PP production in Russia grew by 6% in January - March 2016

MOSCOW (MRC) -- Russia's overall polypropylene (PP) production rose in the first three months of 2016 by 6% year on year, totalling 361,400 tonnes. Traditionally, Tobolsk-Polymer and Neftekhimia (Kapotnya, Moscow region) accounted for the main increase in the output, according to MRC ScanPlast report.

March PP production in Russia increased to 122,200 tonnes from 116,700 tonnes a month earlier. Tobolsk-Polymer raised its capacity utilisation last month. Russia's overall PP production reached 361,400 tonnes in January - March 2016, compared to 340,300 tonnes over the same period of 2015. All plants, except for Ufaorgsintez, showed a positive result, with Tobolsk-Polymer and Neftekhimia accounting for the greatest growth in the output.

The production structure by plants looked the following way over the stated period.

Tobolsk-Polymer, Russia's largest PP producer, produced 44,600 tonnes last month, compared to 41,700 tonnes in February. The Tobolsk plant's PP production reached 129,500 tonnes over the first three months of the year versus 113,600 tonnes a year earlier.

Omsk Poliom (Titan) produced 15,700 tonnes in March, compared to 16,200 tonnes a month earlier. The Omsk plant's production exceeded 49,700 tonnes in January - March 2016 versus 49,000 tonnes a year earlier.

Nizhnekamskneftekhim increased its production to 18,500 tonnes of PP last month from 17,400 tonnes in February. The Nizhnekamsk plant's PP production exceeded 54,600 tonnes in January - March 2016, whereas this figure was 53,700 tonnes a year earlier.

Tomskneftekhim produced slightly over 12,000 tonnes of PP in March, whereas the February figure was slightly more than 11,600 tonnes. The plant's total output of this polymer was 35,600 tonnes in the first three month of the year, which is virtually the same as in 2015.

Stavrolen (Lukoil) increased its capacity utilisation last month, its PP production rose to 10,400 tonnes versus 9,600 tonnes in February. The Budenovsk plant's output of propylene polymers totalled 29,200 tonnes in January - March 2016, compared to 28,800 tonnes a year ago.

Neftekhimia (Kapotnya) produced 11,100 tonnes of PP in March, compared to 10,400 tonnes a month earlier. The plant's production exceeded 32,800 tonnes over the stated period, up by 19% year on year.

Ufaorgsintez produced 9,800 tonnes of PP last month versus 9,900 tonnes of February. The Ufa plant's output decreased to 29,900 tonnes in January - March 2016 from 31,700 tonnes a year ago.

MRC

MOSCOW (MRC) -- Germany drugmaker Bayer reported 15.7 percent higher underlying core earnings for the first quarter, boosted by prescription drugs such as eye treatment Eylea, said CNBC.

First-quarter profit before interest, taxes, depreciation and amortisation (EBITDA), adjusted for one-off items, rose to 3.4 billion euros (USD3.8 billion), above average market expectations of 3.07 billion euros.

Bayer, the inventor of aspirin and maker of Yasmin birth control pills, said it still expected adjusted EBITDA to increase by a medium single-digit percentage this year, when excluding separately-listed plastics subsidiary Covestro.

As MRC reported earlier, on 1 September 2015, Bayer AG moved a step closer to floating its EUR11 billion (USD12.3 billion) specialty chemicals business by "legally and economically" separating the unit, now named Covestro AG. The German pharmaceuticals group plans to float Covestro, previously called Material Science, by the middle of 2016 year and potentially as soon as last autumn. Bayer plans either an initial public offering or direct spinoff to shareholders. The company has previously indicated that it preferred an IPO, which would generate cash for heavily indebted Bayer.

Bayer is a global enterprise with core competencies in the fields of health care, agriculture and high-tech polymer materials. As an innovation company, it sets trends in research-intensive areas. Bayer's products and services are designed to benefit people and improve their quality of life. At the same time, the Group aims to create value through innovation, growth and high earning power. Bayer is committed to the principles of sustainable development and to its social and ethical responsibilities as a corporate citizen.
MRC

MOSCOW (MRC) -- Swiss specialty chemicals producer Clariant AG said on Thursday that China will overtake the United States to become the world's largest chemicals market in the next five to 10 years despite an economic slowdown, sai the producer on its site.

"The country's GDP growth rate is about 6.5 percent now and when you look at the chemicals sector, it is about 5 to 6 percent, a growth rate that you find nowhere in the world can match. That means even though China has short-term setbacks in its economy, the fundamental picture for the chemicals market will not change in the long term," said Christian Kohlpaintner, member of the executive committee of Clariant International AG.

The global market for chemicals products hit USD3.8 trillion last year, while the Asian market led by China accounts for 40 to 50 percent of that figure with a market value of about USD1.5 trillion to USD1.9 trillion, he said.

