Scale of theft at Shell Singapore refinery much greater, court documents show

MOSCOW (MRC) -- Around USD150 millions’ worth of oil was stolen from Shell’s biggest global refinery over several years, Singapore court documents reviewed by Reuters show, far more than reported when police first revealed the heist earlier this year.

Almost a year on from raids that led to over a dozen arrests, including of several former employees of the local unit of Royal Dutch Shell, charge sheets state that around 340,000 tonnes of gasoil were stolen from the oil major’s Pulau Bukom site in Singapore, in incidents dating back to 2014.

Charges filed in the first few months of investigations after police raids in January related to the theft of around $10 million in oil. Further charges levied in May showed a total of USD40 million had been stolen.

A spokeswoman for Shell said the firm is “disappointed”, adding that it has been working with investigators and taken measures to avoid repeat incidents at the Pulau Bukom facility, which lies just south of Singapore’s main island.

"These include closer monitoring of products moving in and out of Bukom, tightening vessel management procedures, and stepping up ethics and compliance training," the spokeswoman said in an emailed statement to Reuters on Thursday.

Southeast Asia is a hot spot for illegal fuel trading, with its island-dotted waters providing cover for small-scale smuggling of oil products across borders. But the regularity and audacity of the thefts at Shell’s refining facility - some of which took place during working hours - stand out.

"Fuel is both ubiquitous and untraceable, making its theft a seemingly low-risk criminal operation compared to something like drug smuggling or arms trafficking, where the concern about being caught is much higher," said Ian Ralby, a maritime crime expert who works with both the U.N. and the US-based think tank Atlantic Council.

"That false sense of security leads to some fairly brazen forms of theft."

Fuel theft could be worth USD133 billion a year globally, according to industry estimates, although Ralby said that figure might be conservative.

The case in Singapore looks like it could drag on, given the routine addition of new charges and amendments to older charges. The police investigation is still ongoing.

Ho Lifen, a lawyer at Rajah & Tann representing one of the accused former Shell employees, Cai Zhi Zhong, said the charges were being amalgamated. "It’s quite far from final sentencing," she said.

Besides the former Shell employees, there have been related charges filed against former employees of one of Singapore’s biggest marine fuel suppliers, Sentek Marine & Trading Pte Ltd; a Singaporean who worked for Intertek, a British-listed company specializing in quality and quantity assurance, including for fuel products; and three Vietnamese nationals who allegedly received stolen property aboard ships.

As MRC wrote before, Shell Singapore shut down its mixed feed steam cracker in Bukom on 13 August, 2018, following a burst water pipeline Monday. The steam cracker is able to produce 960,000 mt/year of ethylene, 540,000 mt/year of propylene and 155,000 mt/year of butadiene. The refinery also produces 230,000 mt/year of benzene. The sources said then that Shell was forced to shut down two boilers out of four following a burst pipeline.

Royal Dutch Shell plc is incorporated in England and Wales, has its headquarters in The Hague and is listed on the London, Amsterdam, and New York stock exchanges. Shell companies have operations in more than 70 countries and territories with businesses including oil and gas exploration and production; production and marketing of liquefied natural gas and gas to liquids; manufacturing, marketing and shipping of oil products and chemicals and renewable energy projects.

BASF sets up new business structure

MOSCOW (MRC) -- As of Jan. 1, 2019, BASF will have six segments instead of four. With this new segment structure, BASF will create greater transparency regarding the management of its business activities, the importance of value chains and the role of the Verbund, as per Coatingsworld.

Together with this organizational change, the responsibilities of the Board of Executive Directors have been reallocated. The new distribution of responsibilities, effective as of Jan. 1, 2019, is as follows:

• Dr. Martin Brudermuller, chairman of the Board of Executive Directors and CTO, Ressort I: Legal, Taxes, Insurance & Intellectual Property; Corporate Development; Corporate Communications & Government Relations; Senior Executive Human Resources; Investor Relations; Compliance; Corporate Technology & Operational Excellence; Innovation Management.

• Michael Heinz, industrial relations director, Ressort II: Engineering & Technical Expertise; Environmental Protection, Health & Safety; European Site & Verbund Management; Human Resources.

• Dr. Hans-Ulrich Engel, vice chairman of the Board of Executive Directors and CFO, Ressort III: Catalysts; Coatings; Oil & Gas; Finance; Procurement & Supply Chain Services; Digitalization & Information Services; Corporate Controlling; Corporate Audit.

• Dr. Markus Kamieth, Ressort IV: Care Chemicals; Dispersions & Pigments; Nutrition & Health; Performance Chemicals; Advanced Materials & Systems Research; BASF New Business; Region South America.

• Saori Dubourg, Ressort V: Agricultural Solutions; Construction Chemicals; Bioscience Research; Region Europe.

• Sanjeev Gandhi, Ressort VI, headquartered in Asia: Intermediates; Petrochemicals; Greater China & Functions Asia Pacific; South & East Asia, ASEAN & Australia/New Zealand.

• Wayne T. Smith, Ressort VII, headquartered in North America: Monomers; Performance Materials; Process Research & Chemical Engineering; Market & Business Development, Site & Verbund Management North America; Regional Functions & Country Platforms North America.

