Project News - Downstream

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PROJECT NEWS - DOWNSTREAM

COUNTRIES INDEX:

Indonesia

Indonesia

KLK to Build in Indonesia

Downstream Targets not Met

KLK to Build in Indonesia

It was announced in late November that Lumpur Kepong Bhd (KLK) is expanding its downstream operations and plans are under way to build an oleochemical plant in Indonesia costing RM120 million. According to a company spokesperson the plant will be ready by 2013.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

Downstream Targets not Met

Government claimed investments in the upstream oil and gas sector have surpassed annual target, while downstream sector has only reached 25% of annual target. Total investment targeted for oil and gas sector this year is US$13.6 billion.

“For upstream, the target has been surpassed. But the downstream is only 25% of annual target. Hopefully we can catch up soon,” said Evita Legowo, director general for oil and gas, at the energy ministry’s official website.

Overall, she said, investment in the oil and gas sector increased over the years. Last year, total investment was US$13.5 billion, increased from US$12.7 billion in 2009, and about the same with 2008. In 2007, total investment in the sector was US$11.1 billion, doubled from US$5.9 billion in 2004.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

Malaysia

PETRONAS Faces Personnel Crunch

PETRONAS Faces Personnel Crunch

According to a company spokesperson, PETRONAS’ downstream division is embarking on a RM60 billion project that will be bigger than all of its existing refineries and chemical plants put together. The project will require an additional 4,000 competent plant operators by 2017.

The downstream business also has other challenges. These include being subjected to the external economic environment, tough competition, old facilities and main-taining service levels in dealing with end consumers.

However, the biggest challenge remains talent. New facilities in the Middle East means more Malaysian talent will be poached. Over the last few months, PETRONAS has lost some 40 people at its refineries.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

Singapore

Back to Business for Shell

Back to Business for Shell

At the end of November it was almost back to business as usual at Shell’s Singapore facility following a Sept 28 fire at its Pulau Bukom refinery.

The blaze had caused it to shut down some plants, including three crude distillation units which form the backbone of its 500,000 barrels per day (bpd) refinery.

While repairs are continuing on the island - including at the pump house which was ‘ground zero’ of the fire - traders told BT that the oil giant has since returned as a seller in the swaps market here in the last couple of weeks.

Shell has also lifted most of the force majeures for various product supplies it had to impose on some customers, a Shell spokesman told BT yesterday.

A Platts report earlier this month said, for instance that Shell Singapore - as well as Ellba Eastern, a joint venture between Shell and BASF - had ended their force majeure (FM) on styrene monomer supplies.

FM is a clause in contracts which frees both parties from liability or obligation when an extraordinary circumstance beyond the control of the parties occurs.

The Shell spokesman said, however, that there was no further update at this time to the group’s earlier cited November/December timeline for full resumption of Bukom operations.

While Shell had restarted its third crude distillation unit (CDU) at the end of October, following progressive restarts of two earlier CDUs, a Reuters report said then that the 500,000 bpd refinery would be operating at just over 50 per cent at that stage.

Australia’s Rotork, which makes valve control systems for the oil industry, meanwhile said this week that Shell had enlisted its help ‘to assist in its recovery efforts’.

The fire had broken out in a pump house with a complex of many pipes leading to many light product tanks ‘where, the moment one pipe is opened, it temporarily feeds the fire again’, Shell officials earlier explained.

Rotork said that its Singapore office ‘is now working to assist in repairing the damage, by initially helping Shell to actuate new valves for the most urgent repairs’.

‘Rotork electric actuators installed in unaffected areas of the site are also being removed and shipped to the workshop for fitting to new critical plant replacement valves, while Rotork engineers assist with the onsite installation and commissioning of these actuated valves,’ it added. New intelligent electric actuators have also been ordered for new valves to be installed at the site, it said.

Shell earlier indicated that it expects to book a loss of about US$150 million for the fourth quarter as a result of the fire.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

Vietnam

KPI Confirms IFC Funding

Nghi Son Faces Delay

KPI Confirms IFC Funding

State-owned Kuwait Petroleum International (KPI) will receive funding from the International Finance Corporation (IFC) to build and develop Vietnam’s second oil refinery, its chairman was reported as saying at the end of September.

