In Africa LDPE imports expensive despite a price drop

(ICIS) -- Low density polyethylene (LDPE) film is still too expensive for the African markets despite a price drop of up to 15% this year from January to December, producers and distributors said on Thursday. Converter usage of LDPE in Africa declined as prices climbed in the first half of the year, and this has not yet picked up despite prices falling in the second half, sources said.

LDPE import spot prices were at USD1,450-1,550/tonne on 7 December, down from USD1,700-1,730/tonne (EUR1,275-1,298/tonne) in the first week of January. The price gap between LDPE and other film grades remains wide, as highlighted in the graph below.

Buyers deem the grade too expensive compared to linear low density polyethylene (LLDPE) and high density polyethylene (HDPE) film grades.

⌠Even from the Middle East, there is a big differential in prices between LDPE and HDPE, a distributor said. "Customers in West Africa have shifted to using LLDPE instead of LDPE to make water pouches, especially in Nigeria", a second distributor said, explaining that water pouches had been a major end-use of LDPE until recently.

This has led the company to reduce its December LDPE offers into Africa, although it announced a rollover for all other polyethylene (PE) grades, the source said. Other producers also remain flexible on LDPE offers, citing the slow demand and consequent increased global availability.

MRC

(ICIS) -- Repsol's cracker at Sines, Portugal, has been temporarily shut down because of weak demand, a company spokesperson said on Friday. Details about the duration of the shutdown or when it began were not disclosed. Previous reports suggested the cracker was running, albeit recently at low rates.

Repsol has two other European crackers at Tarragona and Puertollano, in Spain, which are both thought to be running at reduced operating rates. Of the three crackers, Sines is the only one not fully-integrated with derivative production and therefore is more likely to have been hit harder by the weak market conditions. Logistical problems and expensive freight costs are also understood to be contributory factors for the idling measures.

Both European propylene and ethylene demand has been lower than expected in the second half of the year because of the underlying economic sentiment, as well as stricter inventory control at year-end.

There is ongoing length in the European system because of low derivative demand, which is not likely to improve until at least the second half of January/February 2012.

Repsol has a nameplate capacity for ethylene of 415,000 tonnes/year at Sines, 660,000 tonnes/year at Tarragona and 250,000 tonnes/year at Puertollano.

For propylene, the company has the capacity to produce 200,000 tonnes/year at Sines, 125,000 tonnes/year at Puertollano and 290,000 tonnes/year at Tarragona, according to ICIS.

MRC

(Plastemart) -- The Supervisory Board of PKN ORLEN, during its meeting on 8 December 2011, has adopted a resolution in accordance to which Mr. Marek Serafin has been dismissed from the position of the Member of the PKN ORLEN Management Board.

At the same time the Company's Supervisory Board has delegated with effective date on 9 December 2011, Member of the PKN ORLEN Supervisory Board, Mr. Piotr Wielowieyski, to act temporary as the Member of the Company's Management Board, Petrochemical Operations. Delegation is valid till the moment of appointment of the Member of PKN ORLEN Management Board, Petrochemical Operations, but no longer than three months.

Earlier this week, Serafin was arrested along with two petrochemicals directors of the company and a businessman from the city of Plock in central Poland, on suspicion of corruption. Serafin had given preferential treatment to a businessman from Plock in awarding contracts in exchange for property benefits. The men were arrested following a request by the Appeal Prosecutor's Office in Warsaw.

MRC

(Arabian oil and gas) -- Khalid al-Falih, CEO of Aramco, affirmed the company's commitment to expanding its downstream assets, saying Saudi is currently slated to spend USD 90 billion on downstream development projects. Al-Falih, addressing the 20th World Petroleum Congress in Doha, Qatar, said Aramco intends to become one of the top-tier petrochemicals companies in the world ⌠within the next decade.

Aramco is changing to meet burgeoning domestic demand for electricity generation feedstock, the tilt to non-OPEC and unconventional production, and the global enthusiasm for gas.

Upstream development will continue, with Al-Falih confirming that Aramco is ⌠undertaking a massive exploration campaign, which will include exploration of the Red Sea, shale oil, and spending USD17 billion to develop the offshore Manifa field, which is due to reach production capacity of 900,000barrels per day in 2014 under an accelerated timetable.

The Manifa project has involved building artificial islands in the shallow water of the Persian Gulf, in order to realize onshore-drilling recovery and logistical efficiencies. The project is central to providing feedstock for Saudi's new heavy crude refineries being built in conjunction with Total and Sinopec.

Saudi Aramco also in its annual review said that it will deliver the Karan offshore non-associated gas development onstream nest year, ahead of its 2013 schedule. When fully operational in 2012, the project will produce 1.8 billion cu ft a day of raw gas.

MRC

The total expenditure amounts to ┬3 mln. In time, this operation is anticipated to employ 13 staff. The recycling of post-industrial waste from Deceuninck window manufacturers is expected to become operational from Q2 2012. By the end of 2012, the recycling of end-of-life PVC windows from window and door installers will start.

MRC