- The economic Supercycle driven by China's growth is over for petrochemicals due to China's economic reforms and the retirement of Baby Boomers reducing demand. This requires a new business approach for the petrochemical industry.
- Non-traditional production methods like shale have increased while lower oil prices make naphtha cracking more economically viable. However, naphtha cracking will still be needed.
- The aromatics industry faces uncertain supply trends and high dependency on China while new condensate splitter projects are promoting PX demand. Integration of refineries and steam crackers will enhance viability.
Energy equipment & services monthly report – september finalCapstone Headwaters
Crude prices have moderated somewhat after reaching the upper $40
range
–– Prices weakened by rising exports from Iran, elevated inventories, and
weak refinery demand
• US Rig counts continue to improve moderately
–– Since August 12, the US onshore market has added 25 rigs, bringing the
total rig count to 506
–– International rig counts rose slightly by 66 in August
• Refining utilization decreased mildly since last month, and more
substantial declines are expected going forward
–– 300k bbl/d capacity expected to be down for routine maintenance at
times during fourth quarter, excluding economic run cuts or unplanned
downtime
• In Q2 2016, overall solar system pricing fell by up to 7.5%. Utility fixedtilt
and tracking projects in Q2 2016 saw an average pricing of $1.17/Wdc
and $1.30/Wdc, respectively.
• Continued elevated temperatures led to record power demand across
the country, including an
Energy Equipment & Services: Industry Insights & HappeningsCapstone Headwaters
The latest issue of our monthly Energy Equipment & Services Report, highlighting trends in M&A, financing and capital markets for private and public companies in the energy market, is now available.
Mercer Capital's Value Focus: Refining | 2Q16 Mercer Capital
Mercer Capital's Energy Industry newsletter provides perspective on valuation issues. Each newsletter also typically includes a macroeconomic trends, industry trends, and guideline public company metrics.
Energy Equipment & Services: Industry Insights & HappeningsCapstone Headwaters
The latest issue of our monthly Energy Equipment & Services Report, highlighting trends in M&A, financing and capital markets for private and public companies in the energy market, is now available.
Highlights include:
Crude prices continue to dominate the industry’s outlook
1Q results in the OFS space were downbeat, but management teams expressed optimism that a recovery is in its early stages and may begin to be realized in 2017
On the M&A front, the big news in May was the termination of the planned Halliburton-Baker Hughes merger less than a month after the US DOJ sued to block the transaction.
Interesante analisis sobre los dividendos de la paz en Colombia,
“Colombia’ s peace deal could spur oil sector turnaround” (Acuerdos de paz en Colombia podrían estimular al sector petrolero),
For much of the last decade through 2014, the U.S. energy sector expe¬rienced a bull market sustained by debt-financed drilling programs in emerging unconventional plays and supported by elevated commodity prices. U.S. E&P players, particularly the emerging universe of indepen¬dent unconventional operators, required an array of capital-intensive services that led to a boom in the services industry as well: rigs to handle development drilling; engineering services to handle geological surveys; logistics/infrastructure services to gather, transport, and store various hydrocarbons; and refitting of refineries to process increasing volumes of light oil. This wave of capital spending led to innovation in drilling and fracking technology, taking US production from about 6 million b/d to over 9 million b/d and marking the reversal of a decades-long decline in U.S. domestic oil production.
What’s Inside:
- U.S. Crude Production Oil Outlook
- Sector Updates: Last 12 Months in Review
- Capital Spending Trends
- Current State of the Storage Market
July 2016 Energy Equipment & Services: Industry Insights & HappeningsCapstone Headwaters
The latest issue of our monthly Energy Equipment & Services Report, highlighting trends in M&A, financing and capital markets for private and public companies in the energy market, is now available.
Energy equipment & services monthly report – september finalCapstone Headwaters
Crude prices have moderated somewhat after reaching the upper $40
range
–– Prices weakened by rising exports from Iran, elevated inventories, and
weak refinery demand
• US Rig counts continue to improve moderately
–– Since August 12, the US onshore market has added 25 rigs, bringing the
total rig count to 506
–– International rig counts rose slightly by 66 in August
• Refining utilization decreased mildly since last month, and more
substantial declines are expected going forward
–– 300k bbl/d capacity expected to be down for routine maintenance at
times during fourth quarter, excluding economic run cuts or unplanned
downtime
• In Q2 2016, overall solar system pricing fell by up to 7.5%. Utility fixedtilt
and tracking projects in Q2 2016 saw an average pricing of $1.17/Wdc
and $1.30/Wdc, respectively.
