A. Schulman, Citadel trial opens in Delaware

MOSCOW (MRC) -- A trial pitting materials firm A. Schulman Inc. against Citadel Plastic Holdings LLC began April 16 in Delaware Chancery Court in Wilmington, Del., as per Plasticsnews.

A spokesperson for Fairlawn, Ohio-based Schulman confirmed that the trial is underway but had no further details. The firm is seeking damages related to its USD800 million acquisition of Citadel in early 2015. Issues related to the Citadel acquisition — including questions about material quality — led to financial problems at Schulman.

Schulman filed the suit in June 2016. The firm is seeking unspecified damages from former Citadel owners including Huntsman Gay Capital Partners and Charlesbank, as well as from several former Citadel executives, including Michael Huff and Matthew McDonald.

Most of Schulman's accusations center around Lucent Polymers, an Evansville, Ind.-based compounding firm that Citadel bought in late 2013. According to the original court filing, Schulman "never would have purchased, much less paid $800 million for Citadel had it know that [Lucent] was engaging in fraudulent business practices that … substantially reduced [Citadel's] profitability and growth prospects."

Schulman also has accused Citadel/Lucent of falsifying certificates of analysis given to customers that exaggerated flame retardant properties and other characteristics of the compounds that Lucent was making. "Knowledge of this pervasive fraudulent scheme … went all the way to the top," Schulman officials said in the filing. "Lucent and Citadel officers and directors knew of and condoned these wrongful practices."

Judge J. Travis Laster is hearing the case. Schulman is being represented by Wilmington lawyer Paul Lockwood. Legal information on Citadel was unavailable on the court's web site. In February, Schulman agreed to be acquired by LyondellBasell Industries for USD2.25 billion.

Separately, Schulman officials in January said that federal officials are undertaking a criminal investigation related to the lawsuit. In a Jan. 9 earnings call, Schulman President and CEO Joseph Gingo said the FBI has identified Schulman as a possible crime victim.

A November court ruling said that several former Citadel employees in October were served with subpoenas requiring them to produce documents as part of the FBI investigation. Those former employees included executives Huff, McDonald, Kevin Andrews, Jason Jimerson and Mario Sandoval.

Schulman posted sales of almost USD2.5 billion for fiscal 2017. The firm ranks as a leading compounder and concentrates maker in both North America and Europe and as one of Europe's leading resin distributors.
MRC

MOSCOW (MRC) - Russia's imports of polypropylene (PP) slightly exceeded 45,000 tonnes in first three months of this year, up 28% year on year, compared to the same period of 2017. Supply of all grades of PP increased, according to a MRC's DataScope report.

Russian companies increased volumes PP imports in March, which reached 16,400 tonnes against 14,200 tonnes in February; shipments of propylene homopolymers (homopolymer PP) and block copolymers of propylene (PP block copolymer) increased. In general, PP imports into Russia exceeded 45,000 tonnes in January-March 2018, compared with 35,100 tonnes year on year. The import for all grades of propylene polymers increased, the greatest increase in supplies accounted on homopolymer PP.

Overall, the structure of PP imports by grades looked the following way over the stated period.
March imports of homopolymer PP grew to 6,000 tonnes against 4,600 tonnes a month earlier, shipments of homopolymer PP raffia from Uzbekistan and Turkmenistan increased. Overall imports of homopolymer PP reached 15,500 tonnes in the first three months of 2018, compared to 10,700 a year earlier.

March imports of PP block copolymers in Russia decreased to about 4,300 tonnes against 3,200 tonnes in February. Local companies increased purchasing of PP block copolymers for extrusion pipes in Europe. Imports of PP block copolymers into Russia rose to 11,200 tonnes in January-March 2018, compared to 10,800 tonnes a year earlier.

March imports of PP random copolymers remained in the level of February at about 2,500 tonnes. Total imports of PP random copolymers in Russia were 7,700 tonnes in January - March 2018, compared with 6,500 tonnes year on year. The greatest increase in supply accounted for pipe propylene copolymers.

