Mid August downstream news update: Asia and the Middle East

Asia

India

Reliance Industries Ltd’s (RIL) pleas for an open auction for Haldia Petrochemicals’ stake sale has been rejected by the West Bengal government.

RIL has requested this for the divestment of the state government’s share in eastern India’s biggest petrochemical company. However, the West Bengal government is considering a proposal for joint bidding by Indian Oil Corporation and Oil & Natural Gas Corporation, the two public sector majors. The proposal is likely to be approved.

Bids are expected by 31^st August, but the date can be extended.

Currently, five companies are in the race for stakes: RIL, Cairn India, IOC, ONGC, and GAIL.

Indonesia

The Indonesian petrochemicals market is growing, bucking the world trend.

Automotive and construction sectors continue to provide market stimulus, although the ability to maximise growth potential is limited by downside factors such as rising inflation, delays in project execution and the 2014 presidential elections.

Annual GDP growth is expected to exceed 6% over the medium term, boosting consumption growth. Domestic demand for ethylene was estimated at 1.4 million t in 2012 and is anticipated to reach 2 million t by 2017.

The country’s plastic consumption reached 2.8 million t in 2012. Polypropylene (PP) and polyethylene (PE) accounted for 70% of this total. Polyvinyl chloride (PVC) and polyethylene terephthalate (PET) accounted for 30%, representing demand growth of 7.5%.

Middle East

Iraq

Iraq’s Deputy Energy Minister. Hussain Ibrahim Saleh al-Shahristani, has called upon Indian investors, including Reliance Industries, to invest in Iraq; building more export outlets, pipelines connecting oilfields with export terminals, and constructing tank farms to increase storage capacity.

Hussain indicated that Iraq wishes to become a petrochemical hub. The Minister outlined that Iraq will provide all the necessary assistance to meet India’s growing needs for oil with its proven reserves of 143 billion bbl (approximately 11% of the world’s total.

‘India’s dependence on oil imports will increase from 74% in 2012 to 92% in 20 years time which requires special attention to be given to the issue of security of supply’, Hussain insisted.

Reliance Industries is exploring all opportunities in Iraq’s oil and gas sector. So far nothing has been finalised.

Pakistan

The Federal Board of Revenue (FBR) has detected a tax evasion scam, which has robbed the national exchequer by Rs 1.7 billion.

The FBR’s Directorate of Intelligence and Investigation (I&I) of Inland Revenue has forwarded a detailed report to FBR Chairman, Tariq Bajwa, advising him about a series of events and investigation through which the alleged taxevasion by M/S Trans Asia Refinery Limited has been detected.

M/S Trans Asia Refinery Limited (TRL) was incorporated into Pakistan in 2005, with the primary objective of setting up an oil refinery at Port Qasim Karachi.

Tax incentives worth billions of rupees were received by TRL for the project but the refinery remains unbuilt.

When contacted about the charges, a TRL spokesman insisted that the company is totally committed to building the refinery in Pakistan.

Edited from various sources by Emma McAleavey.

Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/15082013/mid_august_downstream_news_update566/