Hussein Ismail told Kuwait’s state news agency KUNA that building the 200,000-bpd Nghi Son oil refinery is part of Kuwait’s strategy to invest in large-scale refining and petrochemicals projects in East Asia.

No figure was given for the funding.

The refinery, situated in the northern province of Thanh Hoa, 215 km south of Hanoi, is a joint venture between KPI, Petrovietnam Construction Corp and Japan’s Idemitsu Kosan Co and Mitsui Chemicals.

The project is expected to be completed and ready for operation in 2015, KUNA said.

KPI, an international unit of Kuwait Petroleum Corporation (KPC), established the joint venture in April 2008 to build the refinery, which is designed to process Kuwaiti crude.

Investment in the refinery would total $7.5 billion, Vietnam’s Prime Minister Nguyen Tan Dung said in January.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

Nghi Son Faces Delay

Construction of the $7.5 billion Nghi Son oil refinery, Vietnam’s sec ond such facility, is likely to be delayed until the first quarter of 2012 instead of the last quarter this year, a senior executive from one of the contractors revealed in October.

The 200,800 barrel-per-day (bpd) plant will process sour Kuwaiti crude oil, said Dominique Peiffert, General Director of French oil services group Technip SA in Vietnam.

Construction of the Nghi Son plant, owned by Petrovietnam, Kuwait Petroleum International, Japan’s Idemitsu Kosan Co and Mitsui Chemicals Inc , will take between three and four years to complete, said Peiffert.

The French group, Japanese engineering firm JGC Corp and Spanish oil engineering group Tecnicas Reunidas are building the plant in northern Thanh Hoa province, 215 km (134 miles) south of Hanoi.

Hideto Murakami, General Director of Nghi Son Refinery and Petrochemical Co, the owner of the plant, confirmed the delay.

“We are targeting to start construction early next year,” he said via the telephone. Industry sources said the delay is due to financing issues and government procedures, but Murakami declined to comment on this.

Early this month, Vietnam’s state oil and gas group Petrovietnam said it planned to start construction in the last quarter this year.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

China

Jacobs Wins Contract

Sabic Plans Chongqing Plant

Jacobs Wins Contract

Jacobs Engineering Group announced in the first week of December that it was awarded a contract to provide engineering and procurement services for a newly formed joint venture between Honeywell and Sinochem.

Officials did not disclose the construction value but did announce that production is expected to start in late 2013. The work is being executed by Jacobs’ operations in Mt.Laurel, N.J. and Shanghai, China.

The joint venture, to be located in Taicang, Jiangsu Province, plans to produce HFC-245fa, a nonozone-depleting rigid foam blowing agent used in insulation for appliances, construction, transportation and other applications where maximum energy efficiency is required. Honeywell’s newly launched next generation HFO lower-global-warming-potential blowing agent, Solstice Liquid Blowing Agent, may also be produced by the joint venture.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

Sabic Plans Chongqing Plant

In December Sabic announced a memorandum of understanding with two Chinese parties to establish an engineering thermoplastics compounding plant in Chongqing, China.

The M o U , signed with Chongqing Xiyong Microelectronics Industrial Park and the Chongqing Economic and Informatisation Commission, supports the Chinese government’s 12th Five-Year Plan to expand into the country’s western region and reinforces Sabic’s commitment to build on its long heritage of serving this important marketplace with innovative and consistently highquality materials solutions, Sabic said in a statement.

This is Sabic’s third Chinese engineering thermoplastics investment this year. Earlier announcements include its MoU with Sinopec to collaborate on polycarbonate production in China. A joint investment between both companies would fund a new polycarbonate product plant with an annual capacity of 260,000 tonnes.

The second announcement was investments in new production lines for Sabic’s Lexan polycarbonate resins and films in both Shanghai and Nansha in 2012. This comes on the heels of a similar Lexan compounding expansion in Nansha late last year. The new compounding plant, which is expected to be online in 2013, will produce several of Sabic’s world-class polycarbonate, polycarbonate blends and other high-quality engineering thermoplastics to provide easier access for southwest China customers. The site will have compounding lines, colour development capabilities, and advanced equipment enabling Sabic to work with their customers and partners to create new applications for engineering plastics.

Today, Sabic in Asia has 41 offices, nine manufacturing sites and five technology and innovation centres across 12 key Asian countries servicing a portfolio of customers across diverse industries.

