Top Iran oil tanker firm NITC says shipments to Europe increasing

MOSCOW (MRC) --NITC, Iran's leading oil tanker operator, said on Monday its shipments to Europe were increasing daily and the company plans to upgrade its fleet to support expansion, as per Hydrocarbonprocessing.

International sanctions on Iran were lifted in January 2016 and NITC is looking to come in from the cold after years of isolation.

Mohammad Reza Shams Dolatabadi, NITC's head of international affairs, told Reuters on the sidelines of an energy industry conference in Istanbul that the company aimed to replace some of its older tankers with new vessels.

"We have a plan for the renovation of our fleet and to buy new vessels. We’ll scrap some of our old vessels but we will not change our capacity," he said.

"We have a (renovation) plan for 5 yr, but (we are) still working to finalize that."

NITC's own operations were also hampered previously due to their difficulty in securing international insurance cover for their fleet and getting certification, a key requirement for access to many ports around the world, which tests the sea worthiness of ships.

Iran has steadily reconnected with buyers across Europe since sanctions were lifted and NITC expects to play a bigger role.

"We were active during the sanctions era in the Asian market, but we have started since last year to return to the European market as well," Dolatabadi said.

"Our ships are calling at many European ports, and the number of these shipments is increasing day by day."

He added that the company also planned to acquire liquefied natural gas (LNG) tankers, marking a new direction for the company.

"We are thinking of an LNG fleet in the future," he said.

"Iran has the largest gas reserves in the world. There are plans for production for liquefied gas, LNG, in the future. So due to that we are thinking about playing a part in the shipment of this product in the future. (It will come along) in the mid-term, three to five years," he said.

As MRC informed previously, on 3 July 2017, France's Total signed a deal with Tehran to develop phase 11 of Iran's South Pars, the world's largest gas field, marking the first major Western energy investment in the Islamic Republic since the lifting of sanctions against it. Total will be the operator with a 50.1 percent stake, alongside Chinese state-owned oil and gas company CNPC with 30%, and National Iranian Oil Co subsidiary Petropars with 19.9%.
MRC

MOSCOW (MRC) -- Equate Petrochemical Company has undertaken an emergency shutdown at its No. 2 ethylene cracker at Shuaiba, as per Apic-online.

A Polymerupdate source in Kuwait informed that the company has halted operations at the cracker on July 10, 2017 owing to technical glitch. It is likely to remain off-stream for around 1-2 week.

Located at Shuaiba in Kuwait, the No. 2 cracker has a ethylene production capacity of 850,000 mt/year.

As MRC informed before, Kuwait-based Equate Petrochemical Company continued its global growth through its wholly owned subsidiary MEGlobal with the launch of work on a new world-scale ethylene glycol (EG) manufacturing facility in Freeport, Texas, US, in August 2016. With this plant, Equate is the first Kuwaiti petrochemical company to invest in the US. The new facility, to be completed during 2019, will increase Equate’s monoethylene glycol (MEG) capacity by 750,000 metric tonnes annually and will enhance the company’s global presence to meet customer needs.

Equate is the world’s second largest EG producer with 12% of the global market share.

Equate Petrochemical Company K.S.C.C., together with its subsidiaries, manufactures, markets, and distributes petrochemical products. The company produces ethylene, polyethylene terephthalate, polypropylene, styrene monomer, paraxylene, heavy aromatics, and benzene; polyethylene for various applications, including flexible and food packaging, industrial packaging, agricultural films, HIC, and others; and monoethylene and diethylene glycol that are used in polyester fiber for fabrics, water-based adhesive materials, shoe polish, and printer inks, as well as automotive anti-freeze and coolants. The company sells its products in Kuwait and other Gulf Cooperation Council countries, North America, Asia, Europe, and internationally. Equate Petrochemical Company K.S.C.C. was founded in 1994 and is headquartered in Safat, Kuwait.
MRC

MOSCOW (MRC) -- A deal between Poland's biggest oil refiner PKN Orlen and Lithuanian Railways agreed on Wednesday, 6 July, on new fees for transporting oil products could pave the way for more cooperation between the two countries on energy projects, as per Hydrocarbonprocessing.

PKN's Mazeikiai refinery in Lithuania relies on rail to ship its products to the Klaipeda oil terminal on the Baltic Sea, a route of about 155 mi, but the Polish company has been at odds with state-run Lithuanian Railways over transport fees since 2014.

Lithuanian Railways and PKN Orlen have now agreed on new tariffs for the cargos and to withdraw all litigation concerning roughly USD45.49 MM in fees unpaid by Orlen since it rejected a fee increase in 2014, a Lithuanian Railways spokesman told Reuters.

Under the agreement, PKN Orlen will have to pay only about half of the debt, head of Lithuanian Railways Mantas Bartuska said.

"Orlen's troubles were the largest negative factor in our relationship with Poland," Lithuania's transport minister Rokas Masiulis said. "As we solved this, we can now expect a breakthrough in all areas, including in energy security," the minister, who was in charge of Lithuania's energy security projects in a previous government, told Reuters.

Lithuanian Prime Minister Saulius Skvernelis said the conflict was "casting a shadow on good relationship between our countries."

Poland is the only European Union and NATO member country which shares a border with the Baltic States, making links between Poland and Lithuania vital for regional security as well as energy security.

