Petrobras says 2020 oil output averaged record 2.28 MMbpd

MOSCOW (MRC) -- Brazil's Petrobras produced a record 2.28 million barrels of oil per day in 2020, a figure that is directly in line with the most recent guidance given by the state-run oil company, said Hydrocarbonprocessing.

The combined oil and natural gas output of Petrobras averaged 2.84 million barrels of oil equivalent per day last year, the company said in a securities filing, a figure that also matched the company's guidance.

The firm attributed the record output to better-than-expected processing capacity at its Buzios field, a smaller-than-expected production decline in the Tupi and Sapinhoa fields and better efficiency at its platforms.

Petroleo Brasileiro SA PETR4.SA, as the firm is formally known, had said for most of the year that it expected production of 2.2 million barrels of crude and 2.7 million boepd in 2020. However, the company upped its guidance to 2.28 million barrels of crude and 2.84 million boepd in mid-October, a move that did not come as a surprise to the market, as the company had been outperforming production targets all year.

The company did not break down production by field or product, nor offer any details on the destination of its oil and gas. The firm will likely offer more details during its fourth quarter results release in late February.

We remind that Braskem is no longer pursuing a petrochemical project, which would have included an ethane cracker, in West Virginia. And the company is seeking to sell the land that would have housed the cracker. The project, announced in 2013, had been on Braskem"s back burner for several years.

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

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras" activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

COVID-19 - News digest as of 11.01.2021

1. Feedstocks, energy in transition

MOSCOW (MRC) -- The global transition toward a lower-carbon future is rapidly changing the energy and feedstocks landscape for chemical and energy companies as they head into 2021. The pandemic caused worldwide crude oil demand to slump 10% in 2020, dramatically accelerating preparations by the refining sector to shift away from fuels toward a petrochemicals-centric future, reported Chemweek. The world will still consume large amounts of oil for decades, but COVID-19 “reset world oil demand at a lower level,” says Jim Burkhard, vice president/crude oil markets at IHS Markit. Forecast global crude oil demand is now 3.5-4.0 million b/d less in the late 2020s compared with the pre-COVID outlook. “In our base case, world oil demand reaches a plateau in the mid-2030s. However, we do not rule out the possibility that 2019 was the peak in world oil demand, particularly if COVID-19 is not contained,” Burkhard said, speaking at the World Methanol Conference, held recently by IHS Markit in a virtual format. Last year may be remembered “as a pivot point when the energy transition moves from decades of slow motion to a faster pace of change,” he said.



MRC

Asia distillates-gasoil cracks dip amid concerns over ample supplies

MOSCOW (MRC) -- Asian refining margins for 10-ppm gasoil slipped in late December, weighed down by concerns that near-term supplies on the back of high regional refinery runs would weaken market fundamentals, reported Reuters.

Although gasoil demand has improved in recent weeks, renewed lockdown measures in several markets to contain a new variant of the coronavirus are expected to dampen the pace of recovery in coming weeks, market watchers said.

Refining margins, also known as cracks, for 10-ppm gasoil were at USD6.21 a barrel over Dubai crude during Asian trading hours on 30 December, down from USD6.53 per barrel a day earlier.

Cracks for the benchmark gasoil grade in Singapore have gained 17.6% in the past month, but they were still about 57% lower than their seasonal average for this time of the year, Refinitiv Eikon data showed.

The front-month time spread for 10-ppm gasoil in Singapore, which has narrowed its contango by nearly 70% this month, traded at a discount of 15 cents per barrel on 30 December.

The flattening contango structure would encourage traders to liquidate gasoil stocks from storages, putting pressure on the market and capping any major upside for the refining profits in the first half of 2021, industry analysts said.

Middle-distillate inventories in the Fujairah Oil Industry Zone dropped 8.2% to 5.03 million barrels in the week ended Dec. 28, data via S&P Global Platts showed.

The weekly stocks in Fujairah have averaged 4.2 million barrels in late December, 2020, compared with the weekly average of 2.4 million barrels in 2019, Reuters calculations showed.

US distillate stockpiles fell by 1.9 million barrels in the week to Dec. 25, counter to expectations for a build of 529,000 barrels, data from industry group the American Petroleum Institute (API) showed on 29 December.

