ExxonMobil expands PAO capacity

MOSCOW (MRC) -- ExxonMobil announced today that it has increased low-viscosity polyalphaolefin production capacity at its Gravenchon, France, plant by 19 percent to 105,000 metric tons per year, said Lubesngreases.

The company said in a press release that it undertook the 17,000 t/y expansion in order to meet growing demand for synthetic base stocks.

The oil major reported that it has also improved its supply chain network through expanded sales hubs and upgraded carriers, as well as by placing more emphasis on efficient trucking, shipping and rail operations.

With this expansion, global PAO capacity sits at about 738,600 t/y, nearly all in the United States and Europe. In addition to the Gravenchon facility, ExxonMobil can make 196,000 t/y at its Baytown and Beaumont, Texas, plants, giving it about 40 percent of global capacity.

The company’s capacity is split at 209,000 t/y of low-viscosity PAO, which is typically used as synthetic base stock, and 92,000 t/y of high-viscosity PAO, which is most often used as lubricant additive.

Ineos Oligomers is the world’s second-largest maker of PAO. The producer plans to open 120,000 t/y of new capacity at its Chocolate Bayou, Texas, petrochemical complex before the end of this year. That addition will put Ineos ahead of ExxonMobil as the world’s largest source for PAO.

Citing data from consultancy Kline & Co., ExxonMobil expects demand for synthetic lubricants to grow more than 20 percent from 2017 to 2021. PAO is an important base fluid for synthetic lubricants, especially the types of low-viscosity engine oils that are swiftly picking up market share in North America and Europe.
MRC

MOSCOW (MRC) -- Shares in Egypt’s Qalaa Holdings, one of the country’s largest investment companies, fell by nearly 10% after it said that its stake in a new refining company had been reduced, said Hydrocarbonprocessing.

Qalaa said on Wednesday that it now owns 13.14% of the Egyptian Refining Company (ERC), a USD4.1 billion project it co-owns with Qatar Petroleum, state-run Egyptian General Petroleum Corp (EGPC) and other partners. Qalaa previously held a 19% stake.

The company’s shares closed at 3 Egyptian pounds, down 9.9% from Tuesday’s close. In a statement to the Egyptian stock exchange, Qalaa said its holding had been diluted over time partly because Qatar Petroleum and EGPC have underwritten additional equity for the project.

Radwa El-Swaify, head of research at Pharos Securities Brokerage, said the share price fall was attributable to Qalaa’s reduced stake in ERC combined with the effect of low oil prices on the refinery’s financial outlook.

Qalaa’s shares have suffered steep losses in recent years, sinking as low as 0.66 Egyptian pounds in October 2016.

“The stock’s recent performance has been negative, reaching the level of 3 Egyptian pounds today, which may open the door to a further decline to technical support levels at 2.7-2.75 Egyptian pounds,” said Ibrahim El Nemr, analyst at Naeem Brokerage.

Qalaa Chairman Ahmed Heikal told Reuters in May that he expects revenue to exceed 90 billion Egyptian pounds (USD5.45 billion) in 2020 after the refinery comes online in the third quarter of 2019. Between 50 billion and 55 billion Egyptian pounds would come from ERC, he said.
MRC

MOSCOW (MRC) -- BP has agreed to form a 50:50 joint venture with Bunge – a leader in agriculture, food and ingredients - that will create a leading bioenergy company in one of the world’s largest fastgrowing markets for biofuels, according to Hydrocarbonprocessing.

BP will combine its Brazilian biofuels and biopower businesses with that of Bunge to create a world-scale, highly-efficient producer of sugarcane ethanol in Brazil, BP Bunge Bioenergia. BP’s interest in the new venture will grow its existing biofuels business by more than 50%.

Ethanol produced from sugarcane is one of the most carbon-efficient biofuels available globally, with lifecycle greenhouse gas emissions around 70% lower than conventional hydrocarbon transport fuels. Brazil is the world’s second-largest and most integrated market for ethanol as a transportation fuel with demand forecast to grow rapidly. The majority of vehicles in the country – around 70% – are already able to run on ethanol and the country’s demand for ethanol is estimated to increase by around 70% by 2030.