Sabic currently operates a jointventure with Sinopec that produces petrochemical products including ethylene, polyethylene, ethylene glycol, polypropylene, butadiene, phenol and butane-1.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

India

Jacobs Wins Shell Contract

HPCL-Mittal Refinery Could Undergo Commissioning in January

Jacobs Wins Shell Contract

Jacobs Engineering Group announced in December that it had received a contract from Shell India Markets Private Limited to establish an integrated organization with Shell Projects & Technology for its Project Design office in Bangalore, India.

The integrated project design organization expects to deliver a full range of engineering and design services for onshore upstream (oil and gas) and downstream major capital projects, mainly in the Middle Eastern and Far Eastern regions. The new organization aims to blend the strong technical and engineering design capability held by Shell and Jacobs, while optimizing the best work processes and tools of both companies.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

HPCL-Mittal Refinery Could Undergo Commissioning in January

A planned Rs 18,900 crore US$3.78b HPCL-Mittal Energy Limited refinery in India, a joint venture involving Hindustan Petroleum Corporation Ltd, is expected to be commissioned within two months, according to sources.

HPCL chairman and managing director, S. Roy Chaudhury, last Thursday visited the ambitious 9 million tonne oil refinery to get a first hand account on the progress of the project.

HMEL is a joint venture between Hindustan Petroleum Corporation Limited and Mittal Energy Investment Pte Ltd, Singapore - a Lakshmi N. Mittal Group company. Both the JV partners hold 49 per cent stake each in the company, The rest 2 per cent is held by financial institutions.

The sources said Chaudhury held meeting with senior staff of HPCL-Mittal Energy Ltd (HMEL) to discuss the marketing of finished products, among other issues.

The work on oil refinery commenced on November 14, 2007 with an capital outlay of Rs 18,919 crore.

After commissioning, the refinery will produce high value petroleum products such as LPG, naphtha, petrol, diesel, aviation fuel and pet coke.

The liquid products would be marketed through HPCL, while the solid products like sulphur, pet-coke and polypropylene would be sold directly by HMEL.

After its commissioning the refinery — known as Guru Gobind Singh refinery — is estimated to attract an investment of Rs 1,300 crore in Polypropylene based downstream industry in Punjab.

It will be one of the few refineries in the country that will have the capacity to produce 440,000 Metric Tonne of polypropylene, an official said, adding that at present polypropylene granules are produced in Gujarat and Maharashtra.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

Australia

LNG Hub to Bring $50B Windfall

Bechtel to Employ 400 Adult Apprentices for Gladstone LNG Construction

LNG Hub to Bring $50B Windfall

The proposed liquefied natural gas development north of Broome would create up to 8000 jobs at construction and generate up to $50 billion for the Australian economy over its life, lead proponent Woodside Petroleum announced in mid-November.

In its draft environmental impact statement released yesterday, Woodside detailed potential effects from offshore processing platforms and wells, subsea pipelines and infrastructure in Federal waters. Between 50 and 90 wells would be drilled over 50 years to exploit about 13.3 trillion cubic feet of gas and 360 million barrels of condensate from the Torosa, Brecknock and Calliance fields up to 290km off the Kimberley coast.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

Bechtel to Employ 400 Adult Apprentices for Gladstone LNG Construction

Bechtel announced it will hire an unprecedented 400 adult apprentices for work on construction of the three LNG plants in Gladstone - Queensland Curtis LNG, GLNG, and Australia Pacific LNG. This will be one of the largest single intakes of adult apprentices in Australia’s history and the company will work closely with the Federal Government’s National Apprenticeships Program (NAP) to deliver the opportunities.

Under the adult apprenticeship program, experienced workers will have their existing skills recognized. They will be given the opportunity to complete the competencies required without compromise, to get a full trade qualification in just 18 months instead of the traditional four years.

Bechtel has been in Australia for almost 60 years and in Gladstone for more than 30. Existing trainee programs give opportunities at Bechtel construction sites in Gladstone, Central Queensland and Western Australia. Under this National Apprenticeships Program, adult workers with existing skills are being targeted.

Source: Hydrocarbon Asia October/December 2011 < Back to News Index > < Back to Countries Index >

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