Petrobras revises timing of price adjustments for diesel and gasoline

MOSCOW (MRC) -- Brazilian state-run oil company Petroleo Brasileiro SA said that its management approved a revision in scheduling of price adjustments for diesel and gasoline in its refineries, reported Reuters.

In a securities filing, the company said price adjustments will be made according to market conditions locally and abroad, instead of being made at fixed intervals. The revision will grant Petrobras flexibility, improving its competitiveness and efficiency, the company added.

As MRC informed before, in October 2017, Petrobras’ minority stakes in Braskem and Deten Quimica was excluded from Petrobras’s divestment program, according to a government decree published in Brazil’s Official Gazette. The decree prevents Petrobras from immediately selling its minority stake in Braskem, which had been announced last year. A new decree will be required to release the stock sale.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
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MOSCOW (MRC) -- Indonesia began testing biodiesel with a bio-content of 30% in cars, its energy ministry said, as the Southeast Asian nation pushes to boost local markets for its vast palm oil crop, said Hydrocarbonprocessing.

The world’s top palm oil exporter aims to make it mandatory for all biodiesel to have a 30% bio-content, known as B30, from next year, up from 20% now.

Industry experts have said that could push consumption of bio-content made from palm oil to as much as 9 million kilolitres (KL) per year, up from an estimated 6.2 KL in 2019.

The test will be conducted over the next four months with various passenger vehicles and trucks, Dadan Kusdiana, head of research and development at the Energy and Mineral Resources Ministry, told reporters.

The passenger vehicles will cover 50,000 km (31,000 miles) and trucks 40,000 km during the road test, Kusdiana said.

The ministry also plans to start testing trains, ships and heavy machinery in the mining sector using the fuel.

To offset slowing global demand for palm oil, Indonesia has been pushing to increase domestic consumption of the commodity, used in products ranging from fuels to soap. Nearly all the country’s biofuels are made from palm.

As MRC informed earlier, Total is set to start up a biodiesel refinery using palm oil whose planned launch last summer sparked opposition from farmers producing vegetable oil and from environmental activists.
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MOSCOW (MRC) -- Compensation for the tainted Russian oil supplied to Europe earlier this year via the Druzhba pipeline and in cargoes will be decided company by company, Russia’s Deputy Energy Minister Pavel Sorokin told Reuters.

Russia halted some oil supplies in April after excessive levels of organic chloride were found in the million barrel-per-day Druzhba pipeline that crosses Belarus and serves customers as far west as Germany.

Russian oil pipeline monopoly Transneft put the volume of oil affected at 3 million tonnes, or nearly 22 million barrels.

France’s Total and Russia’s Lukoil have both said compensation per barrel of tainted oil should stand at around USD15.

Belarus has said the volume of contaminated crude could be as high as 5 million tonnes, equivalent to a month’s exports via Druzhba of about 1.2 million barrels a day and worth USD2.3 billion at current prices. However, not all that will be subject to compensation.

Asked about compensation, Sorokin, who is holding talks on the contamination on behalf of the Russian energy ministry, said: "Each (company) has its own situation. There are different schemes of work for oil supplied by the pipeline and in cargoes."

"This means different approaches and, as a result, completely different costs of eliminating the consequences." He said his team had suggested an algorithm for calculating costs.

The compensation will take into account the time needed to mix tainted oil with clean volumes to keep chloride levels within allowed limits, as well as the cost of storage, freight costs, and other expenses, Sorokin said.

He said no foreign buyers of Russian oil have yet calculated the exact amount of compensation they are seeking, though talks were expected to conclude in the near future.

"Russia is and Russia will be a reliable supplier," Sorokin said. "Compensation will be fair."

Officials have said Transneft is to pay compensation rather than the state.

They said while it will compensate oil producers for their losses from the tainted oil, oil firms should in turn talk to their customers about losses further down the supply chain.

Druzhba splits into the two routes in Belarus. Russia has managed to restore some supplies of clean oil to Poland via Druzhba’s northern leg and to Ukraine, the Czech Republic, Hungary and Slovakia in the south.

Russia has put some tainted oil into storage in Europe, including in Hungary, and has agreed to pump some volumes back from Belarus to mix them with clean crude at home. It can then be refined domestically and re-exported.

Sorokin said Russia will be pumping oil back from the Unecha-Polotsk line in two weeks and for now, the contaminated oil is being stored at the Naftan refinery in Belarus. In the south, all tainted oil has been put into storage, he said.

Some Russian ports which were not initially affected by the crisis have seen an increase in chloride levels as Russia has been diluting the tainted oil with clean volumes, he said, though they remained within permitted levels.

Sorokin said chloride levels at Russian ports would not be higher than at Ust-Luga, where the energy ministry said on Monday organic chloride levels in oil cargoes stood at 2.7 parts per million (ppm).

He said the level would remain in a range of 2.5-4 ppm, while for pipeline supplies to Europe, oil will have ‘minimal’ chloride content. "(European customers) will mix it (with clean oil) according to their own plans," he said.

Russia is still studying other options for cleaning the oil other than mixing it, Sorokin said. Tainted oil can affect refining equipment, but oil products are unaffected and there will be no impact on end-users such as motorists, he said.

Druzhba accounts for around a quarter of oil exports from Russia, the world’s second biggest oil exporter after Saudi Arabia.

As MRC wrote before, in early June 2019, the Czech oil refinery at Litvinov, owned by PKN Orlen unit Unipetrol, started receiving oil from state emergency reserves due to halt in Russian supplies via the Druzhba pipeline.

