Marathon Petroleum CEO outlines 2015 plan for refining expenditures

MOSCOW (MRC) -- Marathon Petroleum Corp.’s (MPC) president and CEO, Gary R. Heminger, delivered a positive outlook to investors and industry analysts at the Credit Suisse 2015 Energy Summit in Vail, Colorado this week, as per Hydrocarbonprocessing.

MPC had previously announced a USD2.53-B capital expenditures plan for 2015. The investment plan is budgeted at USD1.28 B, which includes approximately USD235 MM for midstream investments, approximately USD370 MM for refining margin enhancement projects and approximately USD675 MM for refinery-sustaining capital.

At the Credit Suisse investor meeting, Heminger stressed the main focuses of the investment program are to improve the connectivity between the Galveston Bay and Texas City, Texas refineries, and to allow additional synergies through the integration of these two proximate refineries. "Our focus for refining in 2015 is to invest in projects that enhance our overall return," Heminger said.

The Galveston Bay refinery is the former BP-Amoco Texas City refinery, which has throughput capacity of 475 Mbpd and is near Marathon’s smaller Texas City refinery, which has a capacity of 84 Mbpd.

MPC is increasing light sweet crude and condensate processing capacity. The company recently finished building a 25 Mbpd condensate splitter at its Canton, Ohio refinery. A 35 Mbpd splitter is slated for completion by the second quarter of 2015 at Marathon's Cattesburg, Kentucky refinery. Both refineries are located near the Utica shale play.

MPC plans to revamp crude and vacuum units to further optimize for future crude availability and improve distillate recovery. More hydrotreating capacity, especially at the Galveston Bay refinery, is under development, with the goal to shift to 100% ULSD production. MPC has plans to idle the smaller, older fluid catalytic cracking unit (FCCU) at the Galveston Bay–Texas City refining complex.

Heminger also announced company goals to increase refined product export capabilities to 400 Mbpd in 2015 and increase bottom-upgrading capacity.

As MRC wrote earlier, Marathon Petroleum has closed its transaction with BP to purchase several assets, including the 451,000 bpd refinery located in Texas City, Texas.

Marathon Oil Corporation is a United States-based oil and natural gas exploration and production company. Principal exploration activities are in the United States, Norway, Equatorial Guinea, Poland, Angola and Iraqi Kurdistan.

MOSCOW (MRC) -- Solvay Specialty Polymers has chosen to build a new high-performance polymer plant next to its existing facility in Augusta, said Plastemart.

The Belgium-based company chose the south Augusta plastics plant over its sister facility in India, said Alain De Greef, Solvay’s site manager in Augusta, adding “Besides the reputation of this site, the good safety records and the quality, a big factor in the decision was the utilities cost. Basically, in the U.S. and particularly here in Augusta, we have some advantages."

"The total capacity of Solvay is going to be around 2,500 metric tons (about 5.5 million pounds) and that will include the unit in Panoli (India) and the unit in Augusta," De Greef said. Land across from the plant on Clanton Road will be cleared to accommodate parking for the 250 to 300 construction workers who will build the facility, De Greef said.

De Greef said the company is also upgrading and increasing the capacity of four existing units, which service a variety of business sectors, including electronics, health care, aircraft and automotive. In 2001, Solvay acquired the Clanton Road facility from BP Amoco. The site originally was developed by Dartco Manu­facturing in 1984. Solvay makes more than 1,500 products through 35 different high-performance polymer brands.

As MRC wrote before, Solvay completed the acquisition of the Ryton PPS (polyphenylene sulphide) business from US-based Chevron Phillips Chemical Company for USD220 million, enlarging its high-performance polymers offering and entering a solid growth market.

