Petro Rabigh submits file to reduce capital and then raise it by 7.95 bln riyals

MOSCOW (MRC) -- Rabigh Refining and Petrochemical Company (Petro Rabigh) has announced that it has submitted a capital reduction application file and a capital increase application file to the Saudi Capital Market Authority, according to TNG News.

The company said in a statement on “Tadawul Saudi Arabia”, Monday, that it obtained the approval of the lenders regarding the capital reduction and capital increase in accordance with the requirements of the relevant financing agreements.

She explained that the capital reduction and increase are subject to the relevant regulatory approvals, including the approval of the company’s extraordinary general assembly, noting that it will announce any material developments in a timely manner in accordance with the relevant regulations.

On December 7, 2021, the company submitted an amendment to the Board of Directors’ recommendation to increase the company’s capital through a rights issue, to be a recommendation to reduce the capital by an amount of 1.205 billion riyals, and then increase it by offering rights shares with a total value of 7.95 billion riyals.

The amendment includes the board of directors’ recommendation regarding the capital structure, after the board of directors studies the company’s financial position and takes into account the accumulated losses of 13.76% of the company’s capital.

The company said in a previous statement, that the recommendation included reducing the capital by 13.76%, to become after the reduction about 7.55 billion riyals, instead of 8.76 billion riyals.

The method of reduction is through canceling about 120.5 million ordinary shares, by canceling one ordinary share for every 7.3 ordinary shares, bringing the number of shares after the reduction to 755.49 million shares.

The reduction will contribute to amortizing the company’s accumulated losses, and the company does not expect the capital reduction to have a material negative impact on the company’s financial, operational or regulatory obligations, operations or performance.

As MRC wrote previously, the company conducted a 55-day scheduled turnaround at its polypropylene (PP) units in Rabigh since end-February 2020. And in June 2021, Petro Rabigh said it had no overhaul schedule for its PP plant. The company operates two lines at this plant, which can produce 350,000 mt/year of PP each.

Besides, the company has a 300,000 mt/year high density polyethylene (HDPE) unit, a 160,000 mt/year low density polyethylene (LDPE) unit and a 600,000 mt/year linear low density polyethylene (LLDPE) plant at the same site.

According to MRC's ScanPlast report, PP shipments to the Russian market were 1,363,850 tonnes in January-November, 2021, up by 25% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

PetroRabigh, a joint venture between Saudi Aramco and Japan's Sumitomo Chemical, has an annual output capacity of 18 million tonnes of refined products and 2.4 million tonnes of petrochemicals. Thus, the complex currently has a cracker to produce 1.6-million t/y of ethylene, as well as downstream production of polyethylene, polypropylene, propylene oxide, ethylene glycol and butene-1.
MRC

MOSCOW (MRC) -- Honeywell announced that Lukoil -Permnefteorgsintez, a subsidiary of Lukoil, will use a range of Honeywell UOP process technologies at its refinery to convert low value vacuum gasoil into high value products such as gasoline and propylene, said Hydrocarbonprocessing.

Phase one of the project includes the installation of a new UOP vacuum distillation unit and a UOP FCC unit that is tailored to increase production of propylene at the refinery while improving gasoline yield. A UOP Merox unit will also be installed that will treat the liquefied petroleum gas (LPG) streams and reduce the level of mercaptans in the LPG and UOP propylene recovery unit to produce propylene with certain quality requirements for its further use.

The Honeywell UOP Merox process uses a highly efficient design to economically achieve ever-tightening sulfur specifications. The UOP Merox process extracts low molecular weight mercaptans from gas and LPG streams. The Merox process does not require feed or caustic filters and offers greater than 99.5% on-stream availability.

UOP will provide technology licensing, design services, key equipment and state-of-the-art catalysts and adsorbents for this project at the refinery in the Perm region of Russia. When completed, the conversion capacity of the complex is expected to exceed 1,800,000 metric tpy of vacuum gasoil.

"These best-in-class UOP technologies will allow LUKOIL to increase production of propylene and gasoline at its Perm refinery while benefiting from low capital and operating costs,” said Laura Leonard, vice president and general manager, UOP Process Technologies. “UOP constantly invests in its FCC technology development to meet the most ambitious needs of our customers. I’m proud, that Lukoil elected to continue its success story with UOP FCC technology, which is already being employed at several Lukoil refineries."

Earlier it was also reported that Lukoil plans to invest more than 300 billion rubles in the coming years. in the development of a petrochemical cluster in the Stavropol Territory, the core of which is the Stavrolen petrochemical enterprise. The development program, among other things, provides for the technical re-equipment of the pyrolysis complex, which will increase its capacity to 420 thousand tons of ethylene per year. The modernization program also includes the reconstruction of a PE production unit, the capacity of which will increase to 405,000 tons per year, and a polypropylene (PP) production unit, which will increase the production of its copolymers to 120,000 tons per year. In addition, Lukoil plans to launch the production of linear polyethylene (LDPE) and metallocene grades.

Lukoil is one of the leading vertically integrated oil companies in Russia. The main activities of the company include exploration and production of oil and gas, production and sale of petroleum products. Lukoil is the second largest private oil company in the world in terms of proven hydrocarbon reserves. The structure of Lukoil includes one of the largest petrochemical enterprises in Russia - Stavrolen.
MRC

MOSCOW (MRC) -- Oil prices hit two-month highs on Wednesday on tight supply and easing concerns about the potential hit to demand from the Omicron coronavirus variant, reported Reuters.

US Federal Reserve Chairman Jerome Powell on Tuesday said that the economy of the United States, the world's biggest oil consumer, should weather the current COVID-19 surge with only "short-lived" impact and is ready for the start of tighter monetary policy.

