Kazakhstan bans oil product exports by car for six months

MOSCOW (MRC) -- Kazakhstan has banned the export of oil products by car for a period of six months, reported S&P Global with reference to a document on the energy ministry website.

Last month Kazakhstan's energy minister Kanat Bozumbaev warned against exports to nearby countries of cheaper gasoline and diesel and said prices in Kazakhstan could be raised to the level of Russian prices, according to media reports published on the energy ministry website.

Kazakhstan used to rely on imports of duty-free gasoline from Russia to cover domestic demand, but following the modernization of Kazakhstan's three refineries, it announced earlier this year that it could export up to 600,000 mt/year of gasoline to nearby countries in Central Asia.

Separately, Kazakhstan will reduce the share of imported jet fuel to 4% in 2019 from 60% in 2018, following refinery upgrades, according to the energy ministry's website.

The country's jet fuel output in 2019 is forecast at 694,000 mt, or more than 60% higher year on year, and could potentially rise to 850,000 mt/year.

As MRC wrote previously, in January 2016, South Korea's LG Chem said it had decided to drop a plan to jointly build a USD4.2-billion petrochemical complex in Kazakhstan, citing a prolonged slump in oil prices and a sharp increase in facility investments. In 2011, the chemical company said it would construct the complex near the western Kazakh city of Atyrau as part of a 50-50 joint venture with two Kazakh companies. The plan involved building ethylene and polyethylene (PE) plants with annual capacities of 840,000 tonnes and 800,000 tonnes, respectively. The project was announced in 2013.

Ethylene is a feedstock for producing PE.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,589,580 tonnes in the first nine months of 2019, up by 7% year on year. Shipments of all PE grades increased.
MRC

MOSCOW (MRC) -- A reformer and a hydrotreating unit (HTU) shut down on Thursday at Motiva Enterprises’ 607,000 barrel-per-day (bpd) Port Arthur, Texas, refinery, the nation’s largest, reported Reuters with reference to sources familiar with plant operations.

Motiva, a wholly-owned indirect subsidiary of the Saudi Aramco, declined to comment on operations at the Port Arthur refinery.

A time line has not been set for restarting the 49,000 bpd Catalytic Reforming Unit 4 (CRU 4) and the 32,000 bpd Hydrotreating Unit 3 (HTU 3) following the unplanned shutdowns, the sources said.

Reformers convert low-octane refining byproducts into octane boosting components that are blended into gasoline.

HTU 3 uses hydrogen to remove sulfur from light gas oil in compliance with US environmental rules.

As MRC informed before, in September 2019, Motiva Enterprises signed an agreement to buy the Flint Hills Resources' cracker and chemical plant adjacent to its Port Arthur, Texas, oil refinery, kicking off a push into petrochemicals.

Besides, Motiva Enterprises LLC is evaluating opportunities to build a new polyethylene (PE) line within its proposed steam cracker and aromatics project in Jefferson County, Texas. The new PE capacity will be located at the company’s Port Arthur Refinery Complex in Jefferson County, Texas. The planned capacity of the unit was not specified, while the value of the project is reportedly estimated at around USD3.1 billion. The construction is expected to commence by the four quarter of 2020, with completion is estimated in the last quarter of 2024.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,589,580 tonnes in the first nine months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market was 976,790 tonnes in January-September 2019, up by 4% year on year. Shipments of PP block copolymer and homopolymer PP increased.

Motiva Enterprises, LLC, is a fully owned affiliate of Saudi Refining Inc. and headquartered in Houston, Texas, United States with revenue of USD24 billion. Previously, it was a 50–50 joint venture between Shell Oil Company (the wholly owned American subsidiary of Royal Dutch Shell) and Saudi Refining Inc. (controlled by Saudi Aramco).
MRC

MOSCOW (MRC) -- LG Chem announced on Thursday it has opened a technical service and development center in Osan, Gyeonggi Province, marking the country’s largest petrochemical technology center, reported Kemicalinfo.

The company invested 110 billion won (USD94.8 million) in establishing the center, it said. The petrochemical tech center is part of LG Chem’s plan to boost its competitiveness in the sector.

The center will be used for developing technical solutions and offering other forms of support for the company’s contractors and clients.

The Pilot building of the center is equipped with production facilities, where both companies and clients can work together on the development of pilot petrochemical products, such as polyolefin, acrylonitrile butadiene styrene copolymer, super absorption polymer and solution styrene butadiene rubber.

The tech center will have more than 60 laboratories to test petrochemical products and 200 researchers, according to the company."Osan Tech Center has the geographical advantage that will provide easier access to clients flying in from other countries," said Sohn Ok-dong, president of the petrochemical business of LG Chem. "Together with the center in Huanan, China, the Osan center will serve as the hub for technical services for global petrochemical clients."

