Tag Archives: refining

Azerbaijan’s energy company reorganises its assets in Turkey

JUNE 1 2016 (The Conway Bulletin) — SOCAR Turkey Enerji, a subsidiary of Azerbaijan’s state-owned energy company, has said it wants to buy stakes in a pipeline and a lubricants company and sell a stake in a refinery, in a major shake up of its operations in Turkey.

SOCAR Turkey Enerji said it is interested in buying OMV Petrol Ofisi, a subsidiary of the Austrian energy company that produces fuel and lubricants in Turkey. To secure the deal, the Azerbaijani company will have to beat competition from Chinese and Japanese companies.

“SOCAR has an interest in this deal. We are waiting for the company to submit information on these assets,” Zaur Gakhramanov, the company’s head, told local media. He also said his company wants to buy a 7% stake in TANAP, the Trans-Anatolian gas pipeline, from SOCAR, which owns a 58% stake in the project.

Perhaps adding to the company’s expansion plans, Mr Gakhramanov also said that SOCAR Turkey Enerji plans an IPO in 2020 for 49% of its shares. He did not say where the company’s shares would list.

But this year SOCAR Turkey Enerji has also looked to sell.

In May, it said it wanted to sell off its shares in Turkey’s petrochemical complex Petkim. In March SOCAR Turkey Enerji cut its share in Petkim from 8.07% to 5.32%. SOCAR Turkey Petrokimiya, another SOCAR subsidiary, still owns 51% of the project.

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(News report from Issue No. 283, published on June 3 2016)

Refinery capacity rises in Turkmenistan

MAY 31 2016 (The Conway Bulletin) — Turkmenistan’s ministry of oil and gas said it wants to double oil refining capacity in the country over the next three years, in an effort to increase the domestic output of oil products. The ministry said it plans to increase capacity to 20m tonnes by 2020 and then to 30m tonnes by 2030. Last year, Turkmenistan missed its goal of reaching its refining capacity of 15m tonnes. It currently only process around 11m tonnes/year.

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(News report from Issue No. 283, published on June 3 2016)

Azerbaijan’s oil company to build new refinery

MAY 23 2016 (The Conway Bulletin) — SOCAR, Azerbaijan’s state-owned oil company, said it will build a new oil refinery in Kulevi, on Georgia’s Black Sea coast, near its existing oil terminal. SOCAR said it has agreed with Georgian authorties to build the plant by the end of 2019. The refinery will cost $120m to build and will have a capacity of 2m tonnes/year.

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(News report from Issue No. 282, published on May 27 2016)

Romania seizes Kazakhstan’s Kazmunaigas refinery

ALMATY, MAY 6 2016, (The Conway Bulletin) – Prosecutors in Romania ordered the seizure of the Petromidia refinery part-owned by a subsidiary of Kazakhstan’s Kazmunaigas as they re-opened an investigation into its privatisation in the 2000s.

The seizure of the refinery comes only a few days after China’s CEFC China Energy Company Limited completed a $680m deal to buy a 51% stake in KMG International, the Kazmunaigas subsidiary that owns the Petromidia refinery. Kazmunaigas has been looking to sell off assets and raise cash to help it through a sustained economic downturn.

Rompetrol was renamed KMG International in 2014, although the Rompetrol brand still lingers.

Romanian investigators have been focused on recovering cash they say is owed to it after a deal by the late Dinu Patriciu to buy the Petromidia refinery in 2003 from the state for $760m through Rompetrol, which he owned. He bought the Petromidia refinery from the government not with cash but with a bond.

In 2007, Patriciu sold Rompetrol and its daughter companies to Kazmunaigas for $1.6b.

When in 2010 Rompetrol’s bonds reached maturity, Kazmunaigas refused to pay the government the $600m coupon. Instead it gave the Romanian government a 45% stake in Rompetrol. This was reduced to 18% in 2014 after the Romanian government agreed to sell Kazakhstan a 27% stake for $200m.

KMG International said it had not been involved in any wrongdoing and that this legal case could damage its business plans in Romania.

“These are new developments which may have significant negative impact on KMG’s strategic objectives and development plans in Romania,” the press service said in a statement.

The company later also said it is also ready to take legal action.

“We will analyse the facts about the charges and to what extent such deeds justify the seizure of company assets. If we find that the seizure is not justified, we will challenge those seizures,” Gheorghe Albu, a lawyer for KMG International lawyer, said.

Petromidia is Romania’s largest refinery and is situated near Năvodari on the Black Sea coast.

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(News report from Issue No. 280, published on May 13 2016)

Amec wins Azerbaijani deal

APRIL 26 2016 (The Conway Bulletin) – London-based energy service company Amec Foster Wheeler signed a contract for so-called frontend engineering design at Azerbaijan’s Heydar Aliyev Oil Refinery in Bak. SOCAR, Azerbaijan’s state-owned energy company, awarded the contract. Amec will complete the work by in Q1 2017.

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(News report from Issue No. 278, published on April 29 2016)

Kazakhstan plans to upgrade refinery

APRIL 15 2016 (The Conway Bulletin) – Kazakhstan plans to complete the modernisation of the Shymkent oil refinery by the end of 2017. The Shymkent refinery, which has a capacity of 5m tonnes, makes up 30% of Kazakhstan’s domestic production of petroleum derivatives. It currently operates below capacity and is often closed for maintenance.

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(News report from Issue No. 277, published on April 22 2016)

New refinery opens in Tajikistan

MARCH 25 2016 (The Conway Bulletin) – A new refinery opened in Tajikistan’s northern town of Kanibadam, a major boost to the country’s oil products output. Naftrasom, a private company owned by Nosir Usmonov, built the plant with a $3.5m investment. The refinery will have a capacity of 70,000 tonnes. As confirmed by Tajik President Emomali Rakhmon, who attended the inauguration, Tajikistan will import raw materials for the plant, mostly from Kazakhstan.

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(News report from Issue No. 274, published on April 1 2016)

Turkmenistan boosts CNG

MARCH 18 2016 (The Conway Bulletin) – The Turkmenbashi refinery complex plans to produce 340,000 tonnes of compressed natural gas (CNG) this year, a 13% increase compared to 2015. The majority of the production is booked for exports to Georgia, Iran, Tajikistan, Afghanistan and Pakistan. Turkmenistan also uses CNG domestically as fuel.

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(News report from Issue No. 273, published on March 25 2016)

KBR wins refinery contract in Azerbaijan

MARCH 7 2016 (The Conway Bulletin) – US-based engineering company KBR said its joint venture in Azerbaijan had won a project management consulting contract for the Heydar Aliyev oil refinery near Baku. SOCAR, Azerbaijan’s state owned energy company, is a partner in the joint venture with KBR. The companies did not disclose the value of the contract.

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(News report from Issue No. 271, published on March 11 2016)

Sasol considers project cut in Uzbekistan

MARCH 9 2016 (The Conway Bulletin) – Due to sustained low oil prices, South Africa’s Sasol is considering dropping its gas-to-liquids project in Uzbekistan. In Uzbekistan, Sasol operates jointly with Malaysia’s Petronas and state-owned Uzbekneftegaz. The project cost stands at around $5.6b. Sasol said it will make a final decision on the project in the first half of the year.

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(News report from Issue No. 271, published on March 11 2016)