Saudi Arabia’s Petro Rabigh accumulated losses rise above 38% of share capital

Rabigh Refining and Petrochemical Co.’s (Petro Rabigh) accumulated losses amounted to SAR 6.41 billion, representing 38.34% of the company’s SAR 16.71 billion capital, according to the unaudited financial statements for December 2023, closed on Jan. 16, 2024, said Argaam.

Petro Rabigh explained that these losses were incurred as a result of challenging market conditions that had an adverse impact on margins for both refined and petrochemical products, as well as the planned turnaround of its Phase II units from Dec. 1, 2022, to Jan. 23, 2023, according to a statement to Tadawul.

The reasons also included the unplanned shutdown of the Ethane cracker unit during March 1-20, 2023, for necessary maintenance activities to enhance the plant’s reliability and the unplanned shut down of the High Olefins Fluid Catalytic Cracker (HOFCC) unit for necessary repairs and maintenance during Dec. 2023.

In addition, Petro Rabigh reported a one-off provision of SAR 365.7 million during the nine months period ended Sept. 30, 2023, relating to a claim raised by a third-party against the company.

The company also cited the significant increase in the financing costs because of rising interest rates among the reasons for losses.

Procedures related to Tadawul-listed companies, whose accumulated losses reach 20% or more of capital, will apply, the statement added.

We remind, Rabigh Refining and Petrochemical Co. (Petro Rabigh) reported a net loss of SAR 2.16 billion for H1 2023, against a net profit of SAR 2.10 billion in H1 2022 due to unfavorable market conditions, which weighed on the margins of petrochemicals and refined products, said the company. Moreover, Petro Rabigh’s complex was partially shut down for scheduled turnaround of Phase II units starting from Dec. 1, 2022, to Jan. 23, 2023. The ethane cracker unit was also shut down starting from March 1-20, 2023, for necessary maintenance to enhance the plant’s reliability.

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Brazilian state-run oil firm Petrobras, opens new tab said on Wednesday that it plans to finish expansion works on Train One of its Abreu e Lima refinery in the first quarter of 2025, nearly a decade after the expansion was halted due to a massive corruption scandal, said Hydrocarbonprocessing.

Work at the second train of the refinery, located in Pernambuco state, is scheduled to start in the second half of this year and conclude in 2028, said Marina Cavassin, executive manager of production development projects at Petrobras, during a press conference.

"We are talking about several units in a very complex system. We are going to have partial deliveries," she said. The first train will boost RNEST's capacity by 15,000 barrels per day, to 115,000 bpd. When the second train is concluded, RNEST's refining capacity will reach 260,000 bpd, said the general manager of RNEST, Marcio Maia.

RNEST currently represents around 6% of the state-run firm's refining capacity, said Maia. The investment at RNEST is part of a wider push by Petrobras to boost fuel production and lower the country's dependency on imports, said the firm's President Jean Paul Prates in a statement.

On Thursday, President Luiz Inacio Lula da Silva will visit the refinery alongside Prates. Last year Lula has pressed the head of Petrobras to boost investments and generate local jobs.

Expansion at RNEST was halted in 2015 during the massive "Car Wash" corruption probe that started investigating contracts at Petrobras in 2014 and eventually led to Lula's incarceration in 2018.

Last year, when Lula took over the presidency, Petrobras shifted from its divestment strategy, renegotiating the terms of a deal with antitrust watchdog CADE that would lead to the sale of eight of its refineries - about 50% of its capacity.

In November, Prates announced a business plan with $102 billion in investments by the company for the 2024-2028 period, in which the RNEST expansion was already accounted for.

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The world's leading biopolymer manufacturer Braskem S.A. and bioplastics specialist FKuR Kunststoff GmbH are expanding their distribution agreement to include further products from the I'm greenTM bio-based portfolio, said the company.

This development deepens the partnership between the two companies, which has existed since 2011. Effective immediately, FKuR will now also be the official distributor for I'm greenTM bio-based (EVA) ethylene vinyl acetate in the EU, Switzerland, Norway, UK, Turkey, Israel and India.

Braskem's I'm greenTM bio-based EVA is a family of bio-based EVA plastics that combine flexibility, lightness, and resistance. Main applications for this plastic made from renewable raw materials include footwear, toys, sporting goods, tatami mats and foams in general.

With its team, FKuR will not only act as a logistics partner for the countries covered but will also be a competent contact for the technology and development as well as providing application and marketing support. "With our 360° service, we offer our customers everything from a single source, from the initial discussion to the marketing of the final plastic product," emphasizes Patrick Zimmermann, member of the executive board at FKuR.

