Sonatrach becomes majority owner of Medgaz pipeline to Spain

MOSCOW (MRC) -- Algeria's state-owned energy company Sonatrach said it's become the majority owner of the Medgaz pipeline to Europe via Spain after raising its stake to 51% from 42.96% by purchasing 19.1% of Cepsa's shares in the joint venture, reported S&P Global.

Sonatrach didn't disclose the value of the deal or how much Cepsa's stake is now.
The 210-km Medgaz pipeline is also on track to boost its natural gas capacity to 10.2 Bcm by Q1 2021 from the current 8.2 Bcm, Sonatrach said Saturday in a statement.

Algeria's pipeline gas exports to Spain and Italy fell by more than 11 Bcm year on year in 2019 to just 21.1 Bcm, according to S&P Global Platts Analytics data, while LNG exports rose by almost 2 Bcm to 16.4 Bcm of gas equivalent.

Sonatrach is being asked to halve its 2020 spending budget from USD14 billion to USD7 billion due to the oil price slump, the country's president Abdelmadjid Tebboune said in March.

Algeria had already lost USD1 billion in oil and gas export revenue in the first two months of 2020 due to the fall in oil prices and the slump in demand triggered by the coronavirus, he said at the time.

As MRC informed before, in January 2020, Turkey and Algeria announced that they will jointly establish a petrochemicals plant in Adana on the Mediterranean coast. Turkey’s Ronesans Holding and Algeria’s state-owned energy company Sonatrach will take part in the project, Arkab said on the margins of the Turkey-Algeria Business Forum. The petrochemical facility is estimated to cost around USD1.4 billion, according to the Algerian minister, who also said stakes of Ronesans Holding and Sonatrach in the project will be 66 percent and 34 percent, respectively. The facility is planned in Seyhan industrial zone for petrochemical development and will have production capacity of 450,000 tons per year of polypropylene (PP).

According to MRC's ScanPlast report, PP shipments to the Russian market totalled 347,440 tonnes in January-April 2020 (calculated by the formula production minus export plus import). Supply exclusively of PP random copolymer increased.
MRC

MOSCOW (MRC) -- Mitsui Prime Advanced Compounds Europe, a joint venture in which Mitsui Chemicals has 75%, Mitsui & Co. 15% and Prime Polymer Co. 10%, has commissioned its first polypropylene (PP) compounding plant in Europe, said Chemweek.

Located at the Chemelot Industrial Park at Geleen, Netherlands, the facility is designed to produce 30,000 metric tons/year of PP compounds.

Mitsui Chemicals says the new plant will allow it to provide effective lightweighting solutions to automakers and auto parts manufacturers with European bases while also responding to global demand growth. The company says it will have access to 50,000 metric tons/year of PP compounds in Europe, including outsourced material.

At present, Mitsui Chemicals operates production sites in eight regions, including Asia and the Americas. In the Americas it has production facilities in Ohio and Tennessee; Mexico; and Brazil with a combined total of 440,000 metric tons/year of PP compounds. Its Asian operations are based in China, Japan, India and Thailand with a combined total of 630,000 metric tons/year of PP compounds. In total, following completion of the plant in the Netherlands and access to outsourced material, it now has 1.12 million metric tons/year of PP compounds at its disposal.

Mitsui Chemicals says that while forecasts point to reduced automotive production volume around the world due to the COVID-19 pandemic, it is expected that the global needs for automotive lightweighting will continue to rise on the back of more stringent environmental regulations. The company expects that there will be a continuous demand for PP compounds for use in bumpers, instrument panels and other auto parts.

According to MRC's ScanPlast report, PP shipments to the Russian market were 192,760 tonnes in January-February 2020, down by 6% year on year. Homopolymer PP accounted for the main decrease in imports.

Mitsui Chemicals is a leading manufacturer and supplier of value added specialty chemicals, plastics and materials for the automotive, healthcare, packaging, agricultural, building, and semiconductor and electronics markets. Mitsui Chemicals is a Japanese Chemicals company, a part of the Mitsui conglomerate. The company has a turnover of around 15 billion USD and has business interests in Japan, Europe, China, Southeast Asia and the USA. The company mainly deals in performance materials, petro and basic chemicals and functional polymeric materials.

MRC

MOSCOW (MRC) -- Sabic extraordinary general meeting (EGM) approved a series of changes to the company's bylaws in preparation for the acquisition of a 70% stake in the company by Saudi Aramco, said Chemweek.

Aramco plans to complete the acquisition by the end of this month, barring last minute hitches. In April the company was reported to be in talks with the Public Investment Fund (PIF; Riyadh), which is selling the holding to Aramco, to reduce the price of USD69.1 billion following the collapse in the price of oil and the drop in Sabic's share price since the deal was agreed on.

