Sinopec reports record H1 net profit of USD6.3 bn

Sinopec reported on Sunday its H1 net profit rose 10% Y/Y, mostly due to significant improvement in its upstream business, said the company.

The Chinese oil producer said H1 net profit jumped to 43.53B yuan (~$6.33B) and revenues rose 28% Y/Y to 1.58T yuan, due to higher prices of major refined oil and chemical products, and increased sales volumes for some petroleum and petrochemical products.

H1 operating costs jumped 33% Y/Y to 1.33T yuan due to higher purchase costs for outsourced crude oil and other raw materials.

The company's core refining business was hurt by COVID-19 lockdowns, as segment operating profit fell 24% Y/Y.

Sinopec (SNP) said H1 capital spending rose 11% to 64.7B yuan former 57.9B yuan in the year-earlier period, and plans to ramp up H2 capex to 133.35B yuan, with nearly half on the exploration and production segment.

Sinopec's (SNP) strong H1 results followed surging profits at Chinese state-owned energy peers PetroChina and Cnooc.

We remind, Sinopec and PetroChina -- two of the world's biggest energy firms -- will apply for "voluntary delisting" of their American depositary shares, the companies said in separate statements. The Aluminum Corporation of China, also known as Chalco, as well as China Life Insurance and a Shanghai-based Sinopec subsidiary.
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Hungary will continue talks with Russia on additional gas supplies and expects to reach a deal with Gazprom to boost supplies further from next month, as per Hellenicshippingnews.

Szijjarto met his Russian counterpart Sergei Lavrov in Moscow last month, seeking 700 million cubic metres of gas on top of an existing long-term supply deal with Russia. Gazprom started to increase gas supplies to Hungary this month, adding to previously agreed deliveries via the Turkstream pipeline.

“Like it or not, we will continue talks with the Russians about increasing gas shipments to Hungary,” Szijjarto told a business meeting. “There is an offer to increase gas shipments, we will finetune that with Gazprom in the next few days, and we will sign an agreement under which we could get increased daily shipments."

Szijjarto did not give any details about volumes or prices. Hungary’s reserves stored 3.25 billion cubic metres of gas as of Aug. 1, more than 51% of total storage capacity, based on data from the national energy regulator.

Under a deal signed last year, before the start of the war in neighbouring Ukraine, Hungary receives 3.5 billion cubic metres (bcm) of gas per year via Bulgaria and Serbia under its long-term deal with Russia and a further 1 bcm via a pipeline from Austria. The agreement with Gazprom is for 15 years.

As per MRC, Gazprom stopped supplying Latvia with gas, the Russian gas giant announced on Saturday citing a violation of the conditions for gas withdrawal. The move comes as a response to the announcement of Latvian energy firm Latvijas Gaze, which said it was buying gas from Russia, but not from Gazprom. During the last month, approximately one terawatt-hour of natural gas was delivered to Latvia from Russia and the payment was made in euros rather than in roubles as required by Gazprom.
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HPCL commenced its Cowdung to Compressed Biogas Project at Sanchore, Rajasthan. This will be HPCL’s first project under Waste to Energy portfolio, said Indiatimes.

The plant is proposed to utilize 100 Tons per day of dung to produce biogas, which can be utilized as automotive fuel. The project is proposed to be commissioned in a year’s time.

The project’s ground breaking ceremony took place at Shree Godham Mahatirth Pathmeda Lok Punyarth Nyas, Village Pathmeda, Tehsil Sanchore District Jalore in Rajasthan which was attended by ED - Bio-fuel & Renewables, Shri Shuvendu Gupta and Senior officials from HPCL.

The project is being developed under GOBAR-Dhan scheme launched by Governement of India in Apr’18 as a part of the Biodegradable Waste Management componet under Swachh Bharat Mission (Grameen) to positively impact cleanliness and generate wealth and energy from cattle and organic waste.

