SOCAR freezes petchem project, to upgrade old facilities

MOSCOW (MRC) -- Azerbaijan's state oil company SOCAR has put on hold an ambitious petrochemical project due to a plunge in oil prices, but will invest USD1.3 billion to upgrade its existing refinery and chemical facilities, said Reuters, citing a senior SOCAR executive.

SOCAR had planned to build the petrochemical complex, aiming to process oil and gas, at Sangachal, 60 km (37 miles) south of the capital Baku. Investments in the project, which drew interest from several foreign companies including Japan's Mitsui, were estimated at USD17 billion initially but later revised to $8.5 billion after the exclusion of a refinery from its configuration.

"We can say that active work on the OGPC (Oil, Gas, Petrochemical Complex) project has been temporarily frozen," SOCAR Vice President Tofig Gahramanov told Reuters in an interview. He said SOCAR was still in talks with Mitsui on its future participation in the project - "as an investor and a partner".

Azerbaijan's economy and currency, the manat, have come under intense pressure from sliding oil prices. Ratings agency S&P cut the country's credit rating to "junk" status earlier this year.

Gahramanov said SOCAR would most likely return to the petrochemical project if crude prices bounced back, but meanwhile would overhaul its aging oil refinery in Baku as well as facilities of chemicals firm Azerikimya Production Union. "This project is estimated to be worth USD1.3 billion and is financed from the state budget," Gahramanov said.

He said the completion of the project was expected in several phases within four years, and there could be temporary shutdowns at the existing refinery during this period. "Once completed, the oil refinery's annual capacity will rise to 7.5 million tonnes of crude oil from 6 million tonnes," he said.

Seven or eight new units will be installed at the refinery after renovation, he said.

As MRC informed earlier, in Feb 2016, Azerbaijani PASHA Holding company invested about USD25 million in the SOCAR Polymer project.

SOCAR, which is keen on expanding operations in the retail oil products market abroad, is involved in exploring oil and gas fields, producing, processing, and transporting oil, gas, and gas condensate, marketing petroleum and petrochemical products in the domestic and international markets, and supplying natural gas to industry and the public in Azerbaijan.

MRC

MOSCOW (MRC) -- China's BP Zhuhai will be shutting its No. 3 purified terephthalic acid (PTA) production plant on 22 February for a short turnaround, reported TPS with reference to industry sources.

According to a Chinese PTA producer, the BP plant will be down for about seven days. BP was not available for comment.

The No. 3 plant, with a design production capacity of 1.25 million mt/year, is the world's largest single train PTA unit. BP had announced its official start-up on July 3, 2015.

This means the company will only be running at No. 2 PTA unit this week, which was recently restarted in January after a 15-day turnaround. The No. 2 unit is able to produce 1.1 million mt/year. The No. 1 unit, which is able to produce 600,000 mt/year, has been mothballed since September 2014.

"The stoppage will not have a huge impact on prices," a Chinese trader told TPS, as Yisheng Petrochemicals had indicated that they will be restarting its No. 3 unit in Ningbo on Feb 25. Yisheng's No. 3 PTA unit has an annual operating capacity of 2 million mt/year.

As MRC reported earlier, BP on July 3 celebrated the official start-up of the Phase 3 PTA plant of Zhuhai Chemical Co., enhancing its position in the PTA market and its long-term commitment in China. The completed Phase 3 plant, with a design production capacity of 1.25 million tonnes per year, is the world’s largest single train PTA unit, according to BP.

BP Zhuhai Chemical Company was formed in 1997 as a joint venture between BP, which holds 85% stake, and Zhuhai Port Co, with 15% stake.

BP is one of the world's leading international oil and gas companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemicals products for everyday items.
MRC

MOSCOW (MRC) -- Fluor was awarded a construction management contract by Sunoco Logistics for the Mariner East 2 project at its Marcus Hook Industrial Complex on the Delaware River in Pennsylvania, said Hydrocarbonprocessing.

Fluor booked the undisclosed contract value into backlog in the fourth quarter of 2015.

