Reliance records best quarterly performance in October-December 2021

MOSCOW (MRC) -- Reliance Industries Ltd, the nation's biggest company by market value, has reported its best-ever quarterly performance in October-December 2021, helped by an uptick in two 'Rs' -- refining and retail, a recent tariff hike accelerating growth at Jio and a one-off gain from the sale of US shale gas business, according to The News Minute.

The oil-to-retail-to-telecom conglomerate's consolidated net profit rose 35.6% sequentially and 41.5% over the year-ago period to Rs 18,549 crore in the quarter ended December 31, 2021, the firm said in a statement.

Consolidated revenue of the nation's biggest company by market value rose 9.5% over the previous three months and 52.2% year-on-year to record Rs 209,823 crore. EBITDA or earnings before interest, tax, depreciation and amortisation climbed 30% to a record Rs 33,886 crore. Three-fourths of this came from its traditional oil business as higher prices and demand returning from the bouncing economy helped earnings.

But the company, which during the pandemic declared itself net debt-free, saw its borrowings exceed cash in the third quarter of the current fiscal. Refinancing liabilities towards telecom spectrum saw its gross debt of Rs 244,708 crore exceeding cash balance of Rs 241,846 crore.

Festive demand helped retail scale to near pre-COVID levels of earnings. While retail delivered an all-time high revenue and EBITDA, digital services (which includes telecom) saw revenues crossing Rs 25,000 crore and operating profits crossing Rs 10,000 crore. Consumer businesses contributed Rs 75,000 crore of revenue.

An increase in crude oil prices and higher volumes saw oil-to-chemical (O2C) revenues rise and stabilising of gas production from newer fields in the eastern offshore KG-D6 block returned the oil and gas business segment to profitability.

Reliance's capital expenditure for the quarter ended December 31, 2021, was Rs 27,582 crore.

Reliance operates four business verticals - O2C business includes its oil refineries, petrochemical plants, and fuel retailing business; retail business that houses brick-and-mortar stores and e-commerce; digital services that cover telecom arm Jio; and new energy business.

O2C segment's operating profit rose sequentially for the sixth straight quarter, aided by improved refining margins and prices. EBITDA at Rs 13,530 crore was up 6.3% quarter-on-quarter and 38.7% year-on-year.

Inventory gains and recovery in petrol, diesel and jet fuel spreads aided refining margin in the third quarter. Gas production provided a tailwind to earnings despite hiccups in chemicals.

Reliance's oil and gas segment posted a near 500% YoY spurt in revenues to Rs 2,559 crore, with segment EBITDA of Rs 2,033 crore. This was on the back of production from newer fields in the KG-D6 block stabilising, taking the overall production to 18 million standard cubic metres per day.

As MRC informed before, in November 2021, Reliance Industries and Saudi Aramco decided to re-evaluate their agreement for the Middle Eastern producer to buy a stake in the refining and petrochemical business of India"s biggest private refiner, and both companies would look at broader areas of cooperation due to the changing energy scenario.

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 2,265,290 tonnes in the first eleven months of 2021, up by 14% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,363,850 tonnes in January-November, 2021, up by 25% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

Reliance Industries is one of the world's largest producers of polymers. The company produces polypropylene, polyethylene and polyvinyl chloride and other petrochemical products.
MRC

MOSCOW (MRC) -- Clariant has recently announced that its StyroMax UL3 catalyst is demonstrating successful results at Risun’s new styrene monomer (MS) plant located in Tangshan, China, according to Hydrocarbonprocessing.
After a smooth and stable catalyst start-up in October 2020, the plant is reporting very profitable operation with excellent production output. The project is a cooperation between Clariant Catalysts and engineering company Changzhou Ruihua Chemical Engineering Technology Co. Ltd. Through Ruihua’s technology and Clariant’s catalyst, the Risun plant has been able to achieve productivity rates exceeding 120% of the new plant’s nominal design capacity - which is also the highest among all Ruihua process plants in China.

Stefan Heuser, Senior Vice President & General Manager at Clariant Catalysts, commented, “We are delighted by the results of our cooperation with Ruihua in this project. As one of China’s leading private chemicals groups, Tangshan Risun is a highly valuable reference for our StyroMax UL3 styrene catalyst, which has more than demonstrated its excellence for profitable SM production.”

