MOSCOW (MRC) -- Eni's chemical business managed by Versalis swung to a third-quarter adjusted operating profit of €25m from a loss of EUR53m in the same period of last year on the back of higher margins, said the company.
Sales of petrochemical products were 1.03m tonnes in the third quarter, down by 7% year on year.
Petrochemical product margins improved significantly on the back of "macroeconomic recovery, which mitigated competitive pressure, and contingent factors due to temporary supply shortages during the first half of the year", the company said in a statement.
"The exceptionally strong products spread versus feedstocks recorded in the second quarter 2021 moderated in the third quarter as plants affected by contingent issues returned to normal activity", it said.
Adjusted operating profit for the group surged in the third quarter, with the upstream business supported by the rise in oil and gas prices.
Downstream pro-forma adjusted earnings before interest and taxes (EBIT) expected at about €200m in 2021, which is expected to be negatively affected by a deteriorated margin environment driven by higher feedstock and utilities costs. "This guidance could be revised downward under current market conditions," the company added.
As MRC wrote previously, Italian energy group Eni is evaluating conversion of its Livorno refinery in northwest Italy into a biorefinery, as part of the Italian company's wider strategy to make its activities more environmentally sustainable. Eni has already converted two of its Italian refineries and is looking to almost double its biorefining capacity to around 2 million mt/year by 2024, and expand this to at least five times by 2050, as part of its pledge to achieve complete carbon neutrality by 2050.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,638,370 tonnes in the first eight months of 2021, up by 10% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 989,570 tonnes in the first eight months of 2021, up by 30% year on year. Deliveries of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas shipments of injection moulding PP random copolymers decreased significantly.
Eni, abbreviation of Ente Nazionale Idrocarburi, in full Eni SpA, Italian energy company operating primarily in petroleum, natural gas, and petrochemicals. Established in 1953, it is one of Europe's largest oil companies in terms of sales.
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