Shell to sell stake in sadaf chemicals joint venture in Saudi Arabia to Sabic

MOSCOW (MRC) -- Shell and SABIC have signed an agreement whereby SABIC will acquire Shell’s 50% share in the petrochemicals SADAF joint venture, located in Jubail, Kingdom of Saudi Arabia for USD820 million, as per Shell's press release.

The SADAF joint venture encompasses six world-scale petrochemical plants with a total output of more than 4 million metric tons per year. This announcement marks an early termination of the joint venture agreement which was due to expire in 2020.

This acquisition will enable SABIC to further optimize operations at SADAF and further invest in the facilities, integrating them with SABICs other affiliates. This step will allow Shell to focus its downstream activities and make selective investments to support the growth of its global chemicals business.

Graham van't Hoff, Executive Vice President Chemicals, Shell, said: "Our partnership with SABIC, spanning more than thirty years, has been a great success story. We’re proud to have established together one of the first petrochemical ventures in Saudi Arabia - it has grown substantially since the start, in 1986. We will continue to explore potential future opportunities with SABIC."

Yousef Al-Benyan, SABIC Vice chairman and CEO, said, "Since SABIC’s early days, we have enjoyed a strong relationship with Shell Chemicals. We are confident that our journey of partnership together will continue and grow in strength. With this transaction SABIC is looking to capitalize on synergy opportunities of SADAF with other affiliates, and improve its operation and profitability."

The transaction is subject to regulatory approval and is expected to complete later this year. Shell’s other activities in the country are not impacted.

As MRC wrote before, in October 2014, Saudi Basic Industries Corp and Royal Dutch Shell shelved plans to expand an existing petrochemical joint venture in Saudi Arabia as the results of feasibility studies were not encouraging. The two partners in the joint project, known as SADAF joint venture in Jubail, on the Gulf coast of Saudi Arabia, first announced plans to explore an expansion of their petrochemical plant in 2012. The expansion was due to add polyols, propylene oxide (PO) and styrene monomer. SABIC did not say by how much the plant was due to be expanded nor gave an estimated cost.

Saudi Basic Industries Corporation (SABIC) ranks among the world’s top petrochemical companies. The company is among the world’s market leaders in the production of polyethylene, polypropylene and other advanced thermoplastics, glycols, methanol and fertilizers.

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

MOSCOW (MRC) -- Rabigh Refining and Petrochemical Company (Petro Rabigh) announces the precautionary halt of the Petrochemicals Units Complex at about 6:00 pm, Thursday, January 19, 2017 due to a trip in the Utility Generation Unit, said the company on its site.

This precautionary halt has been executed without any material damages and considering the required safety procedures. The Utility Generation Unit has been restarted on Saturday, January 21, 2017.

It is expected that the gradual restarting of the Petrochemicals Units Complex will be on Sunday, January 22, 2017. The financial impact will be assessed and announced later.

As MRC informed earlier, in late May 2016, PetroRabigh brought on-stream its cracker and polyethylene (PE) units following an unplanned outage. The complex was taken off-stream on May 19, 2016 owing to a power failure.

PetroRabigh, a joint venture between Saudi Aramco and Japan's Sumitomo Chemical, has an annual output capacity of 18 million tonnes of refined products and 2.4 million tonnes of petrochemicals. Thus, the complex currently has a cracker to produce 1.3-million t/y of ethylene and 900,000 t/y of propylene, as well as downstream production of polyethylene, polypropylene, propylene oxide, ethylene glycol and butene-1.
MRC

MOSCOW (MRC) -- Petrotechnics, the developer of Proscient – the hazardous industries’ first software platform for Operational Excellence – has been selected by Accenture to deliver its solution for Saudi Aramco’s new Jazan refinery complex, said Hydrocarbonprocessing.

Proscient will be implemented as part of Saudi Aramco’s integrated manufacturing operations management system (imoms) to reduce risk, improve productivity and lower costs.

