Total may close French refinery unit

MOSCOW (MRC) -- Total SA (FP) Chief Executive Officer Christophe de Margerie raised the possibility that the country’s biggest oil company is planning an overhaul amid speculation over the future of its petrochemicals operations, according to Bloomberg.

An employee meeting has been called for Sept. 4 to discuss Total’s petrochemicals strategy as well as a future project for its Carling plant in northern France, de Margerie said. He told a panel discussion the company may restructure its French operations.

He declined to comment further on Carling, citing French law under which changes that may affect jobs must first be given to workers at meetings like the one planned for next week.

"Total could announce a plan to halt the steam cracker" at Carling, Eric Sellini, the CGT union coordinator at the French oil company, said by telephone. "I don’t think the whole site will be shut but we just don’t know."

Total, which gets most of its earnings from oil and natural gas production, has struggled to boost profits at its refining and petrochemicals divisions in recent years. The explorer unveiled an overhaul in 2011 to merge crude processing and petrochemicals and separate out fuel marketing.

"Total, like others, will have to carry out" a restructuring in France, de Margerie said during a panel discussion at a meeting of the employers’ group known as Medef.

Europe’s third-largest oil company has already reduced European refining through the closing of its plant near Dunkirk in France, capacity reduction at Normandy and the sale of its 49 percent stake in Spain’s Cia. Espanola de Petroleos SA. Total has also tried and failed to sell its Lindsey plant in the U.K.

The Carling plant, which makes petrochemicals such as ethylene and propylene at the site near the German border, employs 350 Total workers as well as sub-contractors, Sellini said. These chemicals are used to make plastics.

Total has four steam crackers in France, including units at the Gonfreville, Feyzin and Lavera refineries. The company cut jobs at Carling in a plan announced in 2009.

As MRC reported earlier, Total has signed a final agreement to sell TIGF, a regional gas pipeline network, to a group comprising Italy's Snam, Singaporean sovereign fund GIC, and French state-controlled power utility Electricite de France. TIGF was put up for sale last autumn as part of a wider strategy to sell EUR20 billion of assets by 2015 to help boost its cash flow and finance substantial investments.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
MRC

MOSCOW (MRC) -- Imports of polyethylene (PE) and polypropylene (PP) to Kazakhstan grew by 16% in July from June. High density polyethylene (HDPE) accounted for the main increase in imports, said MRC analysts.

Kazakh companies increased their imports of polyolefins (PE and PP) to 14,900 tonnes in July from 12,800 tonnes in June. Expectedly, HDPE imports rose significantly, whereas imports of other PE and PP grades, on the contrary, fell down.

HDPE imports to Kazakhstan rose to 11,600 tonnes in July, an increase of 35% from June. Such a significant growth in HDPE supplies was caused by seasonal strong demand for plastic pipes in the country. Pipe polyethylene accounted for about 80% of total HDPE imports. The overall HDPE imports to Kazakhstan totalled 59,600 tonnes in the first seven months of 2013.

Low density polyethylene (LDPE) imports dropped to 1,300 tonnes in July from 1,900 tonnes in the previous month. Shrinkable film PE accounted for the main decrease in imports. The overall LDPE imports to Kazakhstan totalled about 8,800 tonnes in January-July 2013.

Linear low density polyethylene (LLDPE) imports to Kazakhstan fell by 8% last month from the previous month. The overall LLDPE imports exceeded 2,300 tonnes in January-July 2013.

July PP imports dropped to 1,800 tonnes from 2,100 tonnes in June. Reduced imports were caused by weaker demand for PP from producers of polypropylene bags. The total PP imports to Kazakhstan amounted to about 7,800 tonnes over seven months of 2013.
MRC

MOSCOW (MRC) -- Ufaorgsintez, one of the largest Russian companies producing organic synthesis products and polymers, has announced an increase in contract prices of low density polyethylene (LDPE) and homopolymer of propylene (homopolymer PP) from 2 September by Rb500-2,000/tonne, according to ICIS-MRC Price report.

LDPE grades - 10803-020 and 15803-020 - rose by Rb500/tonne from mid-August. Homopolymer PP grades - Balen 01030 and Balen 01270 - grew by Rb500/tonne. Block comolymers of propylene increased by Rb2,000/tonne.

Ufaorgsintez OAO manufactures organic synthesis products in Russia and Europe. Its products include ethylene, propylene, ethanol, cumol, ethyl benzol, phenol, acetone, copolymer rubber, polyolefines, poly vinyl chloride and polyethylene items, thinners, and dilutants. The company exports its products to Byelorussia, Kazakhstan, Finland, Germany, France, and Brazil. Ufaorgsintez OAO was founded in 1956 and is based in Ufa, Russia. As of January 22, 2010, Ufaorgsintez OAO operates as a subsidiary of Bashneft Joint Stock Oil Company.
MRC

MOSCOW (MRC) -- The Russian polyvinyl chloride (PVC) producers intend to achieve higher contract prices in September by Rb500-1,600/tonne, according to ICIS-MRC Price report.

Negotiations on Russian PVC contract prices for September began this week. Russian producers have announced the necessity to raise contract prices from August. Prices need to be increased because of both tight supply (scheduled outages for maintenance and reduction in imports) and higher prices of imported resin.

The devaluation of the ruble against the dollar has led to a major rise in imported PVC prices, making many Russian companies refuse from purchasing resin in foreign markets, including the United States.

SayanskKhimplast shut down its PVC production for a month of maintenance works in August. In September, Bashkir Soda Company stopped its production (from 11 September for 8 days) and Volgograd Kaustik shut down its operations (from 26 September to three weeks).

However, local converters are going to keep August prices of Russian PVC for September shipments. Many companies said demand for finished products from PVC, particularly for profile-moulding prouducts, fell by 10.5% in the first seven months of 2013. There has been a strong competition in the market of finished goods, and any price increase in feedstock force converters to reduce their margins.
MRC

MOSCOW (MRC) -- Imports of polyethylene (PE) and polypropylene (PP) to Belarus in the first half of 2013 increased by 6% year on year. High density polyethylene (HDPE) accounted for the main growth in imports, according MRC Price report.

The overall PE and PP imports to Belarus totalled about 93,000 tonnes in the first half of 2013, while during the same period of 2012, this index did not exceed 87,500 tonnes. The dependence of the local market from HDPE imports increased, whereas imports of other PE and PP grades, on the contrary, fell down.

HDPE imports reached 31,500 tonnes in January-June, up by 39 % year on year. Russian producers accounted for about half of the overall HDPE imports (this year, imports from Russia increased by three times).

The total low density polyethylene (LDPE) and linear low density polyethylene (LLDPE) in the first half of 2013 dropped to 22,500 tonnes from 25,200 tonnes in 2012. In this segment, Saudi Arabian polyethylene accounted for about 56% of the total imports this year.

Import of homopolymer of propylene (homopolymer PP) reached 29,100 tonnes in January-June, while in the first half of 2012 it was 28,900 tonnes. Russian homopolymer PP accounted for about 51% of the overall imports.

Imports of copolymers of propylene decreased by 7.5% this year and did not exceed 9,900 tonnes. German producers occupy the leading position in the procurement of copolymers of propylene to Belarus (about 73% of total supplies).
MRC