Petrobras CEO says it will take five years to rebuild company

MOSCOW (MRC) -- The chief executive of Brazil's Petroleo Brasileiro SA estimates it will take five years for the state-run oil producer to win back the credibility it lost among investors after a massive corruption scandal sent some of its top executives to jail, said Reuters.

Aldemir Bendine told daily O Estado de S.Paulo that the corruption scandal will weigh on Petrobras as long as investigations continue but that he will keep pushing for management and financial changes in the company.

"I wouldn't be here if I didn't believe in this project," he said in an interview published on the paper's website on Saturday. "It is a five-year project."

Petrobras last week reported a 89% plunge in its second-quarter net income as it took a one-time charge for underperforming projects before a planned sale of up to USD15.1 billion in assets by the end of 2016.

Bendine said he was negotiating partnerships to help Petrobras conclude some of its investments, including its USD15 billion Comperj refinery outside Rio de Janeiro.

"We already have four investors interested (in Comperj), including a Chinese investor," he said without giving names. "The (partnership) value is 3-4 billion reais (USD0.9-1.1 billion) but if they want to invest more I won't be upset."

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
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Petrobras net profit falls nearly 90% in Q2

MOSCOW (MRC) -- Brazil`s state-run oil giant Petrobras, rocked by a massive graft scandal, said that second quarter net income fell nearly 90% from a year ago, in part due to plummeting crude prices, said Thecapitalpost.

The company attributed the sharp drop in net income -- a figure that was far lower than analysts had expected -- to an increase in tax expenses. Petrobras also said it suffered from a 1.3 billion reais deterioration in the value of its assets after slashing its multi-year investment plan.

The company reported net income of 531 million reais (USD150 million) in the second quarter, compared to 4.96 billion reais in the same period last year. In the first quarter, Petrobras clocked net income of 5.330 billion reais.

Share value has plummeted as the company battles a mountain of debt and struggles to meet production goals in the wake of the corruption scandal. Prosecutors estimate that some USD2.1 billion in bribes was moved as part of the scheme, and several top politicians have been implicated.

Investigators allege that top Petrobras executives colluded with construction companies to inflate contracts and to bribe politicians. Numerous government officials have been arrested in the probe, with police detaining a top aide to former president Luiz Inacio Lula Da Silva.

The former treasurer of the ruling Workers` Party was arrested in April on charges that he funnelled bribes skimmed from the top of fake Petrobras contracts. Prosecutors have also announced charges against Marcelo Odebrecht, chairman of Brazil`s biggest construction firm, Odebrecht.

As MRC informed earlier, the chief executive of Brazil's Petroleo Brasileiro SA estimates it will take five years for the state-run oil producer to win back the credibility it lost among investors after a massive corruption scandal sent some of its top executives to jail.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

Sasol mitigates low oil as fuels, chemicals improve

MOSCOW (MRC) -- Sasol, the world’s biggest producer of liquid fuels from coal, said full-year profit fell as much as 19%, less than analysts estimated, after oil prices declined, said Hydrocarbonprocessing.

The stock rose the most in more than three months. Earnings per share excluding one-time items probably declined by as much as 11.43 rand (90 US cents) in the year to June 30, the Johannesburg-based company said in a statement Friday. That equates to as little as 48.73 rand, which exceeds average estimate of 42.67 rand by 15 analysts polled by Bloomberg.

"Sasol’s profitability was negatively impacted by a 33% lower average Brent crude oil price," it said. Dated Brent traded at an average of USD73.46/bbl from USD109 in 2014, the producer said. Sasol is conserving costs after oil prices declined. The company, whose revenue is linked to the dollar price of oil, delayed plans to build a US gas-to-liquids plant, the nation’s first, that would have cost as much as USD14 billion, it said on Jan. 28.

Sasol shares climbed as much as 4.2% to 439 rand and traded 3.3% higher at 435.19 rand at 9:09 a.m. in Johannesburg, giving the producer a market value of 282.7 billion rand.

The company in March said it would conserve as much as USD4.2 billion in cash in addition to a program that entails cost savings of at least 4.3 billion rand annually from July 2017. The producer exceeded its cost-savings target for the 2015 financial year and said implementation costs remain within forecasts.

Sasol increased liquid fuel sales volumes by 5% to a record 61.5 MMbbl, while base chemicals climbed 2% and performance chemicals increased 3%, it said.

Sasol will take a further 1.3 billion rand partial impairment of a share in the Montney shale-gas assets in Canada due to poor conditions in the North American gas market, it said. It wrote off 5.3 billion rand on the asset last year.

As MRC informed before, in June 2014, Sasol Chemicals North America and INEOS Olefins & Polymers announced that they had reached final investment decision to form a 50/50 joint venture to build an HDPE plant in La Porte, Texas. The ethylene required for the production of the HDPE will be supplied by Sasol and INEOS in proportion to their respective ownership positions.