Solvay S.A. is a Belgian chemical company founded in 1863, with its head office in Neder-Over-Heembeek, Brussels, Belgium. The company has diversified into two major sectors of activity: chemicals and plastics. Solvay supplies over 1500 products across 35 brands of high-performance polymers - fluoropolymers, fluoroelastomers, fluorinated fluids, semi-aromatic polyamides, sulfone polymers, aromatic ultra polymers, high-barrier polymers and cross-linked high-performance compounds.

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MOSCOW (MRC) -- BASF SE reported a 25% rise in net profit for the fourth quarter, boosted by strong growth in its chemicals businesses, said the company in its press release.

The world’s largest chemicals company said net profit for the three-month period ended Dec. 31 was EUR1.42 bn (USD1.59 bn), compared with EUR1.13 bn a year earlier. Analysts had predicted a net profit of EUR922 mln, according to a recent poll by The Wall Street Journal.

Sales declined 0.6% to EUR18.05 bn, damped by falling sales prices due to low oil prices. The company’s closely watched earnings before interest and taxes before special items rose 2.8% to EUR1.46 bn, a result of higher profit margins in the petrochemical and agrochemical units.

But the company was held back by a sharp earnings decline in its oil and gas business, a result of the plunge in global oil prices. Fourth quarter EBIT before special items at the unit fell 40% to EUR347 mln.

BASF’s wholly owned oil and gas division, Wintershall AG, generates roughly 30% of the group’s cash flow. A shift up or down in the annual price of Brent crude oil by USD1 a barrel impacts EBIT at Wintershall by EUR15 mln, according to BASF.

BASF said it expects a slight increase in sales for 2015 and for EBIT before special items to match the level it achieved in 2014, at EUR7.36 bln.

As MRC wrote before, BASF started up of its first production plant for polymer dispersions in Pasir Gudang, Malaysia. This production plant is built at the existing BASF production site, located in the Pasir Gudang Industrial Park of the Johor Free Trade Zone. The plant is BASF’s third polymer dispersions plant in ASEAN, complementing the existing dispersions plants in Jakarta and Merak, Indonesia.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries.
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MOSCOW (MRC) -- Petrochemical Malaysia, a subsidiary of Idemitsu Kosan Co, has restarted a polystyrene (PS) plant, reported Apic-online.

A Polymerupdate source in Malaysia informed that the plant restarted early this week. Its was under a maintenance turnaround.

Located in Malaysia, the plant has a production capacity of 110,000 mt/year.

As MRC wrote before, Idemitsu Kosan, one of Japan’s largest refining and petrochemical companies, will be shutting its refinery in Japan for maintenance turnaround in April 2015. It is likely to remain off-stream for around one month. Located at Chiba in Japan, the refinery has a crude processing capacity of 220,000 bpd.

Idemitsu Kosan is a Japanese petroleum company. It owns and operates oil platforms, refineries and produces and sells petroleum, oils and petrochemical products. The company runs two petrochemical plants in Chiba and Tokuyama. The two naphtha crackers can produce up to 997,000 tonnes of ethylene per year.
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MOSCOW (MRC) - Imports of linear low density polyethylene (LLDPE) into Ukraine were 2,600 tonnes in January, down 29% compared with the same time a year earlier. Local producers of the films had to significantly reduce their production because on the back of weaker economy and the problems with the purchase of currency in the country, according to MRC DataScope.

January's imports of LLDPE in Ukraine dropped to two-year minimum to 2,700 tonnes, compared with 3,700 tonnes in January 2014 and 6,000 tonnes in December 2014.

The main decrease in demand for polyethylene occurred for the local film producers and resulted from the downturn in the economy, as well as problems with the purchase of currency for the purchase of polyethylene in foreign markets. January's film LLDPE imports decreased to 2,500 tonnes, compared with 3,600 tonnes in January 2014, and 5,400 tonnes in December 2014. The main decrease in demand occurred for local producers of stretch films. Local producers of multilayer films for food also reduced consumption in January significantly.

The total imports of linear polyethylene for other sectors of consumption exceeded 100,000 tonnes.

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