IOC plans Rs 45,000 cr investment in petrochemicals plants and LNG terminal

MOSCOW (MRC) -- Indian Oil Corporation, is set to spend about Rs 45,000 crore over three years to build petrochemicals plants and LNG terminal, lay pipelines and upgrade its refineries, said Indiatimes.

The state-run firm is also likely to benefit from a rise in crude oil prices since January without much price fluctuations.
AK Sharma, director ( finance) said, "We want to expand the petrochemicals business fast. The company entered the petrochemicals business just a few years ago but the performance so far has made the company confident of pursuing this segment "aggressively."

Inventory loss — a result of sharp fall in prices between June 2014 and January 2015, when refiners were forced to sell products at less than their cost — destroyed profits at most refiners in the quarter to December. A large inventory loss mainly contributed to IOC's losses during the three-month period. Lower crude oil price, coupled with deregulation of fuel at home, has also slashed the company's working capital requirement, reducing the need to borrow.

The future units will manufacture products that offer large-scale opportunity and are able to substitute imports, he said. The corporation sold 2.12 million tonnes of petrochemicals in domestic and overseas markets in 2013-14. The attraction for petrochemicals is mainly due to its disproportionate impact on profits compared to its revenue, Sharma said, adding that the petrochemicals business added Rs 1,000 crore to the company's profits in the first nine months of 2014-15 while the revenue was about Rs 12,000-14,000 crore. Another growth area the company is focusing on is gas. "Gas is the fuel for future. It will replace some of our liquid fuel demand," Sharma said.

As MRC informed earlier, Indian Oil Corp restarted a high density polyethylene/linear low density polyethylene (HDPE/LLDPE) swing plant. The plant restarted this week. It was shut a week earlier for maintenance turnaround. Located at Haryana in the northern Indian state of Haryana, the plant has a production capacity of 300,000 mt/year.

Indian Oil Corporation Limited, or IndianOil, is an Indian state-owned oil and gas corporation with its headquarters in New Delhi, India.
MRC

MOSOCW (MRC) - Royal Dutch Shell (RDSa.L) agreed to buy smaller rival BG Group (BG.L) for 47 bn pounds (USD70 billion) in the first major energy industry merger in more than a decade, closing the gap on market leader U.S. Exxon Mobil after a plunge in prices, said Reuters.

Anglo-Dutch Shell will pay a mix of cash and shares that values each BG share at around 1,350 pence, the companies said. This is a hefty premium of around 52 percent to the 90-day trading average for BG, setting the bar high for any potential counter-bid by a company such as Exxon, which has said it would also use the downturn in oil markets to expand.

The third-biggest oil and gas deal ever by enterprise value will bring Shell assets in Brazil, East Africa, Australia, Kazakhstan and Egypt. BG has some of the world's most ambitious projects in liquefied natural gas (LNG), where demand is growing as consumers turn away from more polluting fuels such as coal.

Shell is already the world's leading LNG company and it would get BG's capacity in LNG logistics - complex infrastructure that includes terminals, pipelines, specialized tankers, rigs, super coolers, regasification facilities and storage points.

As MRC informed earlier, Royal Dutch Shell has completed a revamp and upgrade of its Singapore ethane cracker. The project increased production for the 800,000-tpy ethylene plant on Bukom Island by 20%. The ethylene and olefins unit is also integrated with Shell’s 500,000-bpd refinery.

Britain's BG had a market capitalization of USD46 billion at Tuesday's close, Shell was worth USD202 billion and Exxon, the world's largest energy company by market value, was worth USD360 billion.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.
MRC

MOSCOW (MRC) -- Kuraray has acquired Australia's Plantic Technologies. With this, Kuraray expands into bio-based barrier materials, which meet the increasing global demand of bio-based food packaging materials, said the producer in its press release.

Kuraray was the first to commercialise the high-performance barrier resin, EVAL (ethylene vinyl alcohol copolymer), which it launched in 1972. EVAL boasts the highest level of gas barrier properties of all plastics and is the market leading barrier resin used in food packaging and industrial barrier applications. In addition, Kuraray has developed and launched Kurarister a transparent barrier film for retort applications.

