Petrobras and CNPC conclude that refinery construction at Comperj is not viable

MOSCOW (MRC) -- Petrobras and China’s CNPC have ended talks on the possibility of building a refinery at Comperj in Itaborai (RJ) after concluding that the project would not be economically viable, reported Brazil Energy Isight with reference to Petrobras president Roberto Castello Branco's statement on Wednesday.

The executive stressed that it “makes no sense” strategically for the company to invest in a new refinery, since the oil company is selling refining capacity in several states and already has a refinery in the state of Rio de Janeiro, which will be maintained.

"(Studies with CNPC) showed us that it is not economically viable … CNPC was not very interested in this project," said Castello Branco, during a New Year’s Eve breakfast with the press at the company’s headquarters. , in Rio de Janeiro.

Construction of a refinery at Comperj was suspended after investigations by Lava Jato, which pointed to fraud involving project contracts.

Some of the equipment already in the project will eventually be used to build a lubricant unit on site, whose project is being prepared.

As MRC wrote previously, the chief executive of Brazilian state-run oil firm Petroleo Brasileiro said last Friday he wants to sell the company's stake in petrochemical company Braskem within 12 months, adding that he strongly disagreed with reported plans to delay the sale.

We also remind that Braskem is no longer pursuing a petrochemical project, which would have included an ethane cracker, in West Virginia. And the company is seeking to sell the land that would have housed the cracker. The project, announced in 2013, had been on Braskem's back burner for several years.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,724,670 tonnes in the first ten months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market in January-October 2019 totalled 1,066,520 tonnes, up by 7% year on year. Supply of block copolymers of propylene (PP block copolymer) and homopolymer of propylene (homopolymer PP) increased, demand for statistical copolymers (PP random copolymer) decreased.

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.
MRC

MOSCOW (MRC) -- China's Sinopec said on Tuesday it had put into operation a pipeline delivering 2.6 million cubic metres a day of shale gas from the Fuling field in Chongqing in southwestern China to central and eastern China, reported Energyworld.

The Nanchuan-Fuling pipeline was built on challenging terrain, crossing steep slopes and a suspension bridge, said a report on the company's microblog.

China's top shale gas field, Fuling is expected to pump at a record 7 billion cubic metres (bcm) in 2020, as Sinopec is set to add nearly 100 new production wells this year, Reuters reported in September.

As MRC informed earlier, Sinopec Guangzhou Petrochemical, part of China's petrochemical giant - Sinopec, restarted operations at its cracker in early December, 2019. The company started maintenance at the plant on October 12, 2019. Located in the Guangzhou province of China, the cracker has ethylene production capacity of 260,000 mt/year and propylene production capacity of 150,000 mt/year.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,724,670 tonnes in the first ten months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market in January-October 2019 totalled 1,066,520 tonnes, up by 7% year on year. Supply of block copolymers of propylene (PP block copolymer) and homopolymer of propylene (homopolymer PP) increased, demand for statistical copolymers (PP random copolymer) decreased.

China Petroleum & Chemical Corporation or Sinopec Limited is a Chinese oil and gas company based in Beijing, China. Sinopec's business includes oil and gas exploration, refining, and marketing; production and sales of petrochemicals, chemical fibers, chemical fertilizers, and other chemical products; storage and pipeline transportation of crude oil and natural gas; import, export and import/export agency business of crude oil, natural gas, refined oil products, petrochemicals, and other chemicals.
MRC

MOSCOW (MRC) - Imports of injection moulding PET chips in Russia increased by 15% in the eleven months of the year compared with the same period a year ago and reached 115,400 tonnes, as per MRC DataScope.

The same indicator in January-November 2019 amounted to 100,400 tonnes. The share of bottle grade PET imports from China amounted to 88% compared to 86% for the same period last year.

The share of Chinese material was 78% (9,600 tonnes) in November versus 92% (5,800 tonnes) a month earlier.
In November last year, the share of Chinese material in total imports amounted to 94% (7,700 tonnes).

