Saudi Aramco to meet investors ahead of debut dollar bond

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.
MRC

MOSCOW (MRC) -- Mitsubishi Chemical Corp. (MCC) has completed its acquisition of the PVC compound business of Welset Plast Extrusions Private Ltd, said Canplastics.

First announced in June 2018, the acquisition will allow MCC to enter the medical PVC compound business. Furthermore, MCC will strengthen its existing PVC and thermoplastic elastomers businesses in India – where Welset is headquartered – and Association of Southeast Asian Nations (ASEAN) markets by utilizing Welset’s marketing channels and infrastructure.

Plans now call for construction a new facility to manufacture thermoplastic elastomer for automotive interior components and other applications at subsidiary MCPP India Private Ltd. Production is scheduled to begin by the end of March 2020.

MCC acquired Arparn Plast Compound Private Ltd. (representing the PVC compound business of Welset) after a demerger from Welset Plast Extrusions, and changed its name to MCPP India Private Ltd. after the acquisition was formally completed.

MCC currently outsources the manufacturing of thermoplastic elastomers in India. The acquisition of Welset Plast Extrusions’ PVC compound business, and the construction of the new production facility, will allow MCC to upgrade its performance polymer supply system to meet the increasing demand.
MRC

MOSCOW (MRC) - Production of polypropylene (PP) in Russia decreased to 212,700 tonne in first two months of this year, down 13,2% year on year, compared to the same period of 2018. Four producers out of seven reduced the capacity utilisation, according to MRC ScanPlast.

February PP production in the country grew to 111,800 tonnes, compared with 100,900 tonnes in January; SIBUR Tobolsk increased its capacity utilisation. Russia's overall PP production reached 212,700 tonnes in the first two months of 2019, compared to 245,100 tonnes a year earlier. Four producers out of seven reduced the operating time, with the largest reduction was seen at SIBUR Tobolsk.

The structure of PP production by plants looked the following way over the stated period.

SIBUR Tobolsk solved its technical problems in production by February, the total production rate rose to 39,800 tonnes against 18,600 tonnes a month earlier. The Tobolsk plant's total PP production reached 58,300 tonnes in the first two months of 2019, down by 28% year on year.

Poliom (Titan Group) last month produced about 14,600 tonnes of polypropylene, compared with 19,300 tonnes in January. Total PP production at the plant over the reported period was about 33,900 tonnes, down 4% year on year.

Nizhnekamskneftekhim produced 16,900 tonnes of propylene polymers in February versus 18,400 tonnes a month earlier. The producer's PP output decreased to 35,300 tonnes in January-February 2019 compared with 35,700 tonnes year on year.

Tomskneftekhim last month produced about 11,600 tonnes against 12,600 tonnes a month earlier. Total PP production by the producer increased to 21,200 tonnes in January-February 2019, up 4% year on year.

February PP production at Ufaorgsintez reached about 10,600 tonnes from 11,700 tonnes a month earlier. Overall output of polymer at the Ufa plant rose to 22,300 tonnes in January-February 2019, compared to 21,500 tonnes a year earlier.

Neftekhimiya (Kapotnya) last month produced about 11,100 tonnes of PP, compared with 12,500 tonnes in January. The plant's overall PP output reached 23,600 tonnes over the stated period, up 2% year on year.

Stavrolen (LUKOIL) shut its facilities for short-term repairs in January-February, as a result, produced polymers of 7,800 tonnes and 7,300 tonnes respectively in each of the months. In general, the total production of polymers of propylene in the first two months of this year at the Budenovsk enterprise reduced to 15,100 tonnes against 19,600 tonnes a year earlier.

MRC

MOSCOW (MRC) -- Overall polypropylene (PP) imports to the Ukrainian market totalled 19,600 tonnes in the first two months of 2019, up by 5% year on year. Demand for all grades of propylene polymers increased, with some propylene copolymers being the exception, as per MRC's DataScope report.

February PP imports into Ukraine rose to 11,400 tonnes from 8,100 tonnes a month earlier, with propylene homopolymer (homopolymer PP) accounting for the main increase. Overall imports of propylene polymers reached 19,600 tonnes in January-February 2019, compared to 18,700 tonnes a year earlier. Imports of homopolymer PP and propylene block copolymers (PP-block) increased, whereas shipments of other grades of propylene polymers decreased.

The structure of PP imports by grades looked the following way over the stated period.

January imports of homopolymers of propylene to the Ukrainian market grew to 9,100 tonnes from 5,800 tonnes a month earlier, local companies increased purchasing of homopolymer PP raffia in the Middle East and Azerbaijan. Overall shipments of homopolymer PP reached 14,900 tonnes in the first two months of 2019 versus 14,000 tonnes a year earlier.

Last month's imports of PP block copolymers fell to 1,100 tonnes, which virtually corresponds to the figure of January. 2,200 tonnes of PP block copolymers were imported over the stated period, whereas this figure was 11,900 tonnes a year earlier.

February imports of statistical propylene copolymers (PP random copolymer) also remained at the level of January, totalling 1,100 tonnes. Overall imports of PP random copolymers exceeded 2,200 tonnes in January-February 2019, whereas this figure was 2,400 tonnes a year earlier.

Overall imports of other propylene copolymers were about 300 tonnes over the stated period.

MRC

MOSCOW (MRC) -- New York State lawmakers have agreed to impose a statewide ban on most types of single-use plastic bags from retail sales, changing a way of life for millions of New Yorkers as legislators seek to curb an unsightly and omnipresent source of litter, as per The New York Times.

The plan, proposed a year ago by Gov. Andrew M. Cuomo, would be the second statewide ban, after California, which banned bags in 2016. Hawaii also effectively has a ban in place, since all the state’s counties bar such single-use bags.

New York’s ban, which would begin next March, would forbid stores to provide customers with single-use plastic bags, which are nonbiodegradable and have been blamed for everything from causing gruesome wildlife deaths to thwarting recycling efforts.

The ban, which is expected to be part of the state’s budget bills that are slated to be passed by Monday, would have a number of carveouts, including food takeout bags used by restaurants, bags used to wrap deli or meat counter products and bags for bulk items. Newspaper bags would also be exempted, as would garment bags and bags sold in bulk, such as trash or recycling bags.
MRC