The acquisition of Plantic enables Kuraray to provide barrier materials which meet the increasing global demand of bio-based food packaging materials. This is in line with Kuraray’s corporate mission.

Plantic film is used in a broad range of products in the barrier packaging sector and is supplying major supermarkets and brand owners on three continents (Australia, North America and Europe) in applications such as fresh case ready beef, pork, lamb and veal, smoked and processed meats, chicken, and fresh seafood and pasta applications.

Kuraray expects that its global sales network will assist to develop the bio-based barrier business in Europe, USA and Asia, responding to the global demand of improved freshness, reduced food loss and waste with the use of environmentally friendly material, Plantic film.

Kuraray produces specialty chemicals, fibres and other materials, including functional resins and films, synthetic isoprene chemical products, synthetic leather, vinylon fibre and polyester fibre.
MRC

MOSCOW (MRC) -- Celanese Corporation, a global technology and specialty materials company, has announced it has completed the conversion of its Narrows, Va., operation to natural gas-fired boilers, as per the company's press release.

Celanese invested USD150 million to replace its coal-fired boilers with natural gas to generate the steam needed to run the plant's electrical generators and processes.

"The completion of this project is a concrete example of our commitment to carrying out two important Celanese core values - Being Sustainable and Improving the World," said Jon Mortimer, vice president of Manufacturing & Capital Projects, Celanese. "This is a milestone in Celanese's continued growth and an opportunity for us to do our part to create a cleaner environment for the communities where we operate."

"Celanese's investment in its Narrows, Virginia, plant speaks volumes to the commitment the company has made to improve the well-being of the people of Giles County," said Congressman Morgan Griffith (R-VA). "This project has impacted the State of Virginia and its residents in many positive ways, particularly by creating new job opportunities."

The Celanese Narrows plant has been in operation for 75 years. Celanese's boiler equipment conversion project provided more than 300 jobs in Giles County during the duration of the project as well as the continued support of more than 1,000 existing jobs. The plant is one of the world's largest producers of cellulose acetate tow, a natural and environmentally friendly product that is used for filtration applications.

As MRC reported earlier, in May 2014, Celanese Corporation announced its intent to construct a EVA emulsions production unit in Southeast Asia. The unit is expected to begin production by mid-2016.

Celanese Corporation is a global technology leader in the production of differentiated chemistry solutions and specialty materials used in most major industries and consumer applications. Based in Dallas, Texas, Celanese employs approximately 7,500 employees worldwide and had 2014 net sales of USD6.8 billion.
MRC

MOSCOW (MRC) -- Huntsman Corporation has announced that it has completed its previously announced EUR300 million offering of 4.25% Senior Notes due 2025 through its wholly owned subsidiary, Huntsman International LLC, as per the company's press release.

Huntsman intends to use the net proceeds from the offering to redeem a portion of its 8.625% Senior Subordinated Notes due 2021 and pay associated accrued interest. In connection with this transaction, Huntsman expects to incur charges of approximately USD21 million related to the early extinguishment of debt in the second quarter of 2015.

Kimo Esplin, Executive Vice President and CFO, stated, "We continue to lower the cost of borrowing with the issuance of these Euro notes. Our annual interest expense will decrease by approximately USD11 million. In addition, denominating more of our debt in Euro currency will reduce our net long Euro cash flow position."

As MRC wrote previously, in October 2014, Huntsman commenced preliminary engineering to expand production of methylene diphenyl diisocyanate (MDI) by investment in a new, world-scale MDI plant at its complex in Geismar, Louisiana, US. The 400,000-tpy expansion will leverage the significant advantages of the Geismar site, with its access to US shale gas, strong logistics base and excellent integration. The new capacity is expected to come on-stream in 2018 and will enable Huntsman to further support the global growth of its customers.

Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated chemicals with 2014 revenues of approximately USD13 billion including the acquisition of Rockwood’s performance additives and titanium dioxide businesses. The company's chemical products number in the thousands and are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets. Huntsman operates more than 100 manufacturing and R&D facilities in more than 30 countries and employ approximately 16,000 associates within the company's 5 distinct business divisions.
MRC