Indonesia and Iran agree to boost cooperation in petrochemical sector

MOSCOW (MRC) -- Indonesia is strengthening its bilateral cooperation with Iran particularly in the oil and gas sector following the recent removal of sanctions on Iran, one of the world’s biggest oil producers, said GV.

During a bilateral meeting in Bogor, West Java, the two countries agreed to cooperate in the upstream oil and gas sector, and data and technology exchange. The Energy and Mineral Resources Ministry’s oil and gas director general Wiratmaja Puja said Iran offered to supply crude oil, condensate and liquefied petroleum gas (LPG) as well as to develop refineries in Indonesia. In addition, the two countries also agreed to develop human resources as well as conduct research and development together.

"All of those will be conducted through business-to-business deals. Pertamina held a meeting on 25 Feb 2016 with Iranian firms so that the purchase of crude and LPG can be realized soon," Wiratmaja said.

Meanwhile, Iran is also seeking to take part in the construction of an integrated refinery and petrochemical complex in Indonesia. The refinery capacity will be about 300,000 b/d.

"The total investment will reach USD 14 billion, including the petrochemical industry, but only USD 8 billion without it," Wiratmaja said.

As MRC reported earlier, Iran exported the first consignment of petrochemical products to Europe after seven years, following lifting of sanctions against the country on 16 January 2016, said the Islamic Republic of Iran Shipping Lines (IRISL) Managing Director Mohammad Saeidi. The official said that the shipment would arrive in European ports in early April, the Tasnim news agency reported. By removal of the sanctions from Iranian shipping lines, the ground is laid for the Iranian vessels to ship products to European ports, Saeidi stated.
MRC

MOSCOW (MRC) -- Oman Oil Refineries and Petroleum Industries (Orpic) is in plans to restart its polypropylene (PP) plant in Sohar, reported Apic-online.

A Polymerupdate source in Oman informed that the plant is expected to resume production on April 23, 2016. The plant was shut for a maintenance turnaround on February 23, 2016.

Located at Sohar in Oman, the plant has a production capacity of 340,000 mt/year.

As MRC informed previously, in May 2014, Orpic said it had awarded two contracts for construction of a USD3.6 billion plastics production complex, the Liwa Plastics Project. The plant will be built in Oman's northern industrial city of Sohar, next to Orpic's oil refinery and petrochemical plants. The Liwa Plastics Project is due to be completed in 2018, doubling Orpic's profitability by allowing it to extract more value from Omani crude oil and natural gas, the company said.

The project will boost Orpic's annual production of polypropylene and polyethylene to 1.4 million tonnes, increasing Oman's exports, while additional production of 1 million tonnes of plastics will help to develop downstream industries within the country, ORPIC added.

ORPIC (Oman Oil Refineries and Petroleum Industries Company) is one of the leading companies in Oman and has two refineries in that country, in Sohar and Muscat. ORPIC is owned by the Government of the Sultanate of Oman and Oman Oil Company SAOC, the trading company created by the Government of the Sultanate of Oman for managing investments in the energy sector.
MRC

MOSCOW (MRC) -- Lotte Group said that it changed the name of a chemical unit that it took over from Samsung Group, the latest in its steps to wrap up the 3-trillion won (USD 2.41 billion) merger, as per GV.

Retail and chemicals giant Lotte Group took over Samsung Fine Chemicals Co., Samsung BP Chemicals Co. and Samsung SDI Co.'s chemical unit, as part of an effort to further strengthen its chemicals business.

Samsung Fine Chemicals was renamed Lotte Fine Chemicals Co., according to the group. The deal came around a year after Samsung sold four of its defence and chemical units to Hanwha Group in 2014 through a deal estimated at 1.9 trillion won.

Samsung, the country's top conglomerate, has been making efforts to reorganize and streamline its business structure, especially after the family-controlled conglomerate's de facto head Lee Kun-hee has remained bedridden since May 2014. The group has been making various efforts to pave the way for the management inheritance to his only son Jae-yong.

