July 26, 2012:

SYDNEY - Oil refiner Caltex Australia announced on Thursday it will close its loss-making 124,500 barrel-per-day Kurnell oil refinery in Sydney after a year-long review, converting it into an import terminal and cutting more than 600 jobs. Australian refiners have been grappling with ageing equipment, cheaper imports, high costs and a strong Australian dollar, leading to closures, restructurings and reviews of operations. "Caltex's refineries are relatively small and, in their current configuration, are disadvantaged when compared to the modern, larger scale, more efficient refineries in the Asian region against which we compete," Caltex Chief Executive Julian Segal said in a statement. Caltex said it had agreed a long-term supply deal with 50 percent shareholder Chevron for transport fuels at "market-based prices". Segal did not specify where the fuel would be imported from but said not having a refinery in the region would not impact local fuel prices. "There is a reliable supply in the region -- in Singapore, in Korea, India," he told a news conference.

Kurnell has around 430 employees and 300 contractors. There would be less than 100 employees on site once the plant is closed in the second half of 2014, Caltex said. Costs related to closing the plant and converting it into an import terminal will come to around A$680 million ($698 million), the company said, announcing it will cut back on dividend payments while the closure and conversion takes place. Combined production at the 57-year-old Kurnell refinery and the company's Lytton refinery in Brisbane is made up of about 50 percent petrol, 30 percent diesel and 15 percent jet fuel. Caltex said it was working to improve the operational and financial performance of Lytton, which had better hardware than Kurnell. While there were no guarantees about Lytton's long-term future, Caltex was confident it could better meet market requirements, Segal said. Caltex said its refinery business lost A$60 million in the March quarter and A$208 million in the past year. It wrote down the value of its refinery assets by A$1.5 billion earlier this year. Caltex also said it was cutting its dividend policy, from a current payout ratio of 40-60 percent to 20-40 percent, and was looking at raising capital by issuing hybrid securities to improve its balance sheet. Shares in Caltex rose 1.5 percent in a slightly firmer broader market.

Australia consumed 52 billion litres of petrol, diesel and jet fuel in the year to June 30, 2011, with net imports accounting for around 14 billion litres.

By Reuters

July 26, 2012:

Jordan Petroleum Refinery Co. (JOPT) is seeking to buy about 830,000 metric tons of oil products in three separate tenders, the company said, without specifying delivery dates. The Amman-based operator of Jordan’s sole refinery plans to purchase 500,000 tons of diesel, 210,000 tons of fuel oil and 120,000 tons of unleaded gasoline, according to announcements posted on the company’s website. Suppliers have until July 31 to bid, it said. Jordan Petroleum Refinery has a processing capacity of 90,000 barrels a day, according to data compiled by Bloomberg.

Jordan, one of the smallest economies in the Middle East, imports most of its energy. Its power plants have switched to burning more expensive fuels after repeated halts in natural- gas shipments from neighboring Egypt, as a result of sabotage attacks on an export pipeline in the Sinai Desert.

By Bloomberg

July 26, 2012:

KUWAIT - Kuwait National Petroleum Company (KNPC) says it is going ahead with its long-delayed plan to build the Middle East's largest oil refinery despite political tensions that have stalled many economic development plans. The government expects to announce next month the winner of the Al-Zour refinery's project management and consultancy (PMC) contract, a senior executive at KNPC told Reuters. 'The bids have been submitted and now we are in the evaluation phase...I expect the result to be out in August,' the executive, who declined to be named under briefing rules, told Reuters.

Five international engineering firms submitted bids for the PMC contract, industry sources told Reuters: U.S.-based Foster Wheeler and Fluor Corp, Australia's WorleyParsons, France's Technip and British-based Amec. The executive and a spokesman for KNPC declined to comment on the names of the bidders or the size of the contract. Other contractors are due to prequalify by Aug. 7 in order to bid for the project's engineering, procurement and construction (EPC) contracts, the industry sources said. If it goes ahead, the Al-Zour project could have an impact well beyond its monetary value, helping to restore confidence in Kuwait's economic management and the government's ability to get things done. Originally planned a decade ago, the project, which aims to provide fuel for power generation and water desalination facilities and export any excess, is estimated to cost around $14.5 billion. The refinery would process 615,000 barrels per day, coming online in 2018; it would exceed the capacity of the Middle East's largest refinery, Saudi Arabia's 550,000 bpd Ras Tanura plant.

