Two dead in explosion at BASF's Ludwigshafen complex, separate blast rocks nearby BASF site

MOSCOW (MRC) -- An explosion today at BASF's Ludwigshafen, Germany, complex has killed at least two workers and injured six others, the company says. Two more workers are missing following the blast, BASF says.

A separate explosion occurred earlier today at BASF's nearby Lampertheim, Germany, site injuring four workers.

BASF has confirmed that the explosion at Ludwigshafen occurred at about 11.30am local time and was followed by several smaller fires. Two workers died in the accident and two others remain unaccounted for, BASF says. The blast injured six workers, most of whom have been hospitalized, the company says. The blast struck a pipeline at the complex's north harbor. The pipeline transports chemicals to the harbor for storage and onward shipment on the Rhine River. Feedstock such as naphtha and LPG are also unloaded at the north harbor for consumption at Ludwigshafen. Fire fighters are still tackling the blaze.

BASF has warned residents in Ludwigshafen and nearby Mannheim to stay indoors and keep windows closed. The company says it has launched an investigation into the cause of the accident.

BASF has idled 14 production plants at Ludwigshafen as a safety measure, including the site's two steam crackers, and this has resulted in flaring at the site, the company says. The Ludwigshafen crackers have a combined capacity for about 660,000 metric tons/year of ethylene.

IHS Chemical says that BASF is managing the plant shutdowns for a smooth restart. An extensive flow of chemicals passes by barge through the north harbor, IHS Chemical adds. "The olefin markets are relatively well placed to deal with the outage but for a number of derivative sectors a prolonged outage could cause a significant supply issue," says Matthew Thoelke, senior director/olefins and derivatives, EMEA at IHS Chemical. "There could be a long-term logistics issue and it will take some time to determine the full impact."

The explosion at Lampertheim, where BASF makes additives for plastics, coatings, and cosmetics, happened at about 8.30am and injured four workers, who have been hospitalized, BASF says. The company says that the causes of the incident are not yet known. Plants at the site, which have a combined capacity of about 40,000 metric tons/year, have been taken offline, BASF says. The Lampertheim site's products include flame retardants and antioxidants.

Police have ruled out terrorism as the possible cause of the incidents, BASF says.

BASF is the world’s leading chemical company. Its portfolio ranges from chemicals, plastics, performance products and crop protection products to oil and gas.
MRC

MOSCOE (MRC) -- JNC Corp. has completed a new production technology development center, which has been under construction at its Minamata factory in Japan, as per Apic-online.

The center comprises a development management building and an innovative technology building, equipped with examination facilities for existing technologies and innovative production technologies.

"We established the production technology development center in order to prepare a base for developing production technology for the future and to aim at further improving our technological competitiveness," JNC noted.

As MRC wrote before, in 2014, Wacker Asahikasei Silicone, a Japanese joint venture of Wacker Chemie AG, opened a new development laboratory for airbag applications. The competence center will spearhead the development of silicone coatings for airbags and technical textiles in the region. Investment in the new laboratory amounts to roughly JPY1 million. Wacker Asahikasei Silicone (AWS) is jointly owned by Wacker and the Japanese chemical group Asahi Chemical Industry each with a fifty-percent stake.

Besides, earlier, in 2013, DSM opened its first application development technical center for engineering plastics in Japan on 26 March 2013 in Yokohama City. The launch of the DSM Engineering Plastics Japan Technical Center is fully in line with DSM’s strategy to support and grow business not only with customers in Japan but also with overseas Japanese Transplants, for which material specifications are determined in Japan. DSM recognizes the importance of developing new innovative and more sustainable applications together with its customers in Japan. The main subjects for examination at the center are highly functional engineering plastics used in automotive, electrical and electronics, and flexible food packaging industries.
MRC

MOSCOW (MRC) -- Russian private investment group United Capital Partners (UCP), which is teaming up with oil giant Rosneft to buy India's Essar Oil in a USD12.9-B deal, said it may sell its stake within five years, reported Hydrocarbonprocessing.

The purchase of Essar Oil, by Russia's state-owned Rosneft and a consortium of UCP and global oil trader Trafigura, will be the biggest foreign acquisition ever in India and Russia's largest overseas deal. The takeover is expected to be completed in the next few months.

The chief executive of Russian lender VTB, which advised on the deal, has said it was specially structured to ensure it was not affected by Western sanctions imposed on Rosneft and its boss Igor Sechin, an ally of Russian leader Vladimir Putin.

Since Rosneft will control only 49% of Essar under the deal, with Trafigura and UCP jointly holding another 49%, the sanctions risk is mitigated.

But the structure has raised questions about whether UCP and Trafigura will cede their shares to Rosneft once sanctions are lifted or eased, giving Sechin full control over the acquisition.

The sanctions were imposed over Moscow's annexation of Crimea and support for separatist rebels in eastern Ukraine.

"We do not plan to sell our stake to anyone in the near future," Irina Lanina, a director of UCP, said in a written response to Reuters' questions.

"We plan to make this investment in a consortium with our partner Trafigura and are likely to exit together with them as well. As of now, we are looking at (remaining in Essar) for 3-5 years but time will tell," Lanina said.

Lanina said that UCP plans to use its own funds and credit facilities to finance the acquisition of its stake but did not say how much it would cost.

