Indorama and Dhunseri form joint venture to acquire Egypt PET plant

MOSCOW (MRC) -- Indorama Ventures Public Company Limited (IVL), a global chemical producer, has announced that it has entered into a joint venture agreement with Dhunseri Petrochem Ltd. (Dhunseri) to acquire its Egyptian Indian Polyester Company S.A.E. (EIPET) PET facility located in Ain Sokhna free trade zone, North West of the Gulf of Suez in Egypt, as per IVL's press release.

This plant has a manufacturing capacity of 540,000 tonnes per annum. The transaction takes place with immediate effect. Restart activities for manufacturing recyclable PET has commenced and key raw material PTA will be shipped from IVL Portugal soon after restart of Portugal PTA production anticipated in early July 2018.

This joint venture between Dhunseri and IVL allows for an uninterrupted supply of recyclable PET, which promotes the development of the consumer beverage industry and increases demand for sustainable packaging. Indorama Ventures will bring its world class capability and supply chain economics to the JV in order to competitively serve customers growing needs of sustainable packaging in Egypt and in the region as a whole and will be one of the largest project in EMEA. IVL is one of the few integrated producer of PTA and PET in Europe-Middle East-Africa (EMEA) spanning Lithuania in the North East and Nigeria in West Africa. IVL is the largest producer in Turkey for recyclable PET and producer of PTA and PET in Rotterdam, The Netherlands and in the Iberian Peninsula.

IVL is focused on balancing market needs for recyclable PET packaging, which has faced unprecedented economic challenges over last several years leading to uncompetitive supplies and disruptions in recent times. The facility in Egypt will lead to easing supply concerns in North Africa and in the Common Market for Eastern and Southern Africa (COMESA) as well as the markets covered by the several Free Trade Agreements (FTA) which Egypt is a signatory to.

The EIPET plant is strategically located in Ain Sokhna free trade zone, Egypt, offering logistics advantage when sourcing feedstocks and delivering end products in key markets, domestically and internationally. This facility is one of the largest in the Middle East and Africa and is well-positioned to cater to the increasing packaging needs of customers in the region and elsewhere. The economic resurgence in the region is expected to further improve demand growth potential, which currently is at around 7% per annum. Both partners are confident about the reforms that President El-Sisi has brought about in Egypt and the JV is a step forward to fulfilling the commitment made to the Egyptian authorities over the past three years.

Dhunseri and Indorama Ventures have established a sound business rapport and support mechanism in India since 2016 and expects to achieve continued success in this follow up investment in Egypt. Indorama Ventures has successfully revived a PTA producer in Portugal following the previous owner’s bankruptcy and has recently taken on the revitalization of Brazil’s largest PET plant, which faced a serious financial crisis after its former parent went in liquidation. The revival of these businesses will support easing of reliable supplies by IVL to its customers and help grow sustainable packaging in markets worldwide.

The addition of EIPET will increase Indorama Ventures’ existing global PET capacity by 10%. This plant uses the same technology as deployed at the IVL Dhunseri facility in India, allowing the Company to leverage its proven operational expertise and track record of successful integration. This recently built facility will be among Indorama Ventures’ finest in terms of scale and competiveness, enabling the Company to maintain its position at the forefront of the industry and serving customer needs in every geography in a timely and reliable manner.

Indorama Ventures expects to be able to leverage on internal feedstock supply of PTA from its manufacturing base in Asia and Iberian Peninsula as well as IPA from its facility in Spain, enabling it to utilize its assets more efficiently and ensure supply continuity to all its customers. In addition, this joint venture will also open up a new avenue for growth by providing immediate access to a large domestic market and duty-free access to North and East Africa through preferential trade agreements in the region. Additional volume can be exported, with duty-free privileges to key Western markets that currently face limited availability of supply.

Commenting on this joint venture, Mr. Aloke Lohia, Group CEO of Indorama Ventures said, "I am delighted to extend our strategic partnership with Dhunseri through this acquisition. EIPET is a good fit with Indorama Ventures’ strategy in the recyclable and sustainable PET business, where the Company aims to supplement its position and build scale in key markets. EIPET also marks Indorama Ventures’ maiden entry into Egypt, complementing our existing footprint in EMEA. EIPET will provide meaningful opportunities for feedstock integration from our existing assets while allowing us to serve our customers in growth markets of Egypt and in the region."

