DuPont to slash thousands of Delaware jobs ahead of Dow Chemical merger

MOSCOW (MRC) -- DuPont Co. said it will cut about 28% of its workforce in its home state of Delaware in early 2016 as the chemical company proceeds with a merger with Dow Chemical, as per Hydrocarbonprocessing.

"The effect in Delaware will be significant, reflecting the urgent need to restructure our cost base and, as part of that effort, reduce our corporate overhead costs so that we can remain competitive," DuPont CEO Ed Breen said in a letter to employees. The cuts will affect 1,700 employees out of 6,100 in the state.

The job cuts are part of the plan to reduce the workforce of 63,000 by 10% and trim costs by USD700 million, Dan Turner, a spokesman at the Wilmington, Delaware- based company, said in a telephone interview. That strategy was outlined on Dec. 11, the day that the companies disclosed the merger. Dow and DuPont, two historic giants of US industry, will join as equals in an all-stock deal that’s the first step in an effort to create three new businesses.

The jobs cuts are "deeply disappointing, especially to the thousands of Delawareans who helped this company grow and succeed for generations,” Delaware Governor Jack Markell said in a statement. "For those affected by today’s announcement, they should know that the state will do all that it can in the coming months to assist them as they evaluate new opportunities."

DuPont’s Breen said the company was required to notify the state by Dec. 31 on the job cuts. “Given that we are in the middle of the holidays, we would have preferred to wait until individual notifications were complete before reporting the full local impact,” he said.

After the merger, the specialty products business will remain in Wilmington, Breen said. The new USD130 billion DowDuPont plans to combine products from both companies in the areas of agriculture, commodity chemicals and specialty products to create the new businesses.

The state "will continue to urge DuPont and Dow to see the value of locating other businesses here in Delaware, where they have grown and succeeded in the past," the governor said in his statement.

DuPont is an American chemical company that was founded in July, 1802. The company manufactures a wide range of chemical products, leading extensive innovative research in this field. The company is the inventor of many unique plastics and other materials, including neoprene, nylon, Teflon, Kevlar, Mylar, Tyvek, etc. DuPont was the developer and main producer of Freon used in the production of refrigeration equipment.
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MOSCOW (MRC) -- Petroleos Mexicanos’s plans last year included joint ventures and higher oil production. For 2016, that’s turned into job cuts and asset sales as it tries to weather the worst downturn in a generation, as per Hydrocarbonprocessing.

In Jan. 2014, CEO Emilio Lozoya was optimistic about 2015. He expected the company’s first joint ventures would reverse nine straight years of declining output. Revenue from oil would rise, he said. This rosy outlook never materialized. Pemex is ending 2015 with total debt that’s set to surpass USD100 billion and has accumulated USD22.4 billion in quarterly losses this year. Instead of participating in joint ventures, the oil producer might instead sell off pieces.

"Pemex could consider the sale of any of its assets," Nymia Almeida, senior credit officer at Moody’s Investors Service, said in a telephone interview from Mexico City. “The only thing that Pemex can’t sell are the oil reserves. Everything else is a possibility."

Pemex has already divested its USD1.3 billion stake in a natural gas pipeline and storage operator. It may also look for new operators for its six refineries and announced it will return some oil fields assigned to it by the government. Currently, it has no joint ventures to produce oil.

Last quarter, the company lost 34 billion pesos (USD2 billion) from oil refining, Pemex Transformation Director Alejandro Martinez Sibaja said Dec. 9. A day earlier, the Mexican government had announced USD23 billion in investments to upgrade its plants -- money set to come directly from private investors yet to be announced.

"There is nothing official yet," interim chief financial officer Rodolfo Campos said in a phone interview Dec. 23. "However, it is undoubtedly part of our plans." Campos said the plan is to find partners for new projects such as reconfigurations of three refineries and have the new investors share profits with Pemex -- not necessarily to sell stakes of existing plants.

"In general what we’re looking for is private capital to develop our business plan," Campos said. The company has repeatedly said refining is no longer a profitable activity and hopes to bring on private partners to operate them. Bloomberg calculated the average utilization rate among Pemex’s six refineries to be at 63%. That compares with over 91% for US plants this year.

The challenge might be to find anyone who wants a part of this business, according to Almeida. “There is interest in refining but much less," she said. "It’s far more complicated and difficult, though it is a good moment for the industry because the crude prices are so low."

As MRC informed earlier, Petroleos Mexicanos (Pemex) said it will spend USD23 billion on projects designed to modernize and reduce greenhouse gas emissions from the country’s six refineries.

