Siemens and Covestro strengthen strategic partnership as part of digitalization

MOSCOW (MRC) -- Siemens AG and Covestro Deutschland AG have concluded a Joint Business Development Plan to provide further strategic reinforcement of their trust-based partnership for many years, particularly in the field of digitalization, as per Hydrocarbonprocessing.

This is based on the corporate ethos of the two companies which is both innovative and geared towards sustainability. The agreement, therefore, helps make life simpler and safer through continuous improvement and future-oriented products.

The variety of topics is exceptionally broad and extends from the continuous development of production technologies to piloting new ideas which contribute to shaping the digital landscape of both companies.

Dr. Klaus Schafer, Chief Technology Officer, Member of the Executive Board, Covestro Deutschland AG: "This collaboration with Siemens generates added value for both companies. We are combining the innovative forces of both companies to extend our lead in this time of rapid development."

One focal point of the collaboration is to increase the availability of all assets in a plant and to give personnel on site quick and meaningful decision-making tools for their work. The objective is to make the plants more reliable through proven products and innovative services and to be able to predict developments in the condition of a plant’s assets more reliably.

New analytical methods are now available using Siemens’ open, cloudbased IoT operating system, MindSphere. Significant data and measured values are collated on this platform, put into a meaningful context, and intelligently linked in data models. Smart data applications provide support for both operation and maintenance. They enable potential asset or component defects to be predicted, as well as helping to minimize plant downtime. New options are available through Siemens’ data analytics and simulation methods. On this basis, the partnership will examine various applications and evaluate, for instance, the benefit to be gained from correlating data for production.

Eckard Eberle, CEO of the Business Unit Process Automation, Siemens AG: "I am very pleased with this new stage of our concerted collaboration with Covestro Deutschland AG. By exchanging expertise, we can support plant operations and maintenance with the right information at the right time, particularly with smart data for production, plant equipment and instrumentation."

Siemens is developing predictive process data models for manufacturing which, among other things, minimize breakdowns; other developments include mobile devices for use in the field, and software solutions which can communicate with process technology and control and management systems. Further to this, Covestro Deutschland AG is introducing its process technology and production expertise to generate joint marketing solutions.

As MRC wrote before, in May 2018, Bayer Group sold 28.81 million shares representing a 14.2 percent interest in Covestro at a price of 75.50 euros per share. The proceeds of this sale totaled 2.2 billion euros. Bayer AG now holds just 6.8 percent of Covestro shares to repay the exchangeable bond that matures in 2020. Bayer AG acquired these shares from Bayer Pension Trust, which now no longer holds any Covestro shares.

We also remind that on 1 September, 2015, Bayer MaterialScience became known as Covestro. The plans for the carve-out of Bayer MaterialScience were announced in September 2014.

Covestro (formerly Bayer MaterialScience) is an independent subgroup within Bayer. It was created as part of the restructuring of Bayer AG from the former business group Bayer Polymers, with certain of its activities being spun off to Lanxess AG. Covestro manufactures and develops materials such as coatings, adhesives and sealants, polycarbonates (CDs, DVDs), polyurethanes (automotive seating, insulation for refrigerating appliances) etc.
MRC

Idemitsu founding family to accept Showa Shell merger

MOSCOW (MRC) -- Idemitsu's founding family will drop its opposition to plans for a merger of Idemitsu Kosan and Showa Shell Sekiyu, paving the way for the Japanese oil firms to combine, reported Reuters with reference to Nikkei.

The family, led by descendants of founder Sazo Idemitsu and which has a little over 28 percent stake in Idemitsu, has said the two firms are too different for any merger to work, while the Idemitsu management says the combination is necessary to compete in Japan's shrinking oil products market.

In agreeing to a merger, the family, led by Shosuke Idemitsu, has demanded a pledge to maintain the principles held by founder Sazo Idemitsu and two board seats for family members at the combined company, the Nikkei said on Wednesday, without citing sources.

