Latest news with #FrancescaLandini
Yahoo
21-07-2025
- Business
- Yahoo
Analysis-Europe's chemical industry seeks a lifeboat to stay in business
By Francesca Landini, Pietro Lombardi, Mohi Narayan and Arathy Somasekhar MILAN/NEW DELHI/HOUSTON (Reuters) -Europe's petrochemical industry is unravelling under a wave of plant closures after years of losses and a rapid expansion of global capacity led by China. High production costs and ageing plants have left European producers struggling, making the region increasingly dependent on imports of primary chemicals such as ethylene and propylene, the building blocks for plastics, pharmaceuticals and countless industrial goods. "While the rest of the world is building over 20 new crackers, Europe is sleepwalking into industrial decline," Jim Ratcliffe, founder of INEOS said during a recent event, referring to a unit in petrochemical plants. The billionaire made his money buying up petrochemical plants from BP and others, and along with other industry leaders has criticised a lack of political action. The European Commission responded this month with a pledge to support domestic production of chemicals deemed strategic for its industries, such as ethylene and propylene. It plans to expand state aid to modernise plants and require public tenders give preference to goods made in Europe - similar to the EU's 2023 legislation for metals and minerals. But the move may be too late to reverse the damage. "It's like being on the Titanic — you can't stay in denial. You must go and find a lifeboat," said Giuseppe Ricci, head of industrial transformation at Italian energy group Eni. Eni's chemical business Versalis accumulated over 3 billion euros ($3.5 billion) in losses in the last five years, Ricci said, as the firm shuts down Italy's last two steam crackers and invests 2 billion euros in bio-refineries and chemical recycling. Other global groups Dow, ExxonMobil, TotalEnergies, and Shell are also closing or reviewing their European chemical assets. Most of the planned closures target crackers - a unit that turns hydrocarbons into ethylene, propylene or other primary chemical materials. A document issued by eight EU countries on petrochemicals in March said that 50,000 jobs could be at risk due to potential closures of more crackers in Europe by 2035. The EU's plants are mainly small and mid-sized and have been running at an average utilisation rate below 80% - a level considered uneconomical. Up to 40% of the EU's ethylene capacity — which totals 24.5 million metric tons — is at high or medium risk of closure, including shutdowns announced since late 2024, according to consultancy Wood Mackenzie. "The proportion of European crackers at risk is much higher than in other regions," said Robert Gilfillan, head of plastics and recycling markets at Wood Mackenzie. While older European plants use naphtha as a raw material, the United States and the Middle East use cheaper feedstocks like ethane — a by-product of shale gas. NEW DEPENDENCY North America's ethylene capacity will grow to 58 million metric tons by 2030 from 54 million currently, according to consulting firm ADI Analytics. China, meanwhile, will add 6.5% to its ethylene capacity every year between 2025 and 2030, when it will produce nearly 87 million metric tons of ethylene annually, China National Chemical Information Centre CEO Huang Yinguo said in May. That's more than triple the EU's current capacity. Chinese producers are also building outposts in Southeast Asia to export to Europe and North America to bypass carbon taxes and Western tariffs on China-made goods. Japanese and South Korean firms, unable to compete, have kept utilization rates low since 2023, the countries' petrochemical industry bodies said in reports in May. European policymakers now face a stark choice: intervene decisively or watch the continent's chemical backbone erode. In their March document, countries including France, Italy and Spain called for a "Critical Chemicals Act", as latest EU data shows the region was a net importer of ethylene and propylene each year in the period 2019-2023. EU Industry Commissioner Stéphane Séjourné said Brussels will identify strategic supplies and production sites. "First and foremost, this is about sovereignty — keeping our steam crackers," he told reporters this month. But sovereignty comes at a cost. Most European crackers are over 40 years old, compared to just 11 years in China, according to Citi analyst Sebastian Satz. And ethylene production in Europe using naphtha costs $800 a metric ton, versus less than $400 a metric ton in the U.S. if ethane is used, and around $200 a metric ton in the Middle East with ethane, Eni said in a presentation published in March. 