Total to launch fuel retail network with Sonangol

MOSCOW (MRC) -- Total has agreed to develop joint activities in the downstream petroleum sector in Angola, with national company Sonangol, reported Hydrocarbonprocessing.

Already long-term partners in the upstream business, the two companies have decided to establish a Joint Venture company to develop a common retail and distribution activity in the country, the fourth largest market in sub-Saharan Africa.

While developing B2B activities, the Total-Sonangol Joint Venture will initially focus on fuel distribution and lubricants sales on the B2C segment, starting with a network of service-stations under the TOTAL brand.

Depending on the outcome of the ongoing liberalization process, Total also intends to address through this partnership both petroleum products logistics and supply, including imports and primary storage of refined products.

Under the current agreement, Sonangol will bring in 45 already existing urban and highway service-stations, with a key presence on selected locations in 10 coastal and central provinces. Total will work alongside his partner to rapidly develop this network, in order to meet the highest international retail standards and improve fuel quality distribution throughout the country. The newly-established company will invest in both infrastructures and marketing activities and will benefit from Total’s expertise in retail and its customer-minded approach.

"Total is very pleased to establish a new partnership in Angola, following decades of collaboration in upstream with Sonangol. Through the establishment of these joint fuel distribution activities, Total is further strengthening its footprint in the country,” commented Momar Nguer, President Marketing and Services and Executive Committee Member at Total. “This agreement is in line with our strategy to expand in large growing markets worldwide. Already the largest retailer in Africa, we intend to capitalize on this opportunity to roll out in Angola our offer of products and services and to develop additional synergies, for the full benefits of the Angolan customers."

As MRC informed before, 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.

Shell completes sale of New Zealand entities to OMV for USD578 million

MOSCOW (MRC) -- British-Dutch multinational oil and gas giant Royal Dutch Shell plc has announced it has completed the sale of its shares in Shell entities in New Zealand, to OMV for USD578 million, as per EnergyWorld.

This includes the Maui, Pohokura, and Tank Farm assets, and the sale of Shell’s interest in (and operatorship of) the Great South Basin venture, which was subject to a separate agreement.

The company said in a statement the sale is consistent with Shell’s global drive to simplify the upstream portfolio and re-shape the company into a world-class investment.

"We are proud of having worked in New Zealand for more than 100 years and completion of the sale to OMV marks an important milestone in the company’s history. Shell staff in New Zealand, past and present, have been key to building a successful New Zealand business. I wish our colleagues all the very best as OMV takes the business forward," said Zoe Yujnovich EVP, Australia and New Zealand.

Employees of Shell Taranaki Limited and Shell NZ 2011 Limited are now part of OMV New Zealand.

As MRC wrote before, 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".

Singapore light distillate fuel stocks hit record high

MOSCOW (MRC) -- Light distillate fuel stocks at Asia’s refining hub in Singapore have climbed to a record on surging supply just as fears emerge of an economic downturn heading into 2019, but holiday demand and refinery maintenance could lend some relief, as per Reuters.

Light distillate stocks in Singapore, which include the key transportation fuel gasoline and important petrochemical feedstock naphtha, rose by 1.47 million barrels in the week to Jan. 2, to a record 16.1 million barrels, according to data from Enterprise Singapore released on Friday.

The record comes on soaring supply from refineries across Asia, including China where exports have surged amid a broad expansion of the country’s refining capacity.

A slow-down in demand growth in key consumers such as China and India has also contributed to growing gasoline supplies, said Matthew Chew, principal oil analyst at IHS Markit in Singapore.

Weighed down by excess supply and sluggish demand, gasoline producers began losing money from gasoline after Asia’s benchmark gasoline margin GL92-SIN-CRK in December turned negative. The benchmark has since recouped some losses.

“We expect the weakness to persist in January but there could be some relief in February with higher seasonal demand during Lunar New Year (Feb. 5-6) easing some of the oversupplies,” said Chew.

“Planned refinery maintenance season thereafter could also help.”

However, traders said a slowdown in economic growth and, by extension also in fuel and petrochemical consumption, could keep inventories elevated.

“If factory utilization rates fall, then purchases of raw materials like petrochemical feedstocks will also weaken,” Singapore-based shipping brokerage Eastport said on Friday.

Data for December from the Institute for Supply Management (ISM) on Thursday showed the broadest U.S. slowdown in growth for more than a decade, as the trade conflict with China, falling equity prices and increasing uncertainty started to take a toll on the world’s biggest economy.

Leading economies in Asia and Europe have already reported a fall in manufacturing activity.

Sinopec suspends top officials at trading arm

MOSCOW (MRC) -- Sinopec has suspended two top officials at its trading arm Unipec and is evaluating the details related to certain crude oil transactions that have incurred some losses, reported Reuters with reference to the Chinese state oil company.

Unipec’s President Chen Bo, an industry veteran who helped the company become one of the world’s largest oil traders, has been suspended along with the senior Communist Party representative at the company, Zhan Qi, Sinopec said in a filing to the Hong Kong stock exchange.

"The Company was informed that Unipec incurred some losses during certain crude oil transactions due to the oil price drop. The Company is currently in the process of evaluating the details of such circumstance," Sinopec said.

Reuters earlier reported Chen Bo and Zhan Qi had been suspended after Unipec suffered losses, citing five sources. Neither Chen nor Zhan could immediately be reached for comment.

