Sinopec sees Chinese fuel exports rising, shale gas ops nearly in red

MOSCOW (MRC) -- State-run Sinopec Group said it expects China's refined fuel exports to keep rising in the medium to long term as domestic demand growth slows and new refining capacity comes on-stream in 2020, while its shale gas operations struggle with high costs, reported Reuters.

China's shipments abroad of refined fuel products will rise by 4 percent this year to 41 million tonnes, it said in its annual oil and gas sector outlook released on Thursday.

The country exported record volumes of fuel in 2017 as refineries churned out more product to take advantage of decent profit margins at home and abroad, with the government issuing generous export quotas.

Domestic oil product demand in the world's second-largest oil consumer will rise by around 3 percent this year, Sinopec said in the report. China's gasoline consumption will hit a peak between 2025 and 2030, it said.

While forecasting gasoline demand to rise 7.3 percent this year, the top Asian refiner expects China's diesel demand to fall 1 percent in 2018, as Beijing's fight against pollution leads to a greater shift to natural gas as industrial fuel.

On the domestic supply of gasoline and diesel, the refining giant said the government's tightening tax rules will squeeze the margins of small blenders and independent refiners, leading to a cut in imports of blending stocks this year. China imports roughly 20 million tonnes annually of mixed aromatics and light cycle oil, two refinery products widely used as blending components for gasoline and diesel.

The report also said China's 2018 crude oil imports from the United States would top 10 million tonnes (200,000 barrels per day). That would be up from 7.7 million tonnes that China brought in from the United States last year.

Sinopec, which leads China's shale gas sector developing the country's largest commercial discovery, is however struggling to break even in the nascent business, said Ma Yongsheng, a vice president of the state group. "If without government subsidy, our shale gas business is on the verge of being loss-making," Ma told Reuters on the sidelines of the industry outlook briefing. The full cost of producing each cubic metre of gas at its flagship shale project Fuling, in the southwestern mountainous region of Chongqing, was around 1.1 yuan, Ma added.

Sinopec has said it pumped a record 6 billion cubic metres of gas from Fuling last year, out of the country's total shale output of around 9 bcm. China's natural gas output last year was nearly 150 bcm.

As MRC informed before, China's Sinopec group, parent of Sinopec Corp, will invest USD29.05 billion to upgrade four refining bases between 2016 and 2020 to produce higher-quality fuels. Sinopec's upgrades come as China, the world's second-biggest oil consumer, is embracing more stringent fuel standards in its battle against pollution and suffering an overall glut in refining capacity. After the upgrades, the total refining capacity of the four refining sites will reach 130 MMtpy, or 2.6 MMbpd, while ethylene capacity will reach 9 MMtpy, Sinopec said in March 2017.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group's key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.
MRC

MOSCOW (MRC) - Indian Oil Corp Ltd plans to increase the capacity of its Panipat refinery by two thirds to 500,000 bpd at a cost of USD3.64 billion, the country's largest refiner said on Wednesday, said Hydrocarbonprocessing.

India is increasing refining capacity to keep pace with the expected growth in fuel demand as Prime Minister Narendra Modi seeks to boost the manufacturing sector.

The energy-hungry nation's refinery capacity has more-than-doubled since the start of the millennium to about 5 MMbpd.

"Another step towards meeting our rapidly growing energy demand," Oil Minister Dharmendra Pradhan said in a tweet, referring to the planned increase in capacity at Panipat.

Indian Oil didn't give a timeline for the expansion. The company, along with its subsidiary Chennai Petroleum Corp Ltd , has a total installed refining capacity of 1.6 MMbpd, according to government data.
MRC

MOSCOW (MRC) -- The polyurethanes division of Huntsman has appointed Azelis as official distributor of Huntsman Tecnoelastomeri’s Tecnothane products in France and Benelux, as per GV.

Tecnothane hot-cast engineering elastomers are an advanced portfolio of polyurethane-based products from Huntsman Tecnoelastomeri, a specialist systems house based in Italy. Providing good chemical resistance and mechanical, dynamical performance, the products are said to be the ideal material for the manufacture of robust wheels, seals, rollers, pads and other technical parts, that are needed for heavy-duty industrial applications.

Huntsman and Azelis are long-term partners. The two companies started working together in 1993 and the latest supply agreement builds on an existing arrangement. Azelis already distributes core products from Huntsman’s Suprasec MDI product range across most of Europe.

Patrick Hanselaer, Commercial Market Manager Coatings & PU at Azelis, said: "We are delighted to increase our cooperation with Huntsman and look forward to forging a close working relationship with the team at Huntsman Tecnoelastomeri. Our existing knowledge of Huntsman’s operations, and our established distribution network, will enable us to quickly extend the promotion and supply of Tecnothane hot-cast elastomers. We are excited to provide our customers across France and Benelux with access to a family of innovative engineering elastomers plus expert advice on their application across a wide range of industries."