• Continued elevated temperatures led to record power demand across
the country, including an
Energy Equipment & Services: Industry Insights & HappeningsCapstone Headwaters
The latest issue of our monthly Energy Equipment & Services Report, highlighting trends in M&A, financing and capital markets for private and public companies in the energy market, is now available.
Mercer Capital's Value Focus: Refining | 2Q16 Mercer Capital
Mercer Capital's Energy Industry newsletter provides perspective on valuation issues. Each newsletter also typically includes a macroeconomic trends, industry trends, and guideline public company metrics.
Energy Equipment & Services: Industry Insights & HappeningsCapstone Headwaters
The latest issue of our monthly Energy Equipment & Services Report, highlighting trends in M&A, financing and capital markets for private and public companies in the energy market, is now available.
Highlights include:
Crude prices continue to dominate the industry’s outlook
1Q results in the OFS space were downbeat, but management teams expressed optimism that a recovery is in its early stages and may begin to be realized in 2017
On the M&A front, the big news in May was the termination of the planned Halliburton-Baker Hughes merger less than a month after the US DOJ sued to block the transaction.
Interesante analisis sobre los dividendos de la paz en Colombia,
“Colombia’ s peace deal could spur oil sector turnaround” (Acuerdos de paz en Colombia podrían estimular al sector petrolero),
For much of the last decade through 2014, the U.S. energy sector expe¬rienced a bull market sustained by debt-financed drilling programs in emerging unconventional plays and supported by elevated commodity prices. U.S. E&P players, particularly the emerging universe of indepen¬dent unconventional operators, required an array of capital-intensive services that led to a boom in the services industry as well: rigs to handle development drilling; engineering services to handle geological surveys; logistics/infrastructure services to gather, transport, and store various hydrocarbons; and refitting of refineries to process increasing volumes of light oil. This wave of capital spending led to innovation in drilling and fracking technology, taking US production from about 6 million b/d to over 9 million b/d and marking the reversal of a decades-long decline in U.S. domestic oil production.
What’s Inside:
- U.S. Crude Production Oil Outlook
- Sector Updates: Last 12 Months in Review
- Capital Spending Trends
- Current State of the Storage Market
July 2016 Energy Equipment & Services: Industry Insights & HappeningsCapstone Headwaters
The latest issue of our monthly Energy Equipment & Services Report, highlighting trends in M&A, financing and capital markets for private and public companies in the energy market, is now available.
Mercer Capital's Value Focus: Exploration and Production | Q2 2016Mercer Capital
Mercer Capital's Energy Industry newsletter provides perspective on valuation issues. Each newsletter also typically includes macroeconomic trends, industry trends, and guideline public company metrics.
Uncertainty is Clouding the Energy Trading OutlookCTRM Center
As the United States continues to rapidly grow its production of oil and gas from shale, and Canada increases production from its oil-rich tar sands, these new volumes are helping to support world oil markets as crude production outside the US declines due to increasing conflict in the Middle East and North Africa. Should these conflicts widen, the global markets will be increasingly volatile as supply disruptions outpace the growth in North American production.
Though US natural gas production has not yet impacted the global market space via LNG exports, there is no doubt that those exports will happen. While the impact on US prices is unclear at this time, these exports will be yet another variable with which to content in a US market already unsettled by increasing regulations that will, by design, reshape the US energy mix.
Dealing with this uncertainty will require increasing market vigilance, with a constant view on both the near and longterm energy outlook, and supported by a commodity trading and risk management solution that facilitates analytics, market visibility and regulatory compliance, such as Eka Energy.
PLG president, Taylor Robinson, spoke at the 96th Annual Meeting of the Transportation Research Board in Washington D.C. on January 8th, 2017. Mr. Robinson’s presentation featured an overview of the North American energy market including analysis of the impact of shale NGLs on the downstream, and the outlook for U.S. energy/petchem surface transportation over the next five years.
