Huntsman and Hexion Merger Extended

US producer Hexion Specialty Chemicals which is under way of merging with Huntsman has extended the termination date of the Huntsman merger agreement by 90 days to 4 July 2008. This would give the US regualtors more time to evaluate the proposed merger agreement for the two companies.

Methanol for Energy only for China

Methanol usage in the energy sector is widely used in China due to a number of reasons unique to the nation such as the cheap and abundant supply of coal as feedstock for making methanol.

Refining margins in China are currently negative due to lower price of gasoline and even much lower methanol prices. The factor is also driven by transportation infrastructure where local auto manufacturers are looking to capture energy market share with 'low running costs' and the Chinese government was pushing for coal to replace part of energy derived from crude.

Sasol Producing First Ever Synthetic Jet Fuels

Sasol has made a history when the International Air Transport Association (IATA) and other authorities have approved Sasol's coal-to-liquids (CTL) synthetic jet fuel, the first evert synthetic jet fuel approved for commercial airplanes which will be produced at Sasol's Synfuels plant in Secunda, South Africa.

The plan has long been considered but only recently the authorities realised the need to develop aviation fuel from feedstocks other than crude oil in current escalating demand. Sasol's synthetic jet fuels has less emissions due to its limited sulphur making it an environmental friendly fuel.

Foreign Company Building Refinery in Malaysia

Gulf Petroleum is reportedly succeeding in getting government approval to build US$5 Bln Integrated Oil & Gas Complex In Malaysia. Qatar based Gulf Petroleum Ltd has received the final and official approvals from the Malaysian government to build the integrated oil and gas complex in Manjung, Perak.

This is confirmend by the Gulf Petroleum president Ir Abdulaziz Hamad Al-Delaimi which will proceed with the project together with other consortium members comprising major oil and gas groups, including prominent banking and insurance groups.

The proposed site as offered by the state government comprises of 400-hectare site in Manjung offered by the Perak state government.

UAE Borouge Increasing PP/PE Capacity

United Arab Emirates plastics producer, Borouge is planning to increase its polyolefins including Polyethylene and Polypropylene capacity by 2.5m tonnes per annum by the end of 2014 under a feasibility study for the expansion project, codenamed Borouge 3.

The additional feedstock will be supplied Abu Dhabi National Oil Company (Adnoc) through its planned expansions at upstream which if succeeded will boost Borouge's total production capacity to 4.5m tonnes/year to meet the growing demands of polyethylene and polypropylene markets in the Middle East and Asia.

Analysts expect that the feasibility study will be successful since Borouge is a 40:60 joint venture between Borealis and Adnoc.

Methanol Production Cost Arising in China

China methanol makers from medium-to-large coal methanol producers in China are feeling the pinch of rising costs whether in feedstock, inland transport and shipping. Coal prices, previously known as in abundance and unwanted in China, is the most common feedstock for methanol production in China.

Surging fuel oil costs making shipping more expensive especially since methanol cargoes are shipped within China via the country's rivers, even the inland road and rail transport has also become more expensive. On top of these factors, the yuan has appreciated and the government has curbed incentives for the methanol producers to export the product.

The greatest hit is of course the feedstock price of coal which has increased by 10-30% from last year forcing producers working with technology providers to have greater efficiency in coal gasification.

Hefty $1.2 Million Environmental Penalty for ConocoPhilips

An environmental penalty of $1.2m constituing civil penalty to resolve environmental violations has been summoned to ConocoPhillips' 146,000 bbl/day Texas refinery in Borger by the US Environmental Protection Agency (EPA) due to violation of effluent limits in its Clean Water Act for over 2,000 occasions between 1999 and 2006.

The discharged water effluent was found to contain selenium and whole effluent toxicity affecting aquatic organisms. ConocoPhillips has managed to run the refinery in compliance with the regulations after the court order which also requires ConocoPhillips to monitor surrounding waters for selenium levels.