Forties pipeline system of Ineos is safe

MOSCOW (MRC) -- The Forties Pipeline System (FPS) of Ineos is safe, as per Rigzone with reference to an Ineos spokesperson's confirmation.

The declaration follows the discovery of a crack in the FPS at Red Moss, south of Aberdeen, which resulted in a controlled shutdown of the pipeline Dec. 11.

"Ineos takes its responsibility for ‘safety, health and environmental’ very seriously and is fully committed to delivering a continually improving performance across all its operations," the Ineos representative told Rigzone.

"We have recently acquired the FPS but have already implemented a strict and regular inspection regime," the spokesperson added.

Christopher Haines, head of oil and gas at BMI Research, supported the spokesperson’s claims, stating that the pipeline monitoring system did its job and prevented the crack from turning into a larger issue.

"While most infrastructure in the North Sea is aging, I think it would be unlikely that this becomes a regular occurrence," Haines stated when asked if he thought similar structural weak-points could be found in the system in the near future.

The FPS was offline for a total of 17 days in December. According to Genscape’s oil markets and business development director, Hillary Stevenson, around 400,000 barrels per day (bpd) of North Sea production was shut-in during this period.

"Ineos also reduced rates at the Grangemouth refinery due to the FPS shut down," Stevenson said.

"The 110,000-bpd crude distillation unit (CDU) remained offline as of Dec. 27 after being shut since Dec. 15, and the 65,000 bpd CDU was briefly offline Dec. 13 to Dec. 14. Also at the refinery, the 39,600 bpd catalytic reformer was shut at 11:16 (GMT) Dec. 24," Stevenson added.

Ineos revealed that the FPS had been shut for a second time in two months Feb. 7, due to an unexpected closure of the feed control valves on the pipeline supplying the Kinneil gas processing plant. The company said, however, that it aimed to restart the pipeline overnight.

Production from more than 80 North Sea fields is moved onshore via Ineos’ 1.15 million bpd FPS to the Kinneil crude stabilization plant, where oil and NGL combined flow is stabilized in three processing trains for consumption at Ineos’ 210,000 bpd refinery in Grangemouth, or exported via the Dalmeny, Scotland, storage terminal and Hound Point port.

The pipeline outage in December affected several oil and gas firms, including BP plc, Total SA, Chevron Corp., Exxon Mobil Corp., Eni, ConocoPhillips, EnQuest and Premier Oil.

Following the discovery of the crack, the UK’s Health and Safety Executive (HSE) said it was investigating the circumstances surrounding the incident. HSE declined to comment on the expected completion date of the investigation but confirmed that it was still ongoing as of Jan. 4.

A recent Bloomberg article highlighted that these types of investigations are not automatically triggered by the UK Health and Safety Executive. Incidents must be severe or unusual enough to meet the regulator’s criteria for a probe, Bloomberg quoted Martin Wayland, a member of HSE’s gas and pipeline team, as saying.

As MRC informed before, in early November 2017, Ineos completed its acquisition of the Forties Pipeline System (FPS) and associated pipelines and facilities from BP. The 235-mile pipeline system links 85 North Sea oil and gas assets to the UK mainland and the Ineos site in Grangemouth, Scotland, delivering almost 40% of the UK’s North Sea oil and gas production.

Ineos Group Limited is a privately owned multinational chemicals company consisting of 15 standalone business units, headquartered in Rolle, Switzerland and with its registered office in Lyndhurst, United Kingdom. It is the fourth largest chemicals company in the world measured by revenues (after BASF, Dow Chemical and LyondellBasell) and the largest privately owned company in the United Kingdom.

Ineos Styrolution implements new distribution structure in Europe

MOSCOW (MRC) -- Ineos Styrolution announced that it has significantly expanded its distribution agreements with Albis Plastic and the Ultrapolymers Group in Europe, as per GV.

According to Ineos Styrolution, the new structure will give both distributors access to the company’s entire speciality portfolio as well as its standard products. For styrenic speciality products, both distributors have access to all EMEA countries with the exception of Malta, Israel, and the sub-Sahara Africa. For standard products, the agreement covers all European countries. This agreement does not affect existing distribution agreements with other local distributors.

As MRC informed earlier, Styrolution was founded in October 2011 as a joint venture between BASF and INEOS. On November 17, 2014, INEOS completed the purchase of BASF's 50% share - making Styrolution a wholly owned, standalone company within INEOS. And in January 2016, Styrolution changed company names and visual identity to Ineos Styrolution to mark Ineos ownership.

Ineos Styrolution is the leading, global styrenics supplier with a focus on styrene monomer, polystyrene, ABS Standard and styrenic specialties. With world-class production facilities and more than 80 years of experience, INEOS Styrolution helps its customers succeed by offering the best possible solution, designed to give them a competitive edge in their markets. The company provides styrenic applications for many everyday products across a broad range of industries, including automotive, electronics, household, construction, healthcare, toys/sports/leisure, and packaging.INEOS Styrolution employs approximately 3,100 people and operates 15 production sites in nine countries.

Commissioning underway for ExxonMobil’s ethane cracker in Baytown, Texas

MOSCOW (MRC) -- ExxonMobil has announced that a new 1.5 MMtpy ethane cracker at its Baytown, Texas complex is mechanically complete with commissioning progressing well, as per the company's press release.

Project startup is expected during the second quarter of 2018.