PLG Consulting Appalachian logistics League May 5, 2015PLG Consulting
PLG president, Taylor Robinson spoke on May 5, 2015 at the 65th annual Appalachian Logistics League meeting. Mr. Robinson presentedThe North American Energy Revolution: The Implication for Logistics. The meeting was an opportunity for members to network and discuss the ever changing industry of Supply Chain and Logistics with a primary focus on the impacts to the region.
Opening Global Markets to Booming U.S. Shale Gas and NGL ProductionICF
ICF International experts join an industry expert from Vinson and Elkins, LLP to discuss the boom in shale gas and natural gas liquids (NGL) production.
Key topics covered include:
• Marketing issues created by the boost in production
• Outlook for gas supply development
• Regulatory and contractual considerations that shape infrastructure development investments
The operational and financial updated issued by CONSOL Energy for first quarter 2014. The update shows CONSOL's rapid change from coal company to shale gas company. In May CONSOL's current CEO will retire and the current President will assume that role.
Shale gas, naphtha & the petchems conundrum 2013Platts
Petchems market in review
–Fundamental changes
–US feedstock advantage
•Naphtha trade flows
–Where are the demand & supply centers
–Growth of US shale oil gives rise to LPG, naphtha exports to Asia
2
NGL Feedstocks And Derivatives: Global Supply & Demand Dynamics 2016Ash Robins
Understand global supply & demand dynamics for ethane, naphtha, propane and butane. Comparing the competitiveness of NGL feedstocks and derivatives to capitalize the export market potential in the US, Asia, Europe and other global markets
Major changes in 2020 for the global refining industrypetroEDGE
Refiners generally have incentives to upgrade their
refineries, by adding conversion units to produce greater
amounts of clean products (e.g., gasoline, diesel) and
lesser amounts of fuel oil. All else being equal, refiners
with conversion achieve higher margins than simple
refineries without conversion. However, it usually takes at
least four to five years from initial planning to actual startup
of a conversion project.
Mercer Capital's Value Focus: Exploration and Production | Q2 2016Mercer Capital
Mercer Capital's Energy Industry newsletter provides perspective on valuation issues. Each newsletter also typically includes macroeconomic trends, industry trends, and guideline public company metrics.
Uncertainty is Clouding the Energy Trading OutlookCTRM Center
As the United States continues to rapidly grow its production of oil and gas from shale, and Canada increases production from its oil-rich tar sands, these new volumes are helping to support world oil markets as crude production outside the US declines due to increasing conflict in the Middle East and North Africa. Should these conflicts widen, the global markets will be increasingly volatile as supply disruptions outpace the growth in North American production.
Though US natural gas production has not yet impacted the global market space via LNG exports, there is no doubt that those exports will happen. While the impact on US prices is unclear at this time, these exports will be yet another variable with which to content in a US market already unsettled by increasing regulations that will, by design, reshape the US energy mix.
Dealing with this uncertainty will require increasing market vigilance, with a constant view on both the near and longterm energy outlook, and supported by a commodity trading and risk management solution that facilitates analytics, market visibility and regulatory compliance, such as Eka Energy.
PLG president, Taylor Robinson, spoke at the 96th Annual Meeting of the Transportation Research Board in Washington D.C. on January 8th, 2017. Mr. Robinson’s presentation featured an overview of the North American energy market including analysis of the impact of shale NGLs on the downstream, and the outlook for U.S. energy/petchem surface transportation over the next five years.
PLG Consulting Appalachian logistics League May 5, 2015PLG Consulting
PLG president, Taylor Robinson spoke on May 5, 2015 at the 65th annual Appalachian Logistics League meeting. Mr. Robinson presentedThe North American Energy Revolution: The Implication for Logistics. The meeting was an opportunity for members to network and discuss the ever changing industry of Supply Chain and Logistics with a primary focus on the impacts to the region.
Opening Global Markets to Booming U.S. Shale Gas and NGL ProductionICF
ICF International experts join an industry expert from Vinson and Elkins, LLP to discuss the boom in shale gas and natural gas liquids (NGL) production.
Key topics covered include:
• Marketing issues created by the boost in production
• Outlook for gas supply development
• Regulatory and contractual considerations that shape infrastructure development investments
The operational and financial updated issued by CONSOL Energy for first quarter 2014. The update shows CONSOL's rapid change from coal company to shale gas company. In May CONSOL's current CEO will retire and the current President will assume that role.
