BP to cut Houston jobs, reduce US Gulf business

MOSCOW (MRC) -- British oil giant BP is laying off employees in Houston, Texas, to cope with falling oil prices, but the company declined to say how many jobs will be cut, reported Hydrocarbonprocessing.

The firm expects all of its organizational changes to be completed by the end of the first quarter, with more layoff announcements to come in the next few weeks. In late June 2014, BP had 7,200 employees in Houston when oil prices were higher.

Headcount reductions in its Gulf business have come the same day BP announced it sold around half of its equity stake in two major Gulf oil fields to Chevron. Earlier this week, BP told employees it would freeze pay across the company this year.

"The current price environment has caused operators to look at their cost structure and undertake efforts to drive efficiencies," BP spokesman Brett Clanton said.

As MRC reported earlier, BP had divested more than USd43 billion in assets in recent years to slim down after it incurred USD42 billion in liabilities related to the 2010 Gulf of Mexico oil spill.

Late last year, BP said it would incur restructuring charges of USD1 billion in the fourth quarter of 2014 through the end of 2015. The restructuring charges will stem largely from severance packages after the company makes thousands of layoffs around the world.

BP is one of the world's leading international oil and gas companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemicals products for everyday items. BP Zhuhai is in plans to start a new purified terephthalic acid (PTA) plant in China. The exact start-up schedule of the plant could not be ascertained. To be located in Zhuhai province, China, the plant will have a production capacity of 1.25 million mt/year.

Dow launches new resin for PE-RT pipe

MOSCOW (MRC) -- Dow has launched HYPERTHERM 2399 Resin for domestic and commercial hot and cold water plumbing pipes, said the producer on its site.

The new resin enhances the flexibility of plastic pipe so installers can bend water lines at turning joints allowing for ease of installation.

"Turning joints have always been a challenge when installing copper, steel and rigid plastic pipe," says Oray Talu, market manager for Dow pipe and irrigation products. "These are typically the first points of failure and a major contributor to call-backs. Pipes made with HYPERTHERM 2399 Resin eliminates the need for breaks at joints, thus reducing the likelihood of leaks and contributing to greater peace of mind."

HYPERTHERM 2399 Resin is the first product to meet US building codes and product standards for plumbing while also achieving Level 5 chlorine-resistance certification. This key accreditation gives contractors and homebuilders the flexibility to install continuous loop, on-demand recirculation, and traditional plumbing systems. HYPERTHERM 2399 Resin provides excellent taste and odor characteristics for great tasting water. Pipes made with HYPERTHERM Resins are natural insulators and help improve the energy efficiency of hot water heating.

As MRC informed previously, in November 2014, Dow Chemical announced an increased divestiture target aligned to further enhance the value of its portfolio and support the company’s market-driven, integrated strategy. On track to complete its goal of realizing USD4.5 billion to USD6 billion in proceeds by year-end 2015, and with additional portfolio management actions underway, Dow is now increasing its divestiture target to USD7 billion to USD8.5 billion to be complete by mid-2016. Since 2013, the company has generated USD2.5 billion in proceeds, reallocating this capital to remunerate shareholders, fund growth and reduce debt.

The Dow Chemical Company is an American multinational chemical corporation. As of 2007, it is the second-largest chemical manufacturer in the world by revenue (after BASF) and as of February 2009, the third-largest chemical company in the world by market capitalization (after BASF and DuPont). Dow is a large producer of plastics, including polystyrene, polyurethane, polyethylene, polypropylene, and synthetic rubber.

PP imports to Kazakhstan rose by 32% and exports - by 25%

MOSCOW (MRC) -- Imports of polypropylene (PP) into Kazakhstan increased by 32% in 2014 and totalled 20,400 tonnes, whereas PP exports rose by a quarter to 22,200 tonnes, reported MRC analysts.

December PP imports ro Kazakhstan fell to 1,500 tonnes under the pressure of seasonal factors from 2,700 tonnes a month earlier. The overall imports of propylene polymers to the local market rose to 20,400 tonnes last year, whereas this figure was 15,500 tonnes a year ealier.

December imports of propylene homopolymer (homopolymer PP) totalled 1,300 tonnes versus 2,300 tonnes in November on the back of weaker demand from local producers of polypropylene bags. Last year's imports of homopolymer PP to Kazakhstan increased to 15,800 tonnes versus 10,400 tonnes a year earlier.

Last month's imports of propylene copolymer dropped to 250 tonnes from 400 tonnes in November. The overall imports of propylene copolymers were 4,600 tonnes over the stated period versus 5,100 tonnes a year earlier.

November PP exports from Kazakhstan fell to 715 tonnes because of the start-up of the granulation unit, but in December the local manufacturer increased export sales to 2,600 tonnes. Overall, 22,200 tonnes of homopolymer PP were exported to foreign markets in 2014, up by 25% year on year.