Mr. C. K. Dhanuka, Executive Chairman of Dhunseri said, that "Our JV in India has been extremely smooth and provided a win-win situation for both, the customer and us. After experiencing the JV in India, we are very upbeat on entering the same in Egypt, which will be again a equal ownership JV."

Indorama Ventures Public Company Limited, listed in Thailand, is one of the world's leading petrochemicals producers, a global manufacturing footprint with 59 sites in 20 countries across Africa, Asia, Europe and North America. The company's portfolio is comprises necessities and high value-added (HVA) categories of polymers, fibers, and packaging. Indorama Ventures has approx. 15,000 employees worldwide and consolidated revenue of USD 8.4 billion in 2017. The company is listed in the Dow Jones Sustainability Index (DJSI).

Dhunseri Petrochem Ltd. is one of the largest producers of PET resin in India and among the top ten in the world. The company manufactures the finest bottle grade PET resin, for packaging of drinking water, carbonated soft drinks, edible oil, pharmaceuticals and many more. Dhunseri Petrochem Limited is the Petrochem division of Dhunseri Petrochem & Tea Limited.

Mongolia launches construction of first oil refinery with Indian aid

MOSCOW (MRC) - Mongolia launched construction of its first oil refinery, a long-awaited project that is funded by India and designed to end the country's dependence on Russian fuel, as per Reuters.

Friday's ground-breaking ceremony was attended by Mongolian Prime Minister Khurelsukh Ukhnaa and Indian Minister of Home Affairs Rajnath Singh.

The refinery, in southern Dornogovi province, will be capable of processing 1.5 million tonnes of crude oil per year, said Mongol Refinery, the state-owned company building the project, in a press release. That is about 30,000 Mbpd.

The refinery will be small by international standards, with most Chinese facilities each processing hundreds of thousands of barrels of crude per day, and India's Reliance Industries running one refinery at a record 1.2 MMbpd.

Still, Mongolia's new refinery, planned for completion in late 2022, will meet all of the nation's demand for gasoline, diesel, aviation fuel and liquefied petroleum gas (LPG).

"By establishing this strategically important oil refinery, the national economy will become independent from energy imports, and fuel and commodity prices will be stabilized," said Mongol Refinery in its statement. The project is expected to boost Mongolia's gross domestic product by 10 percent, it said.

Mongolia imported almost 1.5 million tonnes of oil products last year, virtually all from Russia. They amounted to 18 percent of all Mongolia's imports, according to official data.

Mongolia, a large landlocked country wedged between giants China and Russia, has a population of just 3 million. Almost half its people live as nomadic stock herders, and the country's oil demand is growing only very slowly.

"From a national security perspective, we do need to diversify our sources of oil products from the current single source, Russia," said Munkhdul Badral Bontoi, chief executive of Mongolia-based market intelligence group Cover Mongolia.

The cost of the refinery is estimated at $1.35 billion, and it will include a pipeline and its own power plant.

The refinery will process Mongolia's own crude oil, which is now sold to China.

Mongolia produced 7.6 million barrels of oil last year, about 21 Mbpd, amounting to 6 percent of its total export earnings. The country's petroleum industry regulator is expecting its crude oil output to rise over the years prior to the refinery's start-up.

Mongolia's big southern neighbor China produces around 3.8 MMbpd of crude, and imports more than 9 MMbpd, according to official government data.

Fluor readies first modules for Kuwait refinery project

MOSCOW (MRC) -- Fluor Corporation, a global engineering, procurement, fabrication and construction company, has announced the arrival of the first modules for the Kuwait Integrated Petroleum Industries Company (Kipic) Al Zour project in Kuwait, according to TradeArabia.

The US-based company is working with its joint venture partners Daewoo Engineering and Construction and Hyundai Heavy Industries to deliver two engineering, procurement, fabrication and construction packages for key process support units, utilities and infrastructure for the Al Zour refinery project.

