Reliance to resume Venezuela oil loadings after four-month pause

MOSOW (MRC) -- Indian refiner Reliance Industries Ltd is scheduled to resume loading Venezuelan crude in October after a four-month pause, according to sources and internal documents from PDVSA seen by Reuters, a move that could help Venezuela’s state-run company drain its large oil inventories, reported Hydrocarbonprocessing.

The United States in January imposed the toughest sanctions yet on Venezuela’s oil industry, depriving the OPEC member of the main destination for its crude exports.

In August, Washington added to the sanctions pressure by threatening non-US companies with punitive action if they “materially assist” Venezuelan President Nicolas Maduro’s government.

The measures have scared away several of PDVSA’s largest customers and tanker operators, causing a fast accumulation of unsold crude that forced the Venezuelan company last month to reduce output.

A Reliance representative said on Wednesday it has been supplying Venezuela with fuels permitted under US sanctions, including diesel, and thus it “is able to recommence crude sourcing” in exchange for the refined products.

“These are actions compliant to US sanctions as crude sourcing against supply of permitted products is allowed,” the representative said in an email to Reuters.

PDVSA did not reply to a request for comment.

China National Petroleum Corp and its units stopped taking Venezuelan oil in August. Others, including Reliance, have recently been buying Venezuelan crude from Russian major Rosneft (ROSN.MM), according to the documents and vessel tracking information from Refinitiv Eikon.

Reliance and the state-run Russian oil company did not respond to requests for comment on these trades.

Reliance needs the type of heavy sour crude that Venezuela sells because its refineries are configured to process it. US sanctions on both Venezuela and Iran have made it harder for the refiners to find supplies of these crude grades.

The Indian firm is sending at least two vessels, the very large crude carriers Antonis I. Angelicoussis and Maran Castor, to Venezuela’s Jose port for loading in late October, according to the PDVSA documents.

The tankers are currently passing the Suez canal, the Refinitiv Eikon data showed.

According to the same PDVSA documents, Italy’s Eni has separately sent the Suezmax tanker Seavoyager to load 1 million barrels of Venezuelan Merey heavy crude in mid-October.

Asked about the shipment, an Eni spokesman said the last time the Italian firm received crude from PDVSA was in late 2018. He did not comment on the cargo allegedly scheduled for October.

"Eni confirms that it has been recovering its receivables with PDVSA through crude supplies, in full compliance with all relevant regulations," the company told Reuters in an email.

The scheduled exports come at a time when PDVSA desperately needs to draw down almost 39 million barrels of unsold oil stocks that have forced it to reduce output and suspend crude blending while shipping more barrels to its political ally Cuba.

A source from one of PDVSA’s joint-venture projects said it was shipping to Cuba and other cargoes would go to Reliance. "We need to make room for storage, otherwise we would have to stop output," the source said.

Besides Rosneft, which takes PDVSA’s oil as repayment of billion of dollars lent to Venezuela in the last decade, Spain’s Repsol has since 2018 taken PDVSA’s crude oil in lieu of dividend payments and also supplying Venezuela with fuel.

Rosneft is scheduled to take at least 7.9 million barrels of Venezuelan oil this month, equivalent to 255,000 barrels per day (bpd), according to the PDVSA document. Venezuela produced between 600,000 and 700,000 bpd of oil last month, according to independent estimates.

The Russian firm became PDVSA’s largest customer in July.

The US Treasury has made clear that transactions between US firms and PDVSA, controlled by Maduro’s government, are not allowed under sanctions but some officials have said oil shipments delivered to foreign firms to repay debt are allowed as long as they do not involve cash payments.

As MRC informed earlier, Saudi Aramco will supply agreed grades and volumes to India’s Reliance Industries in October after the world’s top oil exporter had to provide alternate heavier grader due to drone attacks on its oil installations.