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 DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC

India to renew antidumping duty on PA imports from Russia, removes Japan from ADD list

MOSCOW (MRC) -- India to renew antidumping duty on PA imports from Russia, removes Japan from ADD list, said Chemweek.

Latest ADD on Russian PA imports extends previous five-year period imposed in 2014; Japan removed after being deemed unlikely to resume dumping activities.

The Directorate General of Trade Remedies (DGTR) of India on 5 January recommended continuing the ADD after its investigation showed that “there is likelihood of continuation or recurrence of dumping and injury if the existing ADDs are allowed to cease." he south Asian country’s previous five-year ADD on Russian PA imports expired in December 2020.

The DGTR launched the probe in December 2020 after receiving complaints from domestic producers IG Petrochemicals, Thirumalai Chemicals and the SI Group India Ltd. “Domestic producers will be able to cater to complete demand of the product in India,” the DGTR said in its review. "The two existing producers of PA have already expanded their capacity and commercial production in respect of expanded capacity is going to start soon,” it added, referring to Thirumalai Chemicals and IG Petrochemicals.

SI Group produces phthalates and derivatives. Imposition of the new ADD is expected to begin within three months.

PA is used as a chemical intermediate in the production of phthalate plasticizers, saturated and unsaturated polyester resins. Phthalic anhydride is widely used in for the production of paints and varnishes and plasticizers for PVC products. In a small amount it is used in the manufacture of rubber products, tires. In addition, it is used in the light, pharmaceutical and electrical industries.

According to a MRC's DataScope report, last month's SPVC imports into the Ukrainian market decreased to 2,100 tonnes from 2,100 tonnes in October, with North American PVC accounting for the decrease in shipments. Overall SPVC imports reached 31,100 tonnes in January-November, compared to 44,700 tonnes a year earlier.

MRC

Successful operation of Axens units and digitalization at the ERC refinery

MOSCOW (MRC) -- All Axens’ units of the Egyptian Refining Company (ERC) refinery project are now successfully operating and reaching full production and performances, said Hydrocarbonprocessing.

The refinery produces Euro 5 refined products, including diesel and jet fuel, for Egyptian local market by processing annually 4.7 million tons of mainly atmospheric residue from the Cairo Oil Refinery Company.

Axens was involved in providing licensing, Process Design Package (PDP), catalysts, proprietary equipment and services for:
- The naphtha Block: a naphtha hydrotreating unit (NHT), a CCR-reforming unit OctanizingTM,
- The distillate Block: a diesel hydrotreating unit Prime-D™,
- A single stage Hydrocracking unit HyK™ with recycle meeting high conversion.

All the units are performing well with the full satisfaction of ERC after a successful commissioning and start-up supported by Axens’ technical services teams. Moreover, units’ performances are optimized thanks to Axens’ Connect’In digital services.

“ERC is very proud of the fruitful cooperation with Axens in this megaproject to start the production of this state-of-the-art refinery. We, as ERC, are keen to build on this cooperation with Axens by using latest catalysts and to continue with the digital technology Connect’In that allows close monitoring of the units and opens a direct channel between ERC and Axens’ technical teams,” said Dr. Mohamed Saad, ERC Managing Director.

"Axens is very proud of the trust expressed by ERC following the provision of Axens’ support to operate our technologies in the most efficient way. They demonstrated their confidence in Axens by securing the implementation of Connect’In digital services which proactively enables the monitoring of Axens units performances,” stated Patrick Sarrazin, Axens’ Process Licensing Global Business Unit Executive Vice-President.

As MRC informed earlier, Sumitomo Chemical and Axens signed a license agreement of ethanol-to-ethylene technology Atol for Sumitomo Chemical’s waste-to-polyolefins project in Japan. In the project, to promote circular economy, Axens’ Atol technology will transform ethanol produced from waste into polymer-grade ethylene that will be polymerized in Sumitomo Chemical’s assets into polyolefin, a key product in the petrochemical industry. At full roll-out, the project will enable the production of waste-based polyolefin at industrial scale, which will represent a leapfrog towards a sustainable economy based on renewable carbon.

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

According to MRC's ScanPlast report, Russia's estimated polyethylene (PE) consumption totalled 1,990,280 tonnes in the first eleven months of 2020, up by 1% year on year. Only high density polyethylene (HDPE) shipments increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 090,900 tonnes in the first eleven months of 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.
MRC