157 Rotork electric actuators, a Rotork Master Station and Pakscan control loop testing facility.

The Rotork CSP offers a tailor-made service designed to increase reliability and availability of valve actuator and control products via planned maintenance, predictive maintenance and asset management. The primary goal is to identify and eliminate any potential issues before they occur. This includes equipment checks, replacement of worn components and partial or complete overhauls at specific periods. CSP clients have 24/7 access to Rotork Support Centres, with prioritized technical assistance backed by comprehensive resources and dedicated systems.

Benefits such as increased production and reduced year-on-year maintenance costs are supported by generated reports detailing cost savings and performance improvements.

“Winning this contract has demonstrated Rotork’s ability to adapt to our client’s needs and the value placed by our end users on the reliable maintenance service we can provide. Rotork’s Client Support Programme is the most comprehensive and flexible maintenance programme offered by any actuator manufacturer and focuses on ensuring reliability, not retrospective repairs," a Rotork Malaysia spokesperson said.
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MOSCOW (MRC) -- Arkema will inaugurate a new first-class polyester resin manufacturing facility in Navi Mumbai, Maharashtra on February 13, 2019, said the company.

This new facility also includes a dedicated laboratory to provide both application development and technical support. The facility will help Arkema better serve customers in the fast growing powder coating market throughout India, as well as the Gulf Region and surrounding countries.

"The Navi Mumbai facility significantly extends our global footprint for this product and allows us to better meet local demand in India and Southeast Asia, where we see strong growth and demand. India is one of the fastest growing markets in the world for these products. This facility will offer formulators in the region reliable supply and the resources they need to easily develop high-performance low-VOC powder coating products."

The new facility will produce polyester powder resins marketed under the REAFREE® trade name.

REAFREE® polyester resins are primarily used to develop low-VOC powder coatings for a wide range of industrial and architectural applications. They are highly versatile and can be formulated to provide benefits such as superior scratch resistance, flow and leveling, and rheology control.

In addition to the new facility in Navi Mumbai, Arkema produces REAFREE® polyester resins and runs powder coating R&D laboratories at its facilities in Sant Celoni, Spain and North Kansas City, Missouri, USA. From these three plants, Arkema can meet customer needs anywhere in the world.

This USD15 M investment supports the Group’s ongoing commitment to remain a leading global supplier to the coating industry, providing customers with all the benefits of cutting-edge technology, local manufacture, and strong technical support.
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MOSCOW (MRC) -- Praxair, Inc., a wholly-owned subsidiary of Linde plc, has announced it will expand production capacity at its Neosho, Missouri air separation plant, said the producer in its press release.

The expansion is in response to the growing demand from customers in southwestern Missouri and neighboring parts of Arkansas, Oklahoma and Kansas in the food, aerospace, electronics, refining, chemicals and other industries. The project is expected to be completed in 2020 and will double capacity at the company’s Neosho facility.

"This investment will strengthen supply reliability and help us meet the future demands of our liquid oxygen and nitrogen customers," said Andy Sarantapoulas, South Region Vice President of Praxair’s US industrial gas business. "We are proud to be part of the Neosho community and look forward to growing our presence in this region."

"Our most valuable economic partners are always those companies that have made a long-term commitment to Neosho, and Praxair is just such a company," said Michael Franks, CEO of Grow Neosho Economic Development. "That commitment made it easy for us to work with Praxair on this expansion project that delivers new capital investment and new jobs to the Praxair facility in the Neosho Industrial Park."

“We are excited to have Praxair as a long-standing customer and happy they chose Neosho as the location for expanding their operations. Adding jobs and increasing investment in our communities is important to the success of the Neosho area,” said Brent Baker, Vice President of National Customer Experience at Liberty Utilities.

As MRC informed before, in summer, 2017, Praxair, Inc. started up a new air separation plant to supply 700 tons per day of nitrogen to Samsung’s display manufacturing complex in Tangjeong, South Korea.

Praxair, Inc., a Fortune 300 company, is a leading industrial gas company in North and South America and one of the largest worldwide. The company produces, sells and distributes atmospheric, process and specialty gases, and high-performance surface coatings. Praxair products, services and technologies are making our planet more productive by bringing efficiency and environmental benefits to a wide variety of industries, including aerospace, chemicals, food and beverage, electronics, energy, healthcare, manufacturing, primary metals and many others.
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