Shell considering selling its Iraq oil assets

MOSCOW (MRC) -- Royal Dutch Shell is considering selling out of its oil fields in Iraq as part of its global USD30 billion asset disposal program, industry sources said on Monday, reported Reuters.

Shell is seeking to slim down its vast oil and gas portfolio following the USD54 billion acquisition of BG Group in February, which transformed it into the world's top liquefied natural gas trader.

Thus, as MRC wrote before, in March 2016, Royal Dutch Shell Plc lined up assets for a USD30 billion divestment program that may extend from the U.S. and Trinidad to India following its record takeover of BG Group Plc.

With oil prices having slumped since 2014 the company wants to focus on business areas with the highest returns such as LNG and deepwater oil production in Brazil and the Gulf of Mexico.

A spokesman for Shell in London declined to comment.

The Anglo-Dutch company, which has been present in Iraq for over a century, has found only limited financial benefits in recent years from its involvement in Iraq's oil production, where it is paid in crude oil but has limited say on production strategy, the sources said.

However, Shell continues to see value in developing its gas business in Iraq and is not interested in selling those interests, the sources said.

Iraq accounted for around 4.4 percent of Shell's total oil and gas production in 2015, according to its 2015 annual report.

The move to sell the oil interests highlights the difficulties Iraq faces in its efforts to increase crude output as foreign oil companies such as Shell have found the terms of the production service contracts unappealing.

The Anglo-Dutch is the operator of the giant Majnoon field near Basrah in southern Iraq which started production in 2014.

Royal Dutch Shell, commonly known as Shell, is an Anglo–Dutch multinational oil and gas company headquartered in the Netherlands and incorporated in the United Kingdom.Created by the merger of Royal Dutch Petroleum and UK-based Shell Transport & Trading, it is the fourth largest company in the world as of 2014, in terms of revenue, and one of the six oil and gas "supermajors".
MRC

MOSCOW (MRC) -- A project for the construction of a process condensate purification facility at the Gazprom Neft Omsk Refinery has been approved by federal agency Glavgosekspertiza Russia, said Gazprom Neft.

This project is part of a wide-ranging environmental program at the Omsk Refinery, involving the full-scale modernization of the plant. The new facility is expected to be commissioned in 2018.

The new 100-cubic-meter-per-hour facility will allow the removal of ammonia and sulphides from process condensate produced by secondary refining units. After purification, 97% of the water obtained will be returned directly to the plant’s production run (process cycle), with the sulphides and ammonia recycled into sulphur and nitrogen — both in considerable demand in the petrochemicals industry.

The process condensate purification facility has been designed by Technological Engineering Holding PETON, Ufa. The process condensate purification facility will be equipped with the latest automation, diagnostic and emergency response systems.

Gazprom Neft has been implementing an extensive modernization program at its Omsk Refinery since 2008, directed at improving the quality of the oil products produced at the plant, increasing refining depth and operational efficiency, and increasing the yield of light oil products. Implementation of various projects under the first phase of the modernization has already seen a reduction in environmental impacts of 36% in line with the proportional increase in refining volumes.
MRC

MOSCOW (MRC) -- Idemitsu Kosan Co.,Ltd. and Mitsui Chemicals, Inc. are pleased to announce that Chiba Chemicals Manufacturing LLP, managed jointly by Idemitsu and Mitsui, will improve ethylene manufacturing facilities to enhance the profitability of the facilities, as per Hydrocarbonprocessing.

Idemitsu and Mitsui established the company in Chiba in 2010 for the joint operation of ethylene manufacturing facilities of both companies.

"With this joint operation, Idemitsu and Mitsui aim to form an ethylene center with top-level competitiveness in the Asian region," the press release stated.

The LLP will increase the propane processing capacity of ethylene manufacturing facilities of its Anegasaki Plant. The purpose of this is to utilize the strength that the facilities are adjacent to an LPG import facility in Idemitsu’s Chiba Refinery.

The improvement work will be carried out in autumn of 2017.

As MRC wrote previously, Japanese refiner Idemitsu Kosan Co. and smaller rival Showa Shell Sekiyu will merge on April 1 next year. Japan's No.2 and No.5 refiners by revenue agreed last November in a deal worth approximately USD4 B to create the nation's second-biggest refiner sometime between October 2016 and April 2017.