As MRC informed previously, last week, it became known that Russian oil major Rosneft, along with European trader Trafigura and Russian fund UCP, would acquire 98% in India's Essar Oil for about USD12 B - USD13 B including debt. Rosneft will get 49% and the two investors - Trafigura and UCP - will hold the remaining 49% in equal parts, the sources said, adding that the valuation included about USD4.5 B in assumed debt. Essar Oil operates a 400 Mbpd oil refinery on India's west coast and sells fuels through its 2,470 filling stations in India.

Rosneft became Russia's largest publicly traded oil company in March 2013 after the USD55 billion takeover of TNK-BP, which was Russia’s third-largest oil producer at the time. Apart from other assets, Rosneft owns Angarsk Polymer Plant and Ufaorgsintez in Russia and Lisichansky refinery in Ukraine.
MRC

MOSCOW (MRC) -- Saudi Arabia's National Industrialization Co (Tasnee) made a profit for the second consecutive quarter as a reduction in feedstock costs and higher sales offset the sustained impact of depressed product prices, said Reuters.

Petrochemical firms in the kingdom have been struggling for the last two years as lower oil prices have weighed on product prices in their industry. Tasnee posted losses in every quarter in 2015 as well as the first three months of this year.

A concerted restructuring effort by the company, which focused on improving efficiencies and cost cutting which resulted in it shedding more than 25 percent of its global workforce, had already helped Tasnee return to profit in the second quarter.

The improvement extended into the third quarter as Tasnee recorded a profit of 122.2 million riyals (USD32.6 million), according to a bourse filing.

Shares in Tasnee, which has interests in petrochemicals, metals and chemicals and is one of the world's largest producers of titanium dioxide through its Cristal subsidiary, ended Tuesday down 10 percent despite the profit.

Chief Executive Mutlaq al-Morished denied a Bloomberg report that the company had stopped making payments on a USD1 billion loan.

In an interview with Al Arabiya television he said Tasnee had begun informal talks with local banks to refinance the loan at better terms, as it had done with a 7 billion riyal facility for Cristal earlier this year, with negotiations set to last at least six months.

The profit compared to a loss of 296.3 million riyals in the prior-year period, while the average forecast of three analysts polled by Reuters was 114.9 million riyals. The company is moving forward with projects in Jizan and Hail, despite delays, Morished told Reuters on the sidelines of a company event.

He attributed the hold-up of an ilmenite smelting plant in Jizan industrial city to technology issues, requiring a re-engineering of the design. "When you start a new technology, you run into teething problems. We're going through teething problems," said Morished. The first furnace is expected to start production in the first half of 2017, while the second would begin in the third quarter.

In Hail, he said delays were due to complications associated with the projects' remote location. There are plans for some of the six or seven Tasnee plants in Hail to start commercial production in the first quarter of 2017, he said. The rest will start throughout 2017.

As MRC informed earlier, in 2014, Tasnee entered into an agreement to increase its stake in titanium dioxide (TiO2) producer Cristal.

Headquartered in Riyadh, Tasnee is primarily engaged in petrochemical, chemical and industrial projects. The
company produces petrochemical products, including polypropylene, polyethylene and acrylic acid, as well as other downstream petrochemical products.
MRC

MOSCOW (MRC) -- SIBUR has signed an agreement with Conser, an Italian engineering company, to acquire a license for maleic anhydride (MAN) production technology for its Tobolsk facility, as per Hydrocarbonprocessing.

Maleic anhydride is used in the construction, agriculture, automotive, paint and varnish, furniture, pharmaceutical and other industries. It serves as feedstock for films, synthetic fibers, pharmaceuticals, detergents, fuel components and oils. The use of MAN allows achieve high strength of the material as well as its resistance to moisture, extreme temperature and mechanical stress.

Russia currently does not produce maleic anhydride, with the domestic consumption of 4.5 ktpy fully covered by imports. The estimated output of the new Tobolsk facility will be 45 ktpy. Production of a high-margin product using own feedstock (butane) will enable SIBUR to improve the hydrocarbon processing rate in Russia, fully substitute MAN imports, and export it to Europe and the Middle East. In addition, a state-of-the-art Russian MAN production facility will provide new development opportunities for many domestic industries.

SIBUR has also engaged NIPIgaspererabotka, a leading Russian center for facility design, supply, logistics and construction.

As MRC reported earlier, Russian petrochemical company Sibur is in talks with shareholder Sinopec about investing in a planned gas chemical plant in Russia's Far East. Sibur plans to buy gas from fields which Russia's Gazprom will develop in Eastern Siberia. Sinopec Engineering Group, may also take part in constructing the plant.
In December, Sinopec paid USD1.338 billion for a 10% stake in Sibur and said it planned to acquire an additional 10% within three years.

SIBUR is a uniquely positioned vertically integrated gas processing and petrochemicals company. We own and operate Russia’s largest gas processing business in terms of associated petroleum gas processing volumes and are a leader in the Russian petrochemicals industry. As of 31 March 2014, SIBUR operated 27 production sites located all over Russia, had over 1,400 large customers engaged in the energy, chemical, fast moving consumer goods (FMCG), automotive, construction and other industries in approximately 70 countries worldwide and employed over 27,000 personnel.
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