Refining

SOCAR starts horizontal drilling at one of its own fields

SOCAR has completed the construction of a block on cleaning dry gas and hydrocarbon-containing circulating gas for the catalytic cracking unit at the refinery n.a. Heydar Aliyev. According to the SOCAR’s report, the construction of the block is connected with the need to clean the dry gas, supplied from the refinery Ethylene-Polyethylene of SOCAR’s Azerkimye (chemical manufacturer).
"The new unit is scheduled to be launched on the eve of a 20-year anniversary of the signing of the “Contract of the Century" (on September 20the)", - the report says.

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Bashneft’s net income under IFRS rises by 18.5% in H1.

The IFRS net profit of JSC "Bashneft" in H1 2014 increased by 18.5%, the statement informs.
The proceeds of Bashneft from the sales increased by 18.9% - to 309.844 billion roubles. The adjusted EBITDA increased by 24.6% - up to 54.995 billion roubles. The net profit attributable to shareholders of the parent company increased by 18.5% - up to 29.814 billion roubles. The operating cash flow increased from 22.757 billion roubles to 47.122 billion roubles.
The capital expenditure increased by 31.7% to 18.811 billion roubles. The oil production growth was 9.3%, the increase in the petroleum products production - 3.6%. The production of gasoline and diesel fuel of Euro-5 increased by 34.9% and 26.1%, respectively.

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Kazakhstan is going to supply to Russia 242,000 tons of raw oil as payment for oil products in August and September

Counter deliveries of Kazakh oil to Russia as payment for oil products supplied to Kazakhstan on duty-free basis are planned at a rate of 242,000 tons in August and September, the Vice Minister of Energy of Kazakhstan U. Karabalin says.
Kazakhstan and Russia agreed that Kazakhstan will supply backward cost oil for oil products received in 2012 – 2013. Now Kazakhstan is completing calculation and checking of the volume and is going to start supplies already this month. Supplies will be 60,000 in August and 182,000 tons in September.

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In H1, Slavneft – Yanos increased net profit by 18.5% to 2.2 billion rubles

In H1, Slavneft – Yanos increased net profit by ISA by 18.5% to 2.175 billion rubles, revenue by 17.2% to 12.147 billion rubles, operational expenses by 14.6% to 8.52 billion rubles, operational profit by 23.8% to 3.627 billion rubles, and pretax profit by 26.3% to 3.094 billion rubles.
Slavneft – Yanos JSC is the producer of oil products and organic synthesis products in the structure of Slavneft NGK. Its annual refining capacity is 15.2 million tons.
Slavneft is a joint parity venture of Gazprom Neft and Rosneft via BP-TNK.

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The Court has arrested Rosneft’s oil products within the suit against Kurchenko

They revealed in the investigation that in 2013-2014 they were imported to the Ukraine oil products on the pretext of their further transit but they were sold inside the state.
The Court has arrested Rosneft’s oil products within the suit against VETEK.
The chamber for trying of the criminal cases of Appeal Court of Kiev has kept in force the verdict about arresting of the oil products of TNK-Industries Ukraine belonging to Rosneft.
At the end of July, the judge of the Pechersky court of Kiev met the application of the Central Investigations Department of the Ministry of Internal Affairs of the Ukraine and arrested the oil products in 7 tank cars and 10,000 tons of oil products in the reservoirs at the oil base of Vostok Ltd in the Kiev region.

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Dependence of Kazakhstan on Russian oil products may last till 2019

Kazakhstan may remain dependent on Russian oil products till 2019, a senior analyst of the Agency for Investment Profitability Research (AIPR) Artem Ustimenko said.
According to him, now more than one-third (1.36 million tons) of petrol, consumed in Kazakhstan, and about 14% (0.7 million tons) of diesel fuel fall on imports from Russia.
"The dependence on imports of Russian oil products will be seen until the completion of the modernization of domestic refineries in 2016, although these dates may be shifted to the 2018-2019," – the interlocutor stated. Ustimenko notes that the increase in gasoline prices in Kazakhstan was expected. "The increase of the marginal retail price of oil products became an anticipated forced step against the background of the increasing risk of a sustainable deficit on the domestic market of fuels and lubricants on certain categories of light vehicle fuel, especially high-octane gasoline," - the interlocutor says.