The new ethane cracker, part of ExxonMobil’s multi-billion dollar Baytown chemical expansion project, will provide ethylene feedstock to the new performance polyethylene lines in Mont Belvieu, which began production in the fall of 2017.

"With the completion of the project in Baytown, we are on the verge of fully realizing one of ExxonMobil’s most significant U.S. Gulf Coast investments," said John Verity, president of ExxonMobil Chemical Company. "Our new ethane cracker will allow us to economically meet rapidly growing demand for high-performance polyethylene products around the world while continuing to sustain economic development and create jobs for decades to come."

The project has created more than 10,000 construction jobs and 4,000 related jobs in nearby Houston communities since construction began in 2014. Once operational, it is expected to support 350 new permanent positions at the Baytown complex, USD870 million a year in regional economic activity and USD90 million per year in local tax revenues.

The Baytown chemical expansion project is a key component of ExxonMobil’s previously announced Growing the Gulf initiative. In addition to the ethane cracker in Baytown, ExxonMobil and SABIC are proposing to build a jointly owned petrochemical complex in San Patricio County, Texas, that would include a 1.8 MMtpy ethane cracker - the largest capacity of any ethane cracker built to date.

Massive new supplies of oil and natural gas have dramatically reduced energy costs and created new sources of feedstock for U.S. refining and chemical manufacturing. Most of ExxonMobil’s planned new chemical capacity investment in the Gulf region is focused on supplying export markets such as Asia with high-demand products, which will contribute to strengthening the United States’ balance of trade. Recent changes in the U.S. corporate tax rate also create an environment for increased future capital investments in projects such as these, and will further enhance the company’s competitiveness in global markets.

"The US chemical industry is rapidly expanding along the Gulf Coast due to abundant supplies of domestically produced natural gas, as demonstrated by the investments ExxonMobil alone is making," Verity said. "This expansion will not only increase the nation’s existing manufacturing and export capacity, but also further stimulate economic growth and create thousands of full-time jobs."

ExxonMobil Chemical Company is one of the largest petrochemical companies worldwide. The company holds leadership positions in some of the largest-volume and highest-growth commodity petrochemical products in the world. ExxonMobil Chemical Company has manufacturing capacity in every major region of the world, serving large and growing markets. More than 90% of the company's chemical capacity is integrated with large refineries or natural gas processing plants.

Europe shuns Russian oil as boost of Chinese flows hits quality

MOSCOW (MRC) - European refiners are threatening to cut Russian oil purchases due to worsening quality after Moscow has re-routed large volumes of crude to China, as part of its fight with OPEC and the United States for market share in fast growing Asian markets, Reuters.

The quality of Russia's flagship Urals oil grade has deteriorated so much that multiple buyers are reviewing how much they buy and the price they are willing to pay for it, according to traders and sources close to European refiners.

Russia has forged closer ties with energy-hungry China at a time of chilling relations with the West over Moscow's role in Ukrainian crisis and allegations of its interference in foreign elections, accusations denied by the Kremlin. Miroslaw Kochalski, vice-president of PKN Orlen, Poland's biggest refiner, told Reuters in an interview that the changing quality of the Urals his company buys could influence future deals. "It opens room for negotiations with partners, also regarding price conditions," Kochalski said.

According to the industry sources who spoke to Reuters, that position is shared by others in the industry who buy Urals crude. The Russian energy ministry and oil pipeline monopoly Transneft both acknowledge the problem of weak Urals quality.

The Urals oil that reaches customers in Europe is a blend of different sources of oil, with the mixing taking place inside Russia's pipeline system. The quality depends on the relative proportions of higher-quality and lower-quality darker oils in the mix.

Data on Urals chemical composition, obtained by Reuters from industry sources, showed the oil exported to Europe this month is near the bottom end of the quality range allowed under a standard set by Russia's state standards agency Rosstandart. The trading sources said they track the quality via documents that accompany cargos of crude pumped from Russia.

The worsening of Urals quality has dampened its price and prompted buyers to think about the possibility of reducing the volumes they buy, according to the traders and sources close to European refineries. "We can't refine this (oil)," a trader at a European company said. "There is only one way out, which is to cut Urals purchases and get supplies of lighter grades for blending."

At least five traders said they believed Urals was being affected because better-quality types of oil that would previously have been mixed into Urals were being diverted instead eastwards and incorporated into the ESPO blend exported to China and other Asian markets.

BP to boost U.S. investment after tax reform

MOSCOW (MRC) - British oil and gas company BP will increase investment in the United States after the lowering of tax rates under President Donald Trump, Chief Executive Bob Dudley said on Tuesday, as per Reuters.

"It is important for us, there is no doubt we will increase investments," Dudley, himself a U.S. citizen, said in an analyst call after BP reported a surge in profits in 2017.

BP invested USD90 billion in the United States over the past decade, excluding $65 billion in fines and clean up costs over the 2010 Deepwater Horizon disaster, making it the country's biggest investor in the energy sector, Dudley said.

"The regulatory system in the United States is suddenly so much easier. It was becoming an avalanche of regulations in every direction," he said. "From a business community stand point this is quite transformational, there will be a lot of capital attracted to the U.S. because of that."

BP took a one-off charge of USD900 million in the fourth quarter of 2017 to adjust to new U.S. tax rules, though it expects a long-term boost from the corporate-friendly rates.