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Petronas to buy BP`s Malaysian ethylene, PE assets [ 01 Sep, 2010]
Petronas agreed to buy BP PLC’s Malaysian ethylene and polyethylene production for $363 million in a transaction expected to close by yearend, subject to certain conditions.
"The agreement concerns BP's 15% interest in Ethylene Malaysia Sdn. Bhd. and 60% interest in Polyethylene Malaysia Sdn. Bhd., both of which are operated by Petronas," BP said in a Sept. 1 news release.
Both production plants are at Kertih on the eastern coast of Malaysia. BP said the transaction will not affect its other businesses in Malaysia.
BP is in the process of divesting various assets to help generate cash to meet financial obligations likely to arise from the Gulf of Mexico oil spill, BP Chairman Carl-Henric Svanberg has said (OGJ Online, July 22, 2010).
Previously, BP agreed to sell its wholly owned BP Exploration Co. (Colombia) Ltd. for $1.9 billion to a consortium of Talisman Energy Inc. and Colombia’s Ecopetrol SA. Subject to regulatory and other approvals, the sale is expected to be completed by yearend.
Source: Oil and Gas Journal
USA - September NYMEX ethylene prices increase [ 26 Aug, 2010]
US ethylene prices rose in August, with the September New York Mercantile Exchange's (NYMEX) cleared ethylene settling and expiring at $0.40250 per pound. The contract, which began trading in July 2009, settled for August last month at $0.3225 per pound.
Ethylene trades in 100,000-pound lots per contract on the NYMEX's Clearport system and is a building block chemical used in the production of plastic resins and a variety of solvent chemicals, all used in major consumer manufacturing products.
In the overall cash markets, September ethylene was trading in the $0.35-$0.37 per pound range at the end of July and had dipped down to $0.335 in mid-August before rebounding and breaking above the $0.40 mark at the end of the month, according to PetroChem Wire (PCW), a daily U.S. petrochemical industry newsletter. PCW's cash market assessments are used to settle the cleared NYMEX contracts.
Typical ethylene deals are a minimum of 3 million to 5 million pounds in size, or 30 to 50 lots per trade. So far in August, more than 340 million pounds of ethylene have traded in the spot market.
"While overall steam cracker operating rates in the U.S. Gulf coast were healthy in August, the ethylene market strengthened as inventories remained lean," said Mark Quiner, senior editor of PCW. Quiner noted that demand for ethylene derivatives, such as polyethylene, has been strong and inventory levels have not fully recovered from the numerous supply disruptions seen earlier in 2010.
Ethylene can be produced using raw materials that are derived from both crude oil and natural gas, such as ethane. Ethane prices also rose in August, from the mid-40s cents per pound to around 50 cpp by the end of the month.
Maximum steam cracker operating rates in the U.S. Gulf were about 96% during August. Maximum operating rates were at 94% for steam crackers in Texas and 100% in Louisiana. By comparison, maximum steam cracker operating rates a year ago were around 75% and spot ethylene was trading at $0.28 per pound.
The PetroChem Wire is a daily newsletter serving the petrochemical industry. It counts every major petrochemical and refining company among its readers, as well as many major manufacturing concerns, global conglomerates, industry consultants, equity analysts and government agencies.
Source: PetroChem Wire
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