Last month, the producer Jiangsu Sanfangxiang had the largest volume of supplies to the Russian market - 5,190 tonnes of injection moulding PET chips. The top 5 Chinese suppliers this year are as follows: Jiangsu Sanfangxiang supplied 42,500 tonnes of injection moulding PET chips, Yisheng - 21,900 tonnes, Wankai - 13,800 tonnes, Sinopec - 15,800 tonnes, Indorama - 9,500 tonnes.
MRC

MOSCOW (MRC) -- Asia’s cash premiums for jet fuel dropped, weighed down by abundant supplies and lackluster aviation demand, while traders were skeptical seasonal heating demand for kerosene would likely remain weak due to a warmer winter this year, said Hydrocarbonprocessing.

Cash differentials for jet fuel fell to a premium of 5 cents per barrel to Singapore quotes on Tuesday, down from a 35-cents premium a day earlier.

Refining profit margins or cracks for jet fuel were at USD14.95 per barrel over Dubai crude during Asian trading hours on Tuesday, compared with USD14.76 a barrel on Monday.

Winter in the northern hemisphere typically brings peak heating demand for kerosene, which belongs to the same grade of oil products as jet fuel, with jet refining margins determining the profitability of both.

But temperatures in Tokyo are expected to stay well above normal for the next couple of weeks, while temperatures in Seoul would remain mostly higher than normal over the next 15-day period, weather forecast models on Refinitiv Eikon showed.

Meanwhile, cracks for gasoil with 10 parts per million (ppm) sulphur content rose to USD15.60 per barrel over Dubai crude on Tuesday, their highest in a month. Cracks for the benchmark gasoil grade in Singapore were at USD15.01 per barrel on Monday.

Cash premiums for 10ppm gasoil climbed to 65 cents per barrel over Singapore quotes on Tuesday, up from 60 cents per barrel in the previous session.
MRC

MOSCOW (MRC) -- China's total production of six major oil products - LPG, naphtha, gasoline, jet/kerosene, gasoil and fuel oil - rose by an average of 3.9% on the year to 39.78 million mt in November, slower than the crude throughput growth pace of 10.1%, reported S&P Global with reference to latest data from the National Bureau of Statistics Tuesday.

The total volume of the six major oil products accounted for 70.9% of total crude throughput in November, down from 75.2% a year ago.

Analysts expect the oil product yield to remain on a downtrend as new integrated refining and petrochemical complexes start up.

Among these key products, naphtha, gasoline and gasoil were the main products which saw unchanged year-on-year production volumes, or even reductions, even as China lifted throughput to produce petrochemical products.

Output of gasoline and naphtha declined 0.5% and 2.6%, respectively, while gasoil output was steady from a year ago, the data showed.

The reduction and unchanged output figures explains the relative supply-demand balance despite high throughput levels in the domestic market even as demand was slowing down in winter.

"Gasoil sales have been doing very well and we almost have no inventory, while gasoline is also recovering," a Sinopec refiner in central China said Monday.

Crude oil throughput at China's domestic refineries jumped 10.1% on the year to 13.7 million b/d in November, NBS data showed. This is the third straight month in which China's throughput has crossed the 13 million b/d mark, after doing so for the first time in September at 13.80 million b/d, and recording 13.68 million b/d in October.

Meanwhile, fuel oil output surged 39.7% on the year to 2.39 million mt as the 400,000 b/d green field Zhejiang Petroleum & Refining has not yet started fully commissioning its secondary units, followed by jet/kerosene which gained 17% on the year to 3.85 million mt with the increment from the 400,000 b/d new Hengli Petrochemical (Dalian).

As MRC informed earlier, in H1 November 2019, Zhejiang Petrochemical Co Ltd (ZPC) started up its No. 1 cracker in Zhoushan, China, though it is reported that the company is still working to stabilize the operation rate. The cracker has an annual capacity of 1.4 million tons/year of ethylene and 900,000 tons/year of propylene. As reported earlier, the company is also aiming to bring its Phase I downstream PP and PE plants online within 2019. However, the startup schedule is very much depending on the operation of the No. 1 cracker.

The Phase I facility houses a 300,000 tons/year HDPE unit, 450,000 tons/year LLDPE line and a 900,000 tons/year PP plant. Market players are speculating that these units might only come online in Q1-2020 given the large scale of both upstream and downstream production the company is managing.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,724,670 tonnes in the first ten months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market in January-October 2019 totalled 1,066,520 tonnes, up by 7% year on year. Supply of block copolymers of propylene (PP block copolymer) and homopolymer of propylene (homopolymer PP) increased, demand for statistical copolymers (PP random copolymer) decreased.
MRC