Brent crude futures were up 47 cents, or 0.6%, at USD84.19 a barrel by 1430 GMT. US West Texas Intermediate (WTI) crude futures were up 66 cents, or 0.8%, at USD81.88.

Equities, which often move in tandem with oil prices, also ticked up, while a weaker dollar also lent support. A weaker greenback makes dollar-denominated oil contracts cheaper for holders of other currencies,

The Brent contract is showing growing backwardation, with front-month delivery around USD4.20 more expensive than delivery in six months, indicating tight near-term supply.

OPEC+ oil producers continue to hold back more than 3 million barrels per day (bpd) in output while Iranian exports are pinned back by continuing US sanctions. Though OPEC+ producers are raising output targets each month, technical difficulties have prevented several countries from hitting their quotas.

"Assuming China doesn’t suffer a sharp slowdown, that Omicron actually becomes Omi-gone, and with OPEC+’s ability to raise production clearly limited, I see no reason why Brent crude cannot move towards USD100 in Q1, possibly sooner," said Oanda analyst Jeffrey Halley.

"There are plenty of variable outcomes in the previous sentence, the biggest threat being Omicron in China, India and Indonesia."

Meanwhile, European jet fuel refining margins are back to pre-pandemic levels as supplies in the region tighten and global aviation activity recovers.

US crude stocks fell by 1.1 million barrels in the week ended Jan. 7, market sources said, citing figures from the American Petroleum Institute (API).

As MRC informed before, US commercial crude stocks fell 3.48 million barrels to 413.96 million barrels in the week ended Sept. 17, to more than 8% below the five-year average, Energy Information Administration data showed. Stocks were last lower Oct. 5, 2018.

We remind that in late August, 2021, US crude stocks dropped sharply while petroleum products supplied by refiners hit an all-time record despite the rise in coronavirus cases nationwide, the Energy Information Administration said. Crude inventories fell by 7.2 million barrels in the week to Aug. 27 to 425.4 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop. Product supplied by refineries, a measure of demand, rose to 22.8 million barrels per day in the most recent week. That's a one-week record, and signals strength in consumption for diesel, gasoline and other fuels by consumers and exporters.

We also remind that US crude oil production was expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, EIA said in a monthly report earlier last year, a smaller decline than its previous forecast for a drop of 210,000 bpd.
MRC

MOSCOW (MRC) -- Olga Tarasenko has been appointed General Director of the Titan group of companies, and she took up her duties on 10 January, the company said.

Previously, Tarasenko held the position of Deputy General Director for Economics and Finance. On January 10, Olga Tarasenko assumed the duties of General Director of Titan Group JSC. Since 2020, she has been in charge of the financial and economic unit of Titan Group of Companies under the leadership of Farkhad Samedov, who initiated the transition of Olga Tarasenko to the management company.

Farhad Samedov headed JSC "GK "Titan" for two years. "Today, the Titan Group of Companies is faced with the task of implementing several major investment projects - further modernization of the Omsk Rubber plant, the implementation of the Titan-Polymer project. In addition, the project for the production of auto chemical goods of the Titan-SM company will enter the active phase" - said Olga Tarasenko.

Earlier it was reported that the Titan-Polymer Plant (Pskov, part of the Titan Group, Omsk) assembled almost 80% of the equipment for the BOPET film production under construction.

In February 2020, Titan-Polymer began the construction of production facilities for the first stage of the project - the production of BOPET films. At the site of the plant, construction and installation work began on concreting the bases of columns, foundations of buildings, structures, the main production building of BOPET.

The Titan group of companies, founded in 1989, is one of the largest petrochemical enterprises in Siberia. The Corporation is implementing the Titan-Polymer project in the Moglino Special Economic Zone (Pskov Region). The new facility is designed to produce 72,000 tons of BOPET film and 210,000 tons of PET pellets per year. Products will be supplied to the markets of Russia, Eastern and Western Europe.
MRC

MOSCOW (MRC) -- BASF signed a joint development agreement with China BlueChemical Limited Company (China BlueChemical), a leading natural gas producer, and the chemical engineering company Wuhuan Engineering Co., Ltd. (Wuhuan Engineering) to promote low-carbon development and utilization of marine gas resources, said Hydrocarbonprocessing.

In the Dongfang Industrial Park of Hainan Province, China BlueChemical extracts large quantities of such offshore natural gas (marine gas) from gas fields in the South China Sea.

Marine gas, unlike the commercial natural gas, contains high concentrations of CO2. The gas needs CO2 removal to be usable for downstream large-scale applications. The process of separating CO2 from natural gas not only increases energy consumption, but also contributes to yield loss and direct carbon emissions. These issues limit the systematic development and utilization of natural gas with high CO2 content.

BASF will leverage its extensive expertise in catalyst development and will collaborate with the two companies to solve these challenges. Through technical innovation in reforming catalysts, special reactor design and related process technology development, BASF’s solution will improve process energy efficiency and carbon efficiency beyond existing commercial catalyst and process technology. The partnerships will promote lower-carbon development and utilization of marine gas resources, and ultimately achieve an economically competitive and environmentally friendly commercial process.

As per MRC, BASF, the world's petrochemical major, is strengthening its global catalyst development and helping customers to bring new products faster to the market. As part of this strategy, BASF is building a new pilot plant center at its Ludwigshafen site.

As MRC wrote before, BASF will build a battery recycling prototype plant in Schwarzheide, Germany, at the site of its cathode active materials (CAM) plant.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries.
MRC