Libya approves sale of Hess Waha stakes to TotalEnergies and ConocoPhillips

Libya approves sale of Hess Waha stakes to TotalEnergies and ConocoPhillips

MOSCOW (MRC) -- Libya's Government of National Unity has approved the sale of US oil company Hess Corporation's stake in the giant Waha oil concessions to both TotalEnergies and ConocoPhillips, reported S&P Global wth reference to a statement of Patrick Pouyanne, CEO of TotalEnergies, Nov. 22.

Pouyanne confirmed the deal while speaking at the Libya Energy & Economic Summit 2021 in Tripoli on Nov. 22.
Hess Corporation's 8.16% stake in the key oil license will now be split evenly between France's TotalEnergies (4.08%) and ConocoPhillips (4.08%), sources close to the matter told S&P Global.

But the deal has also been attracting some opposition domestically, and with elections just over a month away pressure was mounting on Prime Minister Abdul Hamid Dbeibah to pass the deal.

Deputy Oil Minister Refaat al-Abbar, who chairs the ministry's technical committee for production affairs, had approved the sale over the past few days, sources said.

Representatives at Hess and ConocoPhillips were unavailable for comment.

In a letter dated Nov. 9 written by Prime Minister Dbeibah to Pouyanne, the PM said he welcomed and supported the proposed joint acquisition. But he asked the two companies to contribute USD45 million to a wholly owned government entity that will be designated in the course of the finalization of the transaction agreement.

As MRC informed before, with its name change from Total to TotalEnergies amid its transition from fossil fuels, the major oil company is investing more in renewables and energy storage while decreasing emissions from its natural gas business.

We remind that TotalEnergies has recently inaugurated the extension of Synova in Normandy, the French leader in recycled polypropylene production. TotalEnergies is therefore doubling its mechanical recycling production capacity for recycled polymers, to meet growing demand for sustainable polymers from customers, such as Automotive Manufacturer (Auto OEM) and the construction industry.

According to MRC's ScanPlast report, PP shipments to the Russian market were 1,138,510 tonnes in the first nine months of 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

TotalEnergies is a broad energy company that produces and markets energies on a global scale: oil and biofuels, natural gas and green gases, renewables, and electricity. The company rebranded itself from Total to TotalEnergies during Q2 2021. The French firm has announced allocating part of surplus revenues to share buybacks. Its 105,000 employees are committed to energy that is ever more affordable, clean, reliable and accessible to as many people as possible. Active in more than 130 countries, TotalEnergies puts sustainable development in all its dimensions at the heart of its projects and operations to contribute to the well-being of people.
MRC

KMG and LUKOIL sign principles agreement for Kalamkas-Sea and Khazar project

KMG and LUKOIL sign principles agreement for Kalamkas-Sea and Khazar project

MOSCOW (MRC) -- On 16 November 2021, Alik Aidarbayev, Chairman of the Management of JSC NC “KazMunayGas” (KMG), met with Vagit Alekperov, President of LUKOIL PJSC (LUKOIL), said the company.

The parties discussed the relevant issues of cooperation and implementation of their joint projects in Kazakhstan.

A Principles Agreement for the Kalamkas-Sea and Khazar Project was signed during the meeting. The document suggests further negotiations between KMG and LUKOIL to define the concept, details and terms of joint development of the fields.

“KMG and LUKOIL have cooperated effectively for many years. Today we discover new areas to extend the cooperation and sign the agreement for the Kalamkas-Sea and Khazar Project. I am confident that the project will give a new impetus to our mutually profitable partnership,” Mr. Aidarbayev noted.

“By signing the Principles Agreement, we lay a foundation for a dynamic interaction. We are glad we have new initiatives and projects that we can bring to life through the experience of our companies in the oil industry,” Mr. Alekperov emphasised.

It should be noted that the companies are involved in such projects as Karachaganak, Tengiz, Al-Farabi, Zhenis, in the Caspian Pipeline Consortium oil transportation project, as well as in joint ventures for the development of Khvalynskoye and Central fields.

As per MRC, Kazakhstan’s state-owned KazMunayGas (KMG) group and industrial gases and engineering company Linde have signed a memorandum of understanding on developing clean energy projects that may include production of green and blue hydrogen and ammonia.

The National Oil and Gas Company of Kazakhstan KazMunayGas (KMG) and the country's largest oil producer, Tengizchevroil LLP, have agreed to supply propane to the polypropylene plant in Karabatan.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in the first nine months of 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.
MRC

COVID-19 - News digest as of 23.11.2021

1. Hexion announced Q3 2021 results

MOSCOW (MRC) -- Hexion’s resin sales into China’s wind energy market have been down significantly in H2 2021, but that market should recover in the second half of 2022, said the company. The US-based adhesives, coatings and composites materials company supplies epoxy resins and systems to composite fabricators in the wind energy market. Last year, the wind market accounted for 17% of Hexion’s total sales. Rogerson said that customers in China's wind blade manufacturing sector could not pass through high epoxy costs in their government contracts, which largely explains why production of blades has been “way down this year”. However, with blade inventories now at low levels, there was a base for a recovery to occur “probably not early in 2022, but sometime in the second half of 2022”, he said. Furthermore, the targets for wind and other renewable energies under China’s five-year plan remain in place, despite the current downturn, he said.