Vice president Chen Gang has been appointed to handle the company’s administrative work, Sinopec added in the filing.

"The government inspectors were looking into the company’s operations for the past few years ... one of the problems they found was the severe trading losses in the second half of this year because of wrong market judgment," one of the sources said.

The sources did not refer to any wrongdoing on the part of the two men.

Benchmark Brent and West Texas Intermediate (WTI) oil prices have fallen by about 40 percent since hitting their highest in four years in October, amid oversupply concerns as major producers ramped up output while the United States unexpectedly issued waivers that allowed countries to continue importing Iranian oil despite sanctions.

A sudden widening of WTI’s spread with Brent earlier this year also led to hefty losses at major traders.

Chen Bo, who rose through the ranks to take on Unipec’s top role, started the company’s liquefied natural gas (LNG) trading desk.

He also advocated boosting China’s crude oil imports from the Americas to help the world’s largest oil importing country to diversify its suppliers.

Oil traders said Chen’s removal could create uncertainty at Unipec.

"He’s been a key man in the oil trading industry in the past decade," said a veteran oil trader in Asia.

Shares in Sinopec closed at 5.25 yuan (USD0.76) on the Shanghai Stock Exchange, the lowest in two years and down 6.7 percent from 26 December 2018.

"Sinopec’s stock has been performing badly in the fourth quarter," said a Beijing-based equity analyst who cannot be named due to local stock exchange rules. The news today caused "a selloff and decline in prices," the analyst added.

In October, Sinopec reported that third-quarter net profit fell from the previous quarter, after rising for five consecutive quarters.

For the first nine months of 2018, the company reported a loss of 5.47 billion yuan (USD794 million) from foreign exchange rate changes and holdings in derivative financial instruments, according to financial reports issued in October.

In the first nine months of 2017, the company reported a gain of 1.13 billion yuan.

Of the 2018 losses, 4 billion yuan occurred in third quarter, according to Reuters calculations based on the financial reports.

Sinopec does not provide a breakdown for revenues at its trading unit.

As MRC informed previously, in September 2018, Sinopec Corp joined a group planning to build an oil refinery in Alberta, an enterprise that would strengthen demand for the Canadian province's heavily discounted crude. State-owned Sinopec, formally known as China Petroleum & Chemical Corp, along with an Alberta indigenous group, China State Construction Engineering Corp and Alberta management company Teedrum, plan to build a refinery to process 167,000 barrels per day of crude into gasoline and other products, the project's consulting firm Stantec Inc said in its statement.

Sinopec Corp. is one of the largest scale integrated energy and chemical company with upstream, midstream and downstream operations. Its principal business includes: exploring, developing, producing and trading crude oil and natural gas; producing, storing, transporting and distributing and marketing petroleum products, petrochemical products, synthetic fiber, fertilizer and other chemical products. Its refining capacity and ethylene capacity rank No.2 and No.4 globally. Sinopec listed in Hong Kong, New York, London and Shanghai in August 2001. Sinopec Group, the parent company of Sinopec Corp., is ranked the 5th in Fortune Global 500 in 2012.

Lanxess strengthens flame retardants production

MOSCOW (MRC) -- Lanxess has announced that it is planning to invest approximately EUR200 million until 2021 to expand its global asset base for flame retardant additives, according to GV.

The company operates a strongly backward integrated production network for bromine and phosphorous based flame retardants with plants in the USA (Charleston, El Dorado, Greensboro), Germany (Leverkusen, Krefeld-Uerdingen), France (Epierre) and the United Kingdom (Manchester).

"With the acquisition of the US company Chemtura in spring 2017 we became one of the world’s leading suppliers of flame retardant additives. With the investment package we will further strenghten our strong position in this growing market," said Karsten Job, head of the Polymer Additives Business at Lanxess.

The company has significantly expanded its market position for flame retardant additives after integrating the former Chemtura businesses with brominated flame retardant additives, bromine and bromine derivatives, which complement Lanxess' existing business with phosphorus-based flame retardant additives.

In addition to the production network for flame retardants, Lanxess is running two technical development centres for these products in Naugatuck/USA and Leverkusen/Germany. "Out of Leverkusen and Naugatuck, we are driving global innovations like reactive and polymeric flame retardants," said Job. According to the company, its reactive and polymeric flame retardants, like Emerald Innovation 3000, enjoy a constant rise in demand as they offer a much better sustainability profile than standard flame retardants.

As MRC reported earlier, in December 2017, Lanxess announced the expansion of its Additives segment and plans to acquire the phosphorus chemicals business with a US production site from Belgian chemical group Solvay. Both companies signed an agreement to this effect.

Besides, Lanxess A.G. is expanding production of high-performance plastics at its Krefeld-Uerdingen site in Germany by building a new compounding facility at the North Rhine-Westphalia site. The Cologne-based specialty chemicals company said Sept. 19, 2018, that it was investing a "mid-double-digit million euro" amount in the new facility, which is scheduled to start operation in the second half of 2019.

Lanxess is a leading specialty chemicals company with about 19,200 employees in 25 countries. The company is currently represented at 74 production sites worldwide. The core business of Lanxess is the development, manufacturing and marketing of chemical intermediates, additives, specialty chemicals and plastics. Through Arlanxeo, the joint venture with Saudi Aramco, Lanxess is also a leading supplier of synthetic rubber.