Russian producers intend to increase import duties on LLDPE

MOSCOW (MRC) - The Ministry of Industry and Trade of the Russian Federation considers the appeal of Nizhnekamskneftekhim about the possibility of increasing import duties on a linear low density polyethylene (LLDPE).
The duty is expected to be increased by 6.5%, according to MRC analysts.

Last week the subcommittee on customs tariff and non-tariff regulation, protective measures in foreign trade of the Government Commission on Economic Development and Integration began considering of the request of Nizhnekamskneftekhim about the possibility of increasing the import customs duties for LLDPE from 0% to 6.5%.
This refers to the products that are classified by Single Commodity Nomenclature of Foreign Trade of the Eurasian Economic Union under codes 3901 10 100 0 and 3901 90 900 0.

The Commission intends before 20, April to collect all the necessary documents on feasibility of increase of the import duty on the above mentioned products. The question of import duties for linear polyethylene is quite painful for Russian converters.

Production of LLDPE is quite small in Russia in comparison with the processing volumes, thus, the main converters have to meet the demand for the feedstock by imports. Before 1, January 2010 import duties on linear polyethylene was 10% (although earlier there were two periods of duty-free imports), and then because of the request of film producers it was cut to 0%. Product code in Single Commodity Nomenclature is 3901 10 100 0.

Council of the Eurasian Economic Commission on 12, October, 2012 made a decision №89 "On Amendments to the single commodity nomenclature of foreign economic activity of the Customs Union and the Common Customs Tariff of the Customs Union in respect of silicone resins, ethylene polymers, certain types of organic chemicals, fish", which cut import duties on other polymers of ethylene to 0% (code TN VED 3901 90 900 0).

Officials Commission's decision was published on 20, November 2012 and entered into force on 20, December, 2012.
According to rules of the Unified Customs Union, the code TN VED 3901 90 900 0 includes all other polymers of ethylene. Linear polyethylene having a total weight of more than 5% of copolymer units of butene, hexene or octene is partially included into this classification.

According to MRC data, PE imports in 2014 on code 3901 10 100 0 and 3901 90 900 0 amounted to about 131,800 tonnes and 120,100 tonnes, respectively, in 2015, these figures dropped to 98,200 tonnes and 120,600 tonnes.
MRC

Yansab Q1 net profit lifts on lower feedstock prices

MOSCOW (MRC) -- Saudi Arabia's Yanbu National Petrochemical Co (Yansab) reported a 41 percent rise in first-quarter net profit on Wednesday, beating analysts' forecasts, said Reuters.

The firm, a subsidiary of Saudi Basic Industries Corp (SABIC), made a net profit of 401.9 million riyals (USD107.2 million) in the three months to Mar. 31, up from 285.1 million riyals in the same period of 2015, it said in a bourse filing.

Five analysts polled by Reuters on average forecast Yansab would make a quarterly profit of 310.8 million riyals. Yansab attributed the increase in profit to decreases in feedstock prices, which helped boost profit despite lower average sale prices for most products.

Saudi companies issue brief earnings statements early in the reporting period before publishing more detailed results later.

The increase came after four quarters of falling profits for Yansab. Like many petrochemical firms in the kingdom, the company's earnings have been hit hard by falling product prices, as they are closely tied to slumping oil prices. Saudi producers have benefited from subsidised energy and feedstock costs, so lower crude prices compress their margins. That is changing though, as the Saudi government reforms energy subsidies to help it close a substantial budget deficit.

Yansab said in February that fuel and electricity price hikes would raise its production costs by 1 percent in 2016. This was lower than the 6.5 percent estimate given at the end of last year.

As MRC informed earlier, Saudi Arabia's Yanbu National Petrochemical Co. (Yansab) in April shut its petrochemical complex this month for maintenance for 35 days. The shutdown will include an ethylene glycol plant, which will suspend operations for 60 days.

Yansab is the most recent SABIC, (Saudi Basic Industries Corp), affiliate in Saudi Arabia, and will be the largest Sabic petrochemical complex. It will have an annual capacity exceeding 4 million metric tons (MT) of petrochemical products including: 1.3 million MT (metric-tons) of ethylene; 400,000 MT of propylene; 900,000 MT of polyethylene; 400,000 MT of polypropylene; 700,000 MT of ethylene glycol; 250,000 MT of benzene, xylene and toluene, and 100,000 MT of butene-1 and butene-2.
MRC

Dow Chemical invests in wastewater treatment technology of OxyMem

MOSCOW (MRC) -- Dow Chemical is investing in Irish company OxyMem, reported Hydrocarbonprocessing with reference to officials' announcement.

