Cosmo petrochemical subsidiary failed to properly inspect some products

MOSCOW (MRC) - Japan's Cosmo Energy Holdings said on Friday its subsidiary, Maruzen Petrochemical Co, failed to properly inspect 30 percent of its products for petrochemicals and tyres, the latest quality assurance scandal involving a Japanese company, said Hydrocarbonprocessing.

Maruzen Petrochemical said it was involved in "inappropriate conduct regarding quality inspection" on 21 products such as propylene and benzene produced at its two factories.

It said it failed to conduct some of the tests and analysis on products that are outlined in contracts with customers.

Maruzen Petrochemical President Masaru Nabeshima told reporters the misconduct had no impact on quality or safety and that it has continued to supply products to customers. The revelation is the latest in a slew of scandals to rock Japan's manufacturing industry. Similar lapses have occurred at Kobe Steel and Toray Industries Inc, and incorrect final inspection procedures have been found at automakers Nissan and Subaru.

As of now, it does not appear that any laws have been broken, the company said. The products in question are likely to have been shipped to 121 corporate customers, it said.

President Nabeshima said the company would set up an internal investigative committee to make thorough checks on the issue and come up with measures to prevent their recurrence by around April. Cosmo Energy Holdings has a 52.7 percent voting right in Maruzen Petrochemical. Other major shareholders include Ube Industries, Denka Co and JNC Corp. A Cosmo Energy spokeswoman said some of the products in question had been manufactured by Maruzen's naphtha cracker at its Chiba plant, adding that it had rectified the misconduct by late January. The revelation would not lead to a halt in manufacturing units operated by Maruzen or Cosmo, she said.

Shares in Cosmo Energy fell as much as 10 percent before closing down 2.5 percent, against a 0.9 percent decline in the Nikkei average.
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MOSCOW (MRC) - Russia's energy minister and senior executives from Russian oil majors discussed the quality of Russian oil on Tuesday, a day after Reuters reported some European refiners are threatening to cut purchases due to worsening quality, as per Reuters.

The quality of Russia's flagship Urals oil grade was one of the topics on the agenda at a meeting at the energy ministry in Moscow between the executives and the minister, Alexander Novak, the ministry said in a statement. A ministry spokeswoman declined to comment on the outcome of the meeting. A source familiar with the discussions, who spoke on condition of anonymity, said no decision has been taken on how to tackle the worsening quality. The source said though there is concern in the ministry that the quality issues could lead to a drop in the price of Urals.

The meeting at the energy ministry was attended by, among other executives, Vagit Alekperov, president of Russia's No.2 oil producer Lukoil, Vladimir Bogdanov, the head of Russia's third largest oil producer Surgutneftegaz and Pavel Fedorov, a vice president of country's largest oil company Rosneft. Maxim Grishanin, the deputy chief executive of Russian oil pipeline monopoly Transneft was also present, according to a Reuters reporter who was at the ministry.

European refineries which process Russian oil have been complaining about the worsening quality of Urals, including rising sulphur content and higher gravity, making the oil harder to refine. The quality has deteriorated so much that several buyers are reviewing how much they buy and the price they are willing to pay for it, according to traders and sources close to European refiners. Some industry sources linked the drop in quality to rising supplies of the lighter, higher-quality ESPO blend to China.

The oil exported by Russia is a blend of crude cargoes of different chemical compositions, that are mixed inside the domestic pipeline network. If better-quality cargoes are diverted eastwards, that results in a lower aggregate quality being exported to Europe. The worsening quality of Urals has had a negative effect on prices. On Monday, Urals crude differentials in northwest Europe eased to their lowest levels since October on sluggish demand for the grade.
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Russian companies significantly reduced PP imports in December to 10,400 tonnes from 16,300 tonnes a year earlier. Imports of propylene homopolymer (homopolymer PP) raffia and block copolymers of propylene (PP block copolymer) decreased. Overall, 171,200 tonnes of propylene polymers were imported in 2017, compared to 167,200 tonnes a year earlier. Deliveries of homopolymer PP accounted for a major reduction, whereas PP block copolymers accounted for the greatest increase in imports.

Overall, the structure of PP imports by grades looked the following way over the stated period.

December imports of homopolymer PP fell to 2,400 tonnes from 4,500 tonnes a month earlier, shipments of homopolymer PP raffia from Central Asia, particularly, from Turkmenistan, decreased significantly because of technical issues of the local producer. Overall imports of this PP grade reached 55,100 tonnes last year, compared to 72,400 a year earlier.