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Ministry of Energy criticizes new proposals of Ministry of Finance on taxes for oil companies

Tax manoeuvre in the oil industry, prepared by the Ministry of Finance, will lead to an increased burden on the industry and will have "serious adverse effects"; besides, the proposed increase of excise duties on oil products will lead to a further rise in the prices of light oil products by 2% or by 0.5 rubles per liter. This was announced by a representative of the Ministry of Energy.
According to the analysis, carried out by the Ministry of Energy, the adoption of the Finance Ministry’s proposals to increase the severance tax rate to 775 rubles and excise taxes on almost all types of oil products in 2015 will have a serious negative impact on the industry in 2017,"- the RIA Novosti’s interlocutor said.
The Ministry of Finance hasn’t provided a quick comment on the matter.

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In September, Kazakh oil refineries can increase oil processing by 90,000 – 100,000 tons

Kazmunai Gas and the Ministry of Energy of Kazakhstan analyze the ability for the increase in oil processing at the state oil refineries by 90,000 – 100,000 tons in September, for the satisfying of the internal consumption on the background of the economic lack of efficiency of oil products imports.
Now they operate in Kazakhstan 3 major oil refineries with total yield of 1.9 million tons of petrol of the AI-92 sort and 4 million tons of diesel fuel. Currently Kazakhstan consumes 2.8 million tons of petrol of AI-92 sort and 4.6 million tons of diesel fuel.
Usually, the deficiency between production and supplies is covered with oil products supplies from Russia. Every year Russia and Kazakhstan close the indicative balance setting the volume of fuel imported to Kazakhstan from the RF on the duty-free basis. All the excess supplies will be charged with export duty.
For prevention of outstripping of the oil product indicative balance, KMGO was assigned as the sole operator for oil product supply from the RF since June 2014.
The company claims that the oil product indicative balance for 2014 is 470,000 tons of diesel fuel and 670,800 tons of AI-92, however, oil product imports to Kazakhstan were 306,800 tons of AI-92 petrol by May 2014 instead of the planned 263,800 tons.
Without restrictions from the state, by the autumn the Kazakh consumers would have to pay for petrol on a price involving duty. At the end of July, the embargo for imports from Russia was lifted in connection with the market situation of those days.
Since June 2014, oil product prices rapidly increased in Russia. Within the period, the FAS of the RF imposed the restriction on petrol exports in order to avoid its deficiency at the RF internal market in connection with the breakdown at the Achinsk oil refinery, the only one in the Krasnoyarsk region, and other factors.

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Gazprom is still interested in supplies of Russian LNG to Vietnamese market

Gazprom and Vietnam have confirmed their interest in organizing the supply of Russian LNG to the Vietnamese market. Chairman of the Gazprom’s Board Alexei Miller and the Ambassador of Vietnam to Russia, Pham Xuan Sean discussed the issues of bilateral cooperation in the energy sector at the meeting. Specifically, cooperation in geological exploration and the production on shelf of Vietnam and in Russia were appreciated. The parties also expressed satisfaction with the progress of the project on development of the motor fuel sector in the republic.

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Petrochemicals industry in Russia hit with draconian measures ,could cost billions to implement

The Government's intention to make polymer packaging for the food safe for the environment has perturbed the petrochemical sector. From 2017 traditional polymers will not be allowed to be used for packaging in Russia, these measures, according to estimates of our sources, will cost the industry up to 10 billion roubles of profit per year, Russia will have to build more capacities for the production of biopolymers for their substitution, more than there are in the rest of the world.
The petrochemical companies are concerned that the government's initiative to transfer to biodegradable plastics for food packaging will bring them billions of dollars in losses. According to the estimates of the sources in the industry, petrochemical production can lose 7-10 billion roubles of profit per year from the prohibition of the traditional polymers. The producers of polyethylene and polypropylene will have to export their products, which now go to the premium domestic market, and this is a loss of 6 billion roubles of operating profit. The exports will be the only alternative for PETF. But the Russian factories will not be able to compete in export markets, the companies will receive less than 35-40 billion roubles of revenue and about 3 billion roubles of operating profit per year and are likely to be closed, the interlocutors believe

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Oil and Gas, Metals and Mining, News from Russia and neighbouring countries
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