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The Prax Group signs exclusive crude oil supply arrangement

March 03/2021

MOSCOW (MRC) -- The Prax Group announced that it has completed an exclusive crude oil and feedstocks supply arrangement with Trafigura, a market leader in the global commodities industry, said Hydrocarbonprocessing.

Under the terms of the transaction, Prax will purchase crude oil and refinery feedstocks from Trafigura for all of its requirements for Prax Lindsey Oil Refinery, located near Immingham in the Humber estuary, in the North East region of the United Kingdom.

Under the new agreement, Trafigura will use its extensive global reach in international oil markets to source the optimal range of crude oils and feedstocks for the refinery.

Sanjeev Kumar, CEO of the Prax Group, said: This arrangement is an important step in the Groups plans for the long-term growth of the refinery and it will pave the way to further strengthen our long-term relationship with Trafigura. It will provide operational and planning flexibility, helping us to continue to deliver an excellent level of service to our customers.

Jose Maria Larocca, Executive Director and Co-Head of Oil Trading for Trafigura, said: Trafigura is delighted to be working with the Prax Group following their new refinery acquisition. Were committed to supporting our customers by providing access to the best opportunities available in the global commodity markets."

The Prax Group took over ownership of Lindsey Oil Refinery from Total on 1st March 2021. With an annual production capacity of 5.4 million tonnes, the acquisition underpins the Groups long-term strategy to be fully integrated across the oil value chain from upstream to downstream, and secures local supply for the trade and sale of oil products for its substantial downstream presence in the United Kingdom.

We remind that the COVID-19 outbreak has led to an unprecedented decline in demand affecting all sections of the Russian economy, which has impacted the demand for petrochemicals in the short-term. However, the pandemic triggered an increase in the demand for polymers in food packaging, and cleaning and hygiene products, according to GlobalData, a leading data and analytics company. With Russian petrochemical companies having the advantage of access to low-cost feedstock, and proximity to demand-rich Asian (primarily China) and European markets for the supply of petrochemical products, these companies appear to be well-positioned to derive full benefits from an improving market environment and global economy post-COVID-19.

We also remind that in December 2020, Sibur, Gazprom Neft, and Uzbekneftegaz agreed to cooperate on potential investments in Uzbekistan including a major expansion of Uzbekneftegazs existing Shurtan Gas Chemical Complex (SGCC) and the proposed construction of a new gas chemicals facility. The signed cooperation agreement for the projects includes the creation of a gas chemical complex using methanol-to-olefins (MTO) technology, and the expansion of the production capacity of the Shurtan Gas Chemical Complex.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 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.


mrcplast.com
Author:Anna Larionova
Tags:petroleum products, PP, PE, neftegaz, petrochemistry.
Category:General News
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