“This is another large-scale example of BP’s commitment to play a leading role in a rapid transition to a low carbon future. Biofuels will be an essential part of delivering the energy transition and Brazil is leading the way in showing how they can be used at scale, reducing emissions from transport. This combination will unlock new possibilities for improved efficiency and future growth in this key market," Bob Dudley, BP group chief executive said.

“This joint venture with BP, one of the world’s leading energy companies, represents a major portfolio optimization milestone for Bunge. We are proud of what our team has done to evolve our sugar and bioenergy business as an industry leader. I am confident that this team, and the strong commitment from a global leader such as BP, will create even greater shareholder value," Gregory A. Heckman, Bunge’s Chief Executive Officer said.

“In one step, this will allow BP to significantly grow the scale, efficiency and flexibility of our business in one of the world’s major growth biofuels markets. With a shared commitment to safety and sustainability, bringing together our assets and expertise will allow us to improve performance, develop options for growth and generate real value. BP Bunge Bioenergia will be well-placed to support Brazil’s increasing demand for both low carbon biofuels and biopower," Dev Sanyal, chief executive of BP Alternative Energy said.

BP Bunge Bioenergia will have 11 biofuels sites in Brazil. With 32 million metric tons of combined crushing capacity per year, the joint venture will have the flexibility to produce a mix of ethanol and sugar. It will also generate renewable electricity - fuelled by waste biomass from the sugar cane - through its cogeneration facilities to power all its sites and sell surplus electricity to the Brazilian power grid. BP and Bunge’s assets are largely complementary, with sites in five Brazilian states including three in the key region of Sao Paulo.

In 2018, the two businesses produced a total of around 2.2 billion liters of ethanol equivalent and, after powering the sites, exported 1,200-gigawatt hours of low-carbon biopower to the national grid. Together the two businesses currently employ over 10,000 people in Brazil.

The combined business will be ranked the second-largest player in the sugar cane ethanol biofuel industry in Brazil by effective crushing capacity.

Under their agreement, BP and Bunge will each contribute their existing Brazilian biofuel, biopower and sugar businesses into the new, equally-owned, standalone joint venture. On completion, BP will pay Bunge USD75 million, subject to customary closing adjustments, and the joint venture will assume USD700 million of non-recourse debt associated with Bunge’s assets.

Subject to satisfaction of conditions precedent, including obtaining the necessary regulatory clearances and approval, the deal is expected to complete in the fourth quarter of 2019.

Following completion, the aim is for BP Bunge Bioenergia to generate significant operational and financial synergies, through scale efficiencies and by applying best practices, optimized technologies and operational capabilities across all the assets of the new business.

The new business is expected to be headquartered in Sao Paulo. Mario Lindenhayn from BP will be executive chairman, Geovane Consul from Bunge, chief executive, and Marcus Schlosser from BP, chief financial officer. BP and Bunge will have equal representation on the board of directors.

In 2018 the Brazilian production of ethanol was some 26 billion liters, produced almost entirely from sugarcane grown in-country. The Brazilian government is introducing a new low carbon transport policy, known as RenovaBio, to establish the first regulated carbon credits market in the country. RenovaBio is expected to encourage continued growth in the market and support development of the sugarcane ethanol industry.
MRC

MOSCOW (MRC) -- Exxon Mobil Corp was hit with a lawsuit over pollution from a fire at the company's Baytown Olefins Plant, according to an attorney for Harris County, Texas, which filed the suit, reported Reuters.

The fire was being investigated by federal and state agencies. The US Occupational Safety and Health Administration (OSHA) and the Texas Commission on Environmental Quality (TCEQ) were at the scene to determine the cause of a blaze that raged for hours on Wednesday and raised a column of black smoke over the area.

The suit by Harris County, which includes Baytown, is the second lawsuit against the company involving fires at the plant this year.