As MRC informed before, LG Chem is planning to spend USD2.4-billion to expand its naphtha cracking center (NCC) and polyolefin (PO) plant in Yeosu, South Korea. The project, which will expand the NCC and PO facility by 800,000 t/y each, is expected to be completed in the second half of 2021.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,589,580 tonnes in the first nine months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market was 976,790 tonnes in January-September 2019, up by 4% year on year. Shipments of PP block copolymer and homopolymer PP increased.

LG Chem Ltd., often referred to as LG Chemical, is the largest Korean chemical company and is headquartered in Seoul, South Korea. According to ICIS report, it is 15th biggest chemical company in the world in 2011. It has eight domestic factories and global network of 29 business locations in 15 countries. LG Chem is a manufacturer, supplier, and exporter of petrochemical goods, IT&E Materials and Energy Solutions.
MRC

MOSCOW (MRC) -- Darya Borisova has been appointed as a new member of the Management Board and Managing Director of SIBUR, said the company.

She will head the Joint Department of Development and R&D established in order to better align SIBUR’s innovation and development projects with the needs of customers. The department will comprise Business Development, Strategic Innovation, and Research and Development functions, along with the NIOST R&D centre.

Before joining SIBUR, Darya Borisova was Senior Partner at McKinsey. One of the founders of the firm’s petrochemical and oil and gas practice in Russia and the CIS, she led McKinsey's expert team for operational and investment efficiency improvements across industrial companies in Russia, CIS, Turkey, Middle East and Africa.

Darya has extensive experience with SIBUR projects aimed at improved operational efficiency and transformation of functions such as Supply Chain Management, Sales and Marketing, Capital Investments, and Digitalisation. Darya graduated from the Faculty of Chemistry, Moscow State University, and the University of Toledo, USA. She holds a PhD in Physical Chemistry.

As MRC informed earlier, SIBUR and Tatneft have closed the sale and purchase of certain production and other assets that to date have been registered in the name of SIBUR Togliatti and Togliattisintez legal entities.

Besides, in October 2019,, ZapSibNeftekhim affiliate produced the first batch of polyethylene (PE) granules using its own ethylene feedstock at its Tobolsk complex in Siberia. Earlier this year, ZapSib produced a test batch of PE from imported feedstock, "while today the process is running smoothly using our own feedstock," SIBUR said. Commissioning and start-up are "well under way", and after ramping up to its full capacity, the petrochemical facility will produce 1.5m tonnes/year of PE - making ZapSib's Tobolsk project Russia's largest polymer production facility.

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.

PAO SIBUR Holding is the largest petrochemical company in Russia and Eastern Europe with full coverage of the industry cycle from gas processing, production of monomers, plastics and synthetic rubbers to plastics processing.
MRC

MOSCOW (MRC) -- Saudi Aramco has approached Malaysian state energy company Petronas to participate in Aramco’s initial public offering (IPO), Petronas said, as the Middle Eastern oil giant seeks cornerstone investors for the listing, said Reuters.

The Saudi government plans to sell 2% of state-run Aramco, the world’s most profitable company, in a domestic listing on Dec. 11, three sources familiar with the matter told Reuters.

The approach comes as Petronas, officially known as Petroliam Nasional Bhd, nears the start of commercial operations at a USD27 billion refinery and petrochemical project built jointly with Aramco in southern Malaysia.

“We have been recently approached by representatives of Saudi Aramco to consider Petronas’ participation in its initial public offering exercise,” Petronas, the Malaysian government’s cash cow, told Reuters.

:However, we will not be providing any further comments on this matter at this time."

Aramco’s much-vaunted IPO was delayed as deal advisers said they needed more time to lock in cornerstone, or anchor, investors such as sovereign wealth funds. In 2016, state-owned Postal Savings Bank of China sold 77% of its USD7.4 billion IPO to such backers.

Reuters reported in September that Aramco had approached Abu Dhabi Investment Authority, Singapore’s GIC and other sovereign wealth funds to invest in the domestic leg of its listing.

Abu Dhabi’s state investor Mubadala Investment Co has also been approached by Aramco’s advisers.

Asked about its interest in the Aramco IPO, Malaysian sovereign wealth fund Khazanah Nasional Bhd told Reuters it “does not have any investments in the oil and gas sector".

As MRC informed earlier, Saudi Aramco, which temporarily lost half of its oil production following the September 14 attacks on two key oil facilities, is running its local refineries at full capacity and is forging ahead with plans to start up new refineries. The company is also starting up a joint venture refinery in Malaysia next year. According to Aramco's bond prospectus released in April, the refining and petrochemical joint venture with Petronas - the Malaysian national oil company - collectively known as PRefChem, was supposed to start this year.

The PRefChem joint venture includes a 300,000 b/d refinery, an integrated steam cracker with capacity to produce 1.3 million mt of ethylene located in Johor, Malaysia. Aramco was supposed to provide a significant portion of PRefChem's crude supply under a long-term supply agreement. Jazan and PrefChem will help Aramco reach a gross refining capacity of 5.6 million b/d, it said in the prospectus. The company currently owns and has stakes in four refineries abroad with a total refining capacity exceeding 2 million b/d.

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.

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.
MRC