Page 16 - LatAmOil Week 26

LatAmOil BRAZIL LatAmOil

Essar submits offer for RLAM oil refinery

INDIA’S Essar Group has reportedly submitted north-eastern Bahia State and has a throughput
an offer for Brazil’s second-largest oil-processing capacity of 333,000 barrels per day (bpd). It has
plant, bringing the number of companies par- a value of around $2.5bn, according to the São
ticipating in this stage of the bidding contest up Paulo-based investment firm Bradesco BBI.
to two. The plant was originally built in 1950 but has
Two sources with knowledge of the matter been modernised. It is now one of the most effi-
told Reuters on June 30 that the Indian con- cient refineries in the country, having a Nelson
glomerate had made a binding offer for the Ran- Complexity Index (NCI) of 7.0. Diesel accounts
dulpho Alves refinery, also known as RLAM. for some 37% of its total output.
They did not say how much Essar had offered RLAM is one of eight refineries with a com-
to pay Petrobras, Brazil’s national oil company bined throughput capacity of 1.1mn bpd that
(NOC), for the refinery and associated assets, Petrobras intends to sell in an asset divestment
including 670 km of pipelines and storage facili- campaign worth more than $10bn. The NOC
ties capable of holding 4.7mn barrels of crude oil has said it wants to sell off $20-30bn worth of
and refined fuels. assets and will have difficulty meeting this target
Essar is one of three entities pre-quali- if it does not sell the oil-processing plants.
fied by Petrobras to bid for RLAM. Petrobras Nevertheless, it did suspend its privatisation
has received a binding offer from one other campaign in March. According to Reuters it did
pre-qualified firm, Mubadala Investment Co. so because potential buyers said they needed
(UAE). As of press time, it was not known more time to meet due diligence requirements
whether Sinopec (China), the third pre-quali- because of the travel restrictions and constraints
fied company, had submitted its own bid. stemming from the coronavirus (COVID-19)
The RLAM refinery is located in Brazil’s pandemic. ™

ARGENTINA
YPF sends force majeure notice

to Belgium’s Exmar for Tango LNG

THE Belgian marine operator Exmar said it had company’s liquidity position will not be at risk
received written notification of force majeure until the end of 2020, it added.
from Argentina’s state-run oil major YPF on The Tango FLNG facility, previously known
their shared Tango floating LNG (FLNG) as Caribbean FLNG, was built in 2017. YPF then
project. signed a 10-year contract for it with Exmar in
In a statement, Exmar said that YPF has November 2018. That contract provided for the
“[claimed] that effects of the coronavirus vessel to liquefy and export natural gas from
[COVID-19] pandemic, both worldwide and in YPF’s fields in Vaca Muerta, a shale formation
Argentina, have hindered [its] ability to perform in the Neuquén Basin. It also stated that Tango
its obligations” under the charter and services FLNG would turn out up to eight LNG cargoes
agreements signed between the two compa- per year over the 10-year term of the deal.
nies. YPF has also said that its ability to pay The floating liquefaction plant, which is
the invoices due for services performed for the capable of turning out 500,000 tonnes per year
period starting in the second half of March had (tpy) of LNG, has loaded four commercial
been affected, Exmar added. cargoes since last November. Operations have
The Antwerp-based firm questioned the slowed down since March, when YPF said it
legality of this move. “Exmar considers the was taking emergency measures, including the
notice to be unlawful, has reserved its rights and gradual suspension of non-critical activities, in
is considering its best option to defend its inter- response to the global coronavirus pandemic.
ests,” it said. YPF is the main producer of gas in the Vaca
Regardless of the outcome of the dispute with Muerta formation, one of the largest shale plays
YPF, Exmar is contemplating several measures in the world. It is now facing challenges in its
to safeguard its liquidity position, the statement effort to develop the formation, as the lockdown
noted. On the basis of current forecasts, the has slashed global fuel demand. ™

P16 www. NEWSBASE .com Week 25 25•June•2020