As of Jan. 1, 2019, the segments will each have two divisions, with the exception of the Agricultural Solutions segment, which will continue to comprise one division.

HDPE production in Russia up by 6.5% in Jan-Nov 2018

MOSCOW (MRC) - Russia's production of high density polyethylene (HDPE) was about 877,600 tonnes in January-November 2018, up 6.5% year on year. At the same time, not all Russian producers raised their output of HDPE, according to MRC's ScanPlast report.

November HDPE production in Russia grew to 81,700 tonnes, whereas this figure did not exceed 64,200 tonnes a month earlier. Capacities of the two largest producers, Kazanorgsintez and Stavrolen were shut for the repair in October. Overall HDPE production reached 877,600 tonnes in the first eleven months of 2018, compared to 824,300 tonnes a year earlier. All producers increased their output volumes with the exception of Nizhnekamskneftekhim, which reduced production in favour of linear polyethylene (LLDPE).

The structure of polyethylene (PE) production by plants looked the following way over the stated period.

Kazanorgsintez's total HDPE output increased to 45,800 tonnes in November from 16,800 tonnes a month earlier, the Kazan producer shut down its production capacities for almost a one-month scheduled turnaround on 25 September. The Kazan plant's overall HDPE production was 465,500 tonnes in January-November 2018, up by 1% year on year.

Stavrolen produced about 25,600 tonnes last month versus 18,600 tonnes in October, the Budenovsk producer took off-stream its production capacities for maintenance in the first decade of October. The plant's overall HDPE output reached 266,700 tonnes in the first eleven months of 2018, up by 24% year on year. Such a high amount of the increase in the output was caused by the absence of a long scheduled maintenance this year.

Gazprom neftekhim Salavat shut its capacities in November for a short scheduled shutdown, with about 8,200 tonnes produced, compared with 11,500 tonnes in October. The Bashkir plant's total HDPE output reached 109,000 tonnes in the first eleven month of 2018, up by 30% year on year. Such a high amount of the increase in the output was caused by the absence of a long scheduled turnaround this year, as it was the case with Stavrolen.

Nizhnekamskneftekhim produced HDPE only in April-May and in late September during the stated period. Thus, the Nizhnekamsk producer manufactured only 43,800 tonnes of HDPE over the incomplete four months of operations versus 65,600 tonnes a year earlier.


PE imports to Russia down by 2% in Jan-Nov 2018

MOSCOW (MRC) -- Overall polyethylene (PE) imports into the Russian market dropped in the first eleven months of 2018 by 2% year on year to 540,200 tonnes. At the same time, ethylene-vinyl acetate (EVA) shipments rose significantly, according to MRC's DataScope report.

November PE imports to the Russian market were 49,200 tonnes, which is almost equal to the last month's figure. Overall PE imports reached 540,200 tonnes in January-November 2018, compared to 553,500 tonnes a year earlier. EVA imports increased significantly, whereas imports of low density polyethylene (LDPE) and linear low density polyethylene (LLDPE) decreased.

The structure of PE imports looked the following way over the stated period.

November high density polyethylene (HDPE) imports grew to 23,300 tonnes from 22,800 tonnes a month earlier, local companies slightly raised their HDPE purchasing in Uzbekistan. Overall HDPE imports reached 227,900 tonnes in the first eleven months of 2018, which virtually corresponds to the last year's figure.

Last month's LLDPE imports were 11,900 tonnes, compared to 11,200 tonnes in October, local companies increased their shipments of film grade PE. Overall LLDPE imports totalled slightly over 145,000 tonnes in January-November 2018 versus 166,600 tonnes a year earlier. Nizhnekamskneftekhim's increased output was the main reason for reducing dependence on imports.

November LDPE imports remained at the level of October - 6,700 tonnes. Overall LDPE imports totalled 77,100 tonnes over the stated period, compared to 82,600 tonnes a year earlier.

Last month's EVA imports fell to 3,700 tonnes, compared to 4,900 tonnes in October, demand for EVA for compounds production increased. However, imports of this ethylene copolymer grade rose by 33% in January-November 2018 to 44,200 tonnes.

Imports of other ethylene polymers were about 46,000 tonnes over the stated period, compared to 44,800 tonnes a year earlier.


Oil loadings resume to Russia's Afipsky refinery

MOSCOW (MRC) -- Oil loadings have resumed to the Afipsky refinery, Interfax news agency cited Russian pipeline monopoly Transneft as saying on Friday, reported Reuters.

The company also said it expected to resume loadings to the Antipinsky refinery soon, the agency reported.

As MRC informed before, Russia’s Afipsky, a mid-sized private oil refiner, suspended oil refining to carry out maintenance of its two crude units from Oct. 6-17, 2018.

Afipsky Oil Refinery Ltd. produces gas, diesel fuel, and fuel oil. Afipsky Oil Refinery Ltd. was formerly known as Afipsky Oil Refinery and changed its name to Afipsky Oil Refinery Ltd. in January 2002. The company was founded in 1975 and is based in Seversk, Russia. As of June 29, 2010, Afipsky Oil Refinery Ltd. operates as a subsidiary of OOO NefteGazIndustria.