'SLEEPWALKING INTO DECLINE' Some companies are betting big on survival. INEOS, which operates one of Europe's most advanced petrochemical facilities in Cologne, is building a 4 billion euro ethane cracker in Antwerp — the first new cracker in Europe in roughly 30 years, with production capacity of 1.45 million metric tons a year of ethylene. The plant, due online in 2026, aims to rival Chinese production and meet local demand with a lower carbon footprint. In the Middle East, consolidation is creating new global giants. A $60 billion merger between Abu Dhabi National Oil Company and Austria's OMV will form Borouge Group, the world's fourth-largest polyolefins producer. The company plans to export polymers to Europe, competing directly with U.S. and Asian firms. Analysts say Europe's petrochemical production won't disappear entirely but will become the domain of a few dominant players. "Only major European companies with the market share to set competitive prices will continue to produce ethylene," said Enzo Baglieri, professor of operations and technology management at SDA Bocconi School of Management in Milan. ($1 = 0.8604 euros) (Additional reporting by America Hernandez in Paris, Shadia Nasralla in London, Marek Strzelecki in Warsaw, Julia Payne in Brussels; editing by Susan Fenton) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
The Star
11-07-2025
- Business
- The Star
Eni, Dubai-based Khazna team up to build data center campus in Italy
FILE PHOTO: The logo of Italian multinational energy company Eni is displayed at their booth during the LNG 2023 energy trade show in Vancouver, British Columbia, Canada, July 12, 2023. REUTERS/Chris Helgren/File Photo MILAN (Reuters) -Italian energy group Eni and Dubai-based Khazna have signed a preliminary agreement to jointly develop a 500-megawatt (MW) data centre campus in northern Italy, the two companies said on Friday. The campus, to be located near Milan, is part of a broader partnership between the Italy and the United Arab Emirates aimed at boosting digital infrastructure, with plans to install up to 1 gigawatt of IT capacity across Italy. The facility will be driven by so-called "blue power", meaning electricity from an Eni gas plant equipped with carbon capture technology to reduce CO2 emissions, the Italian energy group said. Investments in Italy's data centres will double to 10 billion euros ($11.7 billion) in the 2025-2026 period compared with the previous two years as technology heavyweights roll out spending plans, researchers at Milan's Polytechnic University estimated in January. ($1 = 0.8556 euros) (Reporting by Francesca Landini, editing by Alvise Armellini)
Yahoo
27-05-2025
- Business
- Yahoo
Eni in talks with GIP for sale of 49.99% of carbon capture unit
By Francesca Landini MILAN (Reuters) -Eni has entered exclusive talks to sell a 49.99% stake in its carbon capture, utilisation and storage (CCUS) business to BlackRock's infrastructure fund GIP, the Italian energy group said on Tuesday. The move is part of Eni's broader strategy to develop dedicated units - or satellites - and sell minority stakes in them to fund their growth. That allows Eni to expand its low-carbon businesses while preserving its capacity to invest in oil and gas activities, Chief Transition and Financial Officer Francesco Gattei recently said. Eni CCUS Holding includes the Hynet and Bacton projects in Britain and L10 in the Netherlands, and has future rights to acquire Italy's carbon capture project in Ravenna. According to the agreement under negotiation, GIP will not only acquire a stake but also support investments to develop the CCUS projects, Eni said in a statement. The Italian group said the agreement came after a selection process among several suitors. Sources told Reuters in March that GIP, HitecVision, Macquarie, Italy's Snam and Thailand's PTT Exploration and Production Public Company had presented non-binding bids for the business. CCUS technology removes CO2 produced by industrial processes from the atmosphere or captures it at the point of emission and stores it underground. The International Energy Agency says the technology can play a vital role in achieving global climate goals. But critics say it risks prolonging the use of fossil fuels and question its commercial viability. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
13-03-2025
- Business
- Yahoo
How faulty parts at Boeing's 787 jets flew below the radar in Italy
