December 4, 2018:

BP Plc began restarting the blending oil unit at its 413,500 barrel-per-day (bpd) Whiting, Indiana, refinery on Tuesday, said sources familiar with plant operations. BP shut the unit that blends lower-quality crude grades with higher-quality grades on Nov. 27 for maintenance, the sources said.

By Reuters

December 3, 20018:

The construction of an oil pipeline and the refinery will open up the East African region to more oil xploration ventures, according to the East Africa Crude Oil Pipeline (EACOP) project director. Mr Maxim Marchenko, the EACOP director, said the two projects expected to start soon will act as a catalyst for oil companies to seek more exploration opportunities in the region and eventually monetise the resource. “Once we construct this pipeline, it will naturally increase oil exploration activities in the region. Today, before thinking about investment in oil, any oil company has to see how it will sell its oil. So if there is no pipeline, no refinery, then it jeopardises efforts of people to go and do investment,” Mr Marchenko said during a symposium organised by Advocates Coalition for Development and Environment, a policy think tank, and Parliament in Kampala on Friday to discuss developments in the oil sector.

The 1,445km pipeline is planned to run from Hoima District in mid-western to southern Tanga Port in Tanzania on the Indian Ocean coast. The project has been projected to cost at least $3.55b (about Shs12.8 trillion). Uganda discovered oil in the environmentally sensitive Albertine Graben in 2006 and has since raised hopes of an economic boost. Getting oil out of the ground has, however ,seen many delays. It is now expected that oil will start flowing by 2022. Of the 6.5 billion barrels of oil discovered below and around Lake Albert, about 1.5 billion are easily recoverable. Mr Marchenko responded to a long question raised by many speakers who were given a chance to speak at the symposium--- who will take up the lucrative jobs? He said the company is looking at recruiting 75 per cent of staff locally and some engineers have already been taken on.

“I am convinced that the best people to build things in Uganda are Ugandans, so if we do not use Ugandans, then our project will not be efficient,” said Mr Marchenko. Mr Isaac Musumba, the State minister for Lands, said the government is grappling with compensation issues in the oil region because the “office of the chief valuer is weak and needs to be strengthened.”  “We will be coming to Parliament to strengthen this office. The chief valuer is for the first time facing pressure to deliver,” said Mr Musumba.

By www.monitor.co.ug

November 6, 2018:

CHINA International Mining Petroleum Co. Ltd. (CIMP), the local entity behind the country’s first onshore oil discovery, is planning to ramp up its extraction to 1,000 barrels daily as it finalizes talks with a local refinery to sell its crude oil.  “We want to export it out of Cebu going to a refinery,” said Edgar Benedict C. Cutiongco, CIMP assistant country manager, in a chance interview.  He declined to disclose the identity of the refinery, although there are only two oil companies in the country with a refinery — Petron Corp. and Pilipinas Shell Petroleum Corp.  Mr. Cutiongco said he was finalizing the sale and purchase agreement (SPA) with the refinery, with the signing of the contract triggering the increase of the project’s storage capacity. 

CIMP, a company 51% owned by Hong Kong-listed Polyard Petroleum International Group Ltd., has invested $30.80 million in Service Contract (SC) 49 in the oil field up in the mountains of Alegria town in Cebu.  When the project was launched in May 2018, the company said it expected to drill at least three million barrels of oil in the next 19 years. It currently extracts 200 barrels a day. It caters to small industrial users near the area.  “Ang crude oil is very specific ‘yan. Hindi mo pwedeng i-derecho ‘yan sa barko. So ang target namin ngayon mga sugar mills kasi crude oil pa ito, so hindi pa refined (Crude oil is very specific. You cannot move it directly to a ship. So our target now are sugar mills because it’s still crude oil, and not yet refined.),” Mr. Cutiongco said.  “Once we sign that agreement we can [start] delivery to the refinery…. We’re looking initially at around 150 to 200 barrels per day,” he added.  Earlier this year, the Department of Energy said it was monitoring six exploration wells drilled by CIMP and its partners. The company acquired participating interest in SC 49 in southern Cebu and became its operator from July 1, 2009.  Skywealth Group Holdings Ltd. holds a 16% interest, with Phil-Mal Energy International, Inc. holding the rest.  Mr. Cutiongco said the company will to continue to serve its existing customers in Cebu even if it signs an SPA with the refinery.  “Pag na-establish na namin ‘yung route na ‘yun we can ramp it up (Once we have established that route, we can ramp it up). We were looking at about a 1,000 barrels per day in a matter of two to three years,” he said.  The Alegria oil field covers a land area of 197,000 hectares, with about 42,749 hectares allotted to the production area.  The community or the barangays that host the oil field stand to corner 14% of the “profit oil” of the project. Profit oil is the remaining gains from production after the participating partners have been compensated for their investments and operating expenses. 