The investment will accelerate the commercialization of OxyMem’s promising wastewater treatment technology -- the Membrane Aerated Biofilm Reactor (MABR).

"I believe that we have an important technology that can make a sizable contribution in the wastewater market where there is a significant need for more efficient infrastructure solutions," said Wayne Byrne, managing director of OxyMem. "Securing the investment from Dow, an innovation leader, augurs well for the future of the company. We look forward to an exciting journey with Dow Water & Process Solutions business on board."

The MABR technology has the potential to bring wastewater treatment closer to energy neutrality by reducing energy consumption for aeration by up to 75%, according to company officials.

"Global water demand trends are making wastewater infrastructure a major challenge for populations and industries across the globe," said Snehal Desai, global business director for Dow Water and Process Solutions. "OxyMem’s MABR technology shows excellent promise in lowering operational costs for the wastewater treatment process due to reduced energy demand.

"This also makes the technology a strong sustainability value proposition - it can help encourage greater adoption of water reuse and as a result, advance a circular economy that makes water a well-managed resource, sustained by advances in science and technology," he added.

As MRC informed previously, in early April 2016, film extruder Transilwrap Co. Inc. bought the specialty films business of Dow Chemical Co. for an undisclosed price. The deal includes production plants in Hebron, Ohio, and Drusenheim, France. The business makes films based on polyethylene, polypropylene and polystyrene for numerous medical and packaging applications such as beverage closer liners, ostomy bags, window envelope films, labels and protective fabrics.

The Dow Chemical Company is an American multinational chemical corporation headquartered in Midland, Michigan, United States. Dow is a large producer of plastics, including polystyrene, polyurethane, polyethylene, polypropylene, and synthetic rubber.
MRC

Air Liquide to supply gases for petrochemical unit of Sinopec

MOSCOW (MRC) -- Air Liquide has signed a new long-term contract with Maoming Petrochemical Co. (MPCC), a subsidiary of China Petroleum & Chemical Corp. (Sinopec), said the company on its site.

Under the terms of the new agreement, Air Liquide will invest around 40 million euros in a new state-of-the-art ASU (air separation unit), with a total capacity of 850 tpd of oxygen.

Expected to start operations in the second quarter of 2017, the new ASU will supply industrial gases including oxygen and nitrogen to the customer's new ethylene oxide plant as well as to its existing one.

The ASU, located in Maoming City, Guangdong Province, will be designed and supplied by Air Liquide's engineering and construction teams using leading technologies to offer energy efficiency as well as optimal reliability and safety. The ASU will be owned and operated by ALMPCC, the joint venture of Air Liquide China and MPCC established in June 2012.

"It's our pleasure to join hands with Air Liquide again," said Lu Weiqun, deputy GM of MPCC and vice chairman of the ALMPCC board.

"By combining their advanced technology and management expertise with MPCC's experience in the local market, ALMPCC has seen great successes in recent years," he added. "Through the new project, we expect ALMPCC to contribute more to the development of MPCC as well as to that of the local economy."

As MRC informed earlier, Iran is in talks with France’s Air Liquide to develop a 0.5mt Propylene via Methanol (PVM) plant.

L'Air Liquide S.A., or Air Liquide, is a French multinational company which supplies industrial gases and services to various industries including medical, chemical and electronic manufacturers.
MRC

Total sees gas and petrochemicals as priority in Iran

MOSCOW (MRC) -- The CEO of France's Total, Europe’s third-largest oil company, said on Wednesday that the company's priority on getting back into Iran's energy sector was gas and petrochemicals, reported Hydrocarbonprocessing.

"Gas is our priority for us there, and petrochemicals," Total CEO Patrick Pouyanne told reporters at an international liquefied natural gas conference.

He said the company has not signed any deals in Iran yet.

As MRC wrote previously, Total intends to invest EUR160m before 2016 to adapt its petrochemical platform in Carling, in the Lorraine region of eastern France, and to restore its competitiveness.

Besides, in April 2015, Total announced that its proposed new ethane cracker near its refinery in Port Arthur, Texas, is being designed to have a capacity of 1 million tpy.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
MRC