Brazil likely to create ethanol import quota, tax imports above it

MOSCOW (MRC) — The Brazilian government is likely to adopt a quota system for ethanol imports, allowing 600 MM liters into the country per year free of tax and imposing a 20% tariff on volumes in excess of that quota, as per Hydrocarbonprocessing.

Eduardo Leao, Unica's executive director, told Reuters on the sidelines of a seminar in Sao Paulo that the new policy has been discussed within the government and should be approved in an extraordinary meeting of Brazil's foreign trade chamber Camex on August 23.

The Brazilian government is under pressure from sugar and ethanol producers, particularly from the politically influential Northeast region, to tax imports of the biofuel, which currently are free from any tariffs.

The proposal is aimed at curbing ethanol imports, almost all from the United States, which jumped more than 300% in the first half compared to similar period a year earlier, gaining market share from producers in the Northeast.

Leao said that according to the proposal being discussed, imports will remain free of taxes up to the 600 MM liters per year, unless they go above 150 MM liters in only one quarter, when the 20% tariff would also be imposed.

US groups representing ethanol producers, such as the Renewables Fuels Association, are against the imposition of taxes, saying they would go against Brazil's own longstanding view that tariffs would harm the development of a global ethanol industry.
MRC

MOSCOW (MRC) -- The August contract price of propylene was settled at the level of July in Europe. Because of that European producers rolled over July export prices for polypropylene (PP) for August delivery for CIS countries, according to ICIS-MRC Price Report.

Negotiations over August prices of European PP began last week, many market participants said European producers rolled over their export PP prices , despite the serious strengthening of the euro against the dollar.

Most European producers do not have restrictions for export delivery. Deals for August shipments of homopolymer PP were discussed in the range of EUR1,000-1,075/tonne FCA, which corresponds to the July level of prices.

At the same time, it is worth noting that a part of the producers after a week of negotiations went on reducing prices for EUR20-30/tonne in comparison with the initially announced price level.

Deals for copolymers of propylene (PP block copolymers) were done in the range of EUR1,100 -1,150/tonne FCA.
Negotiations over August shipments of statistical copolymers (PP random copolymers) were held in the range of EUR1,150-1,220/tonne FCA.
MRC

MOSCOW (MRC) — Uganda said on Monday it had agreed preliminary terms with a consortium of investors including General Electric to build and operate the country's first oil refinery, reviving a much-delayed project, said Reuters.

Government geologists estimate Uganda's oil reserves at 6.5 billion barrels, of which 1.4 B–1.7 B are considered recoverable. The oil is due to start flowing in 2020 and the government is keen to build a refinery to process it and retain a larger slice of profits.

Uganda suffered a setback last year in its efforts to secure a lead investor for a refinery project then estimated at USD2.5 B, after talks with Russia's RT Global Resources broke down.

Subsequent negotiations with a consortium led by South Korea's SK Engineering also collapsed. On Monday, the ministry of energy and mineral development said "core project terms" had been agreed with the Albertine Graben Refinery Consortium (AGRC), whose other members include India's Yatra Ventures LLC, and Italy's Saipem SpA.

"The consortium has proposed ... a financing approach and a path to establish, develop and operate a commercially viable refinery," the ministry said in a statement.

A project framework agreement was expected to be signed within two months, it said. Energy and Minerals Development Minister Irene Muloni said in November that France's Total, one of three oil explorers operating in the country, wanted to take up a 10% stake in the refinery project.

Kenya and Tanzania have committed to stakes of 2.5% and 8% respectively, Muloni said at the time. Commercially viable hydrocarbon deposits were discovered in 2006, but production has been slowed by tax disputes and disagreements over development strategy.

An export pipeline under development is due to be completed by 2020.
MRC

MOSCOW (MRC) -- Showa Denko ("SDK") has decided to acquire assets concerning Sublimation-recrystallization Method to manufacture silicon carbide (SiC) wafers from Nippon Steel & Sumitomo Metal Corporation (NSSMC) and Nippon Steel & Sumikin Materials Co., Ltd. (NSMAT) by around the end of January 2018, as per the company's press release.

When compared with the mainstream silicon-based semiconductors, SiC-based power devices can operate under high-temperature, high-voltage, and high-current conditions, while substantially reducing energy loss. These features enable the production of smaller, lighter, and more energy efficient next-generation power control modules. On the other hand, development of full-SiC-based power modules including MOSFET (metal-oxide semiconductor field-effect transistor) requires SiC wafers with fewer crystal defects and further cost reduction.

SDK initiated research and development of SiC epitaxial wafers in 2005, and now produces and sells 3,000 epitaxial wafers per month*. This time, SDK aims to improve the quality of its products through the acquisition of assets currently owned by Nippon Steel & Sumitomo Metal Group.

In its ongoing medium-term business plan "Project 2020+," SDK positions its business to produce and sell SiC epitaxial wafers for power devices as "Advantage-establishing" business. SDK will further strengthen its product development and supply system for SiC epitaxial wafers, aiming to contribute to the spread of SiC-based power devices.
MRC

MOSCOW (MRC) -- India's top refiner Indian Oil Corp will spend USD2.4 B to increase capacity at its refinery in western India by about a third over the next few years to meet rising local demand for fuel, said Reuters.

The plan, announced on Friday, will enable the plant in Gujarat state to process 360,000 bdp of oil by the end of 2021. It is part of IOC's vision to increase its refining capacity by about 89 percent to 3 MMbpd by 2030 by building new plants and expanding some existing ones.

The 274,000 bpd Koyali refinery, built in 1965, has five crude units and IOC wants to replace four of them with a single 300,000 bpd crude unit.

The USD2.4 B expansion will also enable the Gujarat plant to process cheaper, tougher oil grades and improve profitability. The secondary units at the plant will be ready by the end of 2022, IOC said in a statement.

India has emerged as a bright spot amid soft demand for oil elsewhere in the world, but the South Asian nation's push to electric vehicles is forcing analysts to revise forecasts for fuel demand in the world's third biggest oil consumer.

The revamped plant will have the flexibility to withstand fluctuations in future demand and supply of fuels and to integrate with downstream petrochemical units, IOC Chairman Sanjiv Singh said.

The refiner is also setting up a 420,000 tpy polypropylene unit at the refinery.

IOC is bolstering its gas imports and retail business as well, as India seeks to increase cleaner fuel's share to 15% of the country's energy use in the next few years from 8% currently.

The company's board has approved a plan to buy up to a 50% stake in the 5 MMtpy Mundra LNG terminal on India's west coast.

The terminal, being set up by a joint venture between Gujarat State Petroleum and Adani Enterprises Ltd at a cost of about 50 B rupees, will start operations in the first quarter of next year.

IOC currently imports liquefied natural gas at Petronet LNG's west coast terminal for supplying to industries. It is also building a 5 MMtpy LNG terminal at Ennore on the east coast and hopes to commission the facility in 2018–2019.
MRC