The law requires 60% of profit to go to the government, and 40% to the investors. The government share is divided as 60% for the national coffers, 18% for the municipality, 8% to the provincial government and the rest to the barangays.

By www.bworldonline.com

October 19, 2018:

ThaiOil, a unit of the Petroleum Authority of Thailand (PTT) Public Co., has awarded an onshore engineering and construction (E&C) contract to a Saipem-Petrofac-Samsung consortium for the expansion of its Sriracha refinery, Saipem reported Friday.  According to Saipem, the total value of the project is approximately $4 billion and the company’s share is roughly $1.4 billion.  “The award of this contract consolidates the presence of Saipem in an area with great development prospects such as Southeast Asia and in particular Thailand, as well as confirming the company’s ability to promote strategic partnerships and become a key player in the field of clean fuel technologies and high-tech projects,” Maurizio Coratella, chief operating officer of Saipem’s E&C Onshore Division, said in a written statement.  Located in the eastern coastal province of Chonburi, Sriracha is Thailand’s main refinery, Saipem stated. The company noted that the expansion – part of ThaiOil’s Clean Fuel Project – will increase the facility’s capacity from 275,000 to 400,000. Moreover, it stated that the contract covers engineering, procurement and construction and calls for the start-up of new production units and upgrading some existing units.  “The project stands out for its high technologies, the complexity of implementation and the cutting-edge technical solutions it will provide in the refining sector,” Saipem remarked.

By Morningstar.co.uk

October 18, 2018:

China’s independent refineries have long faced an uncertain existence, operating in the shadows of their giant state-owned cousins. But one has received a major vote of confidence with the backing of global giant Saudi Arabian Oil Co. (Saudi Aramco), which announced a major new investment in East China’s Zhejiang province on Thursday.  Saudi Aramco has signed a memorandum of understanding to invest in a planned major petrochemical complex near the city of Zhoushan, city officials said at a signing ceremony announcing the deal.  Aramco will take over the 9% stake currently owned by the Zhoushan government in Zhejiang Petrochemical Co. Ltd., the private refiner developing the project, Caixin learned from Abdulaziz M. Al-Judaimi, Saudi Aramco’s senior vice president. While the value of the deal has not yet been revealed, a 9% stake would correspond to about 2.14 billion yuan ($309.0 million), Caixin calculated. The refinery will be capable of processing 40 million tons of crude oil a year, which experts say would make it China’s biggest private refinery by some distance. The project will involve a total investment of $24.9 billion over the next two years. Crude oil storage and transportation will also be developed at the site.  “Saudi Aramco can provide the petrochemical products needed by China in terms of refining and chemical integration,” Al-Judaimi said.

“Saudi Arabia is constantly investing in enterprises in China to meet China’s changing energy needs.” Aramco has been China’s biggest oil supplier since 2006, he added.  The deal is a milestone for China’s independent “teapot refiners” — producers that have managed to develop on the fringes of a domestic industry dominated by state-owned giants such as China National Petroleum Corp. and PetroChina Company Ltd. While mostly sidelined by a lack of government support, teapots have grown rapidly in the last few years and now account for around a fifth of China’s crude oil imports, leading to an increasing interest on international markets.  It also marks significant progress for Saudi Arabia, which has been looking to woo China while Beijing has grown increasingly close to one of the kingdom’s biggest energy rivals, Russia. In June, Saudi Aramco agreed to supply the Hengli Petrochemical Co. Ltd. refinery in the northeastern city of Dalian with around 20 million tons of crude oil a year.

By Caixinglobal