Advanced Petrochemical Q2 profit falls on lower prices, sales volume

Advanced Petrochemical Q2 profit falls on lower prices, sales volume

MOSCOW (MRC) -- Advanced Petrochemical Company generated SAR 103 million worth of net profits after Zakat and tax in the first half (H1) of 2023, which came 62.41% lower than SAR 274 million in H1-22, said Argaam.

The annual plunge in H1-23 net profits resulted from a 22% decrease in sales prices as well as a 6% lower volume, the company said in a bourse disclosure. The earnings per share (EPS) declined to SAR 0.4 in the first six months (6M) of 2023 from SAR 1.05 in the same period a year earlier.

Advanced Petrochemical achieved revenues worth SAR 1.20 billion during January-June 2023, signalling an annual drop of 28.09% from SAR 1.68 billion.

The income statements indicated that the listed company reported a 45.45% year-on-year (YoY) decrease in net profit to SAR 60 million during the second quarter (Q2) of 2023 from SAR 110 million. The revenues also fell by 28.50% to SAR 582 million in Q2-23 from SAR 814 million in Q2-22.

On a quarterly basis, the Q2-23 net profits were 39.53% higher than SAR 43 million in Q1-23, while the revenues shrank by 7.18% from SAR 627 million. It is worth mentioning that in Q1-23, Advanced Petrochemical reported lower net profits when compared to Q1-22.

We remind, Saudi Aramco has completed the USD3.4bn purchase of a 10% stake in China's Rongsheng Petrochemical. The acquisition follows the signing of definitive strategic agreements by the two firms which was announced on 27 March 2023. “Our strategic partnership with Rongsheng advances Aramco’s liquids to chemicals strategy while growing our presence in China," Aramco's downstream president said Mohammed Al Qahtani said.

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Sonatrach signs new contracts with TotalEnergies

Sonatrach signs new contracts with TotalEnergies

MOSCOW (MRC) -- 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, said the company.

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.

“This new contract on Berkine asset, under the Algerian new Hydrocarbon Law, marks a new milestone in the strategic partnership with Sonatrach. This project is in line with the Company’s strategy to develop low-cost oil while contributing to carbon reduction programs to minimize our carbon footprint”, commented Laurent Vivier, Senior Vice President Middle East and North Africa, Exploration & Production at TotalEnergies.

TotalEnergies is a global multi-energy company that produces and markets energies: oil and biofuels, natural gas and green gases, renewables and electricity. Our more than 100,000 employees are committed to energy that is ever more affordable, cleaner, more reliable and accessible to as many people as possible. Active in more than 130 countries, TotalEnergies puts sustainable development in all its dimensions at the heart of its projects and operations to contribute to the well-being of people.

We remind, TotalEnergies and its partner SOCAR (State Oil Company of the Republic of Azerbaijan) announce the start of production of the first phase of development of the Absheron gas and condensate field in the Caspian Sea, around 100 km south-east of Baku.

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ECARU, Qalaa Holdings, and Axens to study second-gen biofuel and SAF production project

ECARU, Qalaa Holdings, and Axens to study second-gen biofuel and SAF production project

MOSCOW (MRC) -- Within the framework of their strategy to provide practical solutions for cleaner energy, ECARU (Egyptian Company for Solid Waste Recycling), Qalaa Holdings, and Axens, signed a cooperation protocol in the presence of H.E. French ambassador to Egypt Marc Barety, to carry out technical and economic studies for a project of second-generation biofuel (advanced bioethanol) and Sustainable Aviation Fuel (SAF) production, said Hydrocarbonprocessing.

In collaborating, the parties are bringing together their respective areas of expertise:

Qalaa Holdings is a leader in energy and infrastructure investments and exerts all efforts to produce cleaner energy and alternative fuels. This comes in accordance with Egypt's strategy to develop renewable/low carbon fuels and contribute to achieving sustainability and recycling various wastes, in order to achieve economic growth. Qalaa Holdings’ strategy aims at providing practical solutions for cleaner energy resulting from converted biomass via ECARU, one of the companies in which Qalaa Holdings invests.

