Singapore-based IEG to start trading crude oil, tap China demand

MOSCOW (MRC) -- Singapore-based trading start-up International Energy Group (IEG) this year plans to expand its portfolio to crude oil from products such as gasoline and gasoil, looking to tap growing Chinese demand, as per Hydrocarbonprocessing.

World No.2 oil consumer China posted record crude import growth in 2016 on demand from independent refiners, with shipments expected to increase again this year.

"We will probably look at importing crude and some light components (such as ethylene) from the West, particularly the US," Artun Gursel, the company's book leader and trading manager, told Reuters on Tuesday. He is IEG's sole trader.

IEG, a subsidiary of Singapore-listed New Silkroutes Group (NSG), started trading oil products in 2015 by leasing storage in South Korea and selling fuel to Southeast Asian countries, said Gursel, declining to give trade volumes.

"There's growth in products trading in middle distillates because of exports from China," Gursel added, as well as noting the company would look to boosting trade with Southeast Asia.

IEG is also working with an asset management unit under parent company NSG to look at energy infrastructure investment that could support its oil trading.

"Oil markets are so transparent that business models that you develop tend to last no more than two years. So you have to control businesses under your own name through infrastructure investments," said Gursel.

"This environment of low oil prices and logistics costs will not stay," he said, adding that this is a good opportunity to acquire assets such as oil tankers or investing in distribution networks or terminals.

Earlier this month, NSG announced that it had bought an 80% stake in New York-based CG Capital Markets Holdings, which will be renamed New Silkroute Capital.

The acquisition provides NSG access to western funds and a financial platform that allows it to accept the currencies of trading partners, such as the Chinese yuan, said IEG executive director Nelson Goh.

We remind that, as MRC wrote before, in June 2016, DuPont opened its previously announced new Asean headquarters and technology center in Singapore. The headquarters will house the administrative offices of DuPont businesses in agriculture and nutrition, biobased industrials and advanced materials, as well as nutrition and health laboratories.
MRC

MOSCOW (MRC) -- CB&I has announced it has been awarded a contract by Dongguan Grand Resource Science & Technology Co. Ltd. for the license and engineering design of a grassroots propane dehydrogenation unit to be built in Dongguan City, Guangdong Province, China, as per Hydrocarbonprocessing.

The unit will use CB&I's CATOFIN catalytic dehydrogenation technology and Clariant's CATOFIN catalyst to produce 600,000 mtpy of propylene. This unit has been optimized to reduce equipment piece-count and lower propane consumption.

"CB&I is pleased to have been selected by Dongguan Grand Resource to provide the CATOFIN technology license for this new petrochemical facility in China," said Philip K. Asherman, CB&I's President and Chief Executive Officer. "Our CATOFIN technology continues to demonstrate low cost of production while providing proven reliability and flexibility to our customers."

As MRC informed before, in December 2015, China-based Hengli Petrochemical (Dalian) Refinery awarded a contract to CB&I to use its Catofin catalytic dehydrogenation technology for a grassroots propane and butane dehydrogenation unit to be constructed in Dalian of Liaoning Province. Under the deal, CB&I will license and provide engineering design for the proposed dehydrogenation unit. As well as CB&I's Catofin technology, the unit will use Clariant's Catofin catalyst to process 300,000t per annum of propane and 600,000t per year of isobutane feedstock for jointly produce propylene and isobutylene.
MRC

MOSCOW (MRC) -- Fertiliser producer Israel Chemicals (ICL) reported a smaller than expected drop in fourth-quarter profit and revenue on Wednesday, helped by its speciality products and record potash sales, said Reuters.

ICL, which produces about a third of the world's bromine and is the sixth-largest potash producer, has sought to counter low commodities prices by diversifying into products such as advanced additives and speciality fertilisers.

The Israel Corp subsidiary, which has exclusive permits in Israel to extract minerals from the Dead Sea, said that the prolonged commodities downturn had reduced minerals margins and that potash prices remain its main challenge this year despite a modest recovery from trough levels.

Net income excluding one-off items was USD114 million for the three months to Dec. 31, against USD180 million a year earlier and a forecast of USD73 million by Thomson Reuters I/B/E/S.

Revenue dropped 6 percent to USD1.34 billion, beating a forecast of USD1.29 billion.

Israel Chemicals Ltd., also known as ICL, is a multi-national manufacturing concern that develops, produces and markets fertilizers, metals and other special-purpose chemical products. ICL serves primarily three markets: agriculture, food and engineered materials. ICL produces approximately a third of the world’s bromine, and is the world’s sixth-largest potash producer. It is a manufacturer of specialty fertilizers and specialty phosphates, flame retardants and water treatment solutions.
MRC

MOSCOW (MRC) -- Asahi Kasei has concluded a joint venture agreement with China National Bluestar (Group) Co., Ltd. (Bluestar), a subsidiary of China National Chemical Corp. (ChemChina), for the integrated production and sale of Xyron modified polyphenylene ether (mPPE) in China, including its intermediate materials 2,6-xylenol and polyphenylene ether (PPE), said the company on its site.

A final investment decision is conditional upon receipt of antitrust clearance, procedures to establish the joint venture, and detailed evaluation of the economics of the joint business.

Under its "Cs for Tomorrow 2018" medium-term management initiative, Asahi Kasei is advancing a strategic global expansion of its engineering plastics business in the Material sector centered on automotive applications. Xyron mPPE, in particular, is expected to enjoy strong demand growth in China in environmental and energy applications including electric vehicle battery modules and solar panel components. Currently, Asahi Kasei manufactures intermediate materials for mPPE in Singapore, and its global production capacity for Xyron is 62,000 tons per year.

The joint venture with Bluestar will enable Asahi Kasei to expand its business for mPPE in the strategically important Chinese market.

Bluestar, China’s only manufacturer of 2,6-xylenol and PPE, sought to expand capacity to meet growing demand and to enter the mPPE business. The joint venture to manufacture and sell 2,6-xylenol, PPE, and mPPE will leverage Bluestar’s technology for 2,6-xylenol and PPE together with Asahi Kasei’s mPPE compounding technology and applications development capability to facilitate further expansion in the growing Chinese market.

Asahi Kasei Corporation is a global Japanese chemical company. Its main products are chemicals and materials science.
MRC

MOSCOW (MRC) -- BASF has suffered a further setback at its Ludwigshafen plant which makes materials for soft foams used in mattresses and car seats, saying a technical defect in a new reactor would reduce output into next year, said Reuters.

Production downtimes often raise global prices of the material, known as TDI, and BASF's glitch might give a boost to competitors such as Bayer's Covestro, Wanhua, Mitsui and Dow Chemical.

With 780,000 t in annual capacity of TDI, BASF is the largest supplier in the market. BASF has spent more than USD1.1 billion on the Ludwigshafen complex, or roughly 20 percent of its annual investment budget for plant and equipment.

The German chemicals group had to stop production at the 300,000-tpy complex at the end of November 2016 because of a damaged reactor.

Production with a smaller backup reactor will be restarted at reduced rates in the next few weeks, BASF said on Wednesday, followed by intermittent shutdowns, but it will take until some time next year for the replacement reactor to be delivered and fully ramped up.

Covestro, for its part, had to reduce output of precursor chemicals for both rigid and soft foams for almost three months late last year due to a supplier's outages.

In a statement BASF said: "Due to the long delivery time for the new reactor, BASF expects the final repair work to be completed in 2018. The supply to customers is secured via BASF's global TDI production network."

Due to unforeseen complexities, BASF had previously been struggling to fully ramp up production at the TDI facility at Ludwigshafen, which was inaugurated in November 2015.

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