Sasol Limited is an integrated energy and chemical company based in Johannesburg, South Africa. It develops and commercialises technologies, including synthetic fuels technologies, and produces different liquid fuels, chemicals and electricity.

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Romania indicts Lukoil for money-laundering

MOSCOW (MRC) -- Romanian prosecutors said on Monday they have indicted Russia's Petrotel Lukoil refinery in Romania, its Russian director-general and three other officials for money-laundering in a EUR2 billion (USD2.19 billion) criminal probe, said Reuters.

Prosecutors have already seized Lukoil assets worth EUR2 billion as part of their investigation into suspected money-laundering at the refinery, in the southern Romanian city of Ploiesti.

Russia's second-largest oil producer, Lukoil has denied the accusations and said it would appeal against the asset seizure. It also called last month for the European Commission to help it fight the charges. When contacted by Reuters about the indictments, a spokesman declined to give any new comment. No one was available for comment at the refinery.

Prosecutors from the Ploiesti court of appeals indicted the director-general of the refinery, as well as two deputy managers and also a Netherlands-registered holding company.

No trial date has been set as of now. Prosecutors said the Romanian secret service, known as SRI, assisted them in their investigation.

"Throughout 2011-2014, the indicted ... have used the company's assets in bad faith and the credit it enjoys, for a purpose contrary to its interests, to favour other companies in which they had a direct or indirect interest to strike crude oil purchasing contracts," the statement said.

The officials were indicted for "sealing supply deals for finished goods in disadvantageous price terms which produced losses as delivery prices were set below production costs."

In October of last year police and customs inspectors raided the offices of Lukoil near Ploiesti in an investigation into alleged tax evasion and money laundering concerning an estimated 230 million euros at the time.

Lukoil , a Russian-based company, is one of the global leaders in the production and refining of crude oil and gas resources. The world's largest privately owned oil and gas company, measured by proven oil reserves, Lukoil has operations in over 40 countries.


MRC

Indorama Ventures reports growth in volumes and profits in Q2 2015

MOSCOW (MRC) -- Indorama Ventures Public Company Limited (IVL), a leading integrated global producer of polymers, saw second quarter sales revenue increase to THB 61.2 billion, with a record production of 1.8 million tonnes on the back of higher utilization rates and additional volumes from new acquisitions, said the company in its press release.

IVL’s scale and business model pursues to build a world-class global corporation and management that are focused on excellence and governance in a sustainable way. IVL has demonstrated its overall resilience to the challenges faced by industry with a healthy Core as well as Reported profit before tax and after non controlling interests of Baht 7.2 billion for the last 12 months (LTM) ending 2Q15. During this period IVL achieved strong Operating Cash Flow of Baht 24.8 billion on a record production of 6.6 million tons.

IVL strives to differentiate and has been successful in building a significant portfolio of niche businesses that are harder to replicate though remain close to consumer daily necessity and therefore much resilient to global uncertainty. IVL’s HVA portfolio in LTM 2Q15 has generated revenue of Baht 81.2 billion or 34.8% of its total revenue that has grown from 30.5% in the previous period, while the total IVL has grown in scale by 9.5% in total volume. BRIC countries remain a laggard due to the economic slowdown and the over-build of capacities in necessities further compounds the situation. New capacities in India in the PTA value chain in 1H15 has delayed the recovery of PTA margins and has put pressure on downstream margins, which is expected to continue in rest of 2015.

Core net profit before taxes in the 2nd Quarter 2015 grew by 27.7% over 2014 to THB 2.3 billion while earnings per share for the quarter rose exponentially to THB 1.04 from THB 0.30 in the same quarter last year. The company has declared an interim dividend of THB 0.24 per share.

The company’s North American business remained strong with a Core EBITDA over the last 12 months of USD327m. The second half of 2015 in this region is expected to see higher volumes, due to the full effect of the volumes expected following the completed acquisition of the PTA facility in Canada in the second quarter of 2015.

IVL capacity grew by one million tonnes to reach 8.5 million tonnes following its acquisitions in 2015 and this is expected to grow a further 700,000 tonnes in the second half of the year under its ongoing M&A CAPEX plan.

As MRC informed earlier, in April 2015 Indorama Ventures completed acquisition of 100 per cent stake in Performance Fibers Asia (PF Asia).

Indorama Ventures is a leading producer in the polyester value chain in Thailand with strong global network and manufacturing across Asia, Europe and North America. Its products serve major players in diversified end use markets, including food, beverages, personal and home care, health care, automotives, textile, and industrial. The company’s main products are PTA, PET and polyester fibre, which are distributed across the world.
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