Citgo taking offers on 3-year loan

MOSCOW (MRC) -- Citgo Petroleum is seeking to raise USD1.8 billion through a three-year term loan to cover operating expenses and to refinance existing debt, reported Reuters with reference to three people.

The financing would help Citgo, the US-based subsidiary of Venezuelan state-run oil firm PDVSA, fund operations and replace an existing revolving credit line, following US sanctions and its split from the parent company, which remains under control of Venezuelan President Nicolas Maduro and a military-led management team.

As MRC informed before, in late February 2019, Houston-based Citgo Petroleum slowed work on an overhaul of its 235 Mbpd Aruba refinery due to a lack of financing stemming from US sanctions on Venezuela's state-run PDVSA.
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MOSCOW (MRC) -- Chevron Phillips Chemical Company LP has announced that it is considering the addition of a world-scale 1-Hexene unit, as per Hydrocarbonprocessing.

The new Hexene unit would augment production of Alpha Plus®, the market brand name for normal alpha olefins (NAO). NAO is used extensively in the production of polyethylene, plasticizers, synthetic motor oils, lubricants, automotive additives, surfactants, paper and multiple other specialty products.

"As global demand for polyethylene continues to grow, this study demonstrates Chevron Phillips Chemical’s commitment to expand with customer demand and remain a leading supplier of 1-Hexene," said Dave Morgan, senior vice president of polymers and specialties.


The new unit would use the company’s proprietary, on-purpose technology to produce comonomer grade 1-Hexene with exceptional product purity from ethylene. 1-Hexene is a critical component used to produce high-strength polyethylene, a plastic resin commonly converted into film, plastic pipe and detergent bottles, as well as food and beverage containers.

Chevron Phillips Chemical is a leader in the development and production of NAO. The company currently operates two, full-range normal alpha olefin plants and the world’s largest on-purpose 1-Hexene plant.

As MRC informed before, in March 2018, Chevron Phillips Chemical Company LP announced that it had successfully introduced feedstock and commenced operations of a new ethane cracker at its Cedar Bayou facility in Baytown, Texas.

Chevron Phillips Chemical, headquartered in The Woodlands, Texas (north of Houston), US,l is one of the world’s top producers of olefins and polyolefins and a leading supplier of aromatics, alpha olefins, styrenics, specialty chemicals, piping, and proprietary plastics. Chevron and Phillips 66 each own 50% of Chevron Phillips Chemical.
MRC

MOSCOW (MRC) -- An agreement to build a proposed USD3.85 billion oil refinery in Sri Lanka will take at least a year to be finalized as its main investor, India’s Accord Group, says it is yet to recruit partners and conduct an assessment of the plan’s viability, reported Reuters.

The comments add to confusion about the project, which was announced last week by the Sri Lankan government as the nation’s largest single foreign direct investment ever, but has since been the subject of conflicting statements by various parties.

Accord’s Chairman S Jagatrakshakan, a former Indian government minister, said he has submitted a preliminary proposal to the Sri Lankan government to invest in the project but has not finalized any terms of the deal.

"The project assessment and financial viability assessment will take at least a year. We have not sorted out any of the equity partners for the projects, but are in talks with investors from many countries," he told Reuters over the phone from the southern Indian state of Tamil Nadu.

The 68-year old politician is campaigning in Tamil Nadu for a seat in the current general election. He was an MP and minister in the last Congress-led government in 2009-2014.

When the Sri Lankan government made the announcement on March 19, it said the oil refinery would be a joint venture between Oman’s oil ministry and Accord and cost USD3.85 billion.

A day later, Omani officials denied involvement in the project, but the middle eastern country’s oil minister arrived in Sri Lanka three days later and said he was “excited” to inaugurate the project though there was no indication of a firm deal in place.

India and China have been vying for political influence in Sri Lanka in recent years, with investment a key part of the battleground.

The refinery’s proposed site is 585 acres of land near the site of the new Humbantota International port and a related industrial zone - both run by Chinese entities - on Sri Lanka’s southern coast.

A Sri Lankan government document seen by Reuters showed the previously proposed deal would have a debt to equity ratio of 51:49, and said the Accord Group’s Singapore entity, Silver Park

However, Jagatrakshakan said he expected 70 percent of the project to be bankrolled by debt from financial institutions, adding that Silver Park would get more investors to fund the equity stake.

