Chemical Technology August 2016

FOCUS ON PETROCHEMICALS

Russia Oil output pumps to new record

Anna Belova, PhD, GlobalData’s Senior Analyst covering Oil & Gas, said recently that Russian president, Vladimir Putin, cer- emoniously opened the Arctic Gate marine oil terminal on May 25. The appropriately named facility provides access for Russia’s Arctic-sourced crude to both European and Asian markets. The terminal was specifically timed to coincide with the commencement of commercial oil production at the Novopor- tovskoye field. Novoportovskoye is just one of five major planned oil fields scheduled to come online by year-end in Russia, and combined, their peak capacities promise to bring over 500 000 barrels per day (bd) of crude to the global market. When viewed in the context of the sustained resilience of Russia’s mature fields, these projects promise that the country’s two-year streak of record-breaking crude output is set to continue. “By meeting with the Organization of the Petroleum Exporting Countries (OPEC) pro- ducers earlier this year, the Energy Ministry of Russia briefly signaled its openness to freezing crude production to stabilise global prices. However, while major Russian op- erators committed to support the ministry’s ultimate decision, they openly spoke against a freeze and continued to invest heavily in new upstream developments. Russia was not invited to OPEC’s June 2016 meeting. “The five planned projects going into commercial production in Russia this year illustrate intensified capital investment, and the large numbers of pre-drilled wells at each project will allow several of the fields to realise peak production as early as 2017. A new study suggests that an increasingly common plastics chemical impacts the repro- ductive system as much, if not more, than the chemical it is gradually replacing. Bisphenol S is used to make a variety of products, from plastic bottles to glues to re- ceipt paper, particularly as a substitute for the much-maligned Bisphenol A, or BPA. Numerous studies linked BPA to reproduc- tive problems, and the substance was banned in baby products by many states. California this year began warning consumers about the risks associated with BPA at grocery stores and other retailers. Some scientists, however, expressed concern that the similar compounds

Photo: www.maritime-executive.com

diture (capex) and operating expenditure (opex) denominated in rubles, Russian operators effectively decreased their dollar- denominated costs, and when the ruble lost half of its value, they continued to generate dollar-based revenues from crude exports. Russia’s progressive taxation system, designed during the previous oil price run to capture the upside of high prices in the government vaults, further cushioned op- erators. When prices dropped, the Russian state took a large hit to its revenues, while Russian operators’ revenues decreased by a smaller margin.

As is the case with most planned projects in Russia, the investments involved not only drilling campaigns and processing facilities, but also significant midstream components connect crude in the Caspian Sea, Arctic North, and East Siberia with domestic and international consumers. Construction on pipelines and export infrastructure for the five planned projects saw rapid progress in the first half of 2016. Commercialization of these projects serves as evidence of the growth approach taken by Russian opera- tors, rather than the freeze advocated by other crude producers. “The Russian ruble devaluation helped keep the country’s operators afloat as global crude prices plummeted over the past two years. With most capital expen- used to replace it could also result in adverse health effects.to concentrations of BPA and BPS that mirrored the exposure level expe- rienced by humans. The analysis found that the exposed worms had decreased fertility from both compounds, but that effects were seen at lower levels of BPS exposure than BPA. Researchers suggested that mammals could be similarly impacted and that BPS could dam- age women’s eggs at lower doses than BPA. “This study clearly illustrates the issue with the ‘whack-a-mole’ approach to chemical re- placement in consumer products,” said study author Patrick Allard. “There is a great need for the coordinated safety assessment of multiple

For more information contact: +44 (0)161 359 5822 or email pr@globaldata.com.

Study shows BPS could be more harmful than BPA

substitutes and mixtures of chemicals before their use in product replacement.” The chemical industry, meanwhile, long defended BPA and similar compounds as safe and pointed to findings by regulators in the U.S. and Europe. The American Chemistry Council said last year that California’s decision to list the chemi- cal under Proposition 65 “is not supported by the extensive scientific record presented to the committee and is completely contrary to explicit input provided by the US Food and Drug Administration.” Story by Andy Szal for http://www.chem.info/news/2016/08

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Chemical Technology • August 2016