There are several projects where Lithuania needs to work with Poland, including an expansion of the electric power link between the two countries and a synchronization of the Baltic countries' energy grid with the rest of continental Europe.

The two countries are also trying to develop a gas pipeline link.

A source familiar with the matter said the new rail fees would be more favorable for state-run PKN's Lithuanian subsidiary Orlen Lietuva and could bring it significant savings related to fuel transport from its refinery in Mazeikiai, Lithuania.

"The former agreement did not serve well PKN Orlen and the railways", head of PKN Orlen Wojciech Jasinski told reporters.

Orlen Lietuva had been a financial burden on its parent. In 2014, PKN wrote down the value of Orlen Lietuva by USD1.13 B after the refinery swung into the red. It returned to black in 2015, making net profit of USD237 MM in 2015 and USD238 million in 2016.

Jasinski said PKN was looking into reversing the writedown, but could not give a time frame.

"We hope this would go further, some things have to take place. We are having a discussion with the financial market regulator on that," he said.

In total, PKN has spent USD4 B on the Mazeikiai refinery, including the purchase price, since buying a controlling stake from Russia's Yukos in 2006.

As MRC wrote before, in December 2016, PKN Orlen signed an annex with Tatneft Europe AG to the agreement for crude oil supplies to Czech refinery in Litvinov that provides the extension of contractual period and increases the possible maximum volume of the crude oil delivered. According to the annex, Tatneft will deliver to Litvinov refinery a crude oil in the quantity from 1,620 MMt to maximum 3,960 MMt. The contract will be valid from Jan. 1, 2017 until Dec. 31, 2019.

PKN Orlen is a major Polish oil refiner and petrol retailer. The company is a significant European publicly traded firm with major operations in Poland, Czech Republic, Germany, and the Baltic States. It currently (2015) ranks 353, with a revenue of over USD33.8 billion.
MRC

June production of unmixed PVC in Russia dropped to 81,200 tonnes from 84,000 tonnes a month earlier, all producers, except for SayanskKhimplast, reduced their PVC output. Overall PVC production reached 467,700 tonnes in January-June 2017, compared to 360,600 tonnes a year earlier. This year's high level of production growth was caused by the long forced outage at SayanskKhimPlast in February-July 2016.

The structure of PVC production by plants looked the following way over the stated period.

RusVinyl (joint venture of SIBUR and SolVin) produced about 25,400 tonnes of PVC in June, 2,200 tonnes of which accounted for emulsion polyvinyl chloride (EPVC), compared to 27,800 tonnes a month earlier. Thus, RusVinyl's overall production of resin reached 155,800 tonnes in the first six months of 2017, down by 1% year on year.

SayanskKhimPlast increased its capacity utilisation last month, the plant's suspension polyvinyl chloride (SPVC) production reached 26,900 tonnes, whereas this figure was 25,900 tonnes in May. The Sayansk plant managed to produce 136,300 tonnes of resin over the stated period versus 35,300 tonnes a year earlier (2016 low output was caused by the long shutdown from mid-February to July).

Bashkir Soda Company (BSC) produced 21,600 tonnes of SPVC in June, whereas 22,300 tonnes were manufactured in May. The plant's output of resin totalled about 130,000 tonnes in the first half of 2017, compared to 126,700 tonnes a year earlier.

Kaustik (Volgograd) slightly reduced its production last month, the plant's overall SPVC output slightly exceeded 7,300 tonnes versus 8,000 tonnes in May. The plant's overall production of resin reached 45,700 tonnes over the stated period, compared to 41,800 tonnes a year earlier.

MRC

MOSCOW (MRC) -- Gas Technology Institute (GTI) and Yangquan Coal Industry Group signed an agreement to jointly develop an industrial demonstration project for the R-Gas gasification process in China, reported Apic-online.

The demonstration plant, which will be located at the "largest" coal-to-chemicals facility in Shanxi Province, will validate long-duration reliability, operability and capital costs.

"This breakthrough technology provides significant economic and environmental benefits for Yangquan's coal-to-chemical processes," said Eddie Johnston, senior vice president of GTI Research and Technology Development.

The design enables rapid start-up and shut-down, feed stock flexibility able to operate with all ranks of coal and process optimization capability, GTI explained. R-Gas also consumes up to 30% less water and the higher efficiency results in lower overall emissions.

Cost for electricity generation, chemicals and liquid fuels production are estimated to be 15% to 25% lower compared with existing technologies.

We remind that, as MRC informed previously, in early 2016, Rosneft and Sinopec signed a Memorandum of Understanding regarding cooperation in gas and petroleum chemicals projects to be developed in East Siberia.

And in June 2016, the companies signed a Framework Agreement on joint pre-feasibility study of the project related to the construction and operation of a gas processing and petrochemical complex in East Siberia. The Agreement signed in furtherance of the Memorandum of Understanding on cooperation in petrochemical projects, provides to select a technology for natural gas processing from its components to polymers. The parties also decided to choose a consultant for the project management and identified competitive challenges and the time to fix them before entering the stage front-end engineering design (FEED). In the event of successful outcomes as stipulated by the Framework Agreement, it is supposed to create a joint venture between Rosneft and Sinopec in 2017.
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