Luca Fanti, Global Techno-Commercial Manager at Huntsman Tecnoelastomeri, said: "At Huntsman Tecnoelastomeri we have a very successful business model in place, which we are looking to replicate around the world. We already have a strong foothold in Europe and a solid customer base for our Tecnothane elastomers. Signing a distribution deal with Azelis will enable us to consolidate this position while looking for new opportunities. We look forward to working with the team at Azelis and extending a long-standing cooperation that has proved productive over the years."

As MRC reported earlier, in April 2015, Azelis qA appointed by Evonik Industries as distributor for the Aerosil and Sipernat ranges of silica products to the Food, Personal Care, and Pharma Industries in Denmark, Sweden, Norway, and Iceland.

Azelis Chemicals is a leading European distributor of speciality and commodity chemicals, with a comprehensive portfolio of innovative products for high-tech solutions. The company source high quality products from leading global manufacturers, supporting customers in diverse markets including chemical producers and pharmaceuticals, I&I/household and cleaning, lubricants/metal working fluids, paper, agrochemicals, textile and leather, water treatment, building, wood preservation, agriculture & horticulture, electronics and salts.
MRC

MOSCOW (MRC) -- Lotte Chemical Corp. will invest KRW 50 billion (USD 47.1 million) to add production facilities for high value-added purified isophthalic acid (PIA), a move that is expected to nearly double the PIA output of the Korean company to cement its world’s top rank in the field, as per GV.

Lotte Chemical said on Monday (15 Jan 2018) its board approved the KRW 50 billion investment plan to ramp up its production facilities for PIA in Ulsan, South Gyeongsang Province.

PIA is the raw material of polyethylene terephthalate (PET) bottles and unsaturated resins. Only seven makers across the world can currently produce it, and the Korean producer has dominated the global market since 2014.

Following the addition, Lotte Chemical’s PIA production capacity is expected to jump from 460,000 t/y to 840,000 t/y. The added facilities will also house facilities that can manufacture purified terephthalic acid, a company official said, adding that an increase in output of the two high-value added products would help the company improve profitability and price competitiveness. The company aims to complete its construction by the second half of next year.

As MRC wrote before, in May 2016, Lotte Chemical Corp. has finalized the takeover of Samsung Group’s chemical units.The company said that it paid for money to acquire Samsung SDI Chemical on Apr. 29 and completed the acquisition of Samsung Group’s chemical businesses in about six months after the announcement of "Big Deal" in October 2015. Samsung Fine Chemicals, which was completely taken over by Lotte in Feb., changed its name to Lotte Fine Chemical, while SDI Chemical, which completed the acquisition process on the 29th, changed its name to Lotte Advanced Materials through the general meeting of stockholders.

Established in 1976, Lotte Chemical has been solidifyng its position by localizing cutting-edge petrochemical technologies. Among the high-quality products produced by Lotte Chemical through its efficient processes are ethylene, HDPE, LDPE, LLDPE, PP, functional resin, EG, SM, PIA, PET, etc. Lotte Chemical’s products are being distributed to 152 countries around the world. With the acquisition of Pakistan’s PTA in 2009, Artenius in the UK in 2010 and Titan Chemical Corp., Lotte Chemical is now able to efficiently supply excellent products to an increasing number of countries. The company is further accelerating its efforts to strengthen its global competitiveness by establishing overseas branches in Hong Kong, Russia, and USA, along with the sales corporation in China for active sales activities both in domestic and abroad.
MRC

MOSCOW (MRC) -- SIBUR has updated its Articles of Association and now has two single-member executive bodies, namely Chairman of the Management Board of SIBUR Holding and CEO of SIBUR. This decision results from the previously initiated processes seeking to separate strategic management from operational to further enhance management efficiency, as per company's press-release.

The Chairman of the Management Board of SIBUR Holding is in charge of overall management of SIBUR Holding and overseeing its strategic processes. The CEO of SIBUR is responsible for the Company's ongoing development and is the chair of the Management Board of SIBUR. This management system is designed to facilitate SIBUR’s development strategy implementation in the most balanced way.

Dmitry Konov remains the Chairman of the Management Board of SIBUR Holding. Mikhail Karisalov, previously Chief Operating Officer of SIBUR, was appointed as the Company’s CEO and Chairman of the Management Board.

Mikhail Karisalov was born on 11 June 1973 in Leningrad. He graduated from the Russian Presidential Academy of Civil Service (currently, Russian Presidential Academy of National Economy and Public Administration); also from Tyumen State Oil and Gas University. Since 2003, Mr Karisalov held various positions in SIBUR such as Advisor to President, Procurement Director, Head of Logistics and Capital Construction, CEO of SiburTyumenGaz (SIBUR Group).

2006–2011: Vice-President – Head of Hydrocarbon Feedstock Department of SIBUR.

Since June 2007: Member of the Management Board of SIBUR Holding.

Since November 2009: Member of the Management Board of SIBUR. 2009–2012: concurrently CEO of Tobolsk-Polymer (SIBUR Group).

Since January 2012: Deputy Chairman of the Management Board – Executive Director of SIBUR, the management company of SIBUR Holding.

Since 2016: Chief Operating Officer of SIBUR.
MRC