Qatar plans petrochemical shutdowns in Q1 2014

MOSCOW (MRC) -- Industries Qatar plans several lengthy shutdowns of its petrochemical and steel product plants in Q1-2014, as per Reuters.

Shutown of 200 days is being planned at the Qatari plants in the first three months of this year, compared to 59 days of closures in Q1-2013. The planned shutdown schedule published by IQ is as follows, with the comparative shutdowns for Q1-2013 in parenthesis:

Ethylene: 35 days (Q1, 2013: 0 days)
Low density polyethylene (LDPE): 34 days (Q1, 2013: 11 days)
Linear low density polyethylene (LLDPE): 11 days (Q1 2013: 0 days)
Methanol: 10 days (Q1 2013: 0 days)
Methyl tertiary-butyl ether (MTBE):8 days (Q1 2013: 0 days)
Ammonia: 40 days (Q1 2013: 1 day)

As MRC informed previously, Qatar Vinyl Company (QVC) is expected to shut its ethylene dichloride (EDC) and vinyl chloride monomer (VCM) plants for maintenance. Located at Mesaieed Industrial city in Qatar, the EDC and VCM plants have production capacities of 500,000 mt/year and 300,000 mt/year, respectively. Both the plants are likely to be taken off-stream for a maintenance turnaround in March 2014. The period of the shutdown could not be ascertained.
MRC

MOSCOW (MRC) - Export prices of Chinese polyethylene terephthalate (PET) for the CIS countries last week were reduced by USD15-30/tonne on the back of falling prices of paraxylene and PTA, according to ICIS-MRC Price Report.

Chinese producers had to reduce PET chips prices on the back of falling spot price for paraxylene (down USD40/tonne) and PTA (down by USD19-20/tonne). Last week price for PET in the Chinese port was in the range of USD1, 280-1,310/tonne FOB China. Converters in CIS countries also reported the reduction in Chinese PET; last week Chinese PET price dropped to USD1,320-1,350/tonne CFR Vostochny, excluding VAT.

However, price of Chinese PET in the port of Odessa was heard at USD1,370-1,390/tonne CIF Odessa, excluding VAT (shipping in the first half of February). Some converters reported price offer for PET at USD1,360/tonne CIF Odessa, excluding VAT.

It should be noted that during last year the export prices of PET in China and Korea fell more than by USD270/ tonne (down 17%). By the middle of January 2013 PET price in Asia were at USD1,586/tonne FOB, excluding VAT. Price offer for feedstock (paraxylene, PTA and MEG) also had been falling over the last year.

Some market players expect PET chips price to continue to fall in 2014on the back of capacities surplus in China. Sellers also reported a high level of competition amid low profitability, and some plants have already been working at a loss. A market player said that price does not depend on demand and supply any more, but on feedstock price. At the moment, the main driver is the feedstock price.


MRC

MOSCOW (MRC) -- India’s Reliance Industries is looking to acquire a stake in Venezuela’s Carabobo heavy oil field in a potential farm-in deal whereby it would take over the stake of Petronas, according to Upstreamonline.

The privately-owned energy giant, controlled by billionaire Mukesh Ambani, operates the world's biggest refining complex in western India and is hunting for cheaper, heavier crude to feed its refineries, which account for the lion’s share of its revenue.

Reliance signed a 15-year deal to buy up to 400,000 barrels per day of heavy oil from Venezuela’s state-run oil company PDVSA in 2012 and now is apparently looking to participate in the Petrocarabobo joint venture that operates the Carabobo-1 heavy oil project in the Orinoco belt.

The project plans to invest around USD20 billion over 25 years and involves building a 200,000 barrel-per-day upgrader to convert heavy crude into light crude oil.

Malaysia's Petronas said in September it is exiting the Petrocarabobo venture after what sources said were disagreements with Venezuelan authorities and PDVSA.

PDVSA has a 60% stake in the venture while Repsol, Petronas and Indian state-owned Oil & Natural Gas Corporation each own 11%, with Oil India and India Oil Corporation holding 3.5% apiece.

Reliance is also examining a possible entry into the Ayacucho-8 block in a joint venture with PDVSA, Bam said.

Reliance is also looking at exploration opportunities in Mexico after recent regulatory changes there but has so far not committed any investments in that country, he said. Reliance currently buys 60,000 bpd of oil from Mexico.

As MRC reported earlier, Reliance Industries plans to expand capacity at its refineries in the western state of Gujarat. In 2012, the company unveiled an USD18 billion investment plan for India over the next five years.

Reliance Industries is one of the world"s largest producers of polymers. The company's polymer production in 2010-11 (polypropylene, polyethylene and polyvinyl chloride) made 4,094 kilo tonnes.
MRC

MOSCOW (MRC) - Saudi Basic Industries Corp (SABIC), one of the world's largest petrochemical groups and the Gulf's biggest listed firm, reported a 5.7% rise in fourth-quarter net income, missing analysts' forecasts, said Reuters.

The company's results are closely tied to global economic growth because its products - plastics, fertilisers and metals - are used extensively in construction, agriculture, industry and the manufacture of consumer goods.

It earned 6.16 billion riyals (USD1.64 billion) in the quarter, up from a slightly revised figure of 5.83 billion riyals a year earlier. Seven analysts polled by Reuters had forecast, on average, that SABIC would record a net profit for the quarter of 6.58 billion riyals.

Operating profit rose much more slowly than net profit in the fourth quarter, edging up just 0.5% to 10.30 billion riyals.

U.S. production of shale gas has emerged as a major challenge for SABIC, threatening to make its American rivals more competitive, but Chief Executive Mohamed al-Mady said shale output would not become heavy before 2016, so the market would remain firm in 2014 and 2015.

He later told Reuters that Europe appeared to be recovering from its long economic slump so the petrochemical market there was improving, and he expected further strength.

Asked about SABIC's approach to acquisitions, Mady said it was opportunistic, but he stressed that the company was very interested in investing in the United States and China.

For the whole of 2013, net profit climbed 1.8% to 25.23 billion riyals, while company officials said sales were roughly flat at about 189 billion riyals.

As MRC wrote before, SABIC opened a new engineering thermoplastics compounding facility and a polypropylene compounding plant at its manufacturing facility in Jubail, Saudi Arabia. The products to be manufactured at the new facilities are aimed for the consumer electronics, healthcare, transportation, building and construction industries.
MRC

MOSCOW (MRC) -- Royal Dutch Shell said profit plunged because of deteriorating refining markets and mounting losses in the Americas, surprising investors with an early earnings report that wiped out USD10 billion in shareholder value, as per Hydrocarbonprocessing.

Europe’s biggest oil company, in its first profit warning since 2004, said adjusted earnings excluding one-time items and inventory changes were about USD2.9 billion in the fourth quarter. That compares with USD4.5 billion in the previous three months and an average fourth-quarter analyst estimate of USD4.9 billion.

CEO Ben van Beurden, who took over from Peter Voser at the start of the year, is facing rising costs for new projects and stagnant oil prices. Higher exploration expenses and maintenance shutdowns have cut output volumes, while a weaker refining market and disruptions in Nigeria have also pushed down profit and limited share growth.

"Our 2013 performance was not what I expect from Shell," van Beurden said Friday. "Our focus will be on improving Shell’s financial results, achieving better capital efficiency and on continuing to strengthen our operational performance and project delivery."

As MRC wrote previously, Royal Dutch Shell third quarter 2013 earnings were USD4.2 billion compared with USD6.2 billion in the same quarter a year ago.

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