Petrobras starts sale process for refining and logistics assets

MOSCOW (MRC) -- Brazil’s state-controlled oil company Petroleo Brasileiro SA announced the start of a sale process for refining and logistics assets, according to a securities filing, reported Reuters.

Petrobras, as the company is known, said the nonbinding phase involves refineries Abreu e Lima (Rnest), Landulpho Alves (Rlam), Presidente Getulio Vargas (Repar) and Alberto Pasqualini (Refap).

"Potential buyers qualified for this phase will receive a descriptive memorandum containing more detailed information on the assets," the company said in the filing.

As MRC informed before, in H2 June 2019, Petrobras said it had signed a deal with local antitrust regulator CADE regarding the proposed sale of some of its refining installations. According to a securities filing, the company said the agreement will allow for increased competition in Brazil’s refining sector, by attracting new players to the business.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
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Total sells tainted Russian oil to PKN Orlen's Lithuania refinery

MOSCOW (MRC) -- France’s Total has sold a cargo of contaminated Russian Urals oil to Poland’s PKN Orlen for its refinery in Lithuania, reported Reuters with reference to sources.

PKN Orlen said it had agreed on a deal in April to buy a cargo of Russian oil before any contamination was found. It said the crude was being diluted with clean oil so it could be processed in its Lithuanian refinery. The firm did not name the seller.

Russia’s oil industry was plunged into crisis in April when buyers discovered it was shipping oil contaminated with organic chloride, a chemical used in oil recovery but which can damage refining equipment.

Since then, several tankers loaded with the tainted crude have struggled to sell their cargoes.

The tanker Mendeleev Prospect was loaded from Russia’s Ust-Luga port on April 24, at a time when organic chloride levels in oil stored at the port was much higher than normal.

The three sources told Reuters the tainted crude in the Mendeleev Prospect, which was chartered by Total, was sold to PKN Orlen.

Refinitiv Eikon trade flows data show it discharged 72,700 tonnes of crude at Klaipeda port in Lithuania on June 29.

Two of the sources said the tanker’s remaining 30,000 tonnes were offloaded to storage in Poland’s Gdansk port and would then be sent to Klaipeda.

The two sources said the contaminated oil was stored in Klaipeda and transported by rail in stages to PKN Orlen’s refinery in the Lithuanian city of Mazeikiai.

"It’s only possible to refine this oil if you mix it with large amounts of clean Urals, so it will be a long process," a trader in Russian oil market told Reuters.

Industry sources say one barrel of the tainted oil may need to be diluted by 20 barrels of clean oil.

Mendeleev Prospect had been stuck in Gdansk since late April as no buyers could be found, traders said.

Two shipping sources said the delay in offloading could cost the company USD1 million or more in additional demurrage fees.

Total said it did not comment on trading activities.

Officials at Klaipedos Nafta oil terminal, Lithuanian Railways and the Mazeikiai refinery did not respond to requests for comment.

Klaipedos Nafta had said last week it had imported a cargo of crude oil in June for "an oil refinery in the region", which was loaded into rail tankers. But it did not name the refinery or give other details about the deal.

PKN Orlen operates the only refinery in the Baltic states. An industry source said the tainted shipment was transported to that refinery.

In Europe, a limited number of buyers have taken contaminated oil to refine, including Spain’s Repsol, Sweden’s Preem and Finland’s Neste Oil, according to traders and Refinitiv Eikon flows data.

As MRC reported earlier, in December 2017, Total inaugurated the new units at its Antwerp integrated refining & petrochemicals platform, which have progressively started up in the previous few months.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
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First Axens unit successfully starts at Petrobrazi refinery

MOSCOW (MRC) -- After four years of teamwork for project development and execution, the new PolyFuel unit at Petrobrazi refinery was started-up and is fully functional since April 2019, said Chemengonline.

Based on the PolyFuel® technology licensed by Axens, the OMV Petrom’s project at Petrobrazi refinery enables to increase the FCC products value by upgrading LPG and Light Cracked Naphtha into high quality fuels.

In June 2019, the unit test-run was successfully completed, demonstrating that the unit performances are well in line with the expectations.