As MRC informed previously, in October 2015, Samsung Group agreed to sell its chemical assets to Lotte Group for about 3 trillion won (USD2.5 billion). Following the spin-off, Samsung SDI, the battery and chemical arm of South Korea's top conglomerate Samsung Group, will focus on its electric vehicles and battery businesses.

Besides, in 2014, Samsung also sold four of its defense and chemical units to the Hanwha Group, a deal estimated at around 1.9 trillion won.In March 2015, South Korea's Fair Trade Commission (KFTC) gave conditional approval to Hanwha's proposed acquisition of Samsung General Chemicals.
MRC

MOSCOW (MRC) -- Synthomer has acquired the Hexion Performance Adhesives & Coatings (Hexion PAC) business of US-based Hexion in a transaction valued at USD226m, said Chemicals-technology.

Following the acquisition, Synthomer will get access to new product technologies and markets. Hexion PAC is complementary to the company's existing business, both geographically as well as in the markets in which it operates.

The acquisition will enable Synthomer to venture into the speciality coatings market. Integration of the Hexion PAC business will offer around USD12m of annualised synergies to the company by the end of 2018.

Synthomer CEO Calum MacLean said: "The acquisition of Hexion PAC represents a further step forward in our strategy to continue to grow and develop the business. "This acquisition strengthens our platform for continued growth in the global dispersions and additives market, and in particular expands our presence in the US and Asia.

"Hexion PAC has a good performance track record and shares our commitment to innovation and emphasis on strong customer relationships."

The acquisition, which is planned to be funded by Synthomer from its existing cash resources and using additional credit facilities, is subject to the receipt of regulatory approvals and is slated for completion in the second quarter of 2016.

Hexion PAC develops, manufactures and markets a range of dispersions, additives, powder coatings and speciality monomers. Separately, Synthomer has agreed to sell its South African dispersions business to colours and coatings manufacturer Ferro for GBP13m.

The sale is expected to be completed in the second quarter of this year, after securing regulatory approvals.

As MRC informed earlier, AkzoNobel announced the EUR5 million divestment of its 50% share in non-consolidated joint venture Eka Synthomer Oy, to Synthomer.

Synthomer also offers various binders based around acrylics, styrene-butadiene and vinyl acetate chemistries, for use in various applications, including weather-resistant wood coatings, crack-bridging facade paints for cool roofing applications and plaster, as well as binders for PSA tapes, labels and technical textiles.
MRC

MOSCOW (MRC) -- Vietnamese plastic firms that import polypropylene (PP) as production material can reduce their production costs as the finance ministry has reduced the tax on PP by 2%, as per GV.

Under a new circular released in late January, which will come into effect on March 6, the new tax rate on PP is 1%, down 2% from 3 %, imposed by the finance ministry in the previous circular released in 2013.

Viet Capital Securities Corporation (VCSC) wrote in a report that the lower tax rate would help plastic firms to reduce their expenditure on importing polypropylene from overseas suppliers for production purposes.

These plastic companies include Sai Gon Plastic Packaging JSC (SPP), PP Pack Marking JSC (HPB), Tan Dai Hung Plastic JSC (TPC) and Binh Duong PP Pack Making JSC (HBD), besides Vinh Plastic and Bag JSC (VBC).

Meanwhile, the largest companies in the plastic sector such as Binh Minh Plastic JSC (BMP), Tien Phong Plastic JSC (NTP), Dong A Plastic JSC (DAG) and Vietnam Electric Cable Corporation (CAV), besides Vinh Khanh Cable Plastic Corporation (VKC) and An Phat Plastic and Green Environment JSC (AAA) will not benefit from the circular as they use polyvinyl chloride (PVC) as the input material for production.

The BIDV Securities Corporation (BSC) wrote in a forecast for this year that local plastic companies might face business problems as some European countries have abandoned the use of plastic bags and are encouraging their people to use degradable bags, while the United States has also extended the anti-dumping tax on Vietnamese plastic bags.

We remind that, as MRC wrote before, in September 2014, Top Thai energy firm PTT Pcl said it would make a proposal to the Vietnamese government to build a USD20 billion refinery and petrochemical complex, revised down from an earlier project discussed two years ago.
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