We also remind that the impact on European refinery throughput in the second quarter of 2019 from contaminated crude on the Druzhba pipeline is seen at roughly 250,000 barrels per day, under 2% of the continent’s product demand, as per the International Energy Agency.
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MOSCOW (MRC) -- Closures manufacturer Bericap has eliminated silicon from its valves and introduced BericapValve, which is a thermoplastic elastomer (TPE) that can be recycled in the HDPE and PP recycling stream, said Plasticsinpackaging.

Traditional ketchup, mayonnaise and other sauce bottles are often equipped with hinge-caps, and about 40 per cent of these closures have an additional valve to allow for precise and convenient dosing. However, the silicon usually used in the valve contaminates the PET and/or the HDPE/PP recycling stream.

The central packaging register in Germany, established in 2018 for monitoring the packaging stream, the recycling of packaging as well as evaluation of the sustainability of packaging, considers silicon a non-desired contaminant in the recycling stream. In addition, France has established an eco-tax on silicon.

But recycling is a prerequisite within a closed-loop economy for plastics packaging, and the recycling of PET bottles as well as HDPE and PP, which are often used for closures, is very efficient and thus attractive for producers. Returned and collected bottles are ground to pieces, the PET on the one side and the HDPE and PP on the other side are separated in a water bath. The PET sinks and can be reused for the manufacturing of bottles. The HDPE and PP as valuable raw materials remain floating on the water and can be re-used for high value applications.

"With the development of our silicon-free valves, one of the most important products within the ketchup, mayonnaises and spreadables segment, we increase the efficiency within the recycling process and make an important contribution to environmental protection", said Alexander Knipp, Bericap’s business segment leader for ketchup, mayonnaises and spreadables.

As MRC informed earlier, Bericap North America Inc. is investing USD29 million in an expansion that will double the size of its Cowpens plant.

Bericap, a subsidiary of Bericap GmbH & Co. of Budenheim, Germany, opened the 90,000-square-foot South Carolina plant in 2007. The plant does secondary operations like printing and assembly. Bericap North America is based in Burlington, Ontario and has a plant in Ontario, Calif. Bericap is a manufacturer of plastic closures with 21 factories in 19 countries across the world. The company offers a wide range of products for beverages, food, motor oil and agricultural industries.
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MOSCOW (MRC) -- ExxonMobil and SABIC have announced the decision to proceed with the construction of a chemical facility and a 1.8 million metric ton ethane steam cracker in San Patricio County, Texas, leading to thousands of high-paying jobs and billions in economic output, as per Hydrocarbonprocessing.

"Building the world’s largest steam cracker, with state-of-the-art technology, on the doorstep of rapidly growing Permian production gives this project significant scale and feedstock advantages," said Darren W. Woods, chairman and chief executive officer of ExxonMobil. "It is one of several key projects that provide the foundation for significantly increasing the company’s earnings potential."

The joint-venture between ExxonMobil and SABIC, called Gulf Coast Growth Ventures, received final environmental regulatory approval in June 2019 to build an ethane steam cracker, two polyethylene units and a monoethylene glycol unit. Construction will begin in the third quarter of 2019 and startup is anticipated by 2022.

"SABIC is very pleased to move forward on this third joint venture with ExxonMobil - the first to be operated outside of Saudi Arabia," said SABIC vice chairman and CEO Yousef Al-Benyan. "This project will not only increase global diversification for our company, but will also continue to create value within our new home of San Patricio County through creating jobs and supporting economic growth. With this project, we look forward to further building our business presence in the US and serving the communities and customers in the North and South American markets even more effectively."

The project is expected to create more than 600 permanent jobs with average annual salaries of USD90,000 per year. An additional 6,000 high-paying jobs will be created during construction. A preliminary independent study, conducted by Impact DataSource, estimates the project will generate more than USD22 billion in economic output during construction and USD50 billion in economic benefits during the first six years of operation.

The facility will produce materials used in the manufacturing of various consumer products including automotive coolants, packaging, agricultural film and building, construction materials and clothing.

Project construction will be led by four primary engineering, procurement and construction companies: The Wood Group, McDermott & Turner Industries Group, Chiyoda & Kiewit and Mitsubishi Heavy Industries & Zachry Group.

Gulf Coast Growth Ventures is a unique opportunity created by the abundance of low cost US natural gas, and is part of ExxonMobil’s Growing the Gulf initiative, which outlined plans to build and expand manufacturing facilities along the US Gulf Coast, creating more than 45,000 high-paying jobs across the region.

The project is part of SABIC’s growth strategy to build new petrochemical facilities in key markets, including the Americas, to address industry demand and achieve the company’s 2025 strategy.

Ownership interests in the Gulf Coast Growth Ventures project is 50 percent ExxonMobil and 50 percent SABIC, with ExxonMobil as site operator. ExxonMobil and SABIC bring unmatched expertise to this project, having worked together in petrochemical ventures for more than 35 years. The Gulf Coast Growth Ventures project expands that successful international relationship.

As MRC reported earlier, in October 2017, ExxonMobil Chemical Company commenced production on the first of two new 650,000 tons-per-year high-performance polyethylene (PE) lines at its plastics plant in Mont Belvieu, Texas. The full project, part of the company’s multi-billion dollar expansion project in the Baytown area and ExxonMobil’s broader Growing the Gulf expansion initiative, will increase the plant’s polyethylene capacity by approximately 1.3 million tons per year.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.

Saudi Basic Industries Corporation (Sabic) ranks among the world's top petrochemical companies. The company is among the worldпїЅs market leaders in the production of polyethylene, polypropylene and other advanced thermoplastics, glycols, methanol and fertilizers.
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