Saudi Aramco asks banks to pitch for roles in planned IPO

MOSCOW (MRC) -- Saudi Aramco has formally asked major banks to submit proposals for potential roles in its planned initial public offering, reproted Reuters with reference to two sources with direct knowledge of the matter.

Aramco’s planned IPO, which could potentially raise USD100 billion, is the centerpiece of Saudi Arabia’s economic transformation drive to attract foreign investment and diversify away from oil.

Request for proposals were sent to banks few days day ago, they said.

Aramco declined to comment.

The formal IPO process begins after Saudi Arabia’s Crown Prince Mohammed bin Salman had said in June the government remained fully committed to the IPO, expecting it to take place between 2020 and early 2021.

His comments triggered a series of approaches by international investment banks which wanted to be involved, Reuters had reported citing sources.

Work on the deal was halted in 2018 when Aramco began a process to acquire a 70% stake in petrochemicals maker Saudi Basic Industries Corp.

The IPO process could formalize roles for some of the banks that had been previously working on the transaction, one of the sources said.

Before the IPO process was halted, JPMorgan, Morgan Stanley and HSBC were picked to play a leading role in the world’s biggest ever IPO when the plan was first announced in 2016.

Boutique investment banks Moelis & Co and Evercore were also hired by Aramco as independent advisers, sources had said at that time.

As MRC informed previously, in mid-August 2019, Saudi Aramco unveiled a USD15 billion deal to expand its global refining footprint and held its first-ever earnings call with financial analysts, twin moves that could bolster investor confidence as the state-owned oil giant revs up plans to list shares.

Saudi Aramco, officially the Saudi Arabian Oil Company, is a Saudi Arabian national oil and natural gas company based in Dhahran, Saudi Arabia. Saudi Aramco"s value has been estimated at up to USD10 trillion in the Financial Times, making it the world"s most valuable company. Saudi Aramco has both the largest proven crude oil reserves, at more than 260 billion barrels, and largest daily oil production.
MRC

MOSCOW (MRC) -- Fujian Hongrun has brought on-stream its polystyrene (PS) unit following a maintenance turnaround, as per Apic-online.

A Polymerupdate source in China informed that the company has resumed operations at the unit on August 22, 2019. The plant remained under maintenance for about seven weeks.

Located in Quanzhou, Fujian, China, the plant has a production capacity of 60,000 mt/year.

We remind that, as MRC informed before, Jiangsu Lvan Qingfeng has brought on-stream its PS unit, following a maintenance turnaround. The company resumed operations at the unit, on July 24, 2019. The plant was shut for maintenance on July 7, 2019. Located in Jiangsu, China, the plant has a production capacity of 150,000 mt/year.
MRC

MOSCOW (MRC) -- US refineries have cut the volume of crude processed so far this year, but stocks of gasoline and distillates remain ample, highlighting the slack demand for transportation fuels, reported Reuters.

Fuel consumption has stalled, part of a worldwide slowdown in oil demand associated with the slackening of manufacturing and freight activity.

US refineries have reduced crude input by an average of 247,000 barrels per day since the start of the year compared with the same period in 2018, according to data from the U.S. Energy Information Administration (EIA).

Year-to-date processing rates have fallen for the first time since 2011 and by the most since the recession of 2008/09 (“Weekly petroleum status report”, EIA, Aug 21).

Refinery crude consumption has fallen by around 56 million barrels so far compared with the same period in 2018.

Refineries cut processing sharply during the regular maintenance season in March and April and have never made up the shortfall.

Processing has remained at or below prior-year rates throughout the summer driving season, normally the highest demand of the year.

Philadelphia Energy Solutions’ 335,000 bpd refinery on the East Coast has been shut since a fire and explosion on June 21, which may have contributed to the loss of crude processing.

But processing was already running below prior-year rates before the plant exploded and has been below 2018 rates for 13 out of the last 16 weeks since the start of May.

Refiners on the East Coast have cut processing by an average of almost 120,000 bpd so far this year (mostly due to the Philadelphia explosion).

But they have also reduced processing by 87,000 bpd in the Midwest, 15,000 bpd along the Gulf Coast and 45,000 bpd on the West Coast.

Despite the reduction in processing, there has been no shortage of either gasoline or distillate fuel oil, with gasoline stocks level with last year and distillates comfortably above it.

Fuel consumption is broadly unchanged compared with 2018, with the volume of gasoline supplied to domestic customers flat so far this year and distillate consumption down slightly.

Forward refining margins for gasoline and distillates delivered at the end of year do not provide refiners with any significant incentive to boost processing compared with normal seasonal patterns.

Fuel consumption is stuck in the doldrums and unlikely to accelerate much until the domestic and international economies improve.
MRC

MOSCOW (MRC) -- McDermott International, Inc. announced the beginning of commercial operation with Train 1 by joint owners Sempra LNG, LLC, Total, Mitsui & Co., Ltd. and Japan LNG Investment, LLC., following its substantial completion, as per Hydrocarbonprocessing.

"This is a significant milestone for the Cameron LNG project," said Mark Coscio, McDermott's Senior Vice President for North, Central and South America. "Congratulations to the McDermott project team whose steadfast commitment to outstanding project quality has been going strong since its award in 2014."

McDermott and its joint venture member on the project, Chiyoda, have been providing the engineering, procurement, construction and commissioning for the project since it began. The project includes three liquefaction trains with a projected export capacity of more than 12 million tonnes per annum of LNG, or approximately 1.7 billion cubic feet per day.

As MRC wrote previously, in early November 2018, Sempra Energy announced that Cameron LNG had initiated the commissioning process for the support facilities and first liquefaction train of Phase 1 of its Hackberry, La., liquefaction-export project. And in mid-April 2019, Sempra Energy announced that Cameron LNG had begun pipeline feed gas flow to the first liquefaction train of the liquefaction-export project as it prepares to begin production of liquefied natural gas (LNG) at the facility in Hackberry, La.
MRC