Indian Oil to shut half of Panipat refinery from mid-Feb for a month

MOSCOW (MRC) - Indian Oil Corp, the country’s top refiner, will shut half of its 300,000 barrels per day Panipat refinery in northern Haryana state for about a month from mid-February for maintenance, said Reuters.

The refiner will shut a 150,000 bpd crude unit. It will also shut a sulfur recovery unit, hydrocracker, diesel hydrotreater, and coker among others for planned maintenance.

During the shutdown IOC will mobilize naphtha from other plants for the 800,000 tonnes per annum cracker associated with the plant, a company source said.

From mid-March, IOC will shut one of eight heaters attached to its Panipat naphtha cracker for 45 days, the spokesman said.

The company source said the shutdown of one the heaters would curtail the refiner’s naphtha production to 350 tonnes per hour from an average of about 400 tonnes per hour.
MRC

MOSCOW (MRC) -- PetroChina DaQing Refining & Chemical has shut its polypropylene (PP) unit for an unplanned maintenance work, as per Apic-online.

A Polymerupdate source in China informed that the company has halted operations at the unit on January 22, 2019. The unit is likely to resume production in end-January, 2019.

Located in Daqing, China, the plant PP unit with production capacity of 300,000 mt/year.

As MRC reported earlier, PetroChina has nearly doubled the amount of Russian crude being processed at its refinery in Dalian, the company’s biggest, since January 2018, as a new supply agreement has come into effect. The Dalian Petrochemical Corp, located in the northeast port city of Dalian, is expected to process 13 million tonnes, or 260,000 bpd of Russian pipeline crude this year, up by about 85 to 90 percent from last year’s level. Dalian has the capacity to process about 410,000 bpd of crude. The increase follows an agreement worked out between the Russian and Chinese governments under which Russia’s top oil producer Rosneft will supply 30 million tonnes of ESPO Blend crude to PetroChina in 2018, or about 600,000 bpd. That would represent an increase of 50 percent over 2017 volumes. The additional oil sent to Dalian is about 120,000 bpd and will make up the bulk of the Russian increases.

PetroChina Company Limited, is a Chinese oil and gas company and is the listed arm of state-owned China National Petroleum Corporation, headquartered in Dongcheng District, Beijing. It is China's biggest oil producer.
MRC

MOSCOW (MRC)--Production of high density polyethylene (HDPE) in Russia increased by 7% in 2018 year on year and reaching about 960,800 tonnes, with only two producers from four ones increased their output, according to MRC’s ScanPlast report.

December HDPE production in Russia grew to 83,2 00 tonnes, whereas this figure was about 81,700 tonnes a month earlier. All producers increased PE production. Russia’s overall HDPE production reached 960,8 tonnes in January-December 2018, compared to 898,000 tonnes a year earlier. Stavrolen and Gazprom neftekhim Salavat raised their capacity utilisation significantly, whereas Nizhnekamskneftekhim, which for several years has been systematically reducing the production of HDPE in favor of linear polyethylene (LDLP).

Structure of PE production over the reported period looked as follows.

Kazanorgsintez increased HDPE production in December to 47,000 tonnes compared with 45,800 tonnes in November. Overall, the Kazan manufacturer produced 505,100 tonnes of HDPE in 2018, down 0.5%year on year.

Stavrolen’s December HDPE production decreased to 26,900 tonnes from 25,600 tonnes a month earlier. Stavrolen produced 293,600 tonnes of HDPE in January-December 2018, up 26% year on year. Such a high level of output was a result of a lack of prolonged preventive maintenances in 2018.

Gazprom neftekhim Salavat (Gazprom) increased capacity utilization in December, producing about 9,200 tonnes of HDPE in December, compared with 8,200 tonnes in November. The Salavat manufacturer produced over 118,200 tonnes in 2018, up 28% year on year. The high 2018 output was caused as in the case of Stavrolen, by the absence of prolonged preventive maintenances this year.

During the period under review, Nizhnekamskneftekhim only in April-May and the end of September-November produced HDPE. Thus, in less than five months of operation, the Nizhnekamsk manufacturer has produced only 43,900 tonnes of HDPE against 65,600 tonnes a year earlier.

MRC

MOSCOW (MRC) - The United Steelworkers union (USW) has made progress on some issues in contract talks with Shell Oil Co, which is the lead negotiator for U.S. refinery and chemical plant owners, said Hydrocarbonprocessing.