By Francesca Landini and Tim Hepher BRINDISI, Italy (Reuters) - On a Saturday morning in May, 2020, Italian police officers caught two men pouring chemical waste into the sewers in the southern port city of Brindisi, near a small plane components factory. Five years on, that routine pollution case has spiralled into a wide-ranging judicial investigation into how thousands of flawed titanium and aluminium parts manufactured in Italy ended up in nearly 500 Boeing 787 jets still in use. The probe, due to be discussed at a preliminary hearing in Italy on Thursday, focuses on how tiny aero-part-maker Manufacturing Process Specification (MPS) allegedly defrauded clients by using cheaper and weaker metals to make floor fittings and other plane parts. Company executives deny the charge. Boeing has repeatedly said that there is no immediate safety risk. U.S. regulators, meanwhile, are preparing technical guidance for airlines to detect and replace any bad parts, without opting for the emergency orders reserved for the most pressing cases. But the precarious chain of events that led detectives to the alleged scam, including the surprise pollution find, raises broader questions about the failure by the aerospace industry's own voluntary audit system to detect sub-standard components. Detectives were already investigating MPS' owners over the bankruptcy of their previous firm. But after catching two MPS workers dumping polluting liquids next to the factory, police broadened their enquiries to the Brindisi firm's raw material purchases, three investigative sources said. With the help of whistleblowers, police found that MPS and its predecessor company had bought very small quantities of the prescribed metals required for 787 jets, including a tough titanium alloy, switching instead to cheaper and less resilient pure titanium, they said. Prosecutors allege that for four years parts made with the wrong type of metal flowed into the aerospace supply chain via Italian group Leonardo, which builds two fuselage sections for the Boeing 787 at its nearby Grottaglie plant. The case comes as Boeing tries to move beyond a separate safety and quality crisis that triggered financial and management upheaval and layoffs. The rest of the industry is also grappling with sporadic issues with rogue parts. Despite using low-quality metals, the now defunct MPS passed audits by three different certification bodies or private auditors between 2017 and 2021, according to a Reuters review. None of these audits involved a physical check of the floor fittings, which are structural components of a jet, the news agency found. While news of the alleged metal switch at Boeing's Italian subcontractor made international headlines in October 2021, details of MPS' auditing process, as well as the number of weak floor fittings installed, have not been previously reported. For its review, Reuters consulted confidential Italian police and prosecutors' documents, judicial seizure decrees, copies of records from an aerospace supplier database and spoke to four people with direct knowledge of the investigation. Half a dozen investigators, lawyers and certification experts told Reuters the case raises doubts about whether controls, including third-party audits, are robust enough to ensure below-grade parts do not end up in commercial jets. "It is extremely worrying that there were no preventive checks on the type of material used to build these parts," said Danilo Recine, vice-president of Italy's ANPAC pilot union. INSPECTIONS The FAA has not grounded any 787 planes but issued a draft notice last year that, when finalised, will require airlines to inspect jets for flawed parts and replace them. Its proposed notice potentially covers almost 500 jets but until the inspections are carried out it is impossible to know how many parts are on which jets, it said in the May 2024 draft. The FAA declined to elaborate. It noted only that a period for collecting comments from airlines had ended. Contacted by Reuters, Leonardo said in a statement that prosecutors are treating it as a victim in the case. Boeing, which has also been granted the status of victim, declined comment on specifics of the case but said it had a "comprehensive quality management system," which includes audits of suppliers. "This complements additional audits by certification bodies, suppliers and others within the industry" it added. MPS, and its predecessor Processi Speciali, used to make several plane parts for Leonardo, including the fittings connecting the beams supporting the Boeing 787 cabin floor to the fuselage. It also supplied other aerospace firms. After performing material inspections on the components, investigators allege MPS manufactured 539 below-grade floors for Boeing that were supplied via Leonardo, according to a confidential document prepared by prosecutors. The faulty floor fittings ended up in as many as 477 jets still in service, the document said, a handful more than the potential population of affected jets cited by the FAA. In the event of an emergency landing, the lower-quality floor fittings could lead to a collapse of the jet's floor, aerospace experts who tested the parts on behalf of prosecutors said in the document. The FAA has raised a similar worst-case scenario, adding it would need multiple adjacent parts to fail simultaneously. In their final report, Italian prosecutors accuse MPS' head of quality, the company's owner and three relatives of fraud and breach of airplane safety rules. Two other workers are accused of polluting soil and water. "(They) have put flight security in danger by producing and delivering to Leonardo ... structural aerospace parts made, not with contracted titanium alloy, but pure titanium – which has structural strength that is largely lower to that of the prescribed alloy," the report says. In total, prosecutors have said MPS or its predecessor supplied around 6,000 parts using the wrong kind of metal, although the vast majority are not structural components. Francesca Conte, a lawyer for MPS' owner, said the supplier had worked in partnership with Leonardo and obtained all necessary certifications. "If there were any anomalies, they would have been immediately evident". Conte and the lawyers for the other defendants said there was evidence to be presented during the trial that would prove their clients were not responsible for the alleged crimes. WEAK CHECKS To become a Boeing or Airbus supplier, parts makers must be audited for their quality management systems under an aerospace chapter of the ISO global standards organisation. Those involved in certain special processes like welding or electro-plating also need a U.S.-based approval called NADCAP. Industry records reviewed by Reuters show that MPS and its predecessor won approvals from three auditing bodies under the ISO-based aerospace standard for quality systems. The last certification was awarded in May 2021. Leonardo said in an emailed statement it had learnt about issues with MPS components at the end of 2020 from Boeing. Asked how it vetted contractors, Leonardo said that MPS first had to qualify to enter its and Boeing's suppliers' lists. The group said that it had also carried out subsequent checks of MPS using "documents made available by the supplier." The audits were conducted both independently and in joint teams with Boeing, the Italian company added. "Any fraudulent behaviour cannot be detected by these checks," Leonardo said. However, since last year, the company has begun doing extra tests on chemical and physical characteristics of "significant components", it added. The lack of spot physical checks baffled police, according to a source in the investigation. "The problem of faulty parts was found out in 2020," the source said. "If quality controls had worked, then it would not have been discovered so late." "NEED FOR A REGULATORY FRAMEWORK" Under the voluntary oversight system for quality management, private auditors known as certification bodies check whether an aerospace firm has the right processes, machines and skilled workers to carry out its tasks to the correct standards. Random physical tests are typically only included if a company needs a quality certificate for specific products. But Christopher Paris, founder of consultancy Oxebridge Quality Resources, said the MPS case demonstrated the need for tougher oversight of the pyramid of controls, including not only the independent auditors but accreditation bodies that vet them. "There is a need for a regulatory framework," he said. None of the auditors or various industry bodies is targeted by the Italian investigation. ACCREDIA, which is responsible for accrediting auditors in Italy, said existing rules were "robust and well-structured" and stressed that the job of the audits is not to root out crime. Sitting at the top of the system of voluntary controls is the Industry Aerospace Quality Group, a global body. IAQG President Eric Jefferies said in a statement to Reuters that it is actively working on updates to existing standards. "However, the outcomes of any quality management system implementation ultimately rest with the certified organization," he said.
Zawya
28-01-2025
- Business
- Zawya
Snam to sell stake in ADNOC gas pipelines to Abu Dhabi's Lunate
MILAN - Italy's gas grid operator Snam will sell its minority stake indirectly held in ADNOC Gas Pipelines to Abu Dhabi-based investment fund Lunate, Snam said on Tuesday. The deal is in line with the Italian group's long-term strategy to strengthen its role in Europe and reduce exposure to assets not located along the key European energy corridors. "The sale of the stake in ADNOC Gas Pipelines is consistent with the recently presented strategic plan, which focuses on the development of a pan-European multi-molecule infrastructure," Snam's CEO Stefano Venier said in a statement. ADNOC Gas Pipelines, a subsidiary of Abu Dhabi National Company (ADNOC), has lease rights to 38 pipelines covering a total of 982 km (610 miles) across the United Arab Emirates. Snam acquired an indirect stake of nearly 6% in the company in 2020, along with other consortium partners, including international funds GIP, GIC, Brookfield Asset Management, Ontario Teachers' Pension Plan Board and NH Investment & Securities, through Galaxy Pipeline Assets HoldCo Limited. Snam did not provide any figure for the financial value of the transaction. According to a source, the finalisation of the deal will result in a capital gain for Snam. (Reporting by Francesca Landini, editing by Cristina Carlevaro and Tomasz Janowski)