Based on current catalyst performance, the plant is expected to maintain increased yields with productivity of 120% or more. At the same time, it is able to operate at an extremely low steam-tooil ratio of 1.1 wt/wt, which is the lowest among all Ruihua process plants in operation. Consequently, the Risun plant is reporting exceptional energy efficiency. Such benefits are possible for plants operating adiabatic units with low steam-to-oil ratios, since the catalyst is specially designed for these conditions.

The latest generation of the series, the StyroMax UL3 catalyst, is designed to promote dehydrogenation from ethylbenzene to styrene at ultra-low steam-to-oil ratios. While previous catalysts could provide either high activity or high selectivity at such conditions, StyroMax UL3 is the first catalyst to support both, thereby improving yield and significantly reducing process expenses for styrene producers.

As MRC reported earlier, in October 2020, Clariant announced the construction of a new state-of-the-art catalyst production site in China. This project represents a significant investment which further strengthens Clariant’s position in China and enhances its ability to support its customers in the country’s thriving petrochemicals industry.

The new facility will be primarily responsible for producing the Catofin catalyst for propane dehydrogenation, which is used in the production of olefins such as propylene. Thanks to its excellent reliability and productivity, Catofin delivers superior annual production output compared to alternative technologies, resulting in increased overall profitability for propylene producers, says the company. Construction at the Dushan Port Economic Development Zone in Jiaxing, Zhejiang Province was scheduled to commence in Q3 2020, and Clariant expects to be at full production capacity by 2022.

Ruihua Technology is China’s largest process technology licensor for ethylbenzene to styrene monomer, focused on processes with low energy and material consumption using various ethylene feedstock, such as polymer grade ethylene or high ethylene gas content. Over the past decade, the company has been awarded 22 references in China.

Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints.
MRC

MOSCOW (MRC) -- Rosneft Oil Company and China National Petroleum Corporation (CNPC) signed the Memo on Cooperation in the field of low carbon development, said the company.

Within the visit of the delegation headed by the President of the Russian Federation Vladimir Putin to Beijing (PRC), PJSC Rosneft Oil Company and China National Petroleum Corporation (CNPC) signed the Memo on Cooperation in the field of low carbon development.

Signatures under the document were affixed by Igor Sechin, the Chief Executive Officer of Rosneft, and Dai Houliang, the Chairman of the Board of Directors of CNPC.

In accordance with the Agreement of Rosneft and CNPC there are prospects of interaction worked out concerning a set of areas of low carbon development, particularly in reduction of greenhouse gas emissions, including methane, technologies of energy efficiency as well as CO2 capture and storage (CCS). Parties also consider other areas of potential cooperation in the field of low carbon development as well. Low carbon technologies developed by the companies, including “smart” and digital solutions, in the future may be applied within the large-scale joint petroleum projects in Russia and China.

Rosneft and CNPC are organizers of Russian-Chinese Energy Business Forum established by the instruction of the President of the Russian Federation Vladimir Putin and the President of the People's Republic of China Xi Jinping. The objective of this Forum is a development of the energy dialogue between Russia and China, increase in bidirectional commodity circulation, extension of the portfolio of joint projects, attraction of investments and funding of projects.

In May 2017 during the official visit of Russian President Vladimir Putin to China, Rosneft and CNPC signed the Agreement on the establishment of the Joint Coordinating Committee (JCC). The Committee was established for development of the cooperation of the companies in a number of strategic areas, including interaction in the exploration and development of oil and gas fields, oil refining and petrochemicals, trade in oil and oil products, scientific and technical research, training of personnel, as well as the implementation of promising projects in the field of supply and oil services. In November 2021 there was the fourth meeting of the JCC.

Rosneft is a member of the United Nations Global Compact thus confirming its commitment to the highest principles of the sustainable development. Rosneft annually publishes a detailed information about its ESG activities in its sustainable development reports.

Rosneft is the world's largest public oil company. The company accounts for about 5% of global oil production, and its proven reserves in the international category will exceed 5 billion tons of oil equivalent. The structure of Rosneft includes the Angarsk Polymer Plant and Ufaorgsintez (part of the structure of Bashneft) after the closing of the deal to purchase Bashneft on October 12, 2016. The main shareholder of Rosneft is the state-controlled Rosneftegaz (50% plus one share), and the British BP owns another 19.75%.
MRC

MOSCOW (MRC) -- Sumitomo Chemical reports a steep increase in net profit to Yen 133.6 billion (USD1.1 billion) in the fiscal first nine months ended 31 December, from Yen 20.2 billion a year earlier, on sales up 24% to Yen 2.0 trillion, as per the company's press release.