Reliance, owners of the world’s biggest refining complex at Jamnagar in western Gujarat state, is a major buyer of Saudi oil and recently announced plans to sell a fifth of its petrochemical and refining business to Aramco in a multibillion dollar deal.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polyprolypele (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,436,390 tonnes in the first eight months of 2019, up by 9% year on year. Shipments of all PE grades increased. At the same time, the PP consumption in the Russian market was 909,260 tonnes in January-August 2019, up by 10% year on year. Shipments of PP block copolymer and homopolymer PP increased.

Reliance Industries is one of the world's largest producers of polymers. Thus, the company produces among others polypropylene, polyethylene and polyvinyl chloride.
MRC

MOSCOW (MRC) -- Brenntag, the global market leader in chemical distribution, says it has agreed to acquired Quimisa SA (Brusque, Brazil), a distributor of industrial and specialty chemicals in Brazil, as per Chemweek.

Terms of the transaction, including purchase price, were not disclosed. Quimisa generated sales of about EUR60.8 million (USD66.7 million) in 2018.

The company distributes industrial chemicals such as caustic soda and hydrogen peroxide, as well as specialties such as textile auxiliaries, dyes, and polymers. It mostly does business in southern Brazil, in the textiles, household products, food and beverage, and paper industries.

The deal "is an attractive investment with a strong infrastructure which will allow us to increase our market position in Brazil,” says German Torres, CEO/Latin America at Brenntag. “The location of its facilities in the states of Santa Catarina, Parana, and Rio Grande do Sul and its business model enhance our abilities to support the textile and household chemicals industries."

The transaction is expected to close in the coming weeks.

As MRC reported earlier, Since 1 February 2014, Brenntag has startied distributing the cellulosic additive and latex powder portfolio of Dow Construction Chemicals in Germany and Austria.

Brenntag is the global market leader in full-line chemical distribution. Linking chemical manufacturers and chemical users, Brenntag provides business-to-business distribution solutions for industrial and specialty chemicals globally. The value-added services include just-in-time delivery, product mixing, formulation, repackaging, inventory management, drum return handling as well as extensive technical support. Headquartered in Mulheim an der Ruhr, Germany, the company operates a global network with more than 400 locations in 70 countries.
MRC

MOSCOW (MRC) -- Although Indorama’s Lake Charles steam cracker was mechanically complete in May, the plant likely won’t fully start up until January 2020, reported 1012IndustryReport.

In its latest quarterly earnings relase last week, the company said the availability of cheap spot ethylene amid other cracker startups reduced the pressure to ramp up its own unit.

Indorama bought the cracker from Occidental Chemical in 2015 and launched an extensive revamp to increase its capacity to the current level from 370,000 mt/year. OxyChem had shut the cracker in 2001. Originally planned for commissioning in late 2017, the refurbished cracker - jointly owned by IVP (76%) and Singapore-based Indorama Corp. (24%) - is designed to process both ethane and propane feedstock from US shale to produce about ethylene and propylene.

The cracker’s output "has not been commercialized due mainly to implementation of technical improvements discovered during the testing phase, since spot ethylene availability at a low cost can meet our captive needs," the company said. "We foresee startup of this facility on a permanent basis starting January 2020."

As MRC wrote previously, in May 2019, IVL announced that its indirect subsidiary Indorama Ventures Olefins in Westlake, LA, a manufacturer of Ethylene from Ethane with an annual capacity of 440,000 MT, achieved mechanical completion and is undergoing trial runs. IVOL has stabilized the production of on-spec Ethylene and its byproducts at 5 of its 7 furnaces and will ramp up gradually during the course of 2Q19.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polyprolypele (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,436,390 tonnes in the first eight months of 2019, up by 9% year on year. Shipments of all PE grades increased. At the same time, the PP consumption in the Russian market was 909,260 tonnes in January-August 2019, up by 10% year on year. Shipments of PP block copolymer and homopolymer PP increased.

