European Commission questions privatization of Romanian chemical producer Oltchim SA

MOSCOW (MRC) --The European Commission (EC) has asked Romania a series of questions regarding the privatization process of the Romanian chemical producer Oltchim SA, as per Ceeinsight.

"There is a suspicion that the state doesn’t act like a private investor," the president of the Romanian Competition Council Bogdan Chiritoiu stated, as cited by the newswire. "The EC has asked for an explanation regarding the fact that, although Oltchim has debts toward the state, the state doesn’t apply any enforcement actions, as any creditor should do, which raises concerns about a possible state aid."

Romanian chemical producer Oltchim entered into insolvency proceedings in January 2013. The privatization of the company was set for December 2014.

In the first half of 2014, Oltchim narrowed its loss to RON 114.5 mln, which is 22% down year-on-year, as in the first half of 2013 the company reported a loss of RON 147.4 mln.

Oltchim's main products include polyvinyl chloride (PVC), polyols, dioctyl phthalate (DOP) and caustic soda.

MRC

MOSCOW (MRC) -- ExxonMobil affiliate Esso Norge AS reported plans to install a new processing unit at the Slagen refinery to enable production of high quality vacuum gas oil, a higher-yield feedstock used to create finished products such as diesel, said Hydrocarbonprocessing.

The new residual flash tower is an upgrading unit that will improve the facility’s overall crude distillation process by replacing production of heavy fuel oil with lighter, higher-value gas oil.

"The new investment in Slagen builds upon other strategic investments in Europe and further strengthens the industry-leading position of our advantaged assets in meeting increasing demand for energy," said Jerry Wascom, president of ExxonMobil Refining and Supply Company. "This project, coupled with a recently announced major upgrade at our Antwerp facility, will further strengthen ExxonMobil’s integrated downstream portfolio in Europe to better compete in the challenging environment our industry currently faces."

ExxonMobil is investing for the future in its Slagen refinery despite low margins and industry-wide losses in Europe. This project demonstrates ExxonMobil’s long-term view, with strategic investments in advantaged refineries to more successfully face the challenging industry environment. The company is evaluating investments in other advantaged assets in its global refining network.

"ExxonMobil continues to optimize its world-class refining assets through strategic investments in assets with advantages over our competition," said Stephen Hart, regional director of ExxonMobil Refining and Supply Company. "The new processing unit at Slagen refinery supports the company’s position as a leader in the global energy market by improving the production slate at the Slagen refinery. The new unit will enable improvement in the product yield in a highly energy-efficient manner that will help further strengthen the industry-leading position of our assets."

International comparisons show that the Slagen refinery is one of the most energy-efficient refineries in the world. Since the early 1990s, the refinery has implemented internal measures to save energy, and it is 25% more energy efficient today than it was in 1990.

As MRC wrote before, ExxonMobil Corp. started scheduled maintenance on a fluid catalytic cracking (FCC) unit at its 561,000-b/d integrated refining and petrochemical complex in Baytown, Texas. The Baytown refinery, which has the ability to process up to 584,000 b/d of crude oil, operates two FCCs with a combined processing capacity of 204,000 b/d, according to the latest operational data available from ExxonMobil’s web site.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.

MRC

MOSCOW (MRC) -- OAO Rosneft head Igor Sechin met with the chairman of Vietnam Oil & Gas Group to discuss cooperation in refining as the Russian oil producer looks at adding fields off the Asian country’s southern coast, said Hydrocarbonprocessing.

Sechin and Nguyen Xuan Son, the chairman at Vietnam Oil & Gas, met in Moscow and talked about possible joint exploration, output and refining projects, Rosneft said today in a statement on its website.

Rosneft has been building ties with Asia since its 2006 initial public offering, signing a USD270 billion, 25-year supply agreement with China in 2013. The Kremlin-controlled company, which gained Vietnamese natural gas producers with the purchase of TNK-BP last year, is seeking to reduce dependence on western markets as Russia’s ties with the US and the Europe Union sour over the conflict in Ukraine.

"PetroVietnam is a strategic partner for Rosneft," Sechin said in the statement.

Rosneft and PetroVietnam also discussed supplying Russian oil to PetroVietnam’s Dung Quat refinery and potential cooperation on modernizing the plant, according to the statement.