Idemitsu Kosan is a Japanese petroleum company. It owns and operates oil platforms, refineries and produces and sells petroleum, oils and petrochemical products. The company runs two petrochemical plants in Chiba and Tokuyama. The two naphtha crackers can produce up to 997,000 tonnes of ethylene per year.

Mitsui Chemicals is a leading manufacturer and supplier of value added specialty chemicals, plastics and materials for the automotive, healthcare, packaging, agricultural, building, and semiconductor and electronics markets. Mitsui Chemicals is a Japanese Chemicals company, a part of the Mitsui conglomerate. The company has a turnover of around 15 billion USD and has business interests in Japan, Europe, China, Southeast Asia and the USA. The company mainly deals in performance materials, petro and basic chemicals and functional polymeric materials.
MRC

MOSCOW (MRC) -- PVC resin and pipe maker Mexichem SAB de CV has acquired Vinyl Compounds Holdings Ltd. Terms were not disclosed, said Plasticsnews.

In a Nov. 28 news release Mexichem, whose headquarters are on the northern edge of Mexico City, said the acquisition will "provide us with access to new geographies and end markets."

Based in Chinley, England, VCHL manufactures PVC compounds used in pipe and profiles, footwear and consumer goods. It has annual sales of about USD40 million. VCHL’s stabilizer technologies and recycled PVC capabilities will help Mexichem to integrate its compounding operations.

Sameer Bharadwaj, president of Mexichem’s compounds business, said the deal is in keeping with Mexichem’s strategy of completing what he described as “bolt-on” acquisitions.

These, he said, provide us with access to new geographies and end markets, expand our portfolio of specialty products and serve as a platform for future growth, while enhancing returns on invested capital."

Mexichem’s vinyl business reported sales of USD2 billion for the 12 months through Sept. 30. With operations in 30 countries and 18,000-plus employees, the company’s shares have been traded on the Mexican Stock Exchange for 30 years and it has annual sales of USD5.7 billion.

As MRC informed earlier, in 2014, Mexichem completed the acquisition of Vestolit GmbH.

Mexichem, of Tlalnepantla, an industrial municipality close to Mexico City, is Latin AmericaпїЅs largest manufacturer of PVC pipe, vinyl resins and compounds. The company has annual revenues of more than USD5 billion and has been listed on the Mexican Stock Exchange for more than 30 years.
MRC

MOSCOW (MRC) -- Japan's Idemitsu Kosan said on Tuesday its JV with Mitsui Chemicals would conduct work to expand the processing of propane at Idemitsu's naphtha cracker to take advantage of cheap liquefied petroleum gas (LPG) prices, said Reuters.

The work will be carried out next autumn and last about a month, during which time the cracker will be shut, a company spokeswoman said.

The upgrade will boost the cracker's capacity to process propane as feedstock by three or four times, said Hideki Gotoh, deputy general manager of Idemitsu's petrochemical business. He declined to give the current capacity.

He added that Idemitsu would pay the costs for the upgrade, without giving a figure. The benefit from boosting propane and cutting naphtha as feedstock is set to lead to cost cuts of around USD8.90 million a year, the company spokeswoman said.

The cracker will take advantage of its location next to the LPG import facility in Idemitsu's Chiba refinery. It will mainly rely on LPG imports for feedstock rather than a small quantity of LPG produced at the plant, officials said.

The cracker is separately scheduled to undergo planned maintenance next spring, company sources said. Idemitsu and Mitsui Chemicals set up the 50:50 venture in 2010 to jointly operate their naphtha crackers in Chiba, east of Tokyo, to save on costs.

Idemitsu has a naphtha cracker adjacent to its Chiba refinery with capacity to produce 414,000 tpy of ethylene, while Mitsui has one with a capacity of 612,000 tpy.

As MRC informed earlier, Idemitsu Kosan Co. and smaller rival Showa Shell Sekiyu will merge on April 1 next year. Japan's No.2 and No.5 refiners by revenue agreed last November in a deal worth approximately USD4 B to create the nation's second-biggest refiner sometime between October 2016 and April 2017.

Idemitsu Kosan is a Japanese petroleum company. It owns and operates oil platforms, refineries and produces and sells petroleum, oils and petrochemical products. The company runs two petrochemical plants in Chiba and Tokuyama. The two naphtha crackers can produce up to 997,000 tonnes of ethylene per year.
MRC