December imports of PP block copolymers were 1,900 tonnes versus 3,300 tonnes in November. Local companies reduced their purchasing of PP block copolymer for extrusion injection moulding in Europe. Imports of PP block copolymers into Russia rose to 43,000 tonnes in 2017, compared to 30,800 tonnes a year earlier.

Imports of PP random copolymers dropped to 3,200 tonnes in December from 3,600 tonnes a month earlier, local pressure pipes producers reduced their purchasing of PP under the pressure of seasonal factors, whereas purchases of injection moulding PP increased. Overall imports of this propylene copolymers grade totalled 33,600 tonnes in 2017, compared to 34,800 tonnes a year earlier.

Imports of other propylene polymers were 39,300 tonnes over the stated period, compared to 29,200 tonnes a year earlier.

MRC

MOSCOW (MRC) -- The construction of a polypropylene plant in Azerbaijan’s Sumgait city will be completed in the second quarter of 2018, reported Vestnik Kavkaza with reference to head of SOCAR Polymer company’s planning department Vugar Aslanov.

"The work has been completed by 97.2%. The detailed engineering work has been completed by 99.9%, production and delivery - by 99.6%, while construction work - by 93.4%," he said at the conference on expansion of production of import-substituting products in industry by using local raw materials in Baku.

According to Aslanov, this year 70,000-71,000 tons of polyethylene are planned to be produced at the plant. The plant will reach the full production capacity of 180,000 tons next year.

"We intend to launch test work in April, while production will begin in June 2018," abc.az cited him as saying.

As MRC informed before, in October 2015, State Oil Co. of Azerbaijan Republic (SOCAR) subsidiary Azerikimya Production Union (PU) has entered two units into operation at its ethylene and polyethylene (PE) plant in Sumgait, north of Baku.

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 the State Oil Company of the Azerbaijan Republic (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.
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MOSCOW (MRC) -- Honeywell UOP has announced that its Callidus low-nitrogen oxides (NOx) burner technology has been selected by Sinopec Beijing Yanshan Petrochemical Co., Ltd. (Yanshan) to help meet China's new NOx emission regulations, as per Hydrocarbonprocessing.

More than 400 burners used in Yanshan's ethylene process units have been revamped and achieved reductions of 40 to 50 percent of NOx emissions from ethylene furnaces. In addition, Honeywell UOP is providing these process units with engineering, performance verification testing, burner fabrication and service.

Under new government standards in China, emissions of nitrogen oxides from industry furnaces are required to drop from 150 to less than 100 milligrams per cubic meter this year. These pollutants are the primary cause of acid rain and increased surface ozone concentration, which have serious and direct impacts on public health and the environment.

"Our record of project experience around the globe can help Sinopec comply with new environmental regulations and gain economic value by improving their return on investment without sacrificing performance or the environment," said Henry Liu, vice president and general manager, Honeywell UOP China. "Since we opened a new research and test facility in China in 2015, we have developed low-emission and energy efficient combustion technology for customers in China and across Asia."

Among the technologies Honeywell UOP developed to meet new emissions standards are high-performance low-NOx Callidus process burners. These burners are designed to meet NOx reduction requirements for fired heaters in refinery and petrochemical plants, where space is limited and temperatures typically reach 1200 degrees Celsius. Callidus burners can be customized to meet requirements of all types of applications, including refinery heaters, reformers, ethylene crackers, coker units, and CCR (continuous catalytic reforming) and propane dehydrogenation process heaters.

As a subsidiary of Sinopec Group, Sinopec Beijing Yanshan Petrochemical Co., Ltd. processes more than 10 million tons of crude oil and produces more than 800,000 tons of ethylene products annually. The company was established in 1970 and operates one of China's first modern, large-scale integrated refining and petrochemical complexes.

As MRC informed previously, in 2013, Sinopec Maoming Co. selected Honeywell to rejuvenate and improve the operational performance of aging petrochemical plants in China’s Guangdong Province. Honeywell said then its Profit Suite R400 process optimization software would be deployed at two of Maoming’s ethylene crackers, "helping to improve plant performance by increasing energy efficiency, improving flexibility of its operations, and maximizing the plants’ yield of high-value products." The two plants have been operating for more than 50 years and currently produce 1-million t/y of petrochemicals, Honeywell noted.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group's key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.
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