Qatar to withdraw from OPEC and focus on gas exports

MOSCOW (MRC) -- Qatar said on Monday it was quitting OPEC from January 2019 but would attend the oil exporter group’s meeting this week, saying the decision meant Doha could focus on cementing its position as the world’s top liquefied natural gas (LNG) exporter, reported Reuters.

Doha, one of the smallest oil producers in the Organization of the Petroleum Exporting Countries, is locked in a diplomatic dispute with the group’s de facto leader Saudi Arabia but said the move to leave OPEC was not driven by politics.

Minister of State for Energy Affairs Saad al-Kaabi told a news conference that Qatar, which he said been a member of OPEC for 57 years, would still attend the group’s meeting on Thursday and Friday this week, and would abide by its commitments.

"Qatar has decided to withdraw its membership from OPEC effective January 2019 and this decision was communicated to OPEC this morning," the minister said.

"For me to put efforts and resources and time in an organization that we are a very small player in and I don’t have a say in what happens ... practically it does not work, so for us it’s better to focus on our big growth potential," he said.

One OPEC source told Reuters the decision was more symbolic than anything else. "They are not a big producer, but have played a big part in it’s (OPEC) history," the source said.

Qatar has oil output of only 600,000 barrels per day (bpd), compared with the 11 million bpd produced by Saudi Arabia, the group’s biggest oil producer and world’s biggest exporter.

But Doha is an influential player in the global LNG market with annual production of 77 million tonnes per year, based on its huge reserves of the fuel in the Gulf.

Amrita Sen, chief oil analyst at consultancy Energy Aspects, said Qatar’s withdrawal “doesn’t affect OPEC’s ability to influence as Qatar was a very small player."

OPEC and its allies, including Russia, are expected to agree on a supply cut at this week’s meeting in a bid to support crude prices that have slid almost 30 percent since October.

Oil prices surged about 5 percent on Monday after the United States and China agreed to a 90-day truce in their trade war, but Brent crude is still trading at around USD62 a barrel, well below October’s peak of more than USD86.

Al-Kaabi, who is heading Qatar’s OPEC delegation, said the decision was not political but related to the country’s long-term strategy and plans to develop its gas industry and increase LNG output to 110 million tonnes by 2024.

OPEC members, Saudi Arabia and the United Arab Emirates, and fellow Arab states Bahrain and Egypt, have imposed a political and economic boycott on Qatar since June 2017, accusing it of supporting terrorism. Doha denies the charges and says the boycott aims to impinge on its sovereignty.

"A lot of people will politicize it," Al-Kaabi said. "I assure you this purely was a decision on what’s right for Qatar long term. It’s a strategy decision."

"We will make a big splash in the oil and gas business soon," he said.

He said Qatar Petroleum planned to raise its production capability from 4.8 million barrels oil equivalent per day to 6.5 million barrels in the next decade. Doha also plans to build the largest ethane cracker in the Middle East.

As MRC wrote before, in October 2018, Qatar Petroleum (QP), the world’s top supplier of liquefied natural gas (LNG), announced further increase in the capacity of Qatar’s LNG expansion project, by adding a fourth liquefaction train, to raise the country's liquefied natural gas capacity to 110 million t/y.

Total Corbion PLA starts-up its 75,000 tonnes per year bioplastics plant

MOSCOW (MRC) -- Total Corbion PLA, a 50/50 joint venture between Total and Corbion, announces the start-up of its 75,000 tonnes per year PLA (Poly Lactic Acid) bioplastics plant in Rayong, Thailand, said the producer.

The plant has successfully produced Luminy® PLA resins. This bioplastic provides a valuable contribution towards the circular economy being 100% renewable and biodegradable and offering multiple environmentally-friendly waste solutions.

The new facility will produce a broad range of Luminy® PLA resins from renewable, non-GMO sugarcane sourced locally in Thailand: from standard PLA to innovative, high heat PLA and PDLA1 with unique properties. The products will meet customers’ needs in a wide range of markets notably packaging, consumer goods, 3D printing, fibers and automotive and are specifically optimized for extrusion, thermoforming, injection molding and fiber spinning processes.

At the end of their useful life, PLA products can be mechanically or chemically recycled, or in some cases composted and returned to the soil as fertilizer.

Total Corbion PLA will leverage on the integration with its lactide plant, the monomer required for the production of PLA, that has simultaneously been expanded to 100,000 tonnes per year production capacity. Furthermore, the 1,000 tonnes per year PLA pilot plant, which has been operational since the end of 2017, is located on the same site and will be used for product development.

The start-up marks a major milestone for both the joint venture and the bioplastics market. With this additional 75,000 tonnes per year facility, the global production of PLA bioplastics will increase by almost 50% to 240,000 tonnes per year. PLA is a fast-growing polymer market with an estimated annual growth rate of 10% to 15%.

"The start-up of this state-of-the-art plant establishes Total Corbion PLA as a world-scale PLA bioplastic producer, ideally located to serve growing markets from Asia Pacific to Europe and the Americas” says Stephane Dion, CEO of the company. “The subsequent increase in global PLA capacity will enable manufacturers and brand owners to move into the circular economy and produce biobased products with lower carbon footprints and multiple end of life options."