Of the numerous changes, the most important includes the article that says, the government, represented by the PIF, shall retain ownership of at least 25% of the shares of the corporation throughout the whole duration of the corporation. The article further says that a portion of these retained shares may be sold by virtue of cabinet decree by the normal procedure followed in the public offering of the shares of joint stock companies for general subscription according the the relevant laws.

Sabic CEO Yousef al-Benyan says the changes to the bylaws pave the way for a new chapter for Sabic. "We recognize the importance of meeting shareholder expectations and delivering value is fundamental for us. We are geared for long-term growth and moving towards a new chapter that can position Sabic as the kingdom's chemical growth platform," he said. The virtual EGM voted to change bylaws relating to a wide range of matters, such as the company's head office and share ownership. 30% of Sabic shares will continue to trade on the Riyadh stock exchange.

Aramco's chemical business, following the Sabic and other acquisitions, will operate in more than 50 countries and is expected to have the largest net production capacity for ethylene and be among the top four companies by net production of polyethylene, polypropylene and ethylene glycol.

As MRC informed earlier,Sinopec SABIC Tianjin Petrochemical Co. (SSTPC), a 50-50 joint venture of Sinopec and SABIC, has taken off-stream its styrene monomer (SM) plant. The company has undertaken a planned shutdown at the plant on May 7, 2020. The plant is slated to remain under maintenance for about 7-8 weeks. Located at Tianjin, China, the SM plant has a production capacity of 35,000 tonnes/year.

SM is the main feedstock for the production of polystyrene (PS).

According to MRC's ScanPlast report, March 2020 estimated consumption of PS and styrene plastics dropped by 2% year on year, totalling 42,130 tonnes. The estimated consumption totalled 121,880 tonnes in the first three months of 2020, down by 2% year on year. Overall, Russian plants produced 42,790 tonnes in March 2020. Overall output of high impact polystyrene (HIPS) and general purpose polystyrene (GPPS) totalled 32,100 tonnes in March 2020. 98,390 tonnes of HIPS and GPPS were produced in January-March 2020. The decrease in Russian plants' output was 3%.

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

MOSCOW (MRC) -- China’s Shanghai International Energy Exchange (INE) has approved four entities as designated delivery warehouses for its upcoming low-sulfur fuel oil (LSFO) futures contract, according to Hydrocarbonprocessing with reference to the company's statement.

The entities were listed as Sinochem-Xingzhong Oil Staging (Zhoushan) Co., Ltd., Zhejiang Ocean Oil Products Warehousing Co.,Ltd., Dading Petroleum Logistics Co.,Ltd. and Yangshan Shengang International Oil Logistics Co., Ltd.

They will have total approved storage capacity of 570,000 tonnes and active storage capacity of 320,000 tonnes. The storage fee is 3 yuan per tonne each day.

The LSFO contract, with sulphur content lower than 0.5%, will debut on June 22, with foreign investors allowed to participate.

The INE had published rules for its low sulphur fuel oil contract on Wednesday, stating that it will be traded at 10 tonnes per lot with a daily price limit of 5% and a minimum trading margin of 8%.

As MRC reported earlier, China’s Sinochem Quanzhou Petrochemical successfully started up its newly constructed naphtha cracker in Quanzhou, Fujian province on 16 May 2020, setting the company on track to bring its downstream units online by mid of the year. The cracker has an annual capacity of 1 million tons of ethylene.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 557,060 tonnes in the first three month of 2020, up by 7% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments rose because of the increased capacity utilisation at ZapSibNeftekhim. Demand for LDPE subsided. At the same time, PP shipments to the Russian market was 267,630 tonnes in January-March 2020, down 20% year on year. Homopolymer PP and PP block copolymers accounted for the main decrease in imports.
MRC

MOSCOW (MRC) -- Sinopec is pushing an expansion project that can produce up to 1 million tonnes of ethylene and refined oil annually in Hainan Free Trade Zone, located in South China, said Companynewshq.

It is estimated that this project will fuel growth of downstream industries with more than 100 billion RMB (14.1 billion US dollars) and become a new engine for regional economic development.

On the basis of the original project, ten sets of equipment for chemical production, three sets of equipment for oil refining as well as supporting facilities will be built.

The project will also support Hainan in accelerating the development of leading industries including energy storage and petrochemical production, and effectively expand the scale of import and export.

Ethylene and propylene are feedstocks for producing PE and PP.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 383,760 tonnes in the first two month of 2020, up by 14% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased due to the increased capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market were 192,760 tonnes in January-February 2020, down by 6% year on year. Homopolymer PP accounted for the main decrease in imports.
MRC