Iraq expects Total to begin USD27-B energy project in second half of 2023

Iraq expects TotalEnergies to begin operations on a long-delayed USD27-B oil, gas and renewables project in the second half of 2023 after finalizing side-contracts with a state oil company, said Hydrocarbonprocessing.

Basim Mohammed, Iraqi deputy oil minister for upstream affairs, said TotalEnergies and the Basra Oil Company "are now in the process of finalizing some contractual procedures and documents necessary to activate the contract."

"Meetings continue with Total to avoid any delay and the contract will be activated in the second half of this year to start operations," he said.

The deal was signed in 2021 for TotalEnergies to build four oil, gas and renewables projects with an initial investment of USD10 B in southern Iraq over 25 years, but it was delayed amid disputes between Iraqi politicians over terms.

Iraq said last month it had agreed to a smaller 30% stake in the project, reviving the deal that Baghdad hopes could lure foreign investment back into a country enjoying relative stability after years of conflict and tensions.

QatarEnergy will also have a share in the project.

We remind, TotalEnergies and Paprec, leader in plastic recycling in France, have signed a long-term commercial agreement to develop a French value chain for advanced recycling of plastic film wastes. The agreement will secure the supply of TotalEnergies' future advanced plastic recycling plant in Grandpuits. Following the terms of this agreement, Citeo, the main organization in charge of end-of-life household packaging in France, will provide a stream of flexible plastic waste sorted from post-consumer packaging.

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Arkema's sales reached EUR 2.5 bn in 1Q 2023, down by 12.6% year-on-year, said the company.

Sales were affected by drop in volumes, which was due to continued weak demand in Europe, a slowdown observed in construction in the United States, and temporary destocking in batteries in China; overall resilience in prices, benefiting from the work to position the portfolio on higher value-added solutions; and benefits of its sustainable innovation in high performance solutions such as bio-based and recyclable materials, 3D printing and more eco-friendly coatings. EBITDA reached EUR 367 M and EBITDA margin totalled 14.5%, down compared with the exceptionally high comparison base of 1Q 2022 (compared to EUR 619 M and 21.4%, respectively), which benefited from particularly favourable market conditions in PVDF and upstream acrylics.

Adjusted net income reached EUR 162 M, representing EUR 2.17/share (compared to EUR 5.08/share in 1Q 2022). Recurring cash flow amounted to negative EUR 21 M (compared to positive EUR 26 M in 1Q 2022), reflecting the usual seasonality of working capital in 1Q 2023. Net debt was stable at EUR 2389 M (compared to EUR 2366 M at end-Dec 2022), including EUR 700 M in hybrid bonds, representing 1.3x last-twelve-months EBITDA.

In 2023, the group aims to achieve EBITDA of around EUR 1.5 bn to EUR 1.6 bn and maintain a high EBITDA to cash conversion rate of over 40%. Commitment for the climate on the 1.5 degC trajectory by 2030 strengthened by the group in light of the progress achieved in its carbon trajectory, and validated by Science Based Targets initiative (SBTi).

Arkema now aims to reduce its greenhouse gas emissions by 48.5% for Scopes 1+2 and by 54% for Scope 3 by 2030 versus 2019.

We remind, Arkema announces the doubling of its polyester resins capacity in its Navi Mumbai facility in India, reinforcing the Group’s leadership position in the global powder coatings market and its commitment to developing very low-VOC technologies. Arkema invested in the Navi Mumbai facility in early 2019 to expand geographic coverage of its high performance, more sustainable, low-VOC products, and to support its customers in their development. The site includes a modern manufacturing unit and a dedicated laboratory to provide application development and technical support in the region.

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Saudi oil giant Aramco's first quarter net profit dropped 19% from a year earlier to 119.54 billion riyals (USD31.88 billion), said the company.

Profit still beat analysts' median forecast of USD30.8 billion, according to Refinitiv data, and Aramco said the decline was partially offset by lower taxes including in the zakat Islamic tax and a rise in finance and other income. Net profit was 3.75% higher than in the fourth quarter.

Yousef Husseini, head of materials at EFG Hermes Research, said there was no material surprise in Aramco's results, "with the company performing in line with its ability at prevailing oil prices and taking into account production cuts."

"But, the real positive surprise, which we think will be well received by the market, is that Aramco finally decided to up its dividend policy and include a clear link to its performance."

The world's top oil exporter made a record profit of over USD161 billion for 2022 on higher energy prices and production.

Last month, Saudi Arabia and other OPEC+ producers announced surprise oil production cuts from May, initially driving up prices, but global economic uncertainty and an unclear demand outlook continue to weigh on prices.

We remind, Saudi Aramco has signed 59 corporate procurement agreements (CPAs) worth a potential total of USD11 billion with up to 51 domestic and international manufacturers, as a part of its coveted in-kingdom total value add (IKTVA) localisation programme.

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BASF had a 13.4% decrease in sales for Q1 2023, from EUR23.1 billion in Q1 2022 to EUR20.0 billion, said the company.

According to the company, this was primarily the result of “lower volumes in almost all segments due to weaker demand”.

However, net income was EUR1.6 billion, EUR340 million higher than in the same period of the previous year.

“BASF started off 2023 better than analysts had expected – and in a stagnating and difficult economic environment,” said D. Martin Brudermuller, chairman.

The company forecasts sales of between EUR84 billion and EUR87 billion for 2023.

We remind, BASF announced that it has received the International Sustainability and Carbon Certification (ISCC) PLUS for certain grades of plastic additives produced at its manufacturing sites in Kaisten, Switzerland and McIntosh, Alabama, United States.

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Evonik introduces a diverse range of additives under the brand name TEGO Cycle to help its customers improve the process and increase the final quality of recycled plastics, said the company.

Designed to save energy during the mechanical recycling process, the TEGO Cycle portfolio of additives also enhances the quality of polymers, enabling the transition of the plastics value chain into a 'value cycle.'

Evonik will showcase its entire additives portfolio for improving the mechanical recycling process and final quality of plastics at booth A12 in Amsterdam during the Plastics Recycling Show Europe on 10-11 May 2023. In addition to the latest TEGO Cycle products, Evonik will launch its new organo-modified siloxane-based TEGOMER Polymer Processing Aids (PPA) for converters looking to replace standard PPAs made from fluoroelastomers in PE and PP processing.

We remind, Linde has signed a long-term agreement to supply green hydrogen to Evonik. Linde will build, own and operate a nine-megawatt alkaline electrolyzer plant on Jurong Island, Singapore. The plant will produce green hydrogen, which Evonik will use to manufacture methionine, an essential component in animal feed. The new supply agreement supports the planned expansion of Evonik’s existing facility and will help Evonik limit its greenhouse gas emissions in Singapore.

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