ADNOC offers term naphtha at steady-to-firmer levels - sources

01 March 2010 08:28  [Source: ICIS news]

SINGAPORE (ICIS news)--Abu Dhabi National Oil Co (ADNOC) is offering term naphtha for Asian buyers for April 2010 to March 2011 supply at steady-to-firmer levels, traders said on Monday.

“The term offers are quite reasonable considering current spot prices,” one trader said.

But other traders said the premiums could go lower on expectations of an increase in naphtha supply from Abu Dhabi.

The term offer for splitter naphtha stood at a premium of $23.50/tonne (€17.16/tonne) to ADNOC price formula, the same as the current contract from April 2009 to March 2010, traders said.

ADNOC offered low-sulphur naphtha at a premium of $24.50/tonne FOB (free on board), and the pentane plus grade at a premium of $25.50/tonne FOB, they said.

For the current yearly contract that ends by 31 March, the term price for pentane plus grade was at a premium of $26.00/tonne FOB and the term price for low-sulphur naphtha was at a premium of $24.50/tonne, traders said.

ADNOC is expected to raise naphtha exports by an additional 3 million tonnes a year to 8 million tonnes annually this year, once its two condensate splitters with a combined capacity of 280,000 barrels/day operate at full capacity, industry sources said.

“Because of the gas projects, there will be more feedstock supply,” one source said.

Kuwait Petroleum Corp agreed to sell term naphtha in early February, for April 2010-to-March 2011 supply, to buyers at a premium of $22/tonne to Middle East FOB quotes.

Asia’s benchmark naphtha crack spread closed on Friday at over a two-high week of $150.075/tonne versus Brent crude, largely triggered by robust crude futures, ICIS pricing data showed.

($1 = €0.73)

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By: Felicia Loo

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