Belarus proposes Russia step up delivery to Naftan oil refinery

MOSCOW (MRC0 -- Belarusian Deputy Prime Minister Igor Lyashenko said that Minsk was able to raise the volume of oil it processes and had proposed to Russia to increase its deliveries to the Naftan oil refinery, reported Reuters.

Belarus plans to seek compensation from Russia for export and transit revenues that it did not receive due to the contamination of oil via the Druzhba pipeline.

As MRC informed earlier, Belarus state oil firm Belneftekhim said in a statement in early May that not enough clean oil is available for the Novopolotsk refinery to work at its optimal capacity, after contaminated oil was received via the Russian Druzhba pipeline.
MRC

MOSCOW (MRC) -- April imports of high density polyethylene (HDPE) into Russia decreased to 31,600 tonnes from 32,800 tonnes a month earlier. However, these figures have been the record-breaking imports since December 2017, according to MRC's DataScope report.
The record high imports were last registered in November-December 2017, when they exceeded 32,000 tonnes per month. Such high imports in late 2017 were caused by the scheduled and long outage at some of production capacities of Russia's second largest HDPE producer - Stavrolen. This year' record imports were caused by higher HDPE shipments from producers in Central Asia.

In October 2018, a new gas chemical complex with a total capacity of just over 380,000 tonnes per year was launched in Turkmenistan, which led to an increase in supply of HDPE in Central Asia. At the same time, the new producer has offered for sale injection moulding and pipe grade HDPE so far.

Thus, overall HDPE imports into Russia exceeded 107,900 tonnes in the first four months of 2019, whereas a year earlier this figure was 80,800 tonnes. The following countries were the top five countries in terms of polyethylene (PE) shipments in 2019: Uzbekistan, Turkmenistan, Finland, South Korea and Thailand.

MRC

MOSCOW (MRC) -- PDH Polska, owned by top Polish chemical group Azoty and Grupa Azoty Police, has signed a EUR 993 million turn-key contract with Hyundai Engineering Co., Ltd for the execution of the Polymers Police investment project, reported TheFirstNews with reference to the companies' statements.

The "Polymers Police" project is a strategic undertaking of Grupa Azoty Capital Group implemented by PDH Polska S.A., a special purpose vehicle.

"Polymers Police" is one of the largest chemical investments in this part of Europe. The aim of the project is to build a completely new petrochemical complex, the scope of which will include: Propane Dehydrogenation (PDH) Unit; Polypropylene (PP) Production Unit; Polypropylene (PP) Logistics Infrastructure; Handling and Storage Terminal (gas terminal) and Auxiliary Systems

The annual production capacity of the complex is to reach 437 thousand tonnes of polypropylene.

The project is to be completed in 2022.

As MRC informed earlier, in January 2018, W R Grace & Co (GRA) said that it had contracted to license its Unipol PP process technology to PDH Polska SA for a new facility in Police, Poland. With a capacity of 400 kilotons per year, the polypropylene PP line is expected to begin operations in 2022.
MRC

MOSCOW (MRC) -- Venezuela’s 310,000 barrel-per-day (bpd) Cardon oil refinery, operated by state-run oil company PDVSA, halted operations due to damage at some of its units, two workers at the Paraguana refining complex said, as per Reuters.

Neither PDVSA nor Venezuela’s oil ministry immediately responded to requests for comment.

The outage comes amid widespread fuel shortages in several states of the oil-rich but crisis-stricken country. Cardon is the country’s second-largest refinery, after 645,000-bpd Amuay.

In February, PetroChina Co planned to drop Petroleos de Venezuela SA (PDVSA) as a partner in a planned USD10 billion oil refinery and petrochemical project in southern China.
MRC

MOSCOW (MRC) -- Kazakh oil flowing via Russia to be loaded on tankers at the Baltic Sea port of Ust-Luga has been contaminated and Kazakhstan plans to seek compensation from Russian pipeline monopoly Transneft, reported Reuters with reference to a senior Kazakh energy official.

Russia’s oil export flows have been disrupted since April, when high levels of organic chloride were found in crude pumped via the Druzhba pipeline to Ust-Luga and other European countries.

Six tankers with 598,000 tonnes of tainted oil were loaded at Ust-Luga, Kazakh Deputy Energy and Mineral Resources Minister Aset Magaulov told Reuters.

"First, companies that sold the oil will talk to buyers about a discount, then ... (Kazakh pipeline operator) Kaztransoil will have separate talks with Transneft," Magaulov said.

Neither Transneft nor the Russian energy ministry replied to a Reuters request for comment.

Magaulov added that two separate tankers with 199,000 tonnes of clean Kazakh oil were loaded from Ust-Luga between May 10 and May 15. Russia’s energy ministry said earlier that clean oil had started to be loaded at Ust-Luga.

Russian Deputy Prime Minister Dmitry Kozak said on Thursday that Transneft would compensate all parties for losses incurred from contaminated oil if they could prove the damage, while the first European refinery declared force majeure.

"Based on the oil agreement with Transneft, given the fact that we supplied clean oil but it got contaminated ... there should be compensation from Transneft," Magaulov said.

Kazakhstan, which produces around 1.8 million barrels per day (bpd) of oil, is the second-biggest oil producer among former Soviet countries after Russia. Kazakhstan exports around 12 percent of its oil via Russia’s Ust-Luga.

Magaulov said a preliminary agreement had been reached with buyers under which they would take the contaminated oil at a discount. However, talks on such a discount are continuing and there is no estimate of potential compensation.

ExxonMobil, Chevron, Eni, CNPC and Lukoil are among the international companies producing oil in Kazakhstan.

The Druzhba pipeline splits in Belarus into a northern spur to Poland and Germany and a southern leg via Ukraine to Slovakia, Hungary and the Czech Republic. Only Hungary has resumed test flows to see whether its refinery equipment can withstand the contaminated oil.

Druzhba can pump 1 million bpd, or 1 percent of global oil demand. Ukraine and Belarus have said they will ask Transneft for compensation.

On Thursday, Russia’s Kozak said it would take 22 days to clean one branch of Druzhba and seven days for the other, without specifying which was which.

Meanwhile, Poland has increased seaborne oil imports and Czech refiner Unipetrol will start drawing the second batch of an emergency loan of crude from state reserves overnight.

France’s Total has suspended operations at some units of its 230,000-bpd Leuna refinery in Germany for technical checks following the Russian contamination.

Total said it was trying to manage any long-term supply complications and planned to resume operations on Saturday using crude sent via the Polish port of Gdansk.

Russian oil production remained under pressure due to the pipeline debacle. Output from May 1-16 fell to 11.156 million bpd, below the 11.18 million bpd level set in a supply-limiting deal with producer group OPEC, two industry sources said.

Before the contamination, sources indicated Moscow wanted to pump more from July along with the Organization of the Petroleum Exporting Countries, which was considering whether to raise output if Venezuelan and Iranian supply dropped further.

A panel of OPEC and non-OPEC ministers meets on Sunday in Saudi Arabia to discuss the market and make recommendations. The group, known as OPEC+, gathers in June to decide whether to renew the supply-cutting deal.

As MRC informed earlier, Belarus state oil firm Belneftekhim said in a statement on Saturday that not enough clean oil is available for the Novopolotsk refinery to work at its optimal capacity, after contaminated oil was received via the Russian Druzhba pipeline.
MRC