Page 13 - Euroil Week 03 2020

EurOil PROJECTS & COMPANIES EurOil
Polish refiner PKN to ramp up Saudi oil purchases
POLAND
PKN Orlen has been steadily decreasing its intake of Russian oil.
POLAND’S top oil refiner PKN Orlen said on January 21 it would expand its monthly pur- chases of Saudi oil from 300,000 to 400,000 tonnes (around 98,000 barrels per day).
PKN once received almost all its oil from Rus- sia, but has taken steps since 2016 to diversify its supply, agreeing a delivery contract with Saudi Arabia that year. It has also secured spot supplies from Angola, Nigeria, Norway and the US over the past two years.
The company now gets more than 40% of the oil it processes at its refineries in Poland, Lithu- ania and the Czech Republic from non-Russian suppliers, up from just 5% in 2013. These efforts paid off last spring, when PKN was able to keep its plants running when Russian supplies via the Druzhba pipeline were suspended because of contamination.
PKN’s contract with Saudi Aramco initially covered 200,000 tonnes of Arabian Light crude per month, but this was raised to 300,000 tonnes in April 2018. The latest increase will further strengthen Poland’s energy security, PKN CEO
Daniel Obajtek commented in a statement. “We are consistently building our trading position in different regions of the world,” he said. “This process will undoubtedly facilitate the finalisation of the acquisition of Grupa Lotos, when we will become an important recipient of
crude oil for global partners.”
State-run PKN, which has a market cap-
italisation of PLN37bn ($9.7bn), announced plans in 2018 to buy its smaller Gdansk-based peer Lotos, with a market cap of PLN16bn. The Polish government supports the move, which it says will cut costs and establish a player capable of competing in international energy markets.
PKN is still awaiting approval from the Euro- pean Commission to proceed with the takeo- ver. The EU body is expected to clear the deal, but may demand that the merged group divest some assets. The refiner also said in December it wanted to buy state power company Energa to strengthen its position in the Polish electricity market. ™
Gazprom Neft announces $80mn upgrade at Serbian refinery
RUSSIA
Pancevo is already one of the most moderni refineries in Europe, according to Gazprom Neft.
RUSSIA’S Gazprom Neft has announced it will spend more than €72mn ($80mn) on modern- ising a catalytic cracker at the Pancevo refinery in Serbia.
The company operates the 96,400 barrel per day (bpd) Pancevo plant through its major- ity-owned subsidiary NIS. It reported last week it had concluded a deal with McDermott unit Lummus Technology for front-end engi- neering design (FEED) work for the upgrade project.
Gazprom Neft will also construct a produc- tion unit for high-performance gasoline com- ponents as part of the scheme. Its heavy fuel oil output will meanwhile wind down to zero.
Pancevo is one of two refineries in Serbia, both owned by NIS, which in turn is 56.2% con- trolled by Gazprom Neft. The other is situated in Novi Sad, with a throughput capacity of 50,000 bpd.
According to Gazprom Neft, Pancevo is one of the most modern refineries in Europe. NIS, whose other main shareholder is the Ser- bian government with a 29.9% stake, invested
€500mn in the first stage of the plant’s moderni- sation, completed in 2012. The project involved construction of a hydrocracking and hydrotreat- ing complex, enabling the production of Euro-5. Lummus was involved in the work.
The refinery is now undergoing a second stage. As part of this phase, Gazprom Neft broke ground in late 2017 on a new deep con- version complex featuring a delayed coker – a project valued at more than €300mn. Its launch later this year will expand the plant’s motor fuel production, and allow it to man- ufacture coke.
Gazprom Neft dominates Serbia’s oil indus- try. In addition to its refinining business, NIS also operates oil and gas fields in the country, and holds a 12.7% stake in petrochemical firm HIP Petrohemija.
Meanwhile Gazprom Neft’s parent company Gazprom supplies practically all of Serbia’s gas, with shipments totalling 2.15bn cubic metres in 2018. It is also investing in new gas-fired power plants in Serbia, the first of which is due to start up in Pancevo this year. ™
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