Shell to accelerate its energy transition strategy after landmark Dutch court ruling

Shell to accelerate its energy transition strategy after landmark Dutch court ruling

MOSCOW (MRC) -- Royal Dutch Shell will seek ways to accelerate its energy transition strategy and deepen carbon emission cuts following a landmark Dutch court ruling last month, reported Reuters with reference to CEO Ben van Beurden's statement on Wednesday, a move that will likely lead to a dramatic shrinking of its oil and gas business.

Shell plans to appeal the May 26 court ruling that ordered it to reduce greenhouse gas emissions by 45% by 2030 from 2019 levels, significantly faster than its current plans.

But the court ruling applies immediately and cannot be suspended before the appeal, van Beurden said.

"For Shell, this ruling does not mean a change, but rather an acceleration of our strategy," van Beurden said.

Earlier this year, Shell set out one of the sector's most ambitious climate strategies. It has a target to cut the carbon intensity of its products by at least 6% by 2023, by 20% by 2030, by 45% by 2035 and by 100% by 2050 from 2016 levels.

"Now we will seek ways to reduce emissions even further in a way that remains purposeful and profitable. That is likely to mean taking some bold but measured steps over the coming years."

Shell currently plans to increase its spending on renewables and low carbon technologies to up to 25% of its overall budget by 2025.

As MRC informed previously, in late May, 2021, Shell agreed to sell its controlling interest in a Texas refinery to partner Petroleos Mexicanos (Pemex) for about USD596 million. And in early May, Shell announced the sale of its 149,000 barrel per day (bpd) refinery in Washington to Hollyfrontier Corp.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.
MRC

Saudi Aramco seen raising with dollar sukuk

Saudi Aramco seen raising with dollar sukuk

MOSCOW (MRC) -- Saudi Aramco, the world’s biggest oil exporter, is floating US dollar-denominated bonds, with the size and tenors still to be determined by market conditions, said Reuters.

Saudi Arabian oil giant Aramco (2222.SE) is likely to raise between USD3 billion and USD4 billion on Wednesday, two sources said, as it returns to the international debt markets with its first U.S. dollar-denominated sukuk sale. The debt issuance, which will at least partly fund a large dividend that mostly goes to the government, will comprise tranches of three, five and 10 years, the term sheet for the sukuk seen by Reuters showed.

Initial price guidance was around 105 basis points (bps) over U.S. Treasuries (UST) for the three-year portion, around 125 bps over UST for the five-year paper and around 160 bps over UST for the 10-year bonds. Aramco last year maintained a promised $75 billion dividend to shareholders - chiefly the government - despite lower oil prices, and is expected to shoulder significant domestic investments in Saudi Arabia's plans to transform the economy.

The company chose to issue Islamic bonds over conventional ones due to high demand for the instrument as a result of the low number of dollar sukuk sales in the Gulf this year, a source told Reuters on Monday. Aramco has been widely expected to become a regular bond issuer after its debut USD12 billion issuance in 2019 was followed by an USD8 billion, five-part transaction in November last year, also used to fund its dividend.

A source had told Reuters that Aramco was expected to raise up to USD5 billion with the deal, which is expected to close later on Wednesday and has 29 active and passive bookrunners working on it.

As per MRC, this is Saudi Aramco’s third bond flotation, after its maiden USD12bn issue in April 2019, and a second issuance worth USD8bn in November last year. We remind that in June, Aramco said it had completed the share acquisition of a 70% stake in SABIC from the Public Investment Fund, the sovereign wealth fund of Saudi Arabia, for a total purchase price of Riyals 259.125 billion (USD69.1 billion). Combined, in 2019 Aramco and SABIC recorded petrochemicals production volume of nearly 90 million mt, including agri-nutrient and specialty products.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.