Upon completion, Mariner East 2 is anticipated to provide an additional 275,000 bpd of natural gas liquids (NGLs) for distribution to local, domestic and international markets. Fluor will manage the construction of new terminal facilities to store, chill, process and distribute propane, butane and ethane at the complex.

"Fluor is pleased to have been selected by Sunoco Logistics for this critical element of Mariner East 2," said Jim Brittain, president of Fluor’s energy and chemicals business in the Americas.

"It is an important project within their expansion program that enables the continuing development of the Marcus Hook Industrial Complex into a world-class NGL hub," he added. "We will leverage our extensive construction management experience to bring capital efficiency and schedule certainty to this fast-track project."

The project will leverage innovative construction methodologies, including a project-wide collaboration platform to streamline processes and facilitate execution with increased efficiency.

As MRC informed earlier, LyondellBasell contracts Fluor for FEED for its proposed propylene oxide (PO) and tertiary butyl alcohol plant in the USA. Fluor said it booked the undisclosed contract value in the fourth quarter of 2015.
MRC

MOSCOW (MRC) -- Perstorp, a world leader in specialty chemicals has been participating in the event "Make in India". By signing an MoU with MIDC (Maharashtra Industrial Development Corporation), the company initiates the process of evaluating the opportunity to invest in a new world scale production plant for Penta in India, said the producer in its press release.

The related market for coatings is growing fast in the country. Building a world scale production plant would be yet another important part of the ambitious plan to strengthen the position in the Asian Market. In July 2015, Perstorp acquired the Penta business from Koei Chemical Company Ltd., a Japanese chemicals producer.

"The Penta business is a corner stone for Perstorp and an integral part of the strategy to drive growth in the Asia Pacific region. It requires presence and determination in order to succeed. An investment in India would further build upon and strengthen our number one position in the global market. Today’s signing of an MoU demonstrates our intention to take the desired steps in the region." Perstorp’s President and CEO Jan Secher says.

"Perstorp has for a longer period successfully been building its position in Asia. The "Make in India" initiative gives Perstorp an arena to further evaluate opportunities within this exciting region. Ultimately our intention is to develop existing and new customer relationships to further support their success and growth", says Ulrika Andersson, Vice President Business Unit Penta.

Pentaerythritol (Penta) is a white crystalline polyhydric alcohol containing four primary hydroxyl groups. Applications are building blocks in alkyd resins for coatings, radiation curing monomers, polyurethanes, rosin esters, synthetic lubricants and explosives. Perstorp is currently producing Penta in three different production plants in Germany, the US and Sweden.

Perstorp is one of the world leaders in various sectors of the specialty chemicals market, it's pioneer in formalin chemistry, plastics and surface materials. Perstorp was founded in 1881 and is controlled by PAI partners,a major European private equity company. The company has around 1,500 employees in with 22 production plants in Europe, Asia and North America.
MRC

MOSCOW (MRC) -- China's Hanbang Petrochemicals aims to start up its second purified terephthalic acid (PTA) unit in late-February, a company source told TPS.

The company had to postpone its start-up, initially planned for October 2015, to December due to technical issues. Hanbang then planned to have the plant up and running before the Lunar New Year holidays, which began on February 8, but the operation was unsuccessful. The company now aims to get the plant online by the end of this month, the source said.

The startup of Hanbang's new 2.2 million/year PTA line will increase its total nominal PTA production capacity to 2.8 million mt/year. The company's existing 600,000 mt/year line will continue to be run at full capacity after the new plants starts up, the source had said.

Hanbang Petrochemical, also known as China Prosperity Jiangyin Petrochemical, is situated in Jiangyin city within China's Jiangsu province.

We remind that, as MRC reported earlier, in late November 2015, Hengli Petrochemical took off-stream its PTA line. A Polymerupdate source in China informed that the line was shut on account of a technical glitch recently. It remains unclear when the line will restart operations. Located in Hengli, China, the PTA line has a production capacity of 1.1 million mt/year.
MRC