MOSCOW (MRC) -- Qatar Petroleum will slash its spending by around 30% this year in the face of the sharp drop in oil and gas prices due to the coronavirus epidemic, its Chief Executive said, said Hydrocarbonprocessing.
Speaking during a webcast organised by the U.S-Qatar Business Council, Saad al-Kaabi however said that plans to sharply expand Qatar Petroleum’s liquefied natural gas (LNG) capacity by the middle of the decade remain on track.
“We are going through budget revisions... In June we will be somewhere in the range of 30% reduction in expenditure, capex and opex,” Kaabi said. The world’s top oil and gas companies sharply reduced spending in the wake of an unprecedented collapse in oil consumption triggered by travel restrictions governments around the world imposed to contain the coronavirus epidemic.
Kaabi said he expected oil demand to recover to pre-crisis levels only within a year or two, adding that natural gas prices have suffered less due to continued demand for electricity. Qatar Petroleum, or QP, the world’s largest LNG producer, will however not cut its gas exports due to the weaker demand, he added.
QP wants to lift its LNG output to around 110 million tonnes per annum by 2024 from today’s 77 mtpa in the first phase of its expansion. Those plans remain on course, Kaabi said, despite delaying the awarding of commercial tenders for the expansion project from April to the end of the year.
“We’re full steam ahead, we’re going to expand,” Kaabi said. Once the project’s capital costs are understood in the coming months, he expects a number of major international companies, including Exxon Mobil, Chevron and ConocoPhillips to take part in the tendering process, he added.
As MRC informed earlier, on 22 July at cracking units No. 23 and 33 in the city of Sweeny, Old Ocean, Texas, USA, the American Chevron Phillips Chemical (CP Chem), one of the world's largest petrochemical companies, suffered a technological failure as a result of a steam failure. the company said in a statement. The company said in a statement that the company has restored this production with a capacity of 1.68 million tons of ethylene per year.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 595,170 tonnes in the first five month of 2020, up by 10% year on year. Deliveries of all ethylene polymers, except for linear low density polyethylene (LLDPE), rose partially because of an increase in capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market was 457,930 tonnes in January-May 2020 (calculated by the formula production minus export plus import). Deliveris of exclusively PP random copolymer increased.
MRC