Nynas successfully exit reorganization
Company ready to take back lost market share; refineries now able to run with 100% non-Venezuelan feedstock
THE District Court of Södertörn, in Sweden, decided yesterday (30 November) that the Nynas company reorganization is now complete, following a creditors meeting where the previously submitted composition proposal was accepted.
‘I am happy to announce this very important step for Nynas and that we are now exiting the reorganization that has been ongoing since December last year. Together with our loyal customers and suppliers, we will vigorously move forward and continue to develop our business in all our global markets. We are ready to take back lost market share and more,’ said Nynas’ president and chief executive officer Bo Askvik.
The court’s decision will be effective on 21 December, and thereafter Nynas will no longer be limited by the reorganization regulations.
‘The situation that Nynas have found themselves in due to the reorganization has placed tough demands on all parties involved, and intolerable pressure on our staff. Our brand is still strong, and this is the result of efforts made by all the loyal and hard-working staff at Nynas. We are also sincerely grateful for the support received from our customers and suppliers. Our partnerships truly go beyond mere commercial transactions,’ said Mr Askvik.
He added that Nynas will come out of the reorganization as a stronger company with five-year secured financing and a strong balance sheet.
During the reorganization process, extensive work has led to decisive progress. Following ownership changes, Nynas have not been subject to US sanction regulations since May 2020. This has meant that the company has been able to contract crude oil deliveries and to continue financing discussions under more favourable terms.
Nynas also managed to secure good liquidity and cash flow during the reorganization, through a significant reduction in overdue customer payments, a granted deferral of tax payments and an agreement on inventory financing.
The main achievement, however, is the successful shift to a new blend of feedstock during the past year. This was necessary due to US sanctions against the export of Venezuelan crude, which used to be a major feedstock for the company.
Several new feedstocks have now been approved and processed following an extensive change programme at the company’s refineries and across its supply chain. Nynas can now run their refineries with 100% non-Venezuelan feedstock whilst still meeting their strict product quality requirements.
All necessary permits from the authorities needed for running new feedstocks have been secured, product recipes have been adapted at record speed and Nynas have the necessary approvals from their customers across the world.
With the new feedstock portfolio and knowledge gained on how to further optimize production at the company’s specialized refineries, Nynas plan to increase and optimize utilization, as they have the capacity to produce higher volumes.
The continuing restructuring of the refining industry, following the IMO 2020 legislation and stricter performance requirements, will lead to a higher demand for specialized producers both of bitumen and specialty oils. Nynas say this change has been further amplified by the COVID‐19 pandemic that has led to an earlier than expected shutdown of Group I plants.
To meet the shortage of Group I oils, Nynas have developed their NYBASE range of products with similar properties and performance, and the company says it also expects growth in the bitumen market, primarily from increased spending on road maintenance.