"We are looking at getting 20-30 investors on board for the 30 percent equity investment in the project. We expect 70 percent of the project to be bankrolled by debt from financial institutions," he said.

A senior official at Sri Lanka’s Strategic Development and International Trade ministry, speaking on the condition of anonymity, said he was confident of the terms of the deal as originally announced by the government.

He said Jagatrakshakan’s son Sandeep was also present when the deal was signed. Sandeep Jagatrakshakan did not respond to repeated calls seeking comment.

China is the biggest buyer of Omani oil, importing about 80 percent of the Middle Eastern nation’s overall crude exports in January, according to Oman government data.
MRC

MOSCOW (MRC) -- PBF Energy plans to restart the 50,000 bpd coking unit at its Delaware City, Delaware, refinery in mid-April after roughly six weeks of planned work, reported Reuters with reference to two sources familiar with the plant’s operations.

The unit, which helps make gasoline and diesel, was shut around March 3 for planned work.

As MRC wrote previously, PBF Energy Inc said a fire occurred around noon Sunda, 3 February, 2019, at its 175,000 barrel-per-day crude unit at its Delaware City, Delaware refinery. There were no injuries, a PBF spokesman said then. The company did not say what caused the fire or the extent of the damage.
MRC

MOSCOW (MRC) -- Saudi Aramco will begin meeting bond investors this week in an effort to persuade them to buy its debut international bond, which will help the world’s largest oil producer fund the USD69.1 billion purchase of a stake in Saudi Basic Industries Corp (SABIC), reported Hydrocarbonprocessing with reference to sources.

The Saudi oil giant, which declined to comment, said on Wednesday it had agreed to buy a 70 percent stake in SABIC from Saudi Arabia’s Public Investment Fund (PIF) in one of the largest deals in the global chemicals industry.

The deal could inject billions of dollars into the PIF, giving it the firepower to proceed with its plans to create jobs and diversify the largest Arab economy beyond oil exports.

Aramco has issued local currency bonds in the past, but the planned deal would be its first in the international markets.

International demand for Aramco’s bonds is expected to be hefty, given improved conditions across emerging markets, the recent inclusion of Saudi Arabia in key market indexes, and the sheer size of the company, which outweighs peers like Exxon and Shell.

Saudi Arabia gets almost 70 percent of its revenues from oil, and Aramco is the sole holder of Saudi oil concessions.

One of the sources said there was a minor sell-off across the Saudi debt curve on Thursday, as some investors prepared to switch Saudi sovereign paper for the upcoming Aramco securities.

Aramco is expected to meet international bond investors next week in a so-called "roadshow" ahead of the debt sale, which the Saudi energy minister previously said would be around USD10 billion in size.

Aramco’s acquisition of a stake in SABIC has come after months of talks between Aramco and the PIF, which contributed to the delay of Aramco’s planned multi-billion dollar initial public offering.
The international bond sale will almost certainly require the company to obtain a credit rating and disclose financial information in a prospectus.

The oil giant has so far been reluctant to disclose many details of its finances.

JPMorgan, Morgan Stanley, HSBC, Citi , Goldman Sachs and National Commercial Bank have been chosen to arrange the bond issue, sources previously told Reuters.

As MRC reported earlier, in July 2016, Saudi Aramco and SABIC signed a heads of agreement to conduct a feasibility study on the development of a fully integrated crude oil-to-chemicals complex to be located in Saudi Arabia. The heads of agreement contains key principles of cooperation that will form the basis for the companies to establish a joint venture, if the joint study reaches a positive conclusion.

Saudi Aramco is an integrated oil and chemicals company, a global leader in hydrocarbon production, refining processes and distribution, as well as one of the largest global oil exporters. It manages proven reserves of crude oil and condensate estimated at 261.1bn barrels, and produces 9.54 million bbl daily. Headquartered in Dhahran, Saudi Arabia, the company employs over 61,000 staff in 77 countries.

Saudi Basic Industries Corporation (Sabic) ranks among the world's top petrochemical companies. The company is among the worldпїЅs market leaders in the production of polyethylene, polypropylene and other advanced thermoplastics, glycols, methanol and fertilizers.
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