LyondellBasell Reports First-Quarter 2012 Results

During the first quarter 2012, results improved across all business segments over the fourth quarter 2011. The most notable improvements were in the Olefins & Polyolefins – Americas segment, which benefitted from increased product pricing and lower feedstock costs, and in the Refining & Oxyfuels segment, which saw higher margins at the Houston refinery, abnormally strong margins in oxyfuels for this time of year, and the suspension of operations at the Berre refinery in early January.

"We had a solid start to 2012 as margins in North American olefins and our Houston refinery rebounded from the weak levels experienced in the fourth quarter of last year," said Jim Gallogly, LyondellBasell Chief Executive Officer. "Benchmark margins in both businesses were excellent at the end of the quarter, and the momentum has continued into the second quarter. In North American olefins, planned and unplanned industry maintenance led to a reduction in the cost of raw materials and increased ethylene prices," he said.

"The European olefins and polyolefins markets recovered from a very poor fourth quarter but were pressured by rising raw material costs, and generally remain weak. We continue to see steady results from our Intermediates and Derivatives, and Technology segments, as well as our differentiated businesses within Olefins & Polyolefins – Europe, Asia, International," Gallogly said.
"In early April, we took further steps in advancing our capital structure and completed a very successful refinancing of nearly all of our higher cost debt. Combined with our fourth-quarter financing, we have reduced future interest expense by approximately $325 million annually," Gallogly said.

Commenting on the near-term outlook, Gallogly said, "The margin improvement momentum that benefitted the first quarter has continued into April. With global oil prices north of $100 a barrel, U.S. natural gas approximately $2 per million BTUs and comparatively cheap natural gas liquids, U.S. ethylene manufacturers are in a great competitive position relative to other producers. In refining, the benchmark Maya 2-1-1 crack spread remains strong, benefitting our Houston refinery."

"Operationally, our Channelview turnaround is nearing completion and many of the units are already back on line. We have made significant investment in our facilities in recent years to ensure they operate safely and reliably. We are in a good position to benefit significantly from market opportunities in 2012 and beyond," said Gallogly.

Source: LyondellBasell