Zawiya refinery targeted by air strikes

MOSCOW (MRC) -- Libya's oil infrastructure has once again found itself in the crosshairs of the country's prolonged civil conflict between the UN-backed Government of National Accord and the self-styled Libyan National Army, as per S&P Global.

The country's 120,000 b/d Zawiya refinery was the target of an airstrike on 27 December, 2019, and state-owned National Oil Corporation (NOC) confirmed that sites near the oil storage facility operated by the Zawiya refinery were hit by a bomb on Friday.

A source close to the matter said, however, that operations at the refinery were not affected by the strikes in late December.

NOC said the airstrike targeted a storage warehouse west of Zawiya refinery gate but no casualties were reported.

Sources told S&P Global Platts that the airstrikes were carried out by the LNA as it is making its way to capture western parts of Libya like Zawiya, Tripoli and Misrata which are still not under its control.

"Targeting the refinery is a war crime. If the refinery is damaged it will deprive vital facilities including hospitals, and power and desalination plants of fuel," NOC chairman Mustafa Sanalla said.

"It will require additional gasoline and diesel imports, costing the Libyan people tens or hundreds of millions of dollars. The repetition of these absurd actions will lead to human and material losses and environmental disasters."

Oil infrastructure in western Libya is a key risk, especially the town of Zawiya, which is home to a 300,000 b/d export terminal and a 120,000 b/d refinery, along with Sabratha, where the Mellitah gas and condensate terminal is located. In late-November, Libya's El Feel field in the southwest of the country was briefly shut due to military action around the facility.

Political tensions are ratcheting up in Libya. Despite a protracted conflict in the North African country, production remains high, though supply disruptions could reappear.

The UN-backed Government of National Accord has called for Turkish military troops to assist it in the battle against the self-styled Libyan National Army, which has now entered into its ninth month.

Libya's fragile peace, which has seen oil production recover to above 1 million b/d, could soon end. Analysts believe there could be several clashes between LNA and various rivals groups and militias including forces loyal to the UN-backed Government of National Accord which could spill to the country's lucrative oil and gas sector.

Almost all of Libya's key oil terminals and infrastructure, especially those in the east of the country, are already controlled by General Khalifa Haftar's LNA.

The country's oil industry has been at the mercy of groups vying for control of valuable assets, with armed attacks on key pipelines and production facilities since the 2011 civil war.

NOC also renewed its call to all warring parties to stay away from its sites, and not to harm the only source of income for the Libyans.

Libyan crude production averaged 1.05 million b/d this year, according to Platts estimates, compared to 950,000 b/d and 810,000 b/d in 2018 and 2017 respectively.
MRC

NNPC to raise Chevron-operated GTL plant stake to 60%

MOSCOW (MRC) -- Nigeria's state oil company said in late December it will increase its stake in a Chevron-operated gas-to-liquid refinery to 60% as part of a cost dispute resolution with the US oil major, reported Reuters.

The Nigerian National Petroleum Corporation (NNPC) has a 20%stake in the plant some 60 miles (100 km) southeast of Lagos.

California-based Chevron, which is trying to sell some Nigerian assets in an effort to focus on its fast-growing US production, did not immediately comment.

The 33,000 barrel-per-day (bpd) plant, which produces synthetic diesel, liquefied petroleum gas and naphtha from natural gas using technology from South Africa's Sasol, cost around $10 billion to build, four times the original estimate, and its start-up in mid-2014 was years late.

As MRC informed previously, in March 2018, Chevron Phillips Chemical, part of Chevron Corp, Chevron successfully introduced feedstock and commenced operations of a new ethane cracker at its Cedar Bayou facility in Baytown, Texas,. At peak production, the unit will produce 1.5 million metric tons/3.3 billion lbs. per year. This unit is one of the largest and most energy efficient crackers in the world. In September 2017, the company announced the successful commissioning and start-up of two new Marlex polyethylene units in Old Ocean, Texas, based on the company’s proprietary MarTech technologies. Together, these assets form the bulk of the company’s US Gulf Coast Petrochemicals Project (USGCPP), which was first announced in 2011.

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

ding to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,724,670 tonnes in the first ten months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market in January-October 2019 totalled 1,066,520 tonnes, up by 7% year on year. Supply of block copolymers of propylene (PP block copolymer) and homopolymer of propylene (homopolymer PP) increased, demand for statistical copolymers (PP random copolymer) decreased.

Headquartered in San Ramon, California, Chevron Corporation is the the second-largest integrated energy company in the United States and among the largest corporations in the world. Chevron is involved in upstream activities including exploration and production, downstream activities including refining, marketing and transportation, and advanced energy technology. Chevron is also invested in power generation and gasification processes.
MRC

MRC team wishes Merry Christmas and Happy New Year!

MOSCOW (MRC) -- Dear readers of MRC!

We congratulate you on Christmas and New Year!

We wish you every happiness this Holiday season and throughout the coming year.

All of MRC staff join in saying “thank you” and wishing you a happy holiday and prosperous new year.

On this special day, we wish you happiness, prosperity and success, hoping that we continue our association through many more wonderful years ahead!

Best wishes,

MRC staff.


MRC

Huhtamaki has completed the acquisition of the majority of the business of Everest Flexibles

MOSCOW (MRC) -- Huhtamaki has completed the acquisition of the majority of the business of Everest Flexibles, said the company.

Huhtamaki has completed the acquisition of the majority of the business of Everest Flexibles (Pty) Limited (“Everest”), a privately-owned flexible packaging manufacturer in South Africa. The annual net sales of the acquired business is approximately EUR 40 million and it employs altogether approximately 460 people.

