Brazil's Petrobras likely to extend deadline in refineries sale

MOSCOW (MRC) -- Brazil’s state-controlled oil company Petroleo Brasileiro may extend the deadline for potential bidders for a 60 percent stake in four refineries to sign non-disclosure agreements, a person with knowledge of the matter said, reported Reuters.

A ruling from Supreme Court Justice Ricardo Lewandowski this week requiring Congress to approve all sales programs of state-controlled companies threw up another roadblock to the effort to sell the refineries, which had attracted only lackluster interest from potential buyers.

Petrobras did not respond to requests for comment.

The deadline for potential buyers to sign nondisclosure agreements for the refinery partnerships - a first step in the sale process that does not signal firm interest - had been set for next Monday, July 2, but the person said it may be extended.

In a securities filing released on June 18, Petrobras said that five companies had signed nondisclosure agreements, a step that allows them to access more detailed information about the refineries.
Reuters reported last month that Petrobras’ decision to cut diesel prices in response to a truckers’ protest was spooking potential refinery buyers.

Brazilian conglomerate Ultrapar Participacoes SA, Cosan SA Industria e Comercio and Cepsa SA, an energy company controlled by sovereign wealth fund Mubadala Development Co, are among the five companies that signed non disclosure agreements, one source with knowledge of the matter said.

Another source said Petrobras hopes to get more potential bidders to sign non-disclosure agreements before proceeding to the next phase of the refineries sale.

Despite the Lewandowski decision, which has cast a pall over efforts to sell Brazilian state assets in general, a third source within the oil company said it still intends to sell the refineries and is working to conclude the process, as approved by the board.

The refineries are expected to be sold in two regional blocks: one in Brazil’s northeast and another in the southern region of the country. Each refinery cluster Petrobras put up for sale has earnings before interest, tax, depreciation and amortization (EBITDA), a common gauge of operating profits, of USD1 billion, according to a fourth person with knowledge of the process.

As MRC wrote before, in October 2017, Petrobras’s minority stakes in Braskem and Deten Quimica was excluded from Petrobras’s divestment program, according to a government decree published in Brazil’s Official Gazette. The decree prevented Petrobras from immediately selling its minority stake in Braskem, which had been announced last year. A new decree will be required to release the stock sale.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

MOSCOW (MRC) -- Fund Energy Ningbo Co has restarted its methanol-to-olefin (MTO) plant in Changzhou City, as per Apic-online.

A Polymerupdate source in China informed that the company has resumed operations at the plant on July 2, 2018 following a turnaround. The plant was taken off-line for maintenance on May 5, 2018.

Located at Zhejiang, China, the MTO unit has an ethylene production capacity of 300,000 mt/year and a propylene production capacity of 300,000 mt/year.

Ningbo Fund Energy Co. Ltd. manufactures and distributes petrochemical products. The Company produces ethylene glycol, polypropylene, and other products.
MRC

MOSCOW (MRC) -- Petrochemicals company Ineos will invest 2.7 billion euros (USD3.15 billion) to build a new chemical cracker and a propane dehydrogenation (PHD) unit in northwest Europe, the company said.

This is the first cracker to be built in Europe in 20 years and both facilities will benefit from US shale gas economics, it said, adding that the location of the site will be announced soon and the project will be completed in four years.

Jim Ratcliffe, Founder and Chairman of Ineos says, "This is the largest investment to be made in the European chemical sector for a generation. It will be a game changer for the industry and shows our commitment to manufacturing."

Ineos has approved a EUR2.7 billion capital project to build both a world scale ethane cracker and a PDH (Propane Dehydrogenation) unit in Northern Europe. Both units will benefit from US shale gas economics.

This will be the first new cracker built in Europe for two decades. It will also be one of the most efficient and environmentally friendly plants of its type in the world.

The location of the site will be determined soon and it is likely to be on the coast of North West Europe. A project team has been assigned to consider options and the project is expected to be completed within four years.

Gerd Franken, Chairman Ineos Olefins and Polymers North says, "This new project will increase INEOS self-sufficiency in all key olefin products and give further support to our derivatives business and polymer plants in Europe. All our assets will benefit from our ability to import competitive raw materials from the USA and the rest of the world".

This new investment follows a decision taken by Ineos last year to increase the capacity of its existing crackers.

