Cepsa chemicals Q3 earnings decreased on weaker phenol, acetone margins

Cepsa chemicals Q3 earnings decreased on weaker phenol, acetone margins

MOSCOW (MRC) -- Cepsa’s chemicals division third-quarter earnings fell 6%, quarter on quarter, on the back of falling margins in phenol and acetone and lower solvents output, said the company.

Year on year, however, earnings before interest, taxes, depreciation, and amortisation (EBITDA) rose sharply compared with Q3 2020, when Spain was only emerging from one of the strictest lockdowns in Europe to contain the pandemic.

The company did not disclose sales figures. Cepsa is privately owned by The Carlyle Group and Abu Dhabi's investment fund Mubadala and it is not bound by financial reporting like publicly listed companies are.

"When compared to Q2 2021, (chemicals division) EBITDA was 6% lower due to a deterioration in margins in the phenol/acetone market and lower results in the solvent segment as a consequence of the reduction of production loads by refining customers," said Cepsa.

"These impacts were partially offset by the strong performance of the LAB (linear alkylbenzene) segment (22% versus Q2 2021) derived from higher sales and margins, and the increase in production volumes after the change to Detal technology at the Puente Mayorga (Spain) plant."

Cepsa said during the third quarter it had started producing LAB, a chemical used in detergents, using vegetable oils as feedstock. Overall, the company sales volumes stood 15% lower than its pre-pandemic sales volumes, it said.

As it was written earlier, Cepsa is exploring a sale of its chemicals business under a strategic review as it seeks to raise funds to accelerate its transition to clean energy. Cepsa is working with Citi to identify possible buyers for the division which is valued at up to 3 billion euros (USD3.5 billion), the sources said, cautioning that discussions were at a preliminary stage and no deal was certain.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.

Cepsa is a Spanish petrochemical company. Full name Compania Espanola de Petroleos S.A. The company is headquartered in Madrid. Refining is one of the main activities of CEPSA. The production of asphalt and other road surfaces is another of the company's core activities; nine CEPSA factories are engaged in the production of these products.
MRC

Rosneft to acquire Shell stake in German PCK Schwedt refinery

Rosneft to acquire Shell stake in German PCK Schwedt refinery

MOSCOW (MRC) -- Russian oil firm Rosneft has agreed to acquire a 37.5% stake in German refinery PCK Schwedt from Shell, according to Offshore Technology.

The firm has exercised an option to buy the stake, increasing its shareholding in the refinery to 91.67%. The remaining 8.33% interest in the refinery is held by Eni.

The transaction is contingent on government and regulatory approvals.

Rosneft CEO Igor Sechin said: “Increasing the share of PCK refinery is testament to the strategic importance of the German market for Rosneft.

“PCK is one of the most technologically complex refineries in Germany, with a Nelson index of 9.8. Rosneft plans to strengthen the technological leadership of the refinery, including through the implementation of low-carbon projects, considering the current environmental agenda of the EU.

“The company is already developing projects aimed at the production of cleaner fuels, such as ‘green’ hydrogen and sustainable aviation fuel. Work in this direction will continue.”

As MRC wrote before, Shell initially announced a deal to sell its 37.5% non-operated stake in the PCK oil refinery to Alcmene, an Austria-based unit of energy firm Liwathon Group. At that time, Shell said that the other shareholders in the oil refinery, Rosneft and Eni, will have pre-emption rights to acquire Shell’s stake within three months from the signing of the definitive agreement with Alcmene. The sale is a part of Shell’s strategy to cut down its refinery footprint around the world and maintain only core sites integrated with its chemical plants, trading hubs, and marketing businesses.

Located in Schwedt, Brandenburg, the PCK Refinery has a capacity of 11.6 million tonnes per year. It supplies Urals crude through the Druzhba pipeline.

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 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.

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.

Rosneft became Russia's largest publicly traded oil company in March 2013 after the USD55 billion takeover of TNK-BP, which was Russia’s third-largest oil producer at the time.
MRC

ExxonMobil lays groundwork for carbon storage project at offshore auction

ExxonMobil lays groundwork for carbon storage project at offshore auction

MOSCOW (MRC) -- ExxonMobil on Wednesday offered to lease 500,000 acres off the Texas coast, securing space for what could become a massive project to capture and store carbon emissions, according to Hydrocarbonprocessing.

Under pressure by investors to address climate change, Exxon in April floated an up to USD100 B industry hub to collect planet-warming emissions from Gulf Coast petrochemical plants and bury them under the Gulf of Mexico.

Wednesday's nearly USD15 MM in bids are "potentially the first time federal Gulf of Mexico acreage has been leased for purposes other than the extraction" of oil and gas, said Rystad Energy oil analyst Colin White.

The company's bidding in US Department of Interior auction "takes a long-term business view," spokesperson Todd Spitler said. Exxon will evaluate the acreage seismic and subsurface geology once final awards are determined, he said.

Spitler declined to comment on the acreage's carbon capture potential. Exxon has said it will spend USD15 B on lower-carbon technologies over the next six years. It plans to disclose new details of emissions reduction and project spending in two weeks, it said in a filing.