ECARU is already producing a number of products from agricultural waste, such as high-quality organic fertilizers and alternative solid fuel for cement factories (BDF), in line with Egypt's efforts to preserve the environment and mitigate climate change. Over the past 15 years, it contributed in the disposal and recycling for further use of 3.5 million tons of agricultural waste, thus reducing pollution by avoiding open burning.

Axens is a French licensing company that licenses various processes in the field of renewable/low carbon fuels. Starting from biomass to advanced bioethanol (Futurol) and then a further conversion into SAF (Jetanol), Axens is the single licensor for the full set of technologies and will support ECARU and Qalaa Holdings for this project.
The project will be carried out in two phases, the first of which will be the production of advanced bioethanol while the second will be the production of sustainable aviation fuel (SAF). The project’s studies will take about seven months, noting that the company aims to export its production of second-generation biofuel, in line with Egypt’s strategy to maximize the use of various waste types and contribute to sustainability and waste recycling, thereby fostering economic growth.

Dr. Ahmed Heikal, Chairman and Founder of Qalaa Holdings, said: “We are so proud to launch this cooperation with Axens for the production of second-generation biofuels from lignocellulosic biomass to promote global environmental sustainability, within the framework of our commitment to establishing high value-added export-oriented projects”. Heikal added, “Qalaa is significantly increasing its investments in Egypt through the companies in which it invests by implementing high-value-added export-oriented projects. The timing now is ripe for such projects”.

Dr. Hesham Sherif, Chairman and Managing Director of ECARU, commented: “ECARU is looking forward to starting the financial and technical study of the project, and actual production within three years, over two phases. The first phase shall involve the production of advanced bioethanol, while the second phase shall concern the production of sustainable aviation fuel. Such production is export-orientated to meet the growing needs of the global market.”

Jean Sentenac, President and Chief Executive Officer of Axens, said: “We are thrilled to support Qalaa Holdings and ECARU in their effort toward reducing greenhouse gas emissions, thanks to what will be the first advanced bioethanol and SAF project in Egypt. I am proud that Futurol and Jetanol will be the technological key stone of this project.”

We remind, Axens has signed an agreement with KazMunayGas (KMG) to supply the process design package for its proprietary AlphaButol technology for producing high-purity 1-butene, which is required for producing PE. KMG has plans for a 1.2 million t/y PE plant in Atyrau, Kazakhstan. French technology and engineering group Axens has signed an agreement with KazMunayGas (KMG) to supply the process design package for its proprietary AlphaButol technology that produces high-purity 1-butene, which is required for producing PE. KMG plans to build a 1.2 million t/y PE plant in the Atyrau region of Kazakhstan – a timescale for the project has not been disclosed.

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Chinese petchem firms betting big on energy transition products

Chinese petchem firms betting big on energy transition products

MOSCOW (MRC) -- Chinese oil refiners and petrochemical companies are investing tens of billions of dollars to produce high-end chemicals for solar panels and lithium-ion batteries to profit from growing demand for energy transition technologies, said Reuters.

The investments illustrate China's drive to reduce its import dependence and further cement its dominance of renewable energy and electric vehicle supply chains. The move pits the Chinese companies against Dow Chemical, Exxon Mobil and BASF in making key materials.

Companies including Wanhua Chemical, Zhejiang Petrochemical Corp (ZPC) and Hengli Petrochemical (600346.SS) and state oil giant Sinopec Corp are leading the shift, industry executives and analysts said. They are moving from making more basic petrochemicals for polyester fabrics and plastic packaging to manufacturing higher value products such as polyolefin elastomers (POE) used to protect the cells on solar panels, ultra-high-molecular-weight polyethylene for lithium-ion battery separators and carbon fibre for wind turbine blades.

China's glutted market in polyethylene and polyesters after years of rapid petrochemical capacity expansion is prompting some of the shift. The drive also aligns with Beijing's push for companies to break through technological bottlenecks for producing key new materials and strengthen domestic supply chains and builds off China's status as the world's biggest manufacturer of electric vehicles, EV batteries and solar panels.

