London +4420 814 42225
Moscow +7495 543 9194
Kiev +38044 599 2950
info@mrcplast.com

Our Clients

Order Informer

 
Home > News >
 

Oil and gas EPC majors shift to cleaner energy

November 03/2020

MOSCOW (MRC) -- Major oil and gas engineering, procurement, and construction (EPC) companies are increasingly shifting their strategies toward cleaner energy segments, according to Hydrocarbonprocessing.

With a bleak investment outlook for the sector in the wake of COVID-19, now is seen as good a time as any for major oil and gas companies to make strategic shifts in energy transition, according to analysis by GlobalData.

Major oil and gas EPCs, which have traditionally relied on projects within the oil and gas value chain and have had relatively little exposure to renewables, are now looking to renewables and other clean energy sectors for future growth.

EPC companies are adopting diverse strategies to position themselves for the energy transition. Aker and TechnipFMC, for example, have restructured their businesses to create dedicated units for low-carbon projects. Petrofac aims to achieve net zero in Scope 1 and Scope 2 emissions by 2030. Despite these varying approaches, the most common target segments among major oil and gas EPC companies are offshore wind and carbon capture and storage (CCS).

COVID-19 brought a major oil and gas demand shock, delayed projects and raised additional questions about the potential for future oil demand growth. Oil and gas investment is likely to flatline at best over the coming years, and companies will need to look to the growth markets of new energy sectors to support their businesses, said Will Scargill, GlobalData managing oil and gas analyst.

The targeting of offshore wind and carbon capture is a common theme among companies from the oil and gas sector looking to adapt for the energy transition due to the potential for knowledge synergies. Oil and gas EPCs looking to target new segments will also hope to benefit from existing partnerships with clients making a similar transition. However, their growth plans will face a challenge from incumbent players in the renewables space, Scargill added.

As MRC informed earlier, the coronavirus pandemic underscored BP's efforts to "reimagine energy" by taking a leading role in the push to cleaner, low-carbon fuels, said CEO Bernard Looney in July, 2020. Rising levels uncertainty over the future demand for oil, oil price volatility, a growing attractiveness of stable returns from some renewables, and an increased awareness of "the fragility of the world we live in" mean BP is taking the right path to pursue lower-carbon fuels, Looney said.

We remind that in July, 2020, the Turkish Competition Council gave permission to SOCAR and BP to establish a joint venture that will operate in the petrochemical sector. Earlier it was reported that SOCAR and BP applied to the relevant institutions in Turkey to establish a joint petrochemical company, which will be called Mercury complex, in April 2020. Recall that on December 20, 2018 SOCAR and BP signed contractual principles for evaluation of plans for creation a world-class petrochemical complex in Turkey and establishment of a joint venture to manage it.

Construction of the complex was planned to begin during the current year in order to put the enterprise into operation in 2023-2025. However, due to low oil prices and to the COVID-19 pandemic, the project implementation has been postponed until 2021. The Mercury complex will be built near the Petkim petrochemical complex and the STAR refinery in Aliaga region. The enterprise will produce 1.25 million tons of purified terephthalic acid (PTA), 840 thousand tons of paraxylene (PX), 340 thousand tons of benzene.

PTA is the main raw material in the production of polyester from which beverage and food containers, packaging materials, photo and film and other consumer and industrial goods are derived.

According to ICIS-MRC Price report, consumption of PET chips by Russian converters decreased in October, which is generally in line with the current season. Market participants reported weak demand in the Russian PET chips market at the end of last month and expect its further decline in early November. The revival of the domestic PET market is expected in the second half of November, before the New Year holidays.


mrcplast.com
Author:Margaret Volkova
Tags:Asia, Near East, Europe, benzene, crude and gaz condensate, paraxylene (PX), PET-granulate, terephthalic acid, gas processing, petrochemistry, packaging, BP Plc, Petkim, SOCAR Polymer, Russia, USA, Turkey.
Category:General News
|
| More

Leave a comment

MRC help

 


 All News   News subscribe