MRC

Crude oil futures go down in Asia as sentiment remains risk-averse

Crude oil futures go down in Asia as sentiment remains risk-averse

MOSCOW (MRC) -- Crude oil futures edged lower in mid-morning trade in Asia Nov. 23, paring modest gains notched overnight, as investors remained risk-averse despite recent comments by OPEC delegates that they could adjust their monthly output hike if governments choose to tap state oil reserves, reported S&P Global.

At 10:12 am Singapore time (0212 GMT), the ICE January Brent futures contract was down 15 cents/b (0.19%) from the previous close at USD79.55/b, while the NYMEX January light sweet crude contract fell 31 cents/b (0.40%) to USD76.44/b.

"Crude is responding to news that the US is set to announce a coordinated SPR release later Tuesday," said Vandana Hari, CEO of Vanda Insights.

"But the sell-off is muted because the market will likely await the actual announcement, given the weeks of talk but no action from the White House. Also, if there is indeed such a coordinate SPR sale, the impact will need to be weighed on the basis of the pace and scale of the barrels to be released," Hari added.

The decline on Nov. 23 comes after oil prices bounced off 7-week lows in the overnight session, after OPEC delegates said the wider OPEC+ producer group was reassessing its monthly output hikes in response to any state oil reserve release.

"There are no concerns at this time about the US and China releasing crude from strategic reserves because if the market were to be oversupplied, OPEC+ has the option of not increasing or reducing production," one delegate told S&P Global, asking not to be named to discuss private deliberations.

His comments were echoed by International Energy Forum Secretary General Joe McMonigle, who is in frequent contact with OPEC+ ministers.

The comments will bring into focus the tussle between OPEC+ and the Biden-led group of countries over the direction of oil prices. Some analysts have said that any state oil reserve release would be sizeable, with estimates in the range of 35 million to 120 million barrels.

Nonetheless, analysts at Goldman Sachs said Nov. 22 that the slide in global oil prices to below USD80/b over the last month has "overshot" market fundamentals, with concerns over the return of lockdowns over COVID-19 cases in Europe and a slowdown in China overshadowing an ongoing supply deficit.

We remind that, as MRC informed before, earlier this month, TotalEnergies and Daimler Truck AG signed an agreement on their joint commitment to the decarbonization of the road freight in the European Union. The partners will collaborate in the development of ecosystems for heavy-duty trucks running on hydrogen, with the intent to demonstrate the attractiveness and effectiveness of trucking powered by clean hydrogen and the ambition to play a lead role in kickstarting the rollout of hydrogen infrastructure for transportation.

We also remind that TotalEnergies has recently inaugurated the extension of Synova in Normandy, the French leader in recycled polypropylene production. TotalEnergies is therefore doubling its mechanical recycling production capacity for recycled polymers, to meet growing demand for sustainable polymers from customers, such as Automotive Manufacturer (Auto OEM) and the construction industry.

According to MRC's ScanPlast report, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.
MRC

Hexion announced Q3 2021 results

Hexion announced Q3 2021 results

MOSCOW (MRC) -- Hexion’s resin sales into China’s wind energy market have been down significantly in H2 2021, but that market should recover in the second half of 2022, said the company.

The US-based adhesives, coatings and composites materials company supplies epoxy resins and systems to composite fabricators in the wind energy market. Last year, the wind market accounted for 17% of Hexion’s total sales. Rogerson said that customers in China's wind blade manufacturing sector could not pass through high epoxy costs in their government contracts, which largely explains why production of blades has been “way down this year”.

However, with blade inventories now at low levels, there was a base for a recovery to occur “probably not early in 2022, but sometime in the second half of 2022”, he said. Furthermore, the targets for wind and other renewable energies under China’s five-year plan remain in place, despite the current downturn, he said.

Rogerson also noted that authorities in China have moved to temporarily shut down some local production of epichlorohydrin (ECH) because of tighter environmental rules. As ECH is a precursor in basic epoxy resins and epoxy specialty resins production, tighter ECH availability plays into the costs of the epoxy resin chain.

Outside of China, the global wind power market was “relatively strong” for Hexion, the CEO noted. Looking at Hexion’s overall Q4 outlook, the company expects to see continued strength in the epoxy business, as well as tailwinds in its adhesive products business from residential construction demand, Rogerson said.

Meanwhile, Hexion continues to work on strategic plans, announced late September, to potentially spin off its epoxy business and to undertake an initial public offering (IPO) for its adhesives and versatic product lines, he said.

As MRC informed before, Hexion shut down its BPA plant in the Netherlands for scheduled maintenance in early November, 2020. The turnaround at this plant with a capacity of 120,000 mtyear of BPA, located in Pernis, the Netherlands, lasted until the end of November, 2020.

Bisphenol A is used as a hardener in the production of plastics, as well as plastic-based products. It is one of the key monomers in the production of epoxy resins and polycarbonate (PC).

According MRC ScanPlast, the overall estimated consumption of polycarbonate (PC) granules (excluding imports and exports to/from Belarus) dropped in the first three quarters of 2021 by 15% year on year to 63,700 tonnes (75,300 tonnes a year earlier).

Hexion Inc., formerly Momentive Specialty Chemicals Inc., is a chemical company based in Columbus, Ohio. It manufactures thermosetting resins and related technologies and specialty products. Hexion has two divisions: the epoxy, phenolic and coating resins division and the forest products division.
MRC