The top US oil company has been selling its Gulf of Mexico oil properties since 2018, putting investments into more lucrative fields off Guyana, Brazil and in US shale.

In addition to the US carbon capture hub, it has recently reached preliminary agreements with Singapore and Malaysia to explore projects. Exxon snapped up 94 offshore blocks, containing 541,000 acres (219,000 hectares), the largest of any bidder and nearly a third of the tracts receiving bids.

As MRC reported before, ExxonMobil said earlier this month it is on track to meet its 2025 emissions reduction targets by the end of this year - four years earlier than planned - and has vowed to ramp up investments to further cut emissions.

We remind that ExxonMobil plans to build its first, large-scale plastic waste advanced recycling facility in Baytown, Texas, and is expected to start operations by year-end 2022. By recycling plastic waste back into raw materials that can be used to make plastic and other valuable products, the technology could help address the challenge of plastic waste in the environment. A smaller, temporary facility, is already operational and producing commercial volumes of certified circular polymers that will be marketed by the end of this year to meet growing demand.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.
MRC

Uzbekistan to launch a gas chemical plant for the production of olefins from methanol in 2023

Uzbekistan to launch a gas chemical plant for the production of olefins from methanol in 2023

MOSCOW (MRC) - Uzbekistan plans to launch in the fourth quarter of 2023 the production of polymers in a complex with MTO technology (from methanol to olefins), a representative of the country's Ministry of Energy said at the forum "Gas Chemical Complex MTO: Technologies of New Uzbekistan".

The complex with a capacity of 720,000 tonnes of polymers per year will be located in the center of the free economic zone (FEZ) in Karakul, Bukhara region.

The USD2.5 billion project is expected to be commissioned in the fourth quarter of 2023 and will provide the Uzbek industry with olefinic hydrocarbons. The gas chemical complex is designed for processing local raw materials based on a licensed technological process for converting methanol into olefins, which has no analogues in the CIS region.

More than 70% of the plant's products will be sold on the domestic market, which will allow Uzbekistan's industry to meet domestic demand, as well as export various raw materials to the CIS countries, China, Turkey and the countries of Southeast Asia.

Based on the technology of the Chemtex Global Corporation (USA), the plant will produce polyethylene terephthalate (PET). PET is currently fully imported to Uzbekistan. The monoethylene glycol used for PET production will be produced using the technology of Scientific Design Company Inc. (USA).

The production of low-pressure polyethylene (LDPE) will also be launched for the first time in the Republic on the equipment and technology of Versalis (Italy) with the use of a tubular reactor under ultra-high pressure. This technology allows one unit to consistently produce two types of end products - LDPE and ethylene vinyl acetate (EVA).

Polypropylene production will be carried out in cooperation with W. R. Grace & Co. (USA), a world leader in this field.

The fact that Uzbekistan intends to build a new gas chemical complex (GCC) in the coming years, which will become the basis of the largest technological cluster in the region, became known in 2018.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.
MRC

Trafigura to exit Rosneft Indian refining JV

Trafigura to exit Rosneft Indian refining JV

MOSCOW (MRC) -- Trafigura is preparing to sell its 24.5% indirect stake in an Indian oil refining joint venture with Russia's Rosneft to an Italian group, a letter seen by Reuters shows and people familiar with the commodity trading firm's plans said.

Trafigura holds the stake in Nayara Energy, which owns India's third largest refinery, a port and a network of more than 6,000 fuel stations across India, indirectly through a 49.84% holding in Singapore-based Tendril Ventures Pte Ltd.

It plans to sell the Nayara stake to Italy's Genera Group Holding S.P.A, people familiar with the matter said, without giving detail on what had prompted Trafigura to sell.

Trafigura declined to comment. Genera did not respond to Reuters emails and messages seeking comment. Nayara said it could not comment on the actions of its shareholders.

It is unclear how much Trafigura's stake in Nayara, formerly known as Essar Oil, is worth.

Nayara, which owns the 400,000 bpd Vadinar refinery plant in the western Indian state of Gujarat, changed hands for nearly USD13 B in 2017, so the Trafigura stake then would have been worth more than USD3 B.

The other owner of Tendril is Russian investment group United Capital Partners (UCP), which also has 49.84%. Tendril's wholly-owned subsidiary, Cyprus-registered Kesani, owns a 49.13% stake in Nayara Energy. Rosneft's Singapore unit also has a 49.13% stake and public shareholders the remainder.

When Kesani and Rosneft bought the Nayara stakes in 2017, the sale was structured in a way to prevent Rosneft from acquiring a controlling stake and avoid running foul of US sanctions on the Russian oil major.

"As a result of the proposed transfer, Trafigura will cease to hold an indirect shareholding in Kesani and hence also in the borrower (Nayara)," Virag says in the letter seen by Reuters.

After the transfer, Genera will hold a 24.5% stake in Nayara, through Tendril and Kesani, the letter said.

As MRC informed earlier, India's Nayara Energy hopes to operate its 400,000 barrels per day (bpd) refinery in western India at close to 100% capacity in 2021 as fuel demand is picking up.

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 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.

Rosneft became Russia's largest publicly traded oil company in March 2013 after the USD55 billion takeover of TNK-BP, which was Russia’s third-largest oil producer at the time.
MRC