CNOOC closes USD15.1 billion acquisition of Nexen

MOSCOW (MRC) - The contentious USD15.1 billion takeover of Canadian oil and gas company Nexen Inc by Chinese state-owned entity CNOOC Ltd closed on Monday, more than seven months after China's largest-ever foreign takeover was announced, said Reuters.

Nexen, based in Calgary, Alberta, said in a statement on Monday that the deal had closed and its shareholders would receive USD27.50 in cash for each Nexen share.

The company said Kevin Reinhart would remain chief executive of Nexen, which will operate as a wholly owned subsidiary of CNOOC.

As MRC wrote earlier, The takeover, originally announced in July, won approval from Canadian regulators in December (see news MRC). Earlier this month, CNOOC overcame its last major hurdle after the deal was cleared by the Committee on Foreign Investment in the United States, which had a say because of Nexen's exploration and production assets in the Gulf of Mexico.

The two companies have not disclosed what conditions were imposed by Canadian and U.S. regulators for the deal to win approval, but one of CNOOC's advisers said the parameters around the assurances were largely in line with expectations.

The Nexen acquisition gives CNOOC new offshore production in the North Sea, the Gulf of Mexico and off western Africa, as well as producing properties in the Middle East and Canada.

In Canada, CNOOC gains control of Nexen's Long Lake oil sands project in the oil-rich province of Alberta, as well as billions of barrels of reserves in the world's third-largest crude storehouse - the oil sands in the province of Alberta.
MRC

MOSCOW (MRC) -- Shell is closing in on the purchase of a raft of LNG assets from Spain’s Repsol with an announcement imminent, a report has claimed, said Upstreamonline.

The Anglo-Dutch supermajor is finally set to snap up the LNG assets of Repsol in Peru and Trinidad & Tobago.

Repsol is set to land around EUR 1.5 billion (USD1.96 billion) in cash from the deal, claims the report, which also indicates Repsol LNG has gross debts of around EUR1 billion.

State player Repsol has had its LNG assets on the sales block for some time with various companies linked with a purchase in recent months. In late January Spanish newspaper Cinco Dias claimed Shell would beat off competition from the likes of GDF Suez, Gaprom and others to claim the prize.

Repsol said in the summer that it will sell assets in Canada where it controls 75% of the Canaport LNG terminal, its 20% stake and sole off-taker position in the 4.4 million tonnes per annum Peru LNG, and its shareholding in Trinidad and Tobago’s Atlantic LNG. However, the Canadian assets are set to be kept out of the mooted Shell deal, Tuesday’s report claims.

Repsol also controls a number of LNG carriers and holds a stake in a Spanish LNG import terminal.

The aim is to help finance investment of EUR19 billion (USD23.3 billion) set in its 2012-2016 business plan to boost the company’s oil and gas production. The company’s liquefied petroleum gas interests in Chile is also part of the programme.

As MRC wrote earlier, spanish energy giant Repsol is in talks with Pemex regarding a new strategic partnership. The new alliance comes as Repsol tries to reorganise its Latin American business, having been stripped of its shares in the now nationalised Argentinian producer YPF.

Repsol S.A. is an integrated Spanish oil and gas company with operations in 28 countries. The bulk of its assets are located in Spain. It is now the 15th largest petroleum refining company according to the Fortune Global 500 list.

Shell, one of the world's largest oil producers, is increasingly focused on natural gas. It has interests in converting it into clean-burning diesel in Qatar, and is building LNG export facilities in Australia, Africa and Canada. Shell Chief Executive Peter Voser said earlier this year that he expects gas to play a significant role over the next 40 years, with much higher growth rates than oil. In a statement, the company said it expects that the Repsol assets, once the deal closes, will provide immediate additional cash flow.

MRC

MOSCOW (MRC) -- European markets were shaken with news about unexpected production outages at several crackers across the region last week which restricted spot olefins availability at a time when maintenance season is right around the corner, said Apic-online.

Nevertheless, weak demand from derivative markets and the softer energy complex overshadowed the impact of lower availability.

Softer feedstock markets combined with scant demand prevented increases in monomer markets despite recently emerging supply issues across Europe, market sources commented.

Among most recent supply issues, LyondellBasell reportedly declared a force majeure on their propylene supplies from their Muenchsmuenster cracker with 400,000 tons/year capacity in Germany due to technical problems. The force majeure was expected to remain in place for around one month. Versalis took their Dunkirk cracker in France offline for repair work with 380,000 tons/year capacity and it is due to remain offline for a week or a little longer.

In addition, PropanChem shut their PDH (propane dehydrogenation) unit located at Tarragona, Spain for a turnaround that will take place between February 7 and end-March, according to market sources in Europe. The unit has a capacity of 350,000 tons/year.

Moreover, the unplanned shutdown at Naphthachimie’s 745,000 tons/year cracker was expected to persist until the first half of March. The maintenance at the Lavera cracker had started in the last month of 2012.