ZPC, Hengli, and smaller refiner Shandong Chambroad Petrochemical are each building multi-billion-dollar complexes to make the new materials, with production due to come online around 2025, officials at the three companies told Reuters.

Sinopec Corp, the country's top refiner and basic chemicals producer, is shifting investment to high-end chemicals such as ethylene vinyl acetate (EVA) for solar panels and large-tow carbon fibre used in aircraft and lighter, stronger wind turbine shafts.

Engineering plastics, raw materials for bio-degradable plastics and electrolytes for lithium batteries, as well as plastics for the battery separators, are among the new plant's main planned products, said the Hengli representative, who declined to be identified.

Having set up a specialised battery technology unit in late 2022, Wanhua Chemical said in May it will spend 3.4 billion yuan this year on raw materials for anodes, cathodes, and electrolytes used in lithium batteries, China Chemical News reported in June.

Chinese production capacity for POE, a material used for solar panel encapsulation that resists ultraviolet light and is more durable than EVA, will surge to 1 million metric tons per year by 2025 from zero at a cost of about 20 billion yuan, to meet demand that is set to expand at double-digit rates, industry officials estimated.

About a dozen companies, including units of Sinopec and PetroChina , are building or planning POE capacity. The domestic supply would partly replace China's POE imports, which have grown by an average of 23% a year over the past five years to a record 690,000 tonnes worth 13.7 billion yuan in 2022, according to Chinese customs.

Wanhua and Sinopec are expected to be China's first commercial POE producers, according to Zhao and Woodmac's Cui.

In April, Sinopec announced trial output at its Maoming refinery. ZPC expects to bring online a POE facility that can produce 400,000 metric tonnes per year by 2025/2026, said an official from Zhejiang's parent Rongsheng Petrochemical.

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Versalis publishes decarbonisation targets in the latest Sustainability Report

Versalis publishes decarbonisation targets in the latest Sustainability Report

MOSCOW (MRC) -- Versalis, Eni's chemical company, has published the 2022 Sustainability Report, illustrating its contribution to the development of more sustainable and circular models in line with Eni's strategy and values, said the company.

The document also outlines the targets set by the company to achieve carbon neutrality by 2050. Being energy-intensive, the chemical industry bears a heavy responsibility in the decarbonisation challenge since deemed ‘hard to abate’, i.e. difficult to decarbonize.

Versalis aims to play a key role in the transition through the development of complementary and synergistic technologies, products and solutions that support a lower-emissions business model and contribute to a more sustainable future.

Adriano Alfani, CEO of Versalis said: “We are committed to making a contribution to contrasting climate change through our daily actions: by identifying more sustainable alternatives for the supply of feedstocks and energy; by developing chemistry from renewables; by adopting solutions aimed at reducing energy impact; and by conducting research activities dedicated to the development of new technologies, processes and products for decarbonisation. We work to ensure that the path towards decarbonisation offers growth opportunities for the social fabric and prosperity of the communities we operate in, developing new activities and supply chains".

The Sustainability Report highlights cross-cutting emission reduction targets: compared to reference year 2018, 15% for Scopes 1 and 2 by 2025 and 30% by 2035. These short- and medium-term targets are fundamental milestones for achieving the Net Zero* goal by 2050. Specific actions have also been identified to achieve these targets: as to Scope 1, activities on industrial processes and in particular on steam-cracking; as to Scope 2, increases in plant efficiency and use of renewable energy; as to Scope 3, the development of circular economy initiatives and chemistry from renewables, for which the direct involvement of the entire network of suppliers and customers is needed, encouraging them to reduce emissions.

We remind, in Italy, Versalis, Eni’s chemical company, has acquired the technology to produce enzymes for second-generation ethanol from DSM. The agreement has a strategic value for Versalis as it integrates with proprietary Proesa® technology, applied at the Crescentino plant for the production of sustainable bioethanol and chemical products from lignocellulosic biomass, improving the competitiveness of technology and production.

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