Rosneft is in talks to buy Chevron’s stake in gas fields off southern Vietnam for about USD200 million, PetroVietnam CEO Do Van Hau told Bloomberg in an interview on Aug 22.

As MRC wrote before, PetroVietnam, state-run Vietnam Oil and Gas Group, announced that it is going to construct the second oil refinery in the country. The refinery could cost USD8-10 billion.

PetroVietnam, Japan’s Mitsui & Co. and Thailand’s PTT Exploration & Production are partners in the Chevron project and have the first option on any stake up for sale, Hau said.

Rosneft became Russia's largest publicly traded oil company in March 2013 after the USD55 billion takeover of TNK-BP, which was Russia’s third-largest oil producer at the time.
MRC

MOSCOW (MRC) -- Tasnee & Sahara Olefins Co. (TSOC) has shuttered its ethylene and propylene production plant in Al Jubail Industrial City, Saudi Arabia, for nearly a month of planned maintenance, reported Tadawul.

The scheduled maintenance shutdown of the plant, which is owned and operated by Saudi Ethylene & Polyethylene Co. (SEPC), began on 1 September and will last for 24 days, according to a release from Sahara Petrochemicals Co., who owns interest in both TSOC (32.55%) and SEPC (24.41%), as per OGJ editors.

While customer supply commitments will not be interrupted due to the planned maintenance shutdown, production losses stemming from the closure will result in a profit loss of about USD1 million for Sahara, the company said.

The Jubail plant produces 1 million tpa of ethylene, about 80% of which is used as the primary feedstock for about 800,000 tpa of high-density and low-density polyethylene (HDPE and LDPE), according to Sahara’s 2013 annual report. The plant has a propylene production capacity of about 285,000 tpa.

As MRC informed before, on 17 August 2014, Sahara Petrochemical Company declared that its subsidiary Al Waha petrochemicals Company was affected by a technical fault in utilities unit, leading to the interruption of production processes in all operating units. The repairing process at the plants was expected to end in a period not exceeding 9 days starting of 17 August, which means missed opportunity for the profitability of nearly 9 millions SR of polypropylene (PP) prices currently prevailing in the third quarter which will affect the expected profits in the third quarter of this year.

Sahara Petrochemical is involved in building and operating petrochemical projects, especially propylene, polypropylene, ethylene and mixed polyethylene industries.
MRC

MOSCOW (MRC) -- LyondellBasell has seen a 27% surge in its profit for second-quarter 2014, on gains across all segments, especially the Olefins & Polyolefins – Americas division, said the company in its press-release.

The company envisions its margins to be supported by strong production of oil, natural gas and natural gas liquids (NGLs) in the U.S. The company continues to benefit from favorable North American natural gas environment and is executing its expansion projects to leverage the U.S. NGLs advantage.

Plans are underway to construct a world scale plant on the U.S. Gulf Coast for producing propylene oxide (PO) and tertiary butyl alcohol (TBA), leveraging the shale gas boom in the region. The plant, which is expected to go on stream in 2019, will have annual capacity of 900 million pounds of PO and 2 billion pounds of TBA and its derivatives.

The company also remains on track with its ethylene expansion projects. The company’s multi-plant ethylene expansion program, which started last year, represents a total investment of approx USD1.3 bln across its Channelview, La Porte and Corpus Christi facilities in Texas which benefit from shale gas production.

The expansion program, when in full swing, is expected to expand annual ethylene capacity by an estimated 1.85 bln pounds for an aggregate projected capacity of 11.8 bln pounds in North America. It's methanol plant at Channelview along with its other major debottleneck projects (including expansion at La Porte) are expected to bring in new capacity at considerably lower cost than building new facilities. LyondellBasell expects to start production from the La Porte ethylene expansion project in the third quarter.

LyondellBasell Industries NV is a manufacturing company. The company produces chemicals, fuels, and polymers used for packaging, clean fuels, durable textiles, medical applications, construction materials, and automotive parts. LyondellBasell Industries operates globally and is headquartered in the Netherlands. LyondellBasell is also a leading licensor of polypropylene and polyethylene technologies. The more than 250 polyolefin process licenses granted by LyondellBasell are twice that of any other polyolefin technology licensor.
MRC