Shale gas, naphtha & the petchems conundrum 2013Platts
Petchems market in review
–Fundamental changes
–US feedstock advantage
•Naphtha trade flows
–Where are the demand & supply centers
–Growth of US shale oil gives rise to LPG, naphtha exports to Asia
2
NGL Feedstocks And Derivatives: Global Supply & Demand Dynamics 2016Ash Robins
Understand global supply & demand dynamics for ethane, naphtha, propane and butane. Comparing the competitiveness of NGL feedstocks and derivatives to capitalize the export market potential in the US, Asia, Europe and other global markets
Major changes in 2020 for the global refining industrypetroEDGE
Refiners generally have incentives to upgrade their
refineries, by adding conversion units to produce greater
amounts of clean products (e.g., gasoline, diesel) and
lesser amounts of fuel oil. All else being equal, refiners
with conversion achieve higher margins than simple
refineries without conversion. However, it usually takes at
least four to five years from initial planning to actual startup
of a conversion project.
North America Naphtha Market Forecast 2026 - brochureTechSci Research
North America naphtha consumption market stood at 183.89 million metric tons in 2016, and is projected to grow at a CAGR of over 1.62%, in volume terms, to reach 216.34 million metric tons by 2026.
Report URL- https://www.techsciresearch.com/report/north-america-naphtha-demand-supply-analysis-by-end-use-gasoline-blending-reforming-steam-cracking-and-others-forecast-opportunities/988.html
Mercer Capital's Value Focus: Exploration and Production | Q1 2016Mercer Capital
Mercer Capital's Energy Industry newsletter provides perspective on valuation issues. Each newsletter also typically includes macroeconomic trends, industry trends, and guideline public company metrics.
An annual report issued by the Federal Energy Regulatory Commission on the state of energy markets in the U.S. In this year's report, FERC says most places across the country have seen a bump up in pipelines over the past 10 years, relieving constrained natural gas transportation. Except for the Marcellus/Utica region. In the northeast, FERC expects the situation of oversupply and not enough pipelines to get resolved in 2019.
1. WORLD
PETROCHEMICAL
May 2016 MAGAZINE170989
Final Wrap-up
The economic Supercycle is over. One reason for the end of the Supercycle is the retirement of the Babyboomers. Another
reason is China’s economic reforms. These reforms have major implications for the country’s petrochemicals supply and
demand patterns. The petrochemicals industry thus needs a new global business approach, aligned with the real needs of
changing social, political and economic drivers.
These challenges are opportunities for the petrochemicals industry, given its ability to efficiently deliver the products needed
to improve our lives in the future
Non-traditional routes to olefins production have gained importance, and shale developments have provided surplus ethane.
This has an impact on polymer trade and on relative economics, but naphtha cracking will still be needed. A lower crude oil
scenario has moved naphtha cracking economics into more positive territory
The aromatics industry is confronted with uncertain supply trends, recent gasoline strength and a high dependency on China.
The need for heavy naphtha feedstock for incremental PX demand has promoted numerous dedicated condensate splitter
projects. Integration with fuels refineries and steam crackers will enhance viability
Behrooz Mirzaei
CEO Royal Global Energy
2. WORLD
PETROCHEMICAL
May 2016MAGAZINE 1709 88
The new demand scenario will require a shift in the energy mix towards a lower carbon intensity, and growing efficiencies.
Gas will be a key enabler, whilst oil use as a raw material for petrochemicals will steadily increase. Low oil prices are further
promoting refining and petrochemical integration. Peak Oil Demand will take some time to reach.
Incremental volumes of oil and gas will be produced, and more NGLs will be available .
A prolonged scenario of low oil prices may affect shale developments. This could gradually reduce the current surplus of US
ethane. Relative competitiveness for domestic ethylene may be reduced, but remains in place. The LPG surplus will remain
for a prolonged period of time, enabling its role as an alternative feedstock for ethylene production. Delayed expansions in
refining capacity and low oil prices have resulted in a temporary gasoline tightness. This will change in the near future. New
refining capacity and growing fuel efficiencies will ensure comfortable naphtha supply in the future.