This recent shutdown news came on the top of the fact that the region is set to enter a maintenance season in spring. BASF will shut their cracker in Antwerp, Belgium for a turnaround between April and June. The cracker with 1.08 million tons/year capacity is known to be the largest across Europe, sources noted. Plus, Shell will implement a maintenance at their Moerdijk cracker during March and April. For the medium term, BP Refining and Petrochemicals plans to shut their 540,000 tons/year cracker in Gelsenkirchen for two months of maintenance starting from May.

Nonetheless, restricted supplies via the latest outages in addition to upcoming scheduled shutdowns have yet to find a visible reflection on European olefin markets yet as costs followed a steady to slightly firmer trend last week.

As MRC wrote earlier, the growth in demand for North American PVC from both domestic and foreign markets, as well as scheduled outages for maintenance at Formosa and Georgia Gulf facilities in January-February, have led to a major increase in export prices over the past three months. This week price offers for February shipment of PVC from the U.S. were voiced in the range of USD1,010-1,020/tonne, FAS Houston. For March shipments, some manufacturers reported the need to raise the price by USD40-50/tonne.
MRC

MOSCOW (MRC) -- Borealis, a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers, announces a net profit of EUR 100 million in the fourth quarter of 2012, compared to EUR 58 million in the same quarter of 2011. The company recorded a net profit of EUR 480 million in 2012, compared to EUR 507 million in 2011, said the company in its press release.

The reduction in 2012 was largely driven by a weaker margin environment in Europe within the polyolefins business. In 2012, net debt increased by EUR 403 million, due in part to the acquisition of the French fertilizer producer PEC-Rhin and other investments to position the company for future growth. Despite the increase in debt, Borealis’ financial position remains strong with a gearing of 43%.

The European polyolefins market continued to be challenging with lower demand levels adversely affecting margins, particularly in the second half of the year.

The construction of the semi-commercial polyolefin catalyst plant in Linz, Austria was completed in August 2012. After an intensive commissioning phase, the plant was started up successfully and a first batch of Borealis’ Ziegler Natta polypropylene catalyst, based on its proprietary Sirius emulsion technology, was produced in December. The ability to develop and manufacture proprietary catalysts for the production of its most advanced polyolefins lies at the heart of Borealis’ polyolefin growth and innovation strategy.

In November, Borealis reached an agreement to acquire DEXPlastomers, a 50/50 joint venture owned by Royal DSM and ExxonMobil Chemical Company. The products of DEXPlastomers are specialties that fully complement Borealis’ current Polyolefins business. The agreement underpins Borealis’ commitment to its Value Creation through Innovation strategy. The transaction is still subject to customary approvals and notifications.

The Borouge 3 expansion project in Abu Dhabi, UAE, is on schedule, with the annual production capacity of the integrated olefins/polyolefins site set to rise from 2 million tonnes today to 4.5 million tonnes by mid-2014 (see MRC news).

"Despite the difficult market environment, Borealis again delivered solid results in 2012," says His Excellency, Khadem Al Qubaisi, Chairman of Borealis’ Supervisory Board and Managing Director of IPIC (Abu Dhabi based International Petroleum Investment Company).
MRC

MOSCOW (MRC) -- Styron, the global materials company and manufacturer of plastics, latex and rubber, has introduced several new resins for medical equipment enclosures, according to the company's press release.

These materials complement Styron’s portfolio for enclosures providing resins that result in an economical system cost.

The new advanced resins are EMERGE PC/ABS 7700 blend, which provide a well-balanced, cost-effective solution for powered medical devices offering ignition resistance and color stability over time, and MAGNUM 2642 MED and MAGNUM 8391 MED ABS resins, which are manufactured in a continuous mass production process that offers superior lot-to-lot consistency, exceptional natural resin whiteness, and excellent processing characteristics.

Styron has also introduced a broad range of ISO 10993-tested colorants for its CALIBRE polycarbonate resins, CALIBRE MEGARAD polycarbonate resins, and MAGNUM ABS Resins portfolio.

As the demand for attractive medical equipment grows, manufacturers and molders need materials that provide pleasing aesthetics and advanced performance. Recognized as superior, Styron’s MAGNUM ABS Resins have been relied on for decades.

Both MAGNUM 2642 MED and MAGNUM 8391 MED ABS resins offer exceptional appearance due to mass production. MAGNUM 8391 MED ABS resins target premium applications with improved processability and toughness such as higher melt flow, higher impact strength and higher gloss. MAGNUM 2642 MED ABS resins are considered general purpose. Both have been tested for biocompatiblity.

Styron resins are available directly through the company or through distribution partners PolyOne Distribution, Entec, and Channel Prime Alliance.

As MRC informed earlier, Styron Europe and its affiliate companies in Europe had announced price increases for all CALIBRE polycarbonate (PC) and EMERGE polycarbonate and blends products. Effective as of March 7, or as contract terms allow, the prices for these products will rise by EUR270/tonne.

Styron is a leading global materials company and manufacturer of plastics, latex and rubber. Styron's technology solutions are used by customers in industries such as home appliances, automotive, building & construction, carpet, commercial transportation, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires.
MRC