Operating income was Yen 197.9 billion, higher by 71% year on year (YOY).

Sales at Sumitomo's petrochemicals and plastics business segment, the company's largest, rose by 53% YOY to Yen624.9 billion. The unit swung to an operating profit of Yen 51.9 billion from an operating loss of Yen 27.8 billion a year earlier. The company adds that market prices for petchem products, synthetic resins, and synthetic fibers increased owing to demand recovery and a rise in raw material costs. Margins also improved.

At the energy and functional materials segment, operating income grew 19.5% YOY, to Yen 18.6 billion and sales rose 29.2%, to Yen 226.6 billion. Shipments of separators for lithium-ion secondary batteries performed well. Market prices for aluminum and for the metal raw materials for cathode materials increased, resulting in higher selling prices.

The company has not published a forecast for the full fiscal year ending 31 March 2022.

As MRC reported earlier, Sumitomo Chemical is building additional production lines for its liquid crystal polymer (LCP) super engineering plastic at the company's site in Ehime. This expansion will increase the group’s production capacity of LCP by around 30%. The new production lines are scheduled to be completed in the summer of 2023. LCP has been used for a broad range of applications, including electronic components for PCs and smartphones.

We remind, Sumitomo Chemical will establish a subsidiary, Sumika Polymer Compounds Poland (SPCP), to build and operate a polypropylene (PP) compounding facility at PoznaA, Poland. The capacity of the planned PP compounding plant will be 30,000 metric tons/year. It is due to commence operations in 2022.

Sumitomo Chemical, a leading Japanese chemical company, was founded with a mission to drive societal impact and solve environmental challenges through technology. They have been exploring new opportunities to achieve carbon neutrality by 2050.
MRC

MOSCOW (MRC) -- Russia and China have agreed a second long-term gas supply deal, this time for 10 billion cubic metres (bcm)/year which will take total contractual supply between the two countries to 48bcm/year, said the company.

Gazprom and China National Petroleum Corporation (CNPC) signed a long-term Sales and Purchase Agreement for natural gas to be supplied via the Far Eastern route.

The signing of this document is an important step towards further strengthening the mutually beneficial cooperation between Russia and China in the gas sector. As soon as the project reaches its full capacity, the amount of Russian pipeline gas supplies to China is going to grow by 10 billion cubic meters, totaling 48 billion cubic meters per year (including deliveries via the Power of Siberia gas trunkline).

“This is already a second contract to be signed for Russian gas supplies to China, and it is indicative of the exceptionally strong mutual trust and partnership between our countries and companies. Our Chinese partners from CNPC have already seen for themselves that Gazprom is a reliable gas supplier,” said Alexey Miller.

Gazprom on reported the agreement with China’s CNPC for delivery through what is called the Far Eastern Route. The news comes as Russian President Putin visited China for the start of the Beijing Winter Olympics, where the two countries issued a statement on their cooperation on a range of issues, including energy.

In January, Gazprom completed a feasibility study for the Soyuz Vostok pipeline that would become an extension of the Power of Siberia 2 pipeline through Mongolia and which would have a capacity of 50bcm/year. In addition to the latest supply contract and the existing Power of Siberia contract, this would take potential nameplate supply from Russia to China close to 100bcm/year.

We remind, that in December 2020, SIBUR Holding, Russia’s leading petrochemicals company and one of the most rapidly growing petrochemicals businesses globally, and China Petroleum & Chemical Corporation (Sinopec), China’s leading energy and chemical company, have closed the deal to set up a joint venture (JV) at the Amur Gas Chemical Complex after obtaining all the necessary approvals from the regulators of both countries. SIBUR and Sinopec will hold interest in the JV in the amount of 60% and 40%, respectively.

PJSC Gazprom is a Russian energy company engaged in exploration, production, transportation, storage, processing and sale of gas, gas condensate and oil, as well as production and sale of heat and electricity. The largest company in Russia, the largest gas company in the world, owns the longest gas transmission system (over 160,000 km). It is the world leader in the industry.
MRC