Saudi Aramco, SABIC to develop crude oil to chemicals complex

MOSCOW (MRC) -- Saudi Aramco and SABIC have signed a memorandum of understanding (MoU) to develop a fully integrated crude oil to chemicals (COTC) complex in the Kingdom of Saudi Arabia, which governs the execution of the front-end engineering design (FEED) before a final investment decision is made, said Hydrocarbonprocessing.

The COTC complex is expected to process 400,000 bpd of crude oil, which will produce approximately 9 MMt of chemicals and base oils annually and is expected to start operations in 2025.

The COTC complex will be constructed based on an innovative configuration that achieves crude oil to chemicals conversion that is unprecedented in the industry.

This MoU follows the heads of agreement (HoA) signed in June 2016 between the two companies, which governed the feasibility study for the development of a fully integrated petrochemicals complex in the Kingdom. A Saudi team developed innovative COTC configurations derived from best-in-class refining and chemical technologies.

The complex is expected to create an estimated 30,000 direct and indirect jobs, further stimulating the Kingdom’s economic diversification. By 2030 the COTC complex is expected to have 1.5% impact on the Kingdom’s gross domestic product (GDP), with investments being shared equally by both companies.
MRC

MOSCOW (MRC) — Iraq is preparing to divert most future output from Kirkuk oilfield to local refineries as a conflict with Kurdish regional authorities over the use of an export pipeline to Turkey continues, said Reuters.

Kirkuk's production stopped in mid-October after Iraqi forces dislodged Kurdish fighters from Kirkuk and took over the northern region's oilfields. Diverting Kirkuk's crude to Dora, a refinery near Baghdad, and to another one in Baiji, north of the capital, would help free up more oil for exports from the southern region, the official told Reuters.

Some Kirkuk crude would also be shipped "in the near future" by trucks to Iran's Kermanshah refinery, at a rate of 30,000 bpd, the official said, declining to be identified. The takeover of Kirkuk, a mixed area which had been under Kurdish control since 2014, was part of retaliatory measures taken by the Iraqi government against a referendum for Kurdish independence held in September in northern Iraq.

Kirkuk lies just outside the official boundaries of the semi-autonomous Kurdistan Regional Government (KRG). Its fields used to supply about half the crude carried by a pipeline across the KRG territory to Ceyhan, a Turkish export terminal on the Mediterranean. The other half is supplied by fields located inside the KRG territory. Oil flows through the pipeline were reported last week at around 270,000 bpd. Before the crisis flows usually stood at about 600,000 bpd, roughly 17% of Iraq's total exports.

OPEC's second-largest producer after Saudi Arabia, Iraq exports most of its crude from the southern region. The Kurds have refused to hand over to the Iraqi authorities Khurmala, a reservoir which is part of the geological structure of the Kirkuk oil basin but geographically inside the KRG territory, the Iraqi oil official said.

The official said the government wanted Khurmala to be under control of state-run North Oil Company, like the rest of the Kirkuk reservoirs.
MRC

MOSCOW (MRC) -- Toyo Engineering Corporation (TOYO) was awarded a project to construct a naphtha cracking furnace of Tosoh Corporation for producing ethylene at its Yokkaichi Complex in October, said Hydrocarbonprocessing.

TOYO had participated in this construction project from an early stage. This naphtha cracking furnace employs advanced technology developed by CB&I Technology Inc. (Lummus Technology) with which TOYO maintains a mutually beneficial relationship for more than half a century. The cracking furnace is of the latest type with improved ethylene yield based on Lummus’ method, which is the first to be introduced in Japan.

Lummus’ technology has been adopted in approximately 40% of the world’s ethylene plants. TOYO has constructed 45 Lummus-based ethylene plants around the world and will continue to cooperate with Lummus to be engaged in more ethylene projects.

Our domestic subsidiary TEC Project Services Corporation (TPS) will take part in the construction work. TOYO and TPS will cooperate to promote our business in Japan.
MRC

MOSCOW (MRC) -- ExxonMobil Chemical Company has appointed authorized distributor BLS Syn Inc. to solely represent and market its Group IV and Group V synthetics base stock portfolio in Korea, as per Hydrocarbonprocessing.

The strategic relationship was formed based on BLS Syn Inc.’s technical expertise and strong knowledge of the local lubricants industry, combined with ExxonMobil’s broad portfolio and global supply reliability.

"We are excited to bring a new level of service and technical capabilities to customers in Korea developing innovative lubricants for some of the most complex and challenging industries in the world," said Michael Chuah, Asia Pacific sales manager, ExxonMobil Chemical Company. "As industry needs continue to evolve, we are confident that BLS Syn Inc.’s knowledge of sector-specific customer needs together with our leading synthetics products and services will enable customers to develop high performance lubrication solutions."

Headquartered in Seoul, BLS Syn Inc. has an established supply chain and logistics system including locally-based warehouses and drumming facilities. The company will be responsible for reliable delivery of Group IV and Group V synthetic base stocks and providing technical support to the local customer base.

"At BLS Syn Inc., providing exceptional customer service and ensuring supply reliability is an integral part of our operations," said Mr. Song Seong-Han, Chief Executive Officer, BLS Syn Inc. "We are thrilled to partner with ExxonMobil Chemical Company and combine the collective strengths of both companies to supply the Korean market with a wide-array of industry leading base stocks and application expertise."

ExxonMobil Chemical Company and BLS Syn Inc. have begun preparation for joint consultative services pertaining to Group IV and Group V synthetics products to Korean customers which will commence from 1st January 2018.

As MRC informed previously, in Decmeber 2016, Mitsubishi Heavy Industries, Ltd. (MHI) has received an order for supply of systems to support a large-scale polyethylene production train for ExxonMobil's Beaumont Polyethylene plant. The new production train is slated to be completed in 2019, and will produce 650,000 tons of polyethylene per year.

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) — ExxonMobil Corp Chief Executive Darren Woods is reorganizing the company's refining operations, part of a push to boost profits amid volatile oil and natural gas prices, said Reuters.

The changes at the world's largest publicly traded oil producer are the most sweeping to date by Woods, who became chief executive in January after former chief Rex Tillerson resigned to become US secretary of state.

Woods has moved first to reshape the parts of the businesses he knows best, according to sources familiar with the matter. Before taking the helm at Exxon, Woods ran Exxon's refining operations.

Exxon spokeswoman Charlotte Huffaker confirmed the downstream business overhaul in a statement, adding the company expects it will "improve decision making and enhance performance in the market." The parts of the business impacted were refining and marketing divisions, said spokesman Scott Silvestri.

Company sources told Reuters Exxon's chemical operation also has been restructured, but Silvestri denied this. It was not immediately clear if the changes will involve job cuts or executive departures. Exxon's Huffaker said she could not say if there would be any impact on jobs.

The reorganization aims to squeeze more profits from the downstream business as the company works to improve its exploration and production operations, which have struggled since 2014 to adjust to lower oil and gas prices.

The downstream restructuring, disclosed internally last month, will combine the fuels and lubricants division with the supply and refining divisions. Financial responsibility for the merged operation will rest with country and regional chiefs who report to Exxon's Irving, Texas, headquarters rather than divisional bosses as previously, according to people familiar with the matter.

The changes are designed to simplify operations and increase accountability for profitability, the sources said.
MRC