Page 4 - Downstream Monitor - MEA Week 37

DMEA Commentary DMEA
Aramco attack: Saudi
downstream firms struggle
to meet Asian demand
Companies in the downstream are currently feeling the pinch from this week’s attack more than those in the upstream, with a shortage of feedstock supplies taking its toll on end users.
miDDle east
What:
Plants in Saudi Arabian petrochemicals hubs at Jubail and Yanbu have seen their supplies drop significantly.
Why:
Output from Abqaiq facilities is key to these units and is harder to replace than crude, which is held in large reserves.
What next:
Consignments of fuels and chemical products have already been impacted and this will likely carry over into October.
VARiouS Saudi downstream firms reported reduced feedstock availability this week in the wake of attacks at Abqaiq and Khurais over the weekend.
feedstock for it and its products would be reduced and that it had cancelled polymer orders to customers in the Middle East and Asia-Pacific. The disruption is most apparent in the Jubail hub, where numerous petrochemical firms have facilities.
SABiC told Platts that it had insufficient stocks of polymer to fill the void, while Saudi Kayan had seen its allocation of feedstock reduced by 50%.
With 5.7mn barrels of crude and 700,000
barrels of natural gas liquids (NGLs) being
stripped from Saudi supply, domestic supplies
felt the brunt of the impact, while export obli-
gations continue to be met from strategic crude
oil reserves. Meanwhile, concerns were also
expressedaboutfeedstockbyAsianconsumers Theparentcompany,inwhichSaudiAramco
of various refined products.
New Saudi Energy Minister Prince Abdulaziz
bin Salman told a press conference on September 17 that the kingdom had already restored half of the capacity that was knocked out from the attacks. He added that capacity would climb to 11mn bpd by the end of the month and 12mn bpd by the end of November.
Downstream issues
Petrochemicals firms Saudi Basic industries Corp. (SABiC), affiliate Saudi Kayan Petro- chemical, Advanced Petrochemical, Sadara and Yanbu National Petrochemical were all quoted by S&P Platts as having issues because of a fall in the availability of feedstock.
on September 15, SABiC told Platts that
purchased a controlling 69.1% stake earlier this year, said that it would be unlikely to offer large volumes of polyethylene (PE) or polypropylene (PP) in october.
Meanwhile, Sadara, which is a joint venture between Aramco and Dow Chemical of the uS, said that feedstock supply to its plants would be reduced by an average of 16%.
The firm operates a $20bn facility in Jubail, which was the largest single-phase chemical complex ever built, with 26 world-scale man- ufacturing plants producing more than 3mn tonnes per year (tpy). output is comprised of polyeurethanes, Po, propylene glycol (PG), elastomers, linear low-density polyethylene (LLDPE), low-density polyethylene (LDPE), glycol ethers and amines.
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w w w . N E W S B A S E . c o m Week 37 19•September•2019