Indorama Ventures Public Company Limited, listed in Thailand, is one of the world's leading petrochemicals producers, a global manufacturing footprint with 59 sites in 20 countries across Africa, Asia, Europe and North America. The company's portfolio is comprises necessities and high value-added (HVA) categories of polymers, fibers, and packaging. Indorama Ventures has approx. 15,000 employees worldwide and consolidated revenue of USD 8.4 billion in 2017. The company is listed in the Dow Jones Sustainability Index (DJSI).
MRC

MOSCOW (MRC) - INOVYN, one of the largest manufacturers of polyvinyl chloride (PVC) in the world, resumed production of caustic and chlorine in Tavaux (France) after a scheduled maintenance works, said Polymerupdate.

The plant with a capacity of 403,000 tonnes/year of caustic soda and 360,000 tonnes/year chlorine was closed on 21 September and resumed production on 29 September because of partial maintenance shutdown.

Earlier it was reported, said in April 2019, INOVYN also shut down this site for a scheduled maintenances.

As MRC reported earlier, INOVYN started maintenance works at its polyvinyl chloride (PVC) plant at its Jemeppe Site, Belgium. The Jemeppe site is one of the largest PVC production capacities in Europe with 420,000 tons/year of material supplied to key sectors including building, automotive and piping.

As per MRC' ScaPlast, calculated consumption of caustic soda in Russia reached 676,300 tonnes in January-August 2019, down 2% year on year (660,600 tonnes). Imports of caustic soda for eight months of 2019 increased by 13% to 16,000 tonnes, while in 2018 this figure was at 14,200 tonnes.

Headquartered in London, INOVYN has pro-forma sales of more than EUR3 billion, with 4,300 employees and assets across 14 sites in Belgium, France, Germany, Italy, Norway, Spain, Sweden and the UK. Governance of the Joint Venture is equally split between the partners.
MRC

MOSCOW (MRC)--LyondellBasell announced that Michael McMurray has been appointed executive vice president and chief financial officer (CFO), effective Nov. 5, 2019, said the company.

McMurray joins LyondellBasell following a nearly 11-year career at Owens Corning where he served as vice president, Investor Relations and treasurer; vice president, Finance for the Building Materials Group; and, for the past seven years, as chief financial officer. Prior to Owens Corning, McMurray spent 21 years in various positions of increasing responsibility with Royal Dutch Shell including as vice president, Shell Capital; global treasurer for Shell Chemicals; and Americas Finance manager for the Lubricants business.

McMurray sits on the board of directors for Flowserve, a global pumps and valves manufacturer. Mr. McMurray earned a bachelor's degree in Business Administration from Trinity University in San Antonio, Texas and an MBA from Tulane University in New Orleans, Louisiana.

As MRC informed earlier, LyondellBasell has arted up a new, fifth production line at its polypropylene compounding plant in Knapsack, Germany capable of producing 25 kt/yr. With this, capacity of the Knapsack facility is over 200 kt/yr, making the site "the world’s largest polypropylene compounding facility".

In late September 2019, LyondellBasell declared a force majeure on PP supplies from its Carrington, UK facility. The news could not be confirmed directly by the company while the reason for the force majeure was not disclosed at the time of press. LyondellBasell’s Carrington plant is able to produce 210,000 tons/year of PP.

According to MRC's ScanPlast report, the estimated PP consumption in the Russian market was 796,120 tonnes in January-July 2019, up by 11% year on year. Shipments of PP block copolymer and homopolymer PP increased.

LyondellBasell is one of the largest plastics, chemicals and refining companies in the world. Driven by its 13,000 employees around the globe, LyondellBasell produces materials and products that are key to advancing solutions to modern challenges like enhancing food safety through lightweight and flexible packaging, protecting the purity of water supplies through stronger and more versatile pipes, and improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road. LyondellBasell sells products into approximately 100 countries and is the world's largest licensor of polyolefin technologies.
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