POLITICAL DELAYS

But Al-Zour and many other plans have been held up by years of conflict between the cabinet, which is chosen by a prime minister who is appointed by the emir, and the National Assembly over allegations of corruption and mismanagement. Kuwait has seen eight governments come and go in just six years, blocking or delaying the passage of economic legislation and disrupting decision-making. The Al-Zour refinery project was originally awarded in 2008 to companies including South Korea's GS Engineering & Construction and Japan's JGC Corp. But in 2009 the cabinet decided to halt the project on the grounds that oil prices were then too low to finance oil projects, industry sources said; the government is now retendering for it. Announcing a surprise 42 percent drop in second-quarter profit last week, Ibrahim Dabdoub, chief executive of National Bank of Kuwait, the country's biggest bank, blamed the political turmoil for restricting state spending and delaying tenders for infrastructure projects.

In June this year a court annulled the results of a parliamentary election in February which gave opposition, mainly Islamist lawmakers a majority; fresh elections are widely expected to be held after the holy month of Ramadan ends around Aug. 19. Independent Kuwaiti oil analyst Kamel Al Harami said the Al-Zour refinery plan no longer needed to be approved by parliament because it had been designated a top infrastructure project; it is being supervised by the state audit bureau, meaning it can theoretically go ahead without political interference, he said.

He added that the project would help relieve Kuwait of the need to import cargoes of liquefied natural gas to meet excess demand for power generation during the hot summer months. But Harami said he still doubted the project would be completed on time. 'I'm not optimistic - no one including the current oil minister has laid out a plan and milestones for this project, and without that it'll never be complete,' he said. 'The current oil minister is worried he won't be in the new cabinet and there is no one to plan this project now.' Hani Hussein, a former chief executive officer of Kuwait Petroleum Corp, was reappointed as oil minister this month. But under the constitution, the cabinet will have to resign after the parliamentary elections and a new cabinet will be formed.

IWPP STALLED

One plan that appears stalled by political frictions is the Al Zour independent water and power project (IWPP), which is separate from the refinery project. Its fate may not become clear at least until after the elections. The public-private partnership, funded and operated jointly by the government and private companies, is to build a 1,500 megawatt power plant and a desalination plant with a capacity of between 102 million and 107 million gallons per day. It would start commercial operations in May 2015. Earlier this year, Japanese trading house Sumitomo and Europe's International Power Plc said they had together been named preferred bidders for the project.

'But last month the National Assembly said they wanted to halt the project because the bidding process wasn't fair, as not all companies were present to submit the bids,' said an industry source close to the project. 'Now with a new cabinet formed and which might be dissolved, this project is in a controversial state, as many economic projects are in Kuwait.'

By Reuters

July 26, 2012:

KUWAIT - Kuwait National Petroleum Company (KNPC) says it is going ahead with its long-delayed plan to build the Middle East's largest oil refinery despite political tensions that have stalled many economic development plans. The government expects to announce next month the winner of the Al-Zour refinery's project management and consultancy (PMC) contract, a senior executive at KNPC told Reuters. 'The bids have been submitted and now we are in the evaluation phase...I expect the result to be out in August,' the executive, who declined to be named under briefing rules, told Reuters.

Five international engineering firms submitted bids for the PMC contract, industry sources told Reuters: U.S.-based Foster Wheeler and Fluor Corp, Australia's WorleyParsons, France's Technip and British-based Amec. The executive and a spokesman for KNPC declined to comment on the names of the bidders or the size of the contract. Other contractors are due to prequalify by Aug. 7 in order to bid for the project's engineering, procurement and construction (EPC) contracts, the industry sources said. If it goes ahead, the Al-Zour project could have an impact well beyond its monetary value, helping to restore confidence in Kuwait's economic management and the government's ability to get things done. Originally planned a decade ago, the project, which aims to provide fuel for power generation and water desalination facilities and export any excess, is estimated to cost around $14.5 billion. The refinery would process 615,000 barrels per day, coming online in 2018; it would exceed the capacity of the Middle East's largest refinery, Saudi Arabia's 550,000 bpd Ras Tanura plant.