Chevron Q4 net income down 30%

MOSCOW (MRC) -- U.S. energy giant Chevron Corp. reported better-than-expected fourth quarter earnings on improved downstream results that saw refining margins climb on lower input costs. Earnings per share came in at USD1.85, well above the Zacks Consensus Estimate of USD1.67, said the company in its press release.

Chevron’s performance deteriorated from the year-ago profit of USD2.57 per share amid a plunge in oil prices. The company’s quarterly revenue moved down 17.9% year over year to USD46,088 million. However, it was enough to beat the Zacks Consensus Estimate of USD33,277 million.

Apart from the operational performance, Chevron also offered a glimpse of its 2015 capital spending plans. The company has pegged its capital budget at USD35 billion, down 13% from the USD40 billion it invested in 2014.

Chevron’s total production of crude oil and natural gas remained essentially unchanged from the year-earlier level at 2,582 thousand oil-equivalent barrels per day (MBOE/d). Though the U.S. output augmented 3.5% year over year, the company’s international operations (accounting for 74% of the total) registered a 0.9% fall in volumes.

Chevron’s downstream segment achieved earnings of USD1,518 million, considerably higher than the profit of USD390 million last year. The results were buoyed by higher refinery margins on the back of lower feedstock costs.

The second-largest U.S. oil company by market value after Exxon Mobil spent USD11,290 million in capital expenditures during the quarter. Approximately 91% of the total outlays pertained to upstream projects. As of Dec 31, 2014, the San Ramon, CA-based company had USD12,785 million in cash and total debt of USD27,818 million, with a debt-to-total capitalization ratio of about 15.2%. As part of the stock repurchase program, Chevron bought back USD1,250 million worth of shares in the fourth quarter.

Chevron currently carries a Zacks Rank N5 (Strong Sell), implying that it is expected to significantly underperform the broader U.S. equity market over the next one to three months.

The company also said its 50% stake at chemical firm Chevron Phillips Chemical Company had achieved start-up of what Chevron called the world’s largest on-purpose 1-hexene plant, as well as progressed construction of the company’s new ethane cracker and polyethylene units in Texas.

Chevron Phillips Chemica, headquartered in The Woodlands, Texas (north of Houston), US,l is one of the world’s top producers of olefins and polyolefins and a leading supplier of aromatics, alpha olefins, styrenics, specialty chemicals, piping, and proprietary plastics. Chevron and Phillips 66 each own 50% of Chevron Phillips Chemical.

DuPont cuts bonuses, delays raises as profit slows

MOSCOW (MRC) -- DuPont Co., the chemical maker fighting Trian Fund Management’s slate of dissident directors, is cutting employee compensation as it struggles with earnings growth below the company’s long-term target, as per Hydrocarbonprocessing.

Chairman and CEO Ellen Kullman told employees this week that 2014 bonuses will be reduced and salary increases for 2015 won’t take effect until July 1, according to an internal memo distributed Tuesday, a copy of which was obtained by Bloomberg News.

"We set our targets and objectives, and our compensation is tied to the achievement of those targets," Kullman said in the memo. "It is important to recognize that in 2014, we did not meet all of our targets." Kullman, whose long-term goal is to increase annual earnings per share by 12%, posted a 3% increase for 2014 and forecast a 5% rise this year. She said she’ll cut USD1.3 billion in costs by the end of 2017, expanding and accelerating an earlier program.

The delay in merit raises is intended to "maintain our strong position" amid uncertain macroeconomic conditions, challenging agriculture markets and a stronger US dollar relative to other currencies, Kullman said in the memo.

Union members aren’t affected by the compensation cuts, said Jim Briggs, a United Steel Workers representative for DuPont employees at plants in Buffalo and Niagara Falls, New York.

Trian, co-founded by Nelson Peltz, says the company can cut as much as USD4 billion in costs. The New York-based investor is seeking four board seats and argues the 212-year-old company would be better managed if it were broken up.

While DuPont already plans this year to spin off the performance chemicals business, renamed Chemours, Trian advocates the rest of the company be split in two. One part would include the faster-growing agriculture and nutrition units and another would encompass more cyclical businesses.

Kullman is cutting costs as she repurchases more of the company’s stock to improve per-share earnings. A dividend of about USD4 billion from the anticipated spinoff of Chemours, will be used to buyback DuPont shares, the company said Tuesday. The buybacks would be in addition to a USD5 billion repurchase program announced a year ago.

Trian held a 2.7% stake in DuPont at the end of last year. DuPont shareholders will vote to select the board at the company’s annual meeting in April.

DuPont shareholders will vote to select the board at the company’s annual meeting in April.
DuPont is an American chemical company that was founded in July, 1802. The company manufactures a wide range of chemical products, leading extensive innovative research in this field. The company is the inventor of many unique plastics and other materials, including neoprene, nylon, Teflon, Kevlar, Mylar, Tyvek, etc. DuPont was the developer and main producer of Freon used in the production of refrigeration equipment.