3. WORLD
PETROCHEMICAL
May 2016MAGAZINE 1709 90
Summary Conclusions:
Petrochemical
Feedstocks will be
well supplied in the
next few years
Efficiencies needs are accelerated in the “New Demand Scenario”. Demand for oil will
increasingly be for petrochemicals, the material of choice for improving quality of life
As more oil and gas will be required, more NGLs will be available. A lower oil scenario
may will still leave US with wide light NGLs availability and LPG exports, whilst ethane
balances could get tighter
Despite some recent tightness in gasoline, fuel efficiencies and rapidly growing refining
capacity will ensure comfortable naphtha supply in international markets.
4. May 2016 MAGAZINE170991
WORLD
PETROCHEMICAL
er/aromatics sits near middle of cost curve
Reformer Aromatics Complex ; Cond - Nap – Condensate based Naphtha Reformer Aromatics Complex
TDP Complex with toluene feed ; MX - PX Standalone Complex with feed MX
ME – Middle East , NA – North America, EU – Europe,
NEA – North East Asia, SEA – South East Asia
Crude-Naphtha
Reformate, 60%
Condensate-Naphtha
Reformer, 15%
TDP,
11%
Pygas,
4%
TA, 9%
Global PX Capacity by Source
sents a lower feedstock cost to integrated aromatics production both from
20 25 30 35 40 45 50
on tonnes/year (overall account for 90% global share)
ts of Regional PX production
nstant 2015 $)
EU-MX
NEA
STDP
2016
SEA-Cond-Nap
NEA-Cond-Nap
u-Nap
NEA-Cond-Nap
NA-Cru-Nap
EU-MX
SEA-Cond-Nap
2015
2014
NA-Cru-Nap
p
NEA-MX
NA-MX
SEA
STDP
NA-MX
NA-STDP
NEA-MX NEA-STDPSEA-STDP
NEA-Cru-Nap SEA-Cond-Nap
NEA-Cond-Nap
SEA-STDP-Nap
NEA-STDP-Nap
NA-MX
NEA-MX
Condensate splitter/aromatics
sits near middle of cost curve
Cru - Nap – Crude Oil based Naphtha Reformer Aromatics Complex ; Cond - Nap – Condensate based Naphtha Reformer Aromatics Complex
STDP - STDP Complex with toluene feed ; MX - PX Standalone Complex with feed MX
Lower crude oil price presents a lower feedstock cost to integrated aromatics production
both from crude and condensatea
PX units fed by condensate splitter sits somewhere in the middle of the cost curve
ME – Middle East , NA – North America, EU – Europe,
NEA – North East Asia, SEA – South East Asia
Condensate splitter/aromatics sits near middle of co
Cru - Nap – Crude Oil based Naphtha Reformer Aromatics Complex ; Cond - Nap – Condensate based Naphtha Reformer Aromatics C
STDP - STDP Complex with toluene feed ; MX - PX Standalone Complex with feed MX
ME – Middle
NEA – N
Conden
Refo
P
Gl
Lower crude oil price presents a lower feedstock cost to integrated aromatics p
crude and condensate
PX units fed by condensate splitter sits somewhere in the middle of the cost cu
400
800
1200
1600
0 5 10 15 20 25 30 35 40 45 50
Cashcosts,Constant2015$/tonne
Cumulative Capacity, million tonnes/year (overall account for 90% global share)
Estimated Cash Costs of Regional PX production
(Constant 2015 $)
EU-MX
NEA
STDP
2016
SEA-Cond-Nap
NEA-Cond-Nap
ME-cru-Nap
SEA-Cru-Nap
EU-cru-Nap NEA-Cru-Nap
NEA-Cond-Nap
NA-Cru-Nap
EU-MX
SEA-Cond-Nap
2015
2014
ME-cru-Nap
NA-Cru-Nap
SEA-Cru-Nap
EU-cru-Nap
NEA-Cru-Nap
NEA-MX
NA-MX
SEA
STDP
NA-MX
NA-STDP
NEA-MX NEA-STDPSEA-STDPME-cru-Nap
SEA-Cru-Nap
EU-cru-Nap
NEA-Cru-Nap
ME- STDP
SEA-Cond-Nap
NEA-Cond-Nap
NA-Cru-Nap
SEA-STDP-Nap
NEA-STDP-Nap
NA-MX
NEA-MX
Cumulative Capacity, million tonnes/year (overall account for 90% global share)
Global PX Capacity by Source