The Basel-based company raked in USD6 billion in revenue in 2015, of which around 5 percent will be spent for global investment.

Jan Kreibaum, Clariant's president in charge of markets in China and South Korea, said that 40 percent of the company's total investment will go into the world's second-largest market by 2017, especially for innovation and research.

"Our business requires intensive knowledge and ongoing innovation and that's why we are putting so much effort into it," he said, adding that a research and new regional headquarters will be built with more than 500 employees.

Specialty chemicals are products used in industries for their performance and function such as food additives, flavors and fragrances and water treatment materials. The Swiss firm has four business areas: care chemicals, catalysis, natural resources, and plastics and coatings.

As MRC informed earlier, Clariant has been awarded a contract by Hengli Petrochemical (Dalian) Refinery Co. to develop an extensive propane and butane dehydrogenation unit in cooperation with CB&I. The project includes the license and engineering design of the co-processing unit, which is to be built in Dalian, Liaoning Province, China.

Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints.
MRC

MOSCOW (MRC) -- Azerbaijan state oil company Socar lost over manat 1bn (USD662mn) in 2015, with low oil and gas prices a major factor, but it managed to finish the year with zero balance, thanks to its overseas activities, a senior executive said, as per Naturalgaseurope.

"As we have significant activities denominated in international currency, we managed to complete 2015 with an almost zero balance when we converted it into manats," Socar’s vice-president for economy Suleyman Gasymov told the Caspian European Club business forum in Baku April 27. Net profit for 2014 amounted to manat 1.274bn.

"Despite all the challenges we have fulfilled our oil-gas production plan for 2015 and for the first quarter of 2016. We also fulfilled our obligations for the state budget," he said. Socar’s total consolidated debt is around USD6.3bn from international and domestic sources. However, it is manageable, being mainly long-term borrowings.

"For instance, we issued Eurobonds for 10 and 20 years, we have direct borrowings from banks for five years and more," he said, adding that the company is not planning to issue new notes soon. In fact it proposes to buy back outstanding eurobonds worth USD500mn.

Socar's main goal for this year is to keep oil production stable and increase gas production, which is reflected in the company’s investment programme. The state-run company is aiming to complete a programme of domestic gas supply this year. It includes starting gas supply to remote areas that are off-grid.

Gasymov said the company is in the process of buying a methanol plant near Baku, whose owner AzMeCo has been forced to sell to repay debt to the International Bank of Azerbaijan. AzMeCo has been struggling to set stable methanol production as the company did not have a long term gas supply agreement with Socar. It had to stop receiving gas from Russia started last October as it was uneconomical.

Socar will continue with its international projects, mainly in Turkey. According to Gasymov, the Star refinery in Turkey will be completed in 2018. The company and its partner, Azerbaijan's minister for the economy, have already invested USD1.9bn into the project.

Socar's profit from the Petkim petrochemical complex in Turkey was lira 500mn (USD178mn). Last year Socar spent its dividends on repaying debt and financing Star. The other major project in Turkey is Trans Anatolian gas pipeline where Socar is a partner in the Southern gas corridor company.

As MRC informed earlier, Honeywell announced that the State Oil Company of Azerbaijan Republic (SOCAR) will use a suite of Honeywell UOP technologies to modernize its oil refinery in Baku, Azerbaijan, to produce high-quality gasoline that meets stricter emission standards.

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. SOCAR Polymer is a subsidiary of SOCAR. The entity was formed at the end of 2013 to run investments at the Sumgait Chemical Industrial Park, a production park which intends to become a chemical hub in central Asia.

MRC

MOSCOW (MRC) -- Arsenal Capital Partners on Thursday announced that its specialty polymers and additives platform, Polymer Solutions Group (PSG), has acquired Sasco Chemical Group (Albany, GA), a manufacturer of specialty chemicals for the rubber, wood, consumer and medical industries, said Chemweek.

In February this year, PSG acquired Flow Polymers, a manufacturer serving the tyre and automotive, industrial products, wire and cable, and plastics markets. SASCO, based in Georgia, manufactures rubber anti-tack agents.

As MRC informed earlier, Arsenal Capital Partners has made three more polyurethane foam acquisitions and will combine them into a single business.

Sasco Chemical, founded in 1948, is a leading manufacturer of rubber anti-tack agents in North America with its PolyCoat, TechKote and Sasco Cote product lines. It makes more than 1,200 products for the global market.

Arsenal Capital Partners is a leading New York-based private equity firm that invests in middle market healthcare and specialty industrial companies. Arsenal makes investments in sectors where the firm has significant prior knowledge and experience. Arsenal targets businesses that have the potential for further value creation, and works closely with management to accelerate growth by leveraging the firm's industry focus and operational improvement capabilities.

MRC