Dow realigns external reporting segments

MOSCOW (MRC) -- The Dow Chemical Company has announced that it is realigning its external reporting segments to better reflect Dow’s strategy to be low-cost and fully integrated across key value chains, while adding value through shared technology and end-market orientation, as per the company's statement.

The company also announced it is changing the allocation with certain expenses previously reported in its Corporate segment, to drive further visibility into operating performance at the segment level.

"Our new reporting segments are designed to align businesses within their key, integrated chemical envelopes, more effectively allocate resources by targeted end-markets, and provide increased visibility regarding their value drivers," said Howard Ungerleider, Dow’s executive vice president and chief financial officer. "As a result, we expect this new structure will improve modeling and peer comparison capabilities."

The new operating segment structure maximizes Dow’s integration benefits - either through molecular and value chain alignment, such as the company’s acrylic, chlorine, ethylene and propylene envelopes, or through the benefits derived from an enhanced, innovation-driven market focus.

The operating segments will include the following:

Agricultural Sciences – Will continue to operate under the same structure comprised of Crop Protection and Seeds;
Consumer Solutions – Previously part of Electronic and Functional materials, and includes Consumer Care, Dow Automotive Systems, and Dow Electronic Materials;
Infrastructure Solutions – Formerly named Coatings and Infrastructure Solutions, and is comprised of Dow Building & Construction, Dow Coating Materials, Energy & Water Solutions and Performance Monomers;
Performance Materials & Chemicals – Includes Chlor-Alkali and Vinyl, Chlorinated Organics, Epoxy, and Industrial Solutions and Polyurethanes;
Performance Plastics – Comprised of the Company’s previous Performance Plastics business groups, however now also includes key raw material inputs via the energy and hydrocarbons business groups that were formerly included in the Feedstocks and Energy segment.

In addition to segment and business changes, Dow is also changing the allocation of certain expenses previously reported within its Corporate segment, which will better reflect operating performance and profitability at the segment level. All leveraged functional costs, such as information systems, finance, human resources, legal and supply chain, will now be fully allocated to the segments. In addition, long term performance based compensation expense will now be allocated to the segments based primarily on employee alignment.

"These changes to Dow’s Corporate segment will improve clarity and accountability at the business level, and reinforces our overall focus on increasing transparency of our operations," Ungerleider added.

As MRC reported earlier, Dow Chemical has recently announced an increased divestiture target aligned to further enhance the value of its portfolio and support the company’s market-driven, integrated strategy. On track to complete its goal of realizing USD4.5 billion to USD6 billion in proceeds by year-end 2015, and with additional portfolio management actions underway, Dow is now increasing its divestiture target to USD7 billion to USD8.5 billion to be complete by mid-2016. Since 2013, the company has generated USD2.5 billion in proceeds, reallocating this capital to remunerate shareholders, fund growth and reduce debt.

The Dow Chemical Company is an American multinational chemical corporation. As of 2007, it is the second-largest chemical manufacturer in the world by revenue (after BASF) and as of February 2009, the third-largest chemical company in the world by market capitalization (after BASF and DuPont). Dow is a large producer of plastics, including polystyrene, polyurethane, polyethylene, polypropylene, and synthetic rubber.
MRC

MOSCOW (MRC) -- Exports of polypropylene (PP) from Russia increased by 68% over the first ten months of 2014 and totalled about 138,000 tonnes. China is the key importer of Russian PP, according to MRC ScanPlast.

October PP exports from Russia rose to 11,500 tonnes from 7,100 tonnes in September. Overall, Russian plants exported about 138,000 tonnes of propylene polymers to foreign markets from January to October 2014 versus 82,000 tonnes over the same period of 2013. China accounted for the largest export quantities. The five largest importers of Russian PP also include Belarus, Ukraine, Turkey and Kazakhstan.

Such a significant increase in export sales of Russian producers was achieved by a launch of production at new plants in Omsk (Poliom) and Tobolsk (Tobolsk-Polymer) in 2013. To date, Russia's total PP production capacities are about 1.4 million tonnes per year.

Tobolsk-Polymer with the share of around 46% in the total exports became the key exporter over the stated period, while Tomskneftekhim and Poliom follow the leader.

MRC

MOSCOW (MRC) -- Hebei Zhongjie Petrochemical Company Ltd., which operates as a subsidiary of CNOOC, signed a contract for a 1 million 200000 tpa refinery, utilizing the Genoil Upgrading Process, as per Plastemart.