The USD2.1 billion refinery will have the capacity to process 400,000 bpd of crude oil and produce 80,000 bpd of gasoline, 250,000 bpd of ultra-low sulphur diesel and over 1 MMtpy of benzene and paraxylene products. This output will help meet Saudi Arabia’s domestic energy demand, as well as increase its share of high value fuel exports to international markets. The complex is due for completion later this year.

The system will enable connected, collaborative and safe industrial operations; closing the loop between operations, maintenance and engineering through joined-up processes and assets to transform business operations. It is a set of 12 applications, 20 integrated solutions and 550 processes encompassing risk management, production management and activity management.

Proscient will deliver the PSORMS capabilities within imoms to mitigate operational risk and optimize the work schedule dynamically and graphically. It will facilitate the capture and management of work permits, real-time risk analysis, incident reporting, emergency preparedness and safety response, KPIs and management of change.

"Imoms enables the connected, collaborative and safe industrial operations of the future – today. Proscient is a core component of imoms and will support better decision making," said Massimo Pagella, Managing Director of Resources, Accenture. "Petrotechnics’ long track record and approach to helping oil and gas organisations deliver safer and more effective operations combined with the strength of Proscient made them the best choice for imoms and Saudi Aramco."

As MRC informed earlier, Saudi Arabian Oil Co. and Saudi Basic Industries Corp. are one step closer to building their first plant to process crude directly into chemicals, cutting out a link in the production chain from hydrocarbons to the finished products that go into plastics and other consumer goods.

Saudi Aramco is an integrated oil and chemicals company, a global leader in hydrocarbon production, refining processes and distribution, as well as one of the largest global oil exporters. It manages proven reserves of crude oil and condensate estimated at 261.1bn barrels, and produces 9.54 million bbl daily. Headquartered in Dhahran, Saudi Arabia, the company employs over 61,000 staff in 77 countries.
MRC

MOSCOW (MRC) -- Gas Authority of India Ltd (GAIL) is in plans to restart a high density polyethylene/linear low density polyethylene (HDPE/LLDPE) swing plant, as per Apic-online.

A Polymerupdate source in India informed that the company has planned to resume operations at the plant in end-January 2017. The plant was shut in December 2016 owing to a mechanical issues.

Located at Pata-2 complex in Uttar Pradesh, the swing plant has a production capacity of 400,000 mt/year.

As MRC informed earlier, India's state-owned gas utility company GAIL India plans to import ethane from countries including the US, for its upcoming USD5 billion joint-venture Andhra Pradesh petrochemical plant. GAIL is seeking 1.3 million mt/year of ethane for 15 years for its JV ethane cracker with India's Hindustan Petroleum Corp Ltd (HPCL), located on the east coast of India beginning 2022.

Gas Authority of India Limited (GAIL) is the largest state-owned natural gas processing and distribution company in India. It is headquartered in New Delhi. It has the following business segments: natural gas, liquid hydrocarbon, liquefied petroleum gas transmission, petrochemicals, city gas distribution, exploration and production, GAILTEL and electricity generation.
MRC

MOSCOW (MRC) -- Praxair, Inc. signed a long-term contract to supply hydrogen to Marathon Petroleum Corporation’s refinery in Garyville, Louisiana, said Hydrocarbonprocessing.

The company will use the hydrogen to support an ultra-low-sulfur diesel project planned for 2018. Marathon Petroleum is the third-largest transportation fuels refiner in the US and operates an integrated refining, marketing and transportation system in the Midwest, East, Southeast and Gulf Coast. The hydrogen will be supplied through Praxair’s extensive Southeast Louisiana pipeline network.

"Garyville is home to Marathon Petroleum’s largest refinery, the third largest by capacity in the US, and Praxair is proud to be supporting their business in the Gulf Coast," said Dan Yankowski, president of Praxair’s global hydrogen business. "This type of opportunity to further serve our customers in the region is why we expanded our presence in the lower Mississippi River corridor several years ago."

Praxair operates over 50 hydrogen production facilities and six hydrogen pipeline systems worldwide.

As MRC informed earlier, Linde AG and Praxair Inc. announced that the companies intend to combine in a merger of equals under a new holding company through an all-stock transaction.
MRC