POLITICAL DELAYS

But Al-Zour and many other plans have been held up by years of conflict between the cabinet, which is chosen by a prime minister who is appointed by the emir, and the National Assembly over allegations of corruption and mismanagement. Kuwait has seen eight governments come and go in just six years, blocking or delaying the passage of economic legislation and disrupting decision-making. The Al-Zour refinery project was originally awarded in 2008 to companies including South Korea's GS Engineering & Construction and Japan's JGC Corp. But in 2009 the cabinet decided to halt the project on the grounds that oil prices were then too low to finance oil projects, industry sources said; the government is now retendering for it. Announcing a surprise 42 percent drop in second-quarter profit last week, Ibrahim Dabdoub, chief executive of National Bank of Kuwait, the country's biggest bank, blamed the political turmoil for restricting state spending and delaying tenders for infrastructure projects.

In June this year a court annulled the results of a parliamentary election in February which gave opposition, mainly Islamist lawmakers a majority; fresh elections are widely expected to be held after the holy month of Ramadan ends around Aug. 19. Independent Kuwaiti oil analyst Kamel Al Harami said the Al-Zour refinery plan no longer needed to be approved by parliament because it had been designated a top infrastructure project; it is being supervised by the state audit bureau, meaning it can theoretically go ahead without political interference, he said.

He added that the project would help relieve Kuwait of the need to import cargoes of liquefied natural gas to meet excess demand for power generation during the hot summer months. But Harami said he still doubted the project would be completed on time. 'I'm not optimistic - no one including the current oil minister has laid out a plan and milestones for this project, and without that it'll never be complete,' he said. 'The current oil minister is worried he won't be in the new cabinet and there is no one to plan this project now.' Hani Hussein, a former chief executive officer of Kuwait Petroleum Corp, was reappointed as oil minister this month. But under the constitution, the cabinet will have to resign after the parliamentary elections and a new cabinet will be formed.

IWPP STALLED

One plan that appears stalled by political frictions is the Al Zour independent water and power project (IWPP), which is separate from the refinery project. Its fate may not become clear at least until after the elections. The public-private partnership, funded and operated jointly by the government and private companies, is to build a 1,500 megawatt power plant and a desalination plant with a capacity of between 102 million and 107 million gallons per day. It would start commercial operations in May 2015. Earlier this year, Japanese trading house Sumitomo and Europe's International Power Plc said they had together been named preferred bidders for the project.

'But last month the National Assembly said they wanted to halt the project because the bidding process wasn't fair, as not all companies were present to submit the bids,' said an industry source close to the project. 'Now with a new cabinet formed and which might be dissolved, this project is in a controversial state, as many economic projects are in Kuwait.'

By Reuters

July 26, 2012:

The Kaduna State House of Assembly  on Wednesday commenced investigations into the allegations that the Kaduna Refinery and Petrochemical Company  dumped toxic waste in Rido Village, in Chikun Local Government Area of the state. The community claimed that the waste had caused some damages in their community. They  maintained  that  two children and 600 poultry birds belonging to a senior military officer died as a result of the harmful waste. The house investigation  came on the heels of  the Kaduna State Environmental Protection Authority’s claim,  through its laboratory test, that the dumped waste was not harmful to the environment and public health.

The report dated July 10, 2012 and signed by the director of the agency’s laboratory services, Lawal Usman, read, “The confirmatory test shows that the results obtained are within acceptable. Therefore, the refuse dumped is not harmful to the environment and public health.” However,  Colonel Ismaila Isah insisted that he lost 600 birds in his poultry as a result of the waste, adding that more than 10 dogs within the community also died as a result of the waste. “I raised the alarm when they dumped the waste on June 10, 2012. I lost 600 birds within six hours. I have been raising birds for a long time but I have never suffered this kind of loss. The birds inhaled the harmful air and died. My veterinary doctor told me that the birds died of respiratory disorder caused by air pollution from the waste dumped,” he  said.

Pastor Wale Michael, who  also spoke  before the committee, claimed that his dog and his neighbour’s son died as a result of the waste, a claim that was vehemently disputed by some members of the community. Mr. Aminu Mohammed claimed that his family cooked with woods from the waste and nothing happened to them. Public Affairs Manager of the KRPC,  Mr. Abdullahi Idris, while insisting that the waste was not toxic, noted that the company contracted for waste disposal who dumped the waste in the area had been sanctioned.

By Punchng.com