Moodys reviews SOCAR for downgrade

MOSCOW (MRC) -- Moody's Investors Service (Moody's) has today placed on review for downgrade the Ba1 corporate family rating (CFR), Ba1-PD probability of default rating (PDR) and Ba1 senior unsecured notes rating of State Oil Company of the Azerbaijan Republic (SOCAR), following the placement of Azerbaijan's rating on review.

"Our decision to place SOCAR's ratings on review for downgrade reflects the fact that it is wholly state-owned, as well as the company's exposure to Azerbaijan's weakening operating and credit environment. Furthermore, there is increasing risk that the government's capacity and willingness to provide extraordinary support to SOCAR may become more limited if stresses in the banking system worsen," says Denis Perevezentsev, Vice President -- Senior Credit Officer at Moody's.

On 19 May, Moody's placed Azerbaijan's Ba1 long-term issuer rating and senior unsecured rating on review for downgrade, prompted by the unexpected announcement of a restructuring plan for the country's largest bank, state-owned International Bank of Azerbaijan (IBA, Caa3/on review for downgrade), which could imply that Azerbaijan's credit profile is weaker than Moody's had previously expected.

Saudi Aramco plans up to USD30 bln investment in Motiva by 2023

MOSCOW (MRC) -- Saudi Aramco plans an investment of up to USD30 bln in its US subsidiary Motiva Enterprises LLC, the company said in an announcement at a business summit in Saudi Arabia, reported Hydrocarbonprocessing.

The company said that USD12 bln would be the initial investment in a project to expand refining capacity at Motiva's Port Arthur, Texas, refinery, already the largest in the United States, and to extend Motiva's operations in the petrochemical value chain, according to a statement about the investment.

A likely additional investment of USD18 bln is expected in Motiva by 2023, it said.

Since the completion of an expansion of the Port Arthur refinery in 2012, which more than doubled its capacity to refine crude oil to 603,000 bpd, Motiva has weighed plans for further expansion of the plant.

Saudi Aramco has also looked at acquiring at least one additional Gulf Coast refinery and visited chemical plants up for sale.

"We are investing in long-term job creation and the future of the refining industry in the United States, and we are delivering on Vision 2030 to expand the US-Saudi partnership," Saudi Aramco President and Chief Executive Amin Al Nasser said on Saturday, according to the statement.

Aramco said in the announcement that in the short-term an additional 2,500 jobs would be created in Port Arthur and an additional 12,000 jobs by 2023.

Vision 2030 is a plan announced last year by Saudi Deputy Crown Prince Mohammed bin Salman to diversify the Saudi economy away from reliance on oil production.

As MRC informed before, on May 1, Motiva became an Aramco subsidiary with the breakup of a 19-yr partnership with Shell. Under the breakup agreement, Aramco retained the Motiva name and the Port Arthur refinery along with distribution operations across seven states.

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.

PC production in Russia remained the same in January-April 2017

MOSCOW (MRC) -- Kazanorgsintez's production of polycarbonate (PC) totalled 24,900 tonnes in January-April 2017, compared to 24,800 tonnes a year earlier, according to MRC's ScanPlast report.

April output of material was 6,230 tonnes versus 6,665 tonnes a month earlier. The plant has been operating normally. Since the beginning of the year, the plant has gradually increased its production of PC-007 UL1 extrusion grade, and in April, its output reached 99% of the total production for the month.

Overall production of the extrusion grade reached 20,700 tonnes in the first four months of 2017 or 83% of the plant's total output, which equalled the last year's structure. Injection moulding grades accounted for the rest of the output - 4,200 tonnes.
Kazanorgsintez almost did not ship its material for export in April, having focused on saturation of the domestic market.


Output of products from polymers in Russia grew by 4.2% in the first four months of 2017

MOSCOW (MRC) -- Russia's output of products from polymers continued to increase in April year on year to 2.4% under the pressure of seasonal factors. Thus, this figure grew to 2% in January-April 2017, reported MRC analysts.

According to the Russian Federal State Statistics Service, April production of of plastic pipes, hoses and fittings rose to 46,600 tonnes from 38,100 tonnes a month earlier. Overall output of these products totalled 140,800 tonnes in the first four months of 2017, up by only 0.4% year on year.

Last month's production of unreinforced and non-combined films was 84,100 tonnes, compared to 90,100 tonnes in March. Output of films products grew in January-April 2017 by 5.4% year on year to 314,400 tonnes.

April production of boards, sheets and non-porous sheets went up to 29,200 tonnes, compared to 28,000 tonnes a month earlier. Overall output of these products grew in January-April 2017 to 106,000 tonnes, up by 10.5% year on year.

Last month's production of boards, sheets and porous polymer films was 21,700 tonnes, whereas this figure was 20,000 tonnes a months earlier. Overall output of these polymer products dropped over the stated period by 2.4% year on year, totalling 74,200 tonnes.

April production of plastic windows and window sills, and door blocks increased to 1.6 million square metres and 67,900 square metres, respectively, versus 1.2 million square metres and 67,300 square meters. Output of these products totalled about 4 million square metres (a decrease by 1.9% year on year) and 245,000 square metres (a drop by 8.1% year on year), respectively, in the first four months of the year.

ExxonMobil completes new PE lines at Mont Belvieu plastics plant

MOSCOW (MRC) -- ExxonMobil Chemical Company has announced the mechanical completion of two new 650,000 tons per year high performance polyethylene (PE) lines at its plastics plant in Mont Belvieu, Texas. The company expects production to begin during the third quarter of 2017, as per the company's press release.

Part of a previously announced multi-billion dollar expansion project in the Baytown area, the PE lines will process ethylene feedstock from the new steam cracker currently under construction at the Baytown complex.

"As an early mover to complete a polyethylene project fueled by the shale gas revolution, this world-scale, state-of-the-art facility will double the plant’s production capacity, making it one of the largest polyethylene plants in the world," said Neil Chapman, president of ExxonMobil Chemical Company.

This project enables ExxonMobil Chemical to economically supply a rapidly growing demand for high-value polyethylene products. These high-performance products deliver sustainability benefits such as lighter packaging weight, lower energy consumption and reduced emissions. The finished PE product will be shipped to customers around the world.

The Baytown expansion project is one of 11 ExxonMobil announced as part of its 10-year, USD20 billion Growing the Gulf initiative. Projects planned or under way are expected to create more than 35,000 construction jobs and more than 12,000 full-time jobs.

"As the U.S. continues to produce abundant supplies of oil and natural gas, ExxonMobil is investing billions of dollars along the U.S. Gulf Coast to help meet growing global demand. These investments will not only expand existing refining and chemical capacity, but also stimulate economic growth and create jobs," Chapman said.

As MRC informed earlier, in November 2016, Jacobs Engineering Group Inc. announced it received a contract from ExxonMobil Chemical Company to provide engineering, design and construction management services as part of a new 650 kTa polyethylene facility to be located at ExxonMobil’s Beaumont polyethylene plant.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.