We are very pleased to expand the successful cooperation with Fkur to now also include I'm greenTM bio-based EVA and benefit from their great knowledge and network and support clients in Europe to reach their sustainability goals, emphasizes Marco Jansen, Braskem I'm greenTM bio-based EMEA Biopolymers and Europe Advocacy & Sustainability Director.

Just as with I'm greenTM bio-based polyethylene (PE), Braskem also uses sustainably sourced sugarcane-based ethanol to produce I'm greenTM bio-based EVA. During its growth, sugarcane binds CO2 from the atmosphere. By using this renewable raw material, greenhouse gas emissions can be successfully reduced. Depending on the grade, the biobased content is between 45% and 80%, based on the ASTM D6866 standard.

As a drop-in plastic, I'm greenTM bio-based EVA has the same processing properties as its fossil counterpart. It can therefore be processed by customers on existing equipment. Its recyclability also corresponds to that of fossil EVA, so that both products can be recycled and reused in established cycles.

We remind, on January 15th Braskem Netherlands B.V. ("Braskem") and Shell Chemicals Europe B.V. ("Shell") signed an agreement to produce circular polypropylene from mixed plastic waste.Withthis agreement, Shell will upgrade a variety of pyrolysis oils into virgin-quality circular feedstocks at the Shell Chemicals Park Moerdijk, Netherlands. Braskem will then convert this feedstock into circular polypropylene in its plant in Wesseling, Germany.

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Petro Rabigh announced the unplanned shutdown of the high olefins fluid catalytic cracker to conduct emergency maintenance work on the unit, said Petrochemical-news.

No other details were available.

We remind, Petro Rabigh and Gulf Cryo have started up a new state-of-the-art carbon capture facility at Petro Rabigh's monoethylene glycol (MEG) plant in Rabigh, Saudi Arabia. In 2022, the two companies signed a 20-year agreement to partner in the project, which captures 300 tonnes/d of carbon dioxide (CO2) from the MEG plant, representing an 85%/y reduction in its total CO2 emissions footprint. A portion of the captured and highly purified gas will be transformed into food-grade quality. It will be supplied via pipeline to Petro Rabigh for its internal process. The remaining CO2 will be provided in liquid form to industrial end-users.

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Shell Chemicals and Braskem will collaborate to increase the amount of circular content used in Braskem’s production of polypropylene as part of a wider value chain enhancement, said the company.

The circular polypropylene will be produced using a ISCC PLUS-certified feedstock, based on a mass balance approach and will be used by Braskem’s customers in a variety of applications such as in the packaging and automotive sectors.

Shell plans to upgrade, and process pyrolysis oil made from plastic waste, at its new upgrader plant at Shell’s Chemicals Park at Moerdijk, Netherlands, before delivery and further conversion at Braskem’s polypropylene plant in Wesseling, Germany. The upgrader, which is under construction, has a capacity to process up to 50,000 tonnes of pyrolysis oil a year and will remove many of the impurities found within pyrolysis oil to produce higher quality feedstock for chemicals production. This upgraded feedstock can be used to replace conventional virgin fossil feedstocks for the chemicals industry.

Danielle Ebentreich, Chief Marketing & Sustainability Officer at Shell Chemicals states “This agreement emphasizes our commitment to addressing challenging environmental issues, like plastic waste and hard-to-recycle plastics. By using our investments in innovative, sustainable projects at Shell’s strategically positioned Energy and Chemical Parks we are able to play a key role, together with our partners throughout the value chain, in unlocking sustainable solutions for our customers and society.”

“Adopting initiatives that include plastic waste recovery, and mechanical and chemical recycling in our production processes is connected to our company’s purpose to provide a more circular and sustainable future, on top of the leading position Braskem has in biopolymers globally. This agreement represents an important step to combine Shell’s technology and infrastructure with Braskem’s polymer expertise and market knowledge towards more sustainable and scalable solutions”, says Walmir Soller, VP of Olefins and Polyolefins at Braskem Europe & Asia.

We remind, Shell is set to conclude nearly a century of operations in Nigerian onshore oil and gas after agreeing to sell its subsidiary there to a consortium of five mostly local companies for up to $2.4 bn, said Hydrocarbonprocessing.
The British energy giant pioneered Nigeria's oil and gas business beginning in the 1930s. It has struggled for years with hundreds of onshore oil spills as a result of theft, sabotage and operational issues that led to costly repairs and high-profile lawsuits.

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