The Refinery will produce finished products for sale in the local Chinese market.

The previous engineering work and feasibility study done by the Chinese Petroleum Engineering Co, Ltd - Dalian Company, which is a division of Chinese National Petroleum Company (CNPC), will be the base for this new project. Genoil has already invested a substantial amount in the millions of dollars for this engineering work.

Hebei Zhongjie Petrochemical Company will make a 30% direct investment in the project. The profits are to be shared on a 50%-50% basis between Genoil and Hebei Zhongjie Petrochemical Company for the life of the project.
It has been the intention of CNOOC to significantly expand the annual refining capacity of Hebei Zhongjie Petrochemical Company's refining operation. "Genoil is excited to be participating in their expansion plans" says David Lifschultz, CEO of Genoil.

As MRC wrote before, CNOOC Oil and Petrochemicals Co. (CNOOC) has selected the LyondellBasell Spherizone technology for a 400 KT per year polypropylene (PP) plant planned to be built in Huizhou, China.


MRC

MOSCOW (MRC) -- The US Environmental Protection Agency (EPA) has issued two final greenhouse gas (GHG) Prevention of Significant Deterioration (PSD) construction permits to M&G Resins to build a new chemical process plant and utility support facility, said Hydrocarbonprocessing.

The facility will be located in Corpus Christi, Texas.

"EPA will continue working with companies to ensure they have the permits they need,” said EPA regional administrator Ron Curry. “We are working to help Texas businesses take advantage of growth opportunities while building greener facilities with better controls for greenhouse gas emissions."

M&G Resins plans to build a new polyethylene terephthalate (PET) resin manufacturing complex along with a collocated combined support system for heat and power utility generation. The support system will be used for steam and electrical demands.

As MRC wrote before, M&G plans to use Alpek's IntegRex technology for the PTA unit, but will use its own technology for the PET unit. Alpek has purchased a USD350m multi-year sourcing agreement for rights to 400,000 tonnes/year of the plant's PET production.

The project will emit up to 1,178,441 tpy of CO2.

The additions will bring over USD1 billion in capital investments, create 3000 construction jobs, 250 long-term operations jobs and 700 support positions in the local area, according to the EPA news release.

M&G Group is a family owned chemical engineering and manufacturing group headquartered in Tortona, Italy. M&G Group operates in the PET resin industry in the Americas through its wholly-owned holding company, Mossi & Ghisolfi International S.A. (M&G International). M&G International is presently a leading producer of PET resin for packaging applications in the Americas, with a production capacity in 2012 of approximately 1.6 million tons per year. Thanks to its proprietary Easy-up PET Technology M&G International currently owns the world's largest single line PET plants in Altamira, Mexico (single line of 490,000 MT/year nominal capacity) and Suape, Brazil (single line of 650,000 MT/year nominal capacity).

MRC

MOSCOW (MRC) -- Arkema says it has become the ninth member of the Together for Sustainability (TfS) initiative, founded in 2011 by BASF, Bayer, Evonik Industries, Henkel, Lanxess and Solvay, as per the company's press release.

The goal of TfS is to develop and implement a global assessment and audit program to evaluate and improve sustainability practices in chemical industry supply chain. For this purpose, TfS members involve EcoVadis (Paris), a company specialized in corporate social responsibility (CSR) performance assessment, to measure the commitment of their registered suppliers.

For this purpose, TfS members involve EcoVadis, a company specialized in CSR (Corporate Social Responsibility) performance assessment, to measure the commitment of their registered suppliers. Independent audit companies are also conducting supplier audits on many criteria aiming at improving sustainability practices.

"The value of this approach is to share assessments and audits results between all TfS members on a web-based platform, instead of doing all of them separately on our own. Therefore it relieves both suppliers and customers from redundant audit workload. The platform is also a very convenient way to highlight CSR best practices" emphasizes Louis Schmidtlin, Goods and Services Procurement Vice-President.

As MRC informed before, Arkema announced the launch of a share capital increase with preferential subscription rights of shareholders for an amount of around EUR350 million, whose principle had initially been announced on 19 September 2014. This rights issue is part of the refinancing of the projected acquisition of Bostik.

Arkema is a leading European supplier of chlorochemicals and PVC. Kynar and Kynar Flex are registered trademarks of Arkema Inc.

MRC