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

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

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

1. PetroChina ordered to stop trading off oil quotas with independent refineries

MOSCOW (MRC) -- Chinese authorities have ordered a unit of state-run PetroChina to stop trading off crude oil import quotas with local refineries as part of a crackdown on excessive fuel production, a move that could cut the country's crude imports by 3%, reported Reuters with reference to sources. Beijing has stepped up scrutiny of crude oil quota use and imports by state and private firms this year to ease a fuel surplus that has weighed on the sector's profits and led to excess emissions that have undermined China's climate goals, said five industry sources with knowledge of the matter. PetroChina Fuel Oil Co Ltd is a major crude oil supplier to China's independent refineries.

MRC

MOSCOW (MRC) -- Crude oil futures hit fresh multiyear highs during midmorning Asia trade June 9 as the US Energy Information Administration forecast a decline in global oil inventories in the second half of 2021 in its June Short-Term Energy Outlook, reported S&P Global.

The rally was further supported by signs that the US-Iran talks, which could bring sanctioned Iranian barrels back into the market, would take longer than expected.

At 11:12 am Singapore time (0312 GMT), the ICE August Brent futures contract was up 50 cents/b (0.69%) from the previous settle at USD72.72/b while the NYMEX July light sweet crude contract was up 47 cents/b (0.67%) at USD70.52/b.

Both contracts touched multiyear highs June 4 before settling lower. The ICE Brent contract last settled higher at USD71.97/b on May 20, 2019, while the NYMEX light sweet crude contract was last higher at USD69.49/b on July 19, 2018, S&P Global Platts data showed.

Prices regained their upward momentum as EIA's STEO, released June 8, reinforced expectations of a demand-led recovery in the oil markets that would result in a drawdown of global oil inventories.

Global oil production is expected to match the rising levels of global oil consumption, with oil production increasing largely as a result of easing OPEC+ production cuts, according to the STEO.

"We expect rising production will end the persistent global oil inventory draws that have occurred for much of the past year and lead to relatively balanced global oil markets in the second half of 2021," the EIA said in the report.

Furthermore adding to the bullish sentiment, the American Petroleum Institute reported an estimated 2.1 million-barrel draw in US crude oil inventories in the week ended June 4.

On the supply side, US-Iran negotiations to potentially lift sanctions on Iranian crude seemed unlikely to wrap up soon. This was also keeping the sentiment supported in the oil markets.

"It seems talks could drag on much longer which means the timeline for additional output from Iran keeps getting pushed back," said Edward Moya, senior market analyst at OANDA, in a June 9 note.

Meanwhile, the market continues to await OPEC's and the International Energy Agency's June Oil Market Reports, due to be released June 10 and June 11, respectively, to get a better sense of supply and demand fundamentals going forward.

As MRC informed earlier, Indian refiners, anticipating a lifting of US sanctions, plan to make space for the resumption of Iranian imports by reducing spot crude oil purchases in the second half of the year. The world"s third-largest oil consumer and importer halted imports from Tehran in 2019 after former US President Donald Trump withdrew from a 2015 accord and re-imposed sanctions on the OPEC producer over its disputed nuclear programme.

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