Upon completion, the new complex is expected to be one of the largest refineries in the world and produce 615,000 barrels per day.

Modules are being constructed at the COOEC-Fluor Heavy Industries Company (COOEC-Fluor) fabrication yard in Zhuhai, China. The first 14 of the 188 modules were loaded onto a shipping barge and sailed away in May to Kuwait.

The sailaway of the modules was marked by a ceremony officiated by Hatem Al Awadhi, Kipic’s deputy chief executive officer and Jim Brittain, group president of Fluor’s Energy & Chemicals business, and was attended by executive members of the Fluor-led joint venture, known as FDH JV.

"Fluor is proud to be part of Kipic’s prestigious and strategically important Al Zour project," said Brittain.

"This milestone was achieved through the collaboration and commitment of our craft professionals at the newly expanded Zhuhai fabrication yard where more than 6,500 craft workers are safely fabricating steel and pipe and assembling modules for the project," he noted.

"Fluor and our joint venture partners are working closely with Kipic to implement Fluor’s integrated engineering, procurement, fabrication and construction solutions across every phase of the project to enable the safe and efficient construction, commissioning and start-up of this new refinery," said Al Collins, the president of Fluor’s Energy & Chemicals business in Europe, Africa and Middle East.

With headquarters in Irving, Texas, Fluor ranks 153 on the Fortune 500 list with revenue of USD19.5 billion in 2017 and has more than 56,000 employees worldwide, he added.

As MRC wrote before, in December 2017, Fluor Corporation announced that BASF’s Coatings division had opened a new automotive coatings plant at the Shanghai Chemical Industry Park in Caojing, Shanghai, China. After completing the front-end engineering and design, Fluor provided engineering, procurement and construction management services for the project. Fluor was responsible for building production lines, a solvent recovery unit, tank farms, utilities, warehouse, administration building and site infrastructure, with more than 1,200 craft workers onsite at peak.

TechnipFMC to provide licensing support of OxyVinyl ethylene di-chloride and vinyl chloride monomer technologies

MOSCOW (MRC) -- TechnipFMC has announced that it has signed a cooperation agreement with OxyVinyls to provide licensing support of OxyVinyl’s Ethylene Di-Chloride (EDC) and Vinyl Chloride Monomer (VCM) technologies, as per Hydrocarbonprocessing.

EDC and VCM are used primarily as feedstocks for the fabrication of PVC (PolyVinyl Chloride), a common plastic used in the construction of pipe, doors, windows, cable insulation and signage. OxyVinyls has the largest market share in licensing of both technologies.

"We are delighted by the signature of this agreement with today’s leading EDC/VCM licensor. This agreement allows us to complement our portfolio and offer to clients a full suite of high-quality technologies in the vinyls chain," Marie-Christine Charrier, Vice President Technologies of the EMIA region for TechnipFMC said.

TechnipFMC’s operating center in Lyon, France, a center of excellence for polyolefins, chemicals, petrochemicals and bio-sourced products is managing the agreement and will execute the process design packages.

As MRC reported previously, TechnipFMC has recently signed an exclusive cooperation agreement with KEM ONE, Europe’s third-largest PVC producer, to support the marketing and licensing of KEM ONE’s Suspension PolyVinyl Chloride (S-PVC) technology.

Curacao refinery seeks temporary operator to replace Venezuelas PDVSA

MOSCOW (MRC) - The government-owned Isla refinery in Curacao is seeking a company to immediately replace Venezuela’s state-run PDVSA as operator of the 335,000-barrel-per-day facility, which has been largely idled due to a lack of crude shipments to the plant, according to a document seen by Reuters.

The refinery this week sent letters to oil companies and traders offering partnerships for operating the refinery both in the short term and under a new, long-term lease beginning in January 2020, according to a copy of one letter.

"The rapidly deteriorating situation in Venezuela and financial and operational impediments to PDVSA’s business activities have presented a near term risk to continued operations of the oil facilities by PDVSA on its own," the refinery letter said.