"The PolyFuel® unit of Petrobrazi refinery is the first of its kind valorizing C4 and C5 / C6 fractions into high quality gasoline and middle distillates, increasing the overall production of these products” said Bruno Domergue, Axens Clean Fuels, Bio, Olefins and Gas business line Director.

"The new Polyfuel unit brings the state-of-the-art technologies used in the petrochemical and refining industry to the Petrobrazi refinery. Due to sustained investments, Petrobrazi continues to rank among the most important refineries in Romania, operating at the highest standards –energy efficiency and environmental standards included – and contributing to the economic development of the area", said Radu Caprau, member of OMV Petrom Executive Board, responsible for Downstream Oil.
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Refinery expected to shut remaining units as crude dwindles

MOSCOW (MRC) -- The Philadelphia Energy Solutions refinery, the oldest and largest on the U.S. East Coast, is expected to shut its remaining units on Monday as the plant uses up the last of its crude supplies, said Hydrocarbonprocessing.

The refinery is still weighing the economics of running more crude oil to keep the units active for an extended period, the sources said. Crude shipments destined for PES have been diverted in the weeks after the June 21 fire and explosion at the 335,000-barrel-per-day refinery, according to data and trade sources.

The fire, which started in an alkylation unit in the Girard Point section of the Philadelphia complex caused PES to begin closing the facility without an intended restart. Roughly 1,000 workers are expected to be laid off and contractors who do business with the refinery will also be affected by the shutdown.

PES, which emerged from bankruptcy last year, has multiple owners, including investment bank Credit Suisse and investment firm Bardin Hill. Refinery officials were not immediately available for comment.

PES has long been a steady buyer of imported crude oil, particularly from West Africa. Its loss as a buyer threatens to shrink the last steady U.S. market for West African crude.

Last year, U.S. refiners imported 180.7 million barrels of crude oil from Africa, according to U.S. Energy Information Administration figures. The PES refinery imported 43.1 million barrels from Africa in 2018, second only to the Phillips 66 refinery in Linden, New Jersey among U.S. refineries.

A cargo with 1 million barrels of Nigerian crude oil chartered by the PES refinery was rerouted on Wednesday to Point Tupper, Nova Scotia, a crude oil storage hub in Canada, according to data intelligence firm Kpler.

Another cargo chartered by PES carrying 1 million barrels has been sitting idle in the waters near the refinery for about two weeks, Kpler data shows. Three additional crude ships originally bound for Philadelphia are discharging or recently unloaded, at the Monroe Energy refinery, owned by Delta Airlines Inc, in Trainer, Pennsylvania, data from Refinitiv Eikon showed.

"Delta has bought some cargoes," a foreign buyer of West African crude said, noting the refinery had extracted heavy discounts for the crude originally bound for PES. It was not clear how much of the cargoes were initially destined for PES as opposed to other refineries in the area.

As of last week, PES had roughly 3 million barrels of crude in storage, sources said. That supply has since largely been processed after PES restarted a larger crude unit at the Point Breeze section of the plant.

With a small number of East Coast refineries compared with the U.S. Gulf Coast, PES has been left with few options to trade away the barrels without taking a financial hit, one U.S. source familiar with the situation said.

PES could sell the barrels to a nearby refinery, but those plants have typically already secured supplies for a further three weeks to a month, the source said, meaning vessels would have to wait for weeks before being offloaded.
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Haiwan Chemical selects KBR technology for Chinese phenol and acetone plant

MOSCOW (MRC) -- Haiwan Chemical Co. (Haiwan Chemical) has awarded a technology contract to KBR for a new 320,000-t/y phenol and acetone facility to be built in Dongjiakou Industrial Zone, Qingdao City, Shandong Province, China, as per Apic-online.

Under the terms of the contract, KBR will provide the technology license and basic engineering design, as well as technical and training services to Haiwan Chemical.

"KBR's phenol process has been on the leading edge for more than 60 years and KBR is continuously making innovative technical improvements to maintain its competitiveness," said Gao Zijian, general manager of Haiwan Chemical.

"I believe this phenol plant will be playing an important role in our corporation's progress of industrial transformation and upgrading."

We remind that, as MRC wrote previously, in April 2019, KBR, Inc. announced that it had been awarded a contract by Saudi Aramco for KBR's market-leading Supercritical Solvent Deasphalting (SDA) technology ROSE.
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