Imports of other propylene polymers for the reported period increased to about 10,600 tonnes compared with 7,100 tonnes in the same time a year earlier.


MRC

MOSCOW (MRC) - Poland's biggest oil refiner PKN Orlen said that a shipment of 130,000 tonnes of Iranian crude oil has arrived at the Baltic seaport of Gdansk, as per Reuters.

Most of the oil refined in Polish refineries comes via pipelines from Russia, but state-run PKN Orlen and Lotos are increasingly buying from other sources, including Iran and the United States.

"Delivery from Iran has become a fact. Oil from the Middle East gives us many opportunities. First of all, it enables diversification of delivery directions and increases the energy security of the state," PKN said in a statement.

The Iranian oil, which is lighter than the Russian crude and contains less sulphur, will be refined at PKN’s plant at Plock, northwest of Warsaw. PKN said that earlier tests of the Iranian oil “confirmed its significant potential".

It took a month for the Delta Kanaris tanker to transport the Iranian cargo from the Kharg island to Gdansk.
MRC

MOSCOW (MRC) -- LetterOne chairman Mikhail Fridman does not expect recent U.S. sanctions against Russian oligarchs will hamper his company’s oil deal with BASF, as per Neftegaz.

This is according to the Russian Interfax which cited Fridman as saying L1 and BASF still planned to consolidate oil assets "despite new spiral of sanctions pressure".

LetterOne and Germany’s BASF in December 2017 signed a letter of intent to merge their oil and gas businesses into a joint venture named Wintershall DEA. Closing could be expected in the second half of 2018.

Lord Browne, former BP CEO, and currently the Executive Chairman of L1 Energy and Chairman of the Supervisory Board of DEA said the deal would make Wintershall DEA will be one of Europe’s largest independent E&P Companies.

As for the sanctions, the U.S. Treasury Department last Friday designated Russian oligarchs and officials. Among the notable oligarchs designated in the U.S. Treasury list are energy industry names such as Oleg Deripaska, Suleiman Kerimov, and Kirill Shamalov. Gazprom’s head Alexey Miller is also on the list but as a Designated Russian Government Official.

Additionally, non-U.S. persons could face sanctions for knowingly facilitating significant transactions for or on behalf of the individuals or entities blocked today, the U.S. Treasury said on Friday, April 6.

LetterOne’s Mikhail Fridman is not on this list.
MRC

MOSCOW (MRC) -- Rabigh Refining & Petrochemical Co. (Petro Rabigh), a joint venture of Saudi Aramco and Sumitomo Chemical, said its Rabigh Phase II project has achieved on-spec production at the aromatics and ethylene propylene rubber (EPR) units, as per GV.

The aromatics and EPR units are the last two of 12 units to start production at the site. Petro Rabigh recently began production at the cumene, phenol, methyl tertiary butyl ether/isobutylene, metathesis, methyl methacrylate, naphtha reformer, polymethyl methacrylate, low-density polyethylene, thermoplastic olefin and polyamide 6 units.

The SAR 34 billion project also included expanding ethane production to 1.6 million t/y from 1.3 million t/y, where operations began in 2016, as well as units to produce ethylene propylene rubber, thermoplastic polyolefins, methyl methacrylate, polymethyl methacrylate, low-density polyethylene/ethylene vinyl acetate, paraxylene/benzene, cumene and phenol/acetate.

PetroRabigh, a joint venture between Saudi Aramco and Japan's Sumitomo Chemical, has an annual output capacity of 18 million tonnes of refined products and 2.4 million tonnes of petrochemicals. Thus, the complex currently has a cracker to produce 1.3-million t/y of ethylene and 900,000 t/y of propylene, as well as downstream production of polyethylene, polypropylene, propylene oxide, ethylene glycol and butene-1.
MRC