Pemex, Mexican Petroleum, is a Mexican state-owned petroleum company. Pemex has a total asset worth of USD415.75 billion, and is the world's second largest non-publicly listed company by total market value, and Latin America's second largest enterprise by annual revenue as of 2009. Company produces such polymers, as polyethylene, polypropylene, polystyrene.
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MOSCOW (MRC) -- SK Global Chemical has scheduled a maintenance turnaround at its polypropylene (PP) plants in H2 2016, as per Apic-online.

A Polymerupdate source in South Korea informed that the plants are planned to be shut in September-October 2016. It is likely to remain off-stream for around 30-40 days.

Located in Ulsan, South Korea, the No.1 PP plant has a production capacity of 183,000 mt/year and No.2 PP plant has a production capacity of 193,000 mt/year.

As MRC informed previously, in October 2015, SABIC and South Korean petrochemical company SK Global Chemical inaugurated a new industrial plant to manufacture a range of high-performance polyethylene products using the cutting-edge Nexlene Solution Technology. The 50-50 joint venture holding company, SABIC SK Nexlene Company (SSNC) was established in July 2014 and is headquartered in Singapore. Its wholly-owned subsidiary, Korea Nexlene Company (KNC), owns the plant in Ulsan, which has an annual capacity of 230,000 tons.

SK Global Chemical is a pioneering petrochemical company in Korea, being the first in the country to build a naphtha cracking facility in 1972. Through continuous facility investment, R&D and technological improvement, the company has maintained its position as the leader of the petrochemical industry in Korea.
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MOSCOW (MRC) -- South Korea-based Hanwha Total Petrochemical Co. is expanding its business into the global high value-added ethylene vinyl acetate (EVA) market by commercial production using the tubular reactor polymerization process for the first time in the world, and investing in facilities, including the expansion of the second EVA plant, as per BusinessKorea.

Hanwha Total has established EVA production facilities of 320,000 tpa. The company expects to turn over 1.5 trillion won (USD1.28 billion) in solar EVA products alone in the next five years.

The company achieved a 35% share in the global solar encapsulment EVA market amounting to 350,000 tons, being ranked first.

As MRC reported earlier, in July 2015, Hanwha Chemical merged two of its chemical compounds businesses - Hanwha Next and Hanwha Compound. The combined entity, named Hanwha Compound, will produce polyethylene (PE), polypropylene (PP), polyvinyl chloride (PVC), and acrylonitrile butadiene styrene (ABS). The company will operate manufacturing plants in Yeosu and Suncheon, with an annual capacity of 100,000 tons. The company expects the merger to improve management efficiency across its petrochemical affiliates and related businesses.

Hanwha Group is one of the largest business conglomerate in South Korea. Founded in 1952 as Korea Explosives Inc., the group has grown into a large multi-profile business conglomerate, with diversified holdings stretching from explosives, their original business, to retail to financial services.
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MOSCOW (MRC) -- Essen-based Evonik Industries, a leading specialty chemicals manufacturer, invested over EUR400 mln in its plants in Germany in 2015, said the producer in its press release.

Last year, Evonik once again demonstrated its considerable power to create at its German sites. Thus, according to a recent projection, the company invested more than EUR 400 million in its domestic production plants. The lion’s share of the funds (around two-thirds) was divided among Evonik’s five-largest sites in Germany: Marl (hundreds of millions of euros), Hanau, Essen, Darmstadt, and Wesseling (tens of millions of euros at each site).

"By investing in growth and modernization in Germany, we are strengthening our foothold in important markets of the future," stressed Klaus Engel, Chairman of Evonik’s Executive Board. "Favorable conditions for investment are by no means a given. I would like to see greater understanding among policy-makers for the necessary competitiveness of our industry, entailing, for example, improvements in the transportation infrastructure, the transition to renewable energy sources, and the expansion of digital networks."

Evonik is planning further large-scale projects in Germany. One of these is the construction of a new plant for production of specialty copolyesters in Witten by 2018 with an investment in the double-digit million euro range. As part of the global production initiative for specialty silicones, Evonik intends to invest in production for these products in Essen once again. A new silane research center is currently being built in Rheinfelden that is slated to be completed in 2016.

As MRC wrote previously, in Marl, Evonik’s largest site worldwide with a workforce of close to 7,000, a production facility for C4-based raw materials was completed in 2015. In Essen, the company put a new manufacturing plant for polymeric dispersants into operation and expanded a plant in which specialty silicones are produced.

Evonik, the creative industrial group from Germany, is one of the world leaders in specialty chemicals. Its activities focus on the key megatrends health, nutrition, resource efficiency and globalization. Evonik benefits specifically from its innovative prowess and integrated technology platforms. Evonik is active in over 100 countries around the world. In fiscal 2013 more than 33,500 employees generated sales of around EUR12.9 billion and an operating profit (adjusted EBITDA) of about EUR2.0 billion.
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