Jim Ratcliffe adds, "Ineos is going from strength to strength. This new investment builds on the huge investment we made in bringing US shale gas to Europe and will ensure the long-term future of our European chemical plants."
MRC

MOSCOW (MRC) -- Honeywell announced that Secunda Synfuels Operations, an operating division of Sasol South Africa Ltd., will use a Honeywell Connected Plant service to monitor the operating reliability of its two Honeywell UOP CCR Platforming units at its refinery in Secunda, South Africa, as per Hydrocarbonprocessing.

Sasol will use the Honeywell Connected Plant Process Reliability Advisor, which provides performance analysis and recommendations by streaming plant data through Honeywell UOP fault models.

"This initiative forms part of a range of digitization efforts that are being evaluated at Secunda Synfuels Operations," said Stefan Opperman, Vice President, Technical Support, at Secunda Synfuels. "All of these efforts aim to utilize predictive analytics to improve plant performance and reduce costs."

The Connected Plant service will help the Secunda plant run more smoothly by monitoring unit performance and providing early event detection and mitigating issues before they become costly.

"Process Reliability Advisor is unique in the industry because it analyzes site-specific process data using Honeywell UOP's proprietary process knowledge and deep troubleshooting experience," said Zak Alzein, Vice President, Connected Plant, at Honeywell UOP. "This enables the service to recommend operational adjustments more quickly and accurately than has ever been possible, so plants can run at the very top of their capabilities."

Honeywell Connected Plant is a suite of applications that delivers higher levels of safety, reliability, efficiency and profitability. These proven industry solutions are based on decades of Honeywell's domain knowledge and controls experience. These solutions turn data into actionable insight to optimize operations, predict plant failures and eliminate unplanned downtime.
MRC

MOSCOW (MRC) -- Plastic refuse should be seen as a raw material, able to produce "completely waste-based" recycled goods, the incoming chief executive of Austrian plastics maker Borealis AG told Reuters, vowing his firm would do its bit to cut pollution.

An estimated eight million tonnes of plastic waste ends up in the oceans every year in a mounting threat to marine life, according to the United Nations. Companies from Coca-Cola to Volvo Cars are planning ways to limit use of plastics.

Consumer unease about the environmental cost of plastic waste has become a hot political topic. Governments are working to outlaw single-use items such as drinking straws and retailers are rushing to make their packaging more sustainable.

Borealis has previously described plastic waste as "the Achilles heel of the plastics industry."

The company, which makes plastic products ranging from food packaging to pipes and light-weight car parts, plans new investments to raise the share of recycled plastic in its goods.

"We have a long-term vision that we want to make plastic waste a raw material," Alfred Stern said in a telephone interview on Wednesday.

Borealis, which has 6,500 employees and 7.5 billion euros (USD8.71 billion) in sales last year, would aim for recycled products that are "completely waste-based, just like we use other feedstocks today", he said.

"That will result in further investments over time," he said, declining to give any timetable or estimated numbers. Abu Dhabi's sovereign wealth fund owns 64 percent of the company, with the rest held by Austria-based OMV.

Stern, now head of Borealis' polyolefin business and innovation, will take over from Mark Garrett as CEO on July 2.

He said Borealis was working with Volvo, which said last week that at least 25 percent of the plastics used in new car models from 2025 would be from recycled materials, up from about five percent now.

"The materials we supply to Volvo with post-consumer recycling content perform like virgin materials," he said.

And Borealis also said earlier this month that it would invest 15 million euros (USD17.50 million) to raise annual recycling capacity at its German unit mtm plastics GmbH, acquired two years ago, to 80,000 tonnes from 60,000.

Stern said recycling did not make economic sense in many markets. China has banned imports of some low-grade plastic waste for recycling from this year, upending markets in Europe in North America which lack recycling capacity.

"The end goal needs to be commercial, economic viability," he said.

Borealis is also working on a 4 million euro initiative announced in 2017 to combat plastic pollution of the oceans and improve waste management in South-East Asia, with a pilot project in the Indonesian fishing port of Muncar.

Martin Stuchtey, a founder of SYSTEMIQ which works with Borealis in the anti-pollution project STOP, said Muncar would be a test case of ways to limit waste, collect and recycle plastics in a possible guide for governments.

As MRC wrote previously, in March 2018, Borealis and United Chemical Company LLP (UCC) signed a Joint Development Agreement (JDA) for the development of a world-scale polyethylene project, integrated with an ethane cracker, in the Republic of Kazakhstan.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. With headquarters in Vienna, Austria, Borealis currently employs around 6,500 and operates in over 120 countries.
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