The suit seeks court orders to prevent future fires at Exxon's giant Baytown refining and petrochemical complex, said Rock Owens, managing attorney for the environmental practice in the Harris County Attorney's Office.

"It's disappointing to me for a company to have these kinds of problems with the potential for some kind of disaster," he said.

Exxon did not reply to a request for comment on the lawsuit. In a statement on Thursday, spokesman Sarah Nordin said the fire has been extinguished and all employees affected by the fire were cleared to return to work.

Because of the fire, production at Exxon's 560,500 barrel-per-day (bpd) Baytown refinery remains cut back, the company confirmed. It did not say by how much production was affected.

Exxon said earlier that 66 workers had been examined at a clinic for possible injuries, though not all had required treatment. Of those, 37 were treated for injuries including minor burns, Jason Duncan, manager of the Baytown Olefins Plant, said on Wednesday.

Officials ordered Baytown residents to remain indoors with their air conditioning turned off for about four hours after an explosion set off the fire.

Harris County officials are asking a state court to order an investigation to determine the root cause of the fire in a propylene recovery unit, and to order Exxon to take steps to prevent similar fires from happening in the future, Owens said.

Harris County is seeking similar orders in connection with a lawsuit filed in March over a hydrotreater fire in the Baytown refinery, he said.

As MRC informed before, in late July 2019, ExxonMobil said it started production on a new high-performance polyethylene line at its Beaumont, Texas polyethylene (PE) plant. The expansion increases plant production capacity by 65 percent or 650,000 tons per year, bringing site capacity to nearly 1.7 million tons per year.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.
MRC

MOSCOW (MRC) -- ABB has won a multi-million-dollar order to modernize a major oil refinery in Kazakhstan, as the Republic’s ‘Digital Kazakhstan’ program seeks to elevate economic sectors including the oil, gas and chemicals industry and accelerate growth nationally with digital technology, said Hydrocarbonprocessing.

ABB will leverage ABB Ability™, the company’s unified, cross digital offering, in delivering solutions to modernize the Shymkent oil refinery in Kazakhstan. Sensors, data and advanced analytics will monitor and assess the real-time health of the plant’s assets, with operator PetroKazakhstan Oil Products (PKOP) to gain critical, real-time insights into their assets and production processes.

The order win is against a wider backdrop, as the government-led ‘Digital Kazakhstan’ program focuses on accelerating growth and elevating economic sectors including the oil, gas and chemicals industry throughout the Republic through digitalization, with a goal of creating a future digital economy by 2022.

At Shymkent oil refinery, digital transformation enabled by ABB is expected to increase productivity and lower operational costs, with operators empowered to make better informed decisions based on accurate and live data and reporting. As a technology leader, ABB is strategically positioned to support businesses, as well as wider societal efforts, to offer digital solutions for tomorrow’s world.

“With our leading technologies and deep-domain knowledge, we can help operators across the energy industry move forward confidently towards digital transformation,” said Kevin Kosisko, Managing Director, ABB Energy Industries.
“ABB is uniquely positioned to drive and support the digital transformation of the chemical and refining industry in Kazakhstan, and it is exciting to contribute to the modernization of Shymkent oil refinery."

Using ABB Ability™ Asset Performance Management solutions, the company’s maintenance strategy will progress from an hourly-based maintenance system to prescriptive-based maintenance. ABB will extend the current maintenance annual turnaround intervals at the refinery to a three-year plan. This will be achieved through early identification of when assets might need repair or replacement - well ahead of potential failure – supporting operators to prioritize maintenance based on actionable insights.

ABB will also provide a business consultancy service to PKOP to support the lifecycle of the project and promote culture change in adopting digital practices at the plant. This will include assessing current work processes, leveraging opportunities to increase efficiency and resilience, recommending improvements and providing expert training.

The Shymkent project site was first commissioned in 1970 and is in the Sayramskiy region of Kazakhstan Shymkent. It is operated by PetroKazakhstan Oil Products (PKOP), as a joint venture between China National Petroleum Corporation (CNPC) and KazMunayGas (KMG), the national oil and gas company of Kazakhstan.
MRC