Saudi Aramco IPO gets USD44.3 billion in bids so far

MOSCOW (MRC) -- Saudi Aramco has received bids for its shares totaling USD44.3 billion so far, lead manager Samba Capital said on Friday, putting its initial public offering on track to be over-subscribed, said Reuters.

The state-owned oil giant plans to sell 1.5% of the company’s shares for as much as 96 billion riyals (USD25.6 billion), a deal which would give it a market value of USD1.7 trillion.

Overall demand so far totals 1.7 times the amount of shares on offer, with institutional investors having until Dec 4 to put their bids in.

In the first update on institutional investor interest in the listing, Samba said it had received bids from them worth 118.86 billion riyal(USD31.70 billion).

The retail tranche of the offering - which closed to subscribers on Thursday - has had bids totaling 47.4 billion riyals (USD12.64 billion), around 1.5 times the amount of shares on offer to retail investors. While comfortably oversubscribed, the level of interest is relatively muted compared to other Saudi IPOs.

When Saudi Arabia’s National Commercial Bank listed in 2014 the retail portion was 23 times over-subscribed.

As MRC informed earlier, ith Saudi Aramco yet to name any major foreign investors in its upcoming share sale, Malaysia’s state energy company Petronas decided to take a pass. Petronas follows Russia’s second largest oil producer Lukoil in turning its back on the initial public offering (IPO) which is likely to rank Aramco as the world’s most valuable company.

Petronas and Aramco have a joint venture in a USD27 billion refinery and petrochemicals complex in southern Malaysia that is set to start commercial operations this year.

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.
mrcplast.com

MOSCOW (MRC) -- Indian Oil Corporation Ltd (IOCL) has started up one of its new PP plants since July 2019, meanwhile another line has been delayed to January 2020, reported CommoPlast with reference to market sources.

Based in Panipat, India, the company's new PP plants consists of two lines each with 340,000 tons/year of production capacity.

The first PP line which commissioned in July this year is designed to produce homopolymer grades meanwhile another is for copolymer grades.

As MRC wrote earlier, Indian Oil Corp restarted operation at its naphtha cracker in India in early-October, 2019, after completing maintenance works. The cracker was shut in early-September, 2019 for a maintenance turnaround. Located in Panipat, in the northern Indian state of Haryana, the cracker has an ethylene production capacity of 857,000 mt/year and propylene capacity of 425,000 mt/year.

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.

Indian Oil Corporation Limited, or IndianOil, is an Indian state-owned oil and gas corporation with its headquarters in New Delhi, India.
MRC

MOSCOW (MRC) -- After a sharp fall in demand in the Ukrainian EPS boards market at the beginning of this month, consumption of finished products stabilized in the second half of November at a new, lower level, according to ICIS-MRC Price report.

Prices of Chinese and Russian expandable polystyrene (EPS) were in the range of UAH42,000-43,500/tonne CPT Kiev, including VAT, last week.

A middle-sized converter purchased material at UAH42,500-43,000/tonne CPT Kiev, including VAT, in the domestic market.

As reported earlier, in the first half of the month, SIBUR-Khimprom reduced its EPS prices twice for November shipments to Ukrainian buyers under the pressure from foreign markets. Thus, in early November, the Russian producer reduced its EPS prices for this month's shipments to Ukraine by USD45/tonne to USD1,230 per tonne FCA Voronezh, excluding VAT. And in the second week of November, the company announced a reduction of USD10/tonne in prices of material to USD1,220/tonne FCA Voronezh, excluding VAT.
mrcpast.ru

MOSCOW (MRC) -- The oversupply condition in the Asian butadiene market is likely to be offset by a possible export cut from the US after a fire hit the TPC Group's Port Neches butadiene and raffinate petrochemical plant east of Houston, Texas, reported S&P Global with reference to industry sources' statement Thursday.

The United States is a key butadiene supplier to Asia, mainly to South Korea. According to the United States International Trade Commission, or USITC, the US exported 7,433 mt of butadiene in August, while no exports were registered in September.

Around 5,000 mt of butadiene from the US is due to arrive in Asia in January, said market sources.

"Some end-users in Asia may start looking for spot butadiene cargoes in a bid to cover supply shortfall from the US," a Japanese trader said.

Some market sources said the latest sell tender from Taiwan - due to close later Thursday - would likely attract buyers' interests. Taiwan's Formosa is offering around 2,000 mt spot cargo for December loading.

On the other hand, market sources said Asian butadiene market would unlikely see a spike in price as spot butadiene cargoes remains available elsewhere in the region, such as Japan.

Japan's butadiene supplies are currently strong, due to lower synthetic rubber plant operations amid weak margins. Japan's butadiene exports in October stood at 23,433 mt, up 9.1% from a month earlier, according to the customs data. Of the total, exports to Korea rose 11.8% to 18,413 mt during the same period.

Trading sources in Asia said some end-users in the US are looking for spot butadiene cargoes in Europe after the explosion.

However, some others said that such demand would be short lived, considering unused butadiene capacity in the US. A trader pointed out that the butadiene production in the US is estimated around 1.4 million mt/year in 2019, compared to a total capacity of 2.5 million mt/year.

"As long as other butadiene plants in the US can get crude C-4 supplies, they can increase butadiene production," said a trader, adding that there may be some distribution restrictions on moving crude C-4 in the domestic US market.

Located adjacent to the Sabine Neches River, a part of the Sabine Neches Waterway, TPC's Port Neches plant can produce more than 900 million lb (426,000 mt) of butadiene and raffinate a year, according to the company's website. A source familiar with company's operations said the site has two butadiene lines with capacities of 166,000 mt/year and 260,000 mt/year.

Butadiene is one of the feedstocks for the production of acrylonitrile-butadiene-styrene (ABS).

According to ICIS-MRC Price report, in Asia, the falling prices of feedstocks for ABS production have been pushing prices of material down in the Russian market. LG Chem's import prices for November quantities were as follows for Russian buyers: natural ABS - at USD1,400-1,420/tonne FOB Korea, black ABS - at USD1,610-1,630/tonne FOB Korea, white ABS - at USD1,640-1,660/tonne FOB Korea. December prices may drop by another USD30-50/tonn.
Natural grades of Korean ABS went down to Rb138,000-143,000/tonne CPT Moscow, including VAT, in the domestic market in mid-November, whereas black ABS was offered at Rb156,000-160,000/tonne and white ABS - at Rb158,000-163,000/tonne CPT Moscow , including VAT.

Headquartered in Houston, TPC was acquired in 2012 by private equity groups First Reserve and SK Capital.
MRC

MOSCOW (MRC) -- SK Advanced Co Ltd restarted its propane dehydrogenation (PDH) unit in Ulsan, South Korea on 20 November 2019 following an emergency shutdown four days ago, according to CommoPlast.

Thus, this unit was taken off-stream on 16 November, 2019.

Located in Ulsan, South Korea, the plant has a propylene production capacity of 600,000 mt/year.

The company last conducted maintenance works at this unit from 20 November to mid-December 2017.

As MRC informed earlier, Advanced Petrochemical Company was running its 500,000 mt/year PDH unit and a polypropylene (PP) unit of 450,000 mt/year, at its Jubail complex at 40% capacity, due to the Saudi oil attack that happened on 14 September, 2019, which reduced the company's supply of feedstock.

According to MRC's ScanPlast report, 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.

SK Advanced Co Ltd is a joint venture between South Korea's largest LPG supplier - SK Gas and Saudi Arabia's Advanced Petrochemical Company (APC).
MRC