As MRC informed previously, India's HPCL-Mittal Energy Limited, or HMEL, will start a new 500,000 mt/year polypropylene (PP) plant in Bhatinda in 2021. The company has an existing 440,000 mt/year PP unit at the same site.

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SABIC SK Nexlene Company (SSNC), a joint venture between SABIC and SK Geo Centric, has announced plans to expand the capacity of its plant in the South Korean city of Ulsan to produce advanced material solutions, said the company.

The expansion, which is due to come on stream in the second quarter of 2024, targets applications in solar panels, vehicles, footwear, and flexible packaging.

Sami Al-Osaimi, Vice President of PE & Sales, SABIC, and Board Chairman for SSNC, said, “We have identified a strong trend toward customized and high-performance polyolefins, especially metallocene polyethylene materials, in several important new technology markets."

“Many of our polymers are ideally positioned to meet the needs of our global customers for enhanced toughness, flexibility, elasticity, heat-sealing properties, and optical properties, among others. The plant capacity increase will provide the operational efficiency to boost the growth of these Nexlene-based materials and give us a significant competitive edge,” he added.

Expansion supports SABIC’s 2025 growth target to increase operational efficiency, create synergies and strengthen product offerings in its Petrochemicals business.

As per MRC, SABIC is looking at building a plant in Port Arthur, Texas, with process units for polypropylene (PP), high density polyethylene (HDPE) and polyethylene (PE) using SK Global Chemical’s Nexlene technology. Sabic filed a Chapter 313 application with the state of Texas Comptroller of Public Accounts for tax breaks from the local school district. According to the application, Sabic will build a 400,000 tonne/year PP unit, a 400,000 tonne/year HDPE C4/C6 bimodal unit and a 400,000 tonne/year PE unit using the Nexlene technology.

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TotalEnergies publicly shared its principles of conduct for its Russian related business, said Enerdata.

TotalEnergies reiterated its firmest condemnation of Russia's military aggression against Ukraine and stated that it would ensure strict compliance with current and future European sanctions, no matter what the consequences on the management of its assets in Russia.

TotalEnergies thus restated its duty to contribute toward securing Europe’s gas supply from the Yamal LNG plant within the framework of long-term contracts that it must honor as long as Europe's governments do not take sanctions on Russian gas. TotalEnergies also announced the gradual suspension of its activities in Russia for those which do not contribute to the security of energy supply of Europe. This included assets producing oil (Kharyaga field) and gas for the local Russian market (Termokarstovoye field) as well as other local businesses (lubricants, batteries) which were mothballed in the first half of the year.

On July 6, 2022, in line with these principles, TotalEnergies announced the sale of its remaining 20% interest in the Kharyaga oil project to Zarubezhneft. This transfer was finalized on August 3, 2022.

On July 18, 2022, TotalEnergies agreed to sell to Novatek TotalEnergies' 49% interest in Terneftegaz, which operates the Termokarstovoye gas and condensates field in Russia, on economic terms enabling TotalEnergies to recover the outstanding amounts invested in the field.

Pursuant to Russian regulations, a request to authorize this transaction was addressed to the Russian authorities on August 8, 2022. On August 25, 2022, Russian authorities issued their agreement to the proposed sale. As a result, on August 26, 2022, TotalEnergies and Novatek signed the final sale and purchase agreement of TotalEnergies’ 49% interest in Terneftegaz. Closing is expected in September 2022, subject to customary conditions.

We remind, TotalEnergies signed with Sonatrach, Occidental and Eni an extension of its Production Sharing Contract for a period of 25 years for onshore Blocks 404a and 208 in the Berkine basin, in Eastern Algeria. This contract, signed under the new Algerian Hydrocarbon Law published in 2019, will allow to develop additional liquids hydrocarbon resources, while reducing these fields carbon intensity through a dedicated carbon reduction program. The opportunity to develop and valorize associated gas resources will be studied by the partners, thus increasing export potential towards Europe.
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