Many tough issues remain to be resolved at the bargaining table, the sources said. The sources declined to identify on which issues progress has been made or which remain to be resolved between the union negotiating on behalf of 30,000 refinery, chemical plant and pipeline workers and Shell Oil, the U.S. arm of Royal Dutch Shell Plc.

The union is seeking a pay increase of 8 percent a year for each year of a three-year agreement that would take effect when the current contract expires on Feb. 1. Shell has not identified any of its proposals in the first negotiations since a strike in 2015 when more than 7,000 workers walked off their jobs for several weeks.

Monday’s message comes after the United Steelworkers said on Friday it had rejected a proposal from Shell for an automatic extension of negotiations when the contract expires.

In addition to the pay increase for workers, who on average earn USD40 an hour after four years on the job, the USW has said it is seeking improved standards to prevent fatigue as well as additional health and safety representatives, including at small plants.

The union also hopes to gain greater protection for pipeline workers traveling to remote locations and performing high-risk work.

Shell has been the lead company in contract talks for U.S. union-represented refinery workers since 1997.
MRC

MOSCOW (MRC) - Potential U.S. sanctions on Venezuela’s crude oil exports would cut off the nation from Gulf Coast refiners that are among its biggest customers, likely forcing it to send more crude to China, India or other Asian countries, traders said, as per Hydrocarbonprocessing.

U.S. refineries that depend on Venezuela’s heavy crude would have even more trouble securing supplies as Canadian and Mexican crudes are often not as discounted and are limited in availability. The United States is considering moves to cripple Venezuela’s oil shipments, which account for nearly all of the country’s exports, in response to the reelection of President Nicolas Maduro that was widely viewed as a sham.

Washington has recognized opposition leader Juan Guaido as Venezuela’s president as protests against Maduro erupted across the country. It is also considering sanctions on oil deliveries, a move it has until now resisted, energy company sources told Reuters.

Venezuela, on average, exported about 500,000 barrels of crude a day to the United States in 2018, according to U.S. Energy Department data. Those shipments fell in November to an estimated 358,000 barrels per day, however, according to a report by Caracas-based consultancy Gas Energy Latin America seen by Reuters. The U.S. share of its exports has declined in recent years with more shipments going to Russia and China.

Those deliveries are being made largely through oil-for-debt repayment structures as output from state-run oil company Petroleos de Venezuela, S.A., known as PDVSA, has slumped to near 70-year lows in a nationwide economic crisis. Venezuela’s output has been cut in half since 2016 to less than 1.2 million bpd, according to figures from OPEC secondary sources.

Shipments to the United States account for about 75 percent of the cash Venezuela gets for crude shipments, according to a Barclays research note published last week. In the wake of sanctions, the country could seek additional deals with Turkey, India or other Asian nations, one trader of Venezuelan crude said. Gas Energy’s report said India was the second-largest importer of Venezuelan crude in November.

“It will be costly for Venezuela but eventually they’ll be able to sell that oil to Asia at a discount. There will be a period in the middle in which they have difficulty selling those barrels,” said Francisco Monaldi, fellow in Latin American Energy Policy at the Baker Institute for Public Policy at Rice University in Houston.

Though the United States produces nearly 12 million barrels of oil a day, complex Gulf Coast refineries need heavier crude grades to produce diesel and other high-margin products, and cannot simply sub in light crude.

Prices of heavier U.S. grades like Mars Sour, an offshore medium U.S. crude, and Heavy Louisiana Sweet crude have risen as buyers scramble for supply. Mars traded at a $6.90 premium to U.S. crude on Wednesday, a five-year high, according to Refinitiv Eikon data, as bidders came into the market to secure supplies through the second quarter, traders said.

“It would make a tight market even tighter. If it happens, it would be an unambiguous headwind for refiners already struggling to find supplies,” said Bob McNally, president of Rapidan Energy Group, an energy consultancy in Bethesda, Maryland.

Traders said the United States may need to sell oil from the U.S. Strategic Petroleum Reserve to cover supply shortfalls as additional shipments are secured via Canada or Mexico. Sanctions could also include U.S. exports of petroleum products to Venezuela, used for blending with Venezuelan heavy crude.
MRC