Davis-Standard buys thermoforming equipment maker TSL

MOSCOW (MRC) -- Extrusion machinery maker Davis-Standard LLC has acquired Thermoforming Systems LLC (TSL), a manufacturer of thermoforming equipment for the North American food packaging industry, said Canplastics.

The terms of the deal have not been disclosed.

“TSL is the market leader in thermoforming equipment technology for high volume packaging and we are excited to welcome their dedicated team to Davis-Standard today,” said Jim Murphy, president and CEO Pawcatuck, Conn.-based Davis-Standard President and CEO.

Yakima, Wash.-based TSL will continue to operate as a standalone company, Murphy added.

The acquisition is the second big purchase for Davis-Standard this year. In June, the company bought Brampton Engineering, a Brampton, Ont.-based maker of blown film technology.

Davis-Standard designs, develops, and distributes extrusion and converting technology. The company employs more than 1,300 workers, and has manufacturing and technical facilities in the U.S., China, Germany, Finland, Switzerland, Canada, and the UK.

Shell closes divestment of upstream assets in Ireland

MOSCOW (MRC) -- Oil major Shell has left the upstream sector in Ireland following the sale of its interest in the Corrib gas project, as per Offshore EnergyToday.

The Corrib natural gas field lies some 83km off the northwest coast of Ireland, approximately 3,000 meters under the seabed and in waters 350 meters deep. The field development started production on December 30, 2015.

The initial development comprises six subsea wells, and gas is transported through an 83 km pipeline to an onshore gas processing terminal. The gas is exported from the terminal via the Bord Gais Eireann link line to the existing Irish gas grid.

Shell said on Friday it had completed the previously announced sale of its shares in Shell E&P Ireland Limited (SEPIL), which holds a 45% interest in the Corrib gas venture, for up to USD1.3 billion to Nephin Energy Holdings Limited (NEHL), a wholly-owned subsidiary of Canada Pension Plan Investment Board (CPPIB).

Completion follows receipt of all necessary partner and regulatory consents and the transaction’s effective date is January 1, 2017, Shell said.

The transaction includes an initial consideration of USD958 million (EUR840 million), an interest of USD54 million (EUR47 million), and additional payments of up to USD285 million (EUR250 million) between 2018- 2025, subject to gas price and production. Completion of the deal represents Shell’s exit from the upstream sector in Ireland.

Shell’s share of the Corrib gas venture’s production represented approximately 27,000 barrels of oil equivalent/day in 2016.

The sale will contribute to Shell’s USD30 billion divestment target for 2016-2018. Shell Energy Europe Limited (SEEL) has signed an offtake agreement to purchase Corrib gas following completion.

CPPIB is the new Corrib Gas JV partner and Vermilion, as per the strategic partnership agreement with CPPIB, is the new operator of the Corrib Gas Venture.

CPPIB plans to transfer SEPIL along with a 1.5% working interest to Vermilion.

Vermilion said on Friday that this transfer had received all required government approvals and is expected to be completed in the coming weeks. The estimated purchase price after interim period adjustments is approximately €6 million.

Following the transfer, Vermilion will hold a 20% operated interest in Corrib, NEHL will hold a 43.5% non-operated interest, and Equinor continues to hold a 36.5% non-operated interest.

Shell retains a presence in Ireland through its aviation joint venture, Shell and Topaz Aviation Ireland Limited.

Shell on Friday also completed the sale of its entire 44.56% interest in Draugen field and 12% interest in Gjoa in Norway to OKEA.

As MRC wrote before, in October 2018, Royal Dutch Shell agreed a USD1.9bn deal to sell its Danish upstream oil and gas assets to Norwegian Energy Company ASA (Noreco).

Earlier, in March 2016, in March 2016, Royal Dutch Shell Plc began lining up assets for a USD30 billion divestment program that might be extend from the US and Trinidad to India following its record takeover of BG Group Plc.

Royal Dutch Shell, commonly known as Shell, is an Anglo–Dutch multinational oil and gas company headquartered in the Netherlands and incorporated in the United Kingdom.Created by the merger of Royal Dutch Petroleum and UK-based Shell Transport & Trading, it is the fourth largest company in the world as of 2014, in terms of revenue, and one of the six oil and gas "supermajors".

Total restarting Normandy refinery after workers suspend strike

MOSCOW (MRC) -- Oil and gas major Total said on Friday it had begun the restart of its 253,000 barrel-per-day Gonfreville refinery in France’s Normandy region after unions suspended a week-long strike that disrupted output and deliveries, reported Reuters.

A Total spokeswoman said deliveries from its refineries and depots had resumed on Friday.

France’s CGT union suspended the strike on Thursday evening.

As MRC informed earlier, in December 2017, Total inaugurated the new units at its Antwerp integrated refining & petrochemicals platform, which had progressively started up in the previous few months.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.