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Global oil and gas contract activity report marginal increase during Q3 2020

November 30/2020

MOSCOW (MRC) -- The global oil and gas industry has witnessed a marginal increase in the number of oil and gas contracts from 1,104 in Q2 2020 to 1,136 in Q3 2020, said Hydrocarbonprocessing.

This is in spite of challenges such as crude oil process and the COVID-19 outbreak, says GlobalData, a leading data and analytics company. The industry recorded contract value of USD14.16B in Q3 2020, as compared to the previous quarter that reported USD32.51B in value. Primarily this difference was due to a high value USD19.21B contract agreement reported by Qatar Petroleum in Q2 2020.

The key contract in Q3 2020 was JGCs Engineering, Procurement, Construction and Commissioning (EPCC) work for the 34,500 bpd FCC unit, 55,000 bpd VDU unit and 40,000 bpd Diesel Desulfurization unit for the upgrade of Basra refinery project in Al-Basrah, Iraq.

GlobalDatas latest report, Global Oil and Gas Industry Contracts Review, Q3 2020, states that the upstream sector reported 758 contracts in Q3 2020, followed by the midstream and downstream/petrochemical sector with 205 and 183 contracts, respectively, during the quarter.

Europe recorded majority of the contracts, with 495 contracts in Q3 2020, followed by Asia and North America with 240 and 215 contracts, respectively, during the quarter.

Operation and Maintenance (O&M) represented 50% of the total contracts in Q3 2020, followed by contracts with multiple scopes such as construction, design and engineering, installation, O&M and procurement, which accounted for 15%.

As MRC informed before, slumping fuel consumption during the pandemic is accelerating the long-term shift of refining capacity from North America and Europe to Asia, and from older, smaller refineries to modern, higher-capacity mega-refineries. The result is a wave of closures, often centering on refineries that only narrowly survived the previous closure wave in the years after the recession in 2008/09.

We remind that PetroChina has nearly doubled the amount of Russian crude being processed at its refinery in Dalian, the company's biggest, since January 2018, as a new supply agreement had come into effect. The Dalian Petrochemical Corp, located in the northeast port city of Dalian, was expected to process 13 million tonnes, or 260,000 bpd of Russian pipeline crude in 2018, up by about 85 to 90 percent from the previous year's level. Dalian has the capacity to process about 410,000 bpd of crude. The increase follows an agreement worked out between the Russian and Chinese governments under which Russia's top oil producer Rosneft was to supply 30 million tonnes of ESPO Blend crude to PetroChina in 2018, or about 600,000 bpd. That would have represented an increase of 50 percent over 2017 volumes.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers" inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
Author:Anna Larionova
Tags:petroleum products, crude oil, PP, PE, neftegaz, petrochemistry.
Category:General News
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