Saudi Aramco, officially the Saudi Arabian Oil Company, is a Saudi Arabian national oil and natural gas company based in Dhahran, Saudi Arabia. Saudi Aramco's value has been estimated at up to USD10 trillion in the Financial Times, making it the world"s most valuable company. Saudi Aramco has both the largest proven crude oil reserves, at more than 260 billion barrels, and largest daily oil production.
MRC

Tatneft bought Russian PET producer Ecopet

Tatneft bought Russian PET producer Ecopet

MOSCOW (MRC) - Tatneft won the tender for the purchase of the largest polyethylene terephthalate production in the Russian Federation - Ecopet Group (Kaliningrad), which was sold by Trust Bank, the manufacturer said.

According to the bidding materials, Tatneft acquired Ecopet for 6.45 billion rubles at an initial price of 3.75 billion rubles. Four participants were admitted to the auction. Trust sold in a single lot the shares and shares of the companies included in Ecopet - 100% of Ecopet JSC (industrial complex), 100% of the shares of Ecopet Trade House LLC (trading house), 100% of the industrial park of BaltTechProm LLC, and also the claims against these companies.

"The acquisition of Ecopet will allow the most efficient implementation of the company's plans for the development of the petrochemical direction and will contribute to the achievement of the Tatneft group's goals to reduce greenhouse gas emissions along the entire value chain. The signing of legally binding documents on the deal is expected in the coming weeks," NK press release.

Earlier it was reported that the Ecopet plant (Kaliningrad) in 2020 increased the export volume of polyethylene terephthalate (PET) compared to 2019 to 21%, despite the situation due to the COVID-19 pandemic and the slowdown in economic growth. The plant produces 690 tons of PET per day, increasing productivity during the pandemic by 4.5%.

According to the ICIS-MRC Price Report, spot price of domestic material in Russia iin early June did not change as a whole. Price offers of Russian plants to spot buyers for volumes of 20-100 tonnes this week were in the range of roubles (Rb) 125,000-130,000/tonne CPT Moscow, including VAT. PET chips from SIBUR was offered at Rb125,000-129,000/tonne CPT Moscow, including VAT. Spot prices from Ecopet this week have remained in the range of Rb125,000-130,000/tonne FCA Tuchkovo, including VAT.

Ecopet is the largest enterprise for the production and sale of polyethylene terephthalate (PET) in Russia and Eastern Europe, Tatneft notes. The enterprise was commissioned in 2011. The nominal capacity of the PET plant is 220 thousand tons per year. The enterprise uses the MTR (Melt-To-Resin) technology of the German company Uhde Inventa-Fischer (UIF). It is located on the territory of the Baltic Industrial Park and is a resident of a special economic zone in the Kaliningrad region. The plant has its own railway line and is located near the international sea trade ports of Kaliningrad and Baltiysk.
MRC

Valero shut multiple units at Three Rivers, Texas, refinery after fire

Valero shut multiple units at Three Rivers, Texas, refinery after fire

MOSCOW (MRC) -- Multiple units were shut at Valero Energy Corp's 89,000 barrel-per-day (bpd) Three Rivers, Texas, refinery, reported Reuters with reference to energy industry intelligence service Wood Mackenzie's statement.

A fire was reported at the refinery on Sunday, according to notices posted by the Three Rivers Volunteer Fire Department.

As MRC wrote previously, Valero Energy Corp, the second largest US crude oil refiner, planned to operate its 14 refineries up to 89% of their combined total throughput capacity of 3.15 million barrels per day (bpd) during the second quarter of 2021.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.
MRC

Ningbo Fortune to start up second PP line in Ningbo

Ningbo Fortune to start up second PP line in Ningbo

MOSCOW (MRC) -- China's Ningbo Fortune Petrochemical plans to begin test production at its second polypropylene (PP) line in Ningbo, China by mid-June, 2021, according to CommoPlast.

The production capacity of the new line will be 400,000 mt of PP per year.

In early May 2021, the company received commercial production at its first PP line in Ningbo of the same capacity.

As MRC reported earlier, the project for the construction of a new complex located in the industrial park Ningbo Daxie Development Park, Zhejiang Province, China has two stages. The construction and start-up of PP production, along with a new propane dehydrogenation (PDH) unit, are included in the first stage of the project.

According to MRC's ScanPlast, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.

Ningbo Fortune Petrochemical is a subsidiary of Oriental Energy Co. The registered capital of the company is RMB 1 billion.
MRC