07272016Wed
Last updateTue, 26 Jul 2016 4pm

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Chemical Activity Barometer Grows for Fourth Consecutive Month

The Chemical Activity Barometer (CAB) expanded 0.4% in July following a revised 0.7% increase in June, 0.8% increase in May and 0.6% increase in April. All data is measured on a three-month moving average. Accounting for adjustments, the CAB remains up 2.6% over this time last year, an improvement over prior months. On an unadjusted basis the CAB jumped 0.6% in July, following a 0.2% gain in June.

In July, all four categories for the CAB improved for the fourth month in a row. Production-related indicators were positive, with trends in construction-related resins, pigments and related performance chemistry being mixed, and plastic resins used in packaging and other consumer and institutional applications largely showed improvement. Equity prices surged in July, joined by product prices gaining. Inventories and other downstream indicators were positive. 


SABIC, ExxonMobil Evaluating Joint Venture on U.S. Gulf Coast

SABIC and an affiliate of Exxon Mobil are considering the potential development of a jointly owned petrochemical complex on the U.S. Gulf Coast. If developed, the project would be located in Texas or Louisiana near natural gas feedstock and include a world-scale steam cracker and derivative units.

Before making final investment decisions, the companies will conduct necessary studies and work with state and local officials to help identify a potential site with adequate infrastructure access.

ExxonMobil and SABIC have worked together for 35 years in major chemical joint ventures in Saudi Arabia. 

L.A. County Sues to Force Installation of Shut-Off Valves

“In the latest legal fallout from the massive Porter Ranch natural gas leak, Los Angeles County went to court Monday seeking to force Southern California Gas Co. to install underground safety shut-off valves on every active gas storage well and distribution pipeline it operates in the county,” KPCC reports.

“The suit, filed in L.A. County Superior Court, claims SoCal Gas ‘put corporate profits before public safety’ by failing more than 30 years ago to replace a faulty shut-off valve on the well that blew last fall at its Aliso Canyon storage facility.” 

Canadian Oil & Gas Earnings Signal Industry Recovery

The Canadian oil and gas earnings season began yesterday with “signs of an industry recovery as Encana Corp and Precision Drilling Corp outlined plans to boost activity,” Reuters reports.

Analysts say “the uptick in optimism might be mirrored by some U.S. shale companies like Pioneer Natural Resources Co.”

U.S. Lower 48 Sustains $150B in Cuts by Upstream Developers

Out of the more than $370 billion in global capital expenditure cut by upstream developers across 2016 and 2017, $150 billion was slashed in the U.S. Lower 48 alone — more than three times any other single country. Largely due to responsiveness and flexibility in the unconventional space, spending in the U.S. dropped 56% compared to a global 30% decline.

According to analysis by Wood Mackenzie, the shorter lead times and less capital-intensive nature of U.S. unconventional plays has allowed the dominant independent operators to react more nimbly than larger IOCs, NOCs, and Majors, quickly altering development plans in response to the oil price collapse. 

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