The business was acquired for an enterprise value of EUR 58 million. The deal was paid partly in cash and partly in shares, as the sellers of Everest entered into a joint venture also with Huhtamaki’s Flexible Packaging, Foodservice and Fiber Packaging operations in South Africa. As a result, the sellers of Everest now own 30% of all Huhtamaki’s activities in South Africa. The joint venture structure allows Huhtamaki to improve its B-BBEE (“Broad-based Black Economic Empowerment”) rating and subsequently competitiveness in South Africa.

The business will be reported as part of the Flexible Packaging business segment as of December 1, 2019.

As MRC informed earlier, Huhtamaki to acquire full ownership of its Brazilian joint venture company Laminor.

As MRC informed earlier, Russia's output of chemical products dropped by 3.2% in November 2019 month on month.
However, production of basic chemicals increased by 3.6% in the first eleven months of 2019, according to Rosstat's data. According to the Federal State Statistics Service of the Russian Federation, the largest increase in production volumes on an annualized basis accounted for mineral fertilizers and polymers in primary form. Last month, 255,000 tonnes of ethylene were produced versus 210,000 tonnes in October; by November, Russian producers had completed all their scheduled works. Thus, 2,721,000 tonnes of this olefin were produced in January-November 2019, up by 0.3% year on year.

Huhtamaki is a global specialist in packaging for food and drink. With our network of 80 manufacturing units and additional 24 sales only offices in altogether 35 countries, we’re well placed to support our customers’ growth wherever they operate. Mastering three distinctive packaging technologies, approximately 18,800 employees develop and make packaging that helps great products reach more people, more easily. In 2018, our net sales totaled EUR 3.1 billion.
MRC

Fuel shortages mount as strikes continue at French refineries

MOSCOW (MRC) -- Shortages of oil products have started mounting as strikes at most French refineries entered their fourth week resulting in increased imports of diesel and gasoil, reported S&P Global with reference to sources' statement on Friday.

Gasoil traders noted increased demand for fuel imports in Northwest Europe as a result of the industrial action in France.

"I have seen some French demand for diesel in ARA," one regional fuel trader said, adding he expected the impact of the strikes to be felt later when strategic stocks have to be replenished.

French labor unions, including the CGT, FO and FSU, have called on employees in all sectors to take part in industrial action against the government's pension reforms. The strike, which started December 5, has been extended several times.

As the industrial action has also affected the ports, which have halted operations on multiple days and tug assistance has also been disrupted, imports have been facing difficulties and France has had to use some of its strategic stocks, traders said.

France held 106 days worth net imports in crude and product stocks at the end of September, well above the 90-day requirement of the International Energy Agency.

Deliveries were still intermittent in the Mediterranean. Nonetheless, imports have been rising with traders shifting flows between ports, depending on their status.

Elsewhere, staff at Petroineos' Lavera refinery started halting units last weekend, marking an escalation in the impact from the rolling industrial action.

Staff at Total's Grandpuits refinery has voted to block expeditions of products until Monday which, if extended, could result in the refinery also halting units, according to CGT sources.

Total said the refinery was operating, albeit at reduced rates. Total's Donges refinery is also operating at reduced rates, with expeditions blocked, a union source said. Product deliveries from La Mede biofuels plant have been blocked on and off.

Operations and deliveries have returned to normal at Total's Feyzin and the strike has been suspended at Total's Gonfreville refinery after a fire led to the shutdown of the crude distillation unit mid-December. The refinery was operating partially, using its own stock and imports.

Operations and deliveries were back to normal at ExxonMbil's Fos-sur-Mer, where staff have been joining the strike on and off. There has been no strike action at ExxonMobil's Gravenchon refinery in Normandy.

The French ecology ministry said in a statement Friday, after meeting representatives of the oil industry, that difficulties with product deliveries were affecting only two refineries and said there was good level of product supply. Of the 200 oil terminals, just two have faced temporary difficulties, with the remaining receiving products by pipe, sea or rail, and over 98% of the 11,000 retail stations were receiving normal supplies. 1.7% of the retail stations were having temporary difficulties on December 27, down from 2.6% on December 23, the ministry said.

Several unions have called for a wide-ranging strike and demonstrations on January 9, as well as demonstrations on Saturday, December 28. In addition, the CGT union has submitted a strike notice from January 6 until February 6.

Port and dockworkers have also been asked to stop work for a few hours next Monday, organize protests on January 6-7 at the ports of Dunkirk, Le Havre, Rouen, St Nazaire, La Rochelle, Bordeaux and Marseille, and to halt operations for 24 hours on January 9.

French ports have been working intermittently since the start of the industrial actions, with loadings disrupted on several occasions. As a result, tankers have faced delays at the Fluxel-operated Fos and Lavera oil terminals in the Mediterranean and Le Havre in the north.

As MRC informed before, ExxonMobil's cracker at Notre Dame de Gravenchon, France, had an "unexpected stoppage" on Friday, 6 December, following a technical failure this October. Thus, an electric fire Saturday morning, 19 October, 2019, on the ExxonMobil facilities in Notre-Dame-de-Gravenchon (Seine Maritime) resulted in a plume of smoke, below the regulatory thresholds, which could remain visible for several days.

Besides, ExxonMobil halted polyethylene (PE) production at its site in Notre Dame de Gravenchon, France, at the end of the 2nd week of December 2019, due to commercial reasons, without providing further details. The site houses 500,000 tons/year of linear low density polyethylene (LLDPE) plant, including metallocene linear low density polyethylene (MLLDPE). PE plant resumed production in the 3rd week of December.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,724,670 tonnes in the first ten months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market in January-October 2019 totalled 1,066,520 tonnes, up by 7% year on year. Supply of block copolymers of propylene (PP block copolymer) and homopolymer of propylene (homopolymer PP) increased, demand for statistical copolymers (PP random copolymer) decreased.
MRC