Idemitsu, which acquired a little over 31 percent stake in Showa Shell in 2016, agreed to bring on the eldest son of Idemitsu Chairman Emeritus Shosuke Idemitsu as a director, it added.

Idemitsu has resumed discussions with major shareholders, the refiner said, adding no formal decisions have been made as yet. The founding family's spokesperson said they could not confirm the report immediately.

A few members of the founding family have agreed to the merger, while Shosuke Idemitsu is still opposing it, Jiji news agency reported on Wednesday.

Talks on the merger are continuing and no decisions have been made, Showa Shell said.

The boards of Idemitsu and Showa Shell are set to meet in mid-July to make a final decision on the merger through a stock swap and have the matter up for approval at the extraordinary shareholders' meeting within a year, the Nikkei added.

Idemitsu management had long been keen to merge its operations with Showa Shell as shrinking gasoline demand in the country pushes the industry to consolidate, but has been locked in a battle with the Idemitsu founding family for about two years.

The combined firm would account for about 30 percent of domestic gasoline sales, coming second only to JXTG Holdings , which was created last year from JX’s takeover of TonenGeneral Sekiyu and controls about half of domestic oil sales.

Shares in Idemitsu ended 13.6 percent higher at 3,980 yen, while Showa Shell jumped 8.5 percent after the news, compared with a 0.3 percent decline in the benchmark Nikkei share average .

Idemitsu Kosan is a Japanese petroleum company. It owns and operates oil platforms, refineries and produces and sells petroleum, oils and petrochemical products. The company runs two petrochemical plants in Chiba and Tokuyama. The two naphtha crackers can produce up to 997,000 tonnes of ethylene per year.
MRC

PE imports to Ukraine remained in Jan-May 2018 at the level of last year

MOSCOW (MRC) -- Imports of polyethylene (PE) into the Ukrainian market virtually remained in the first five months of 2018 at the last year's level, totalling 100,600 tonnes. At the same time, the high density polyethylene (HDPE) and ethylene-vinyl acetate (EVA) segments accounted for a reduction in imports, according to MRC's DataScope report.


Last month's PE imports to Ukraine rose to 23,900 tonnes from 17,400 tons in April, local companies significantly reduced their purchasing of all grades of ethylene polymers. Overall PE imports reached 100,600 tonnes in January-May 3018, which virtually corresponded to the figure a year earlier. HDPE imports decreased significantly because of the resumption of the domestic production, demand for EVA also subsided, whereas shipments of other ethylene polymers increased.

The supply structure by PE grades looked the following way over the stated period.


Last month's HDPE imports to the Ukrainian market increased significantly, with PE for the production of plastic bottle caps accounting for the main increase in shipments. Total imports were 7,200 tonnes, compared to 4,800 tonnes in April. Overall HDPE imports reached 31,100 tonnes in the first five months of 2018, compared to 42,900 tonnes a year earlier. Film grade HDPE accounted for the greatest reduction in imports (60%), which was caused by the resumption of the local production.

May imports of low density polyethylene (LDPE) grew to 7,100 tonnes from 5,200 tonnes a month earlier, local companies increased their purchases of LDPE in Russia. Overall LDPE imports reached 31,600 tonnes over the stated period, up by 24% year on year.

Last month's imports of linear low density polyethylene (LLDPE) were 8,200 tonnes, compared to 6,400 tonnes in April. Overall LLDPE imports rose to 32,000 tonnes in January-May 2018 versus 25,500 tonnes a year earlier. Local stretch films producers accounted for the main increase in imports.

Imports of other PE grades, including EVA, totalled 5,700 tonnes over the stated period, compared to 6,900 tonnes a year earlier.

MRC

PP imports to Ukraine increased by 7% in January-May

MOSCOW (MRC) -- Ukraine's polypropylene (PP) imports totalled 50,000 tonnes in the first five months of the year, up 7% year on year.
Demand for all PP grades increased, as per MRC DataScope.

May PP imports into Ukraine rose to 11,400 tonnes, compared with 10,200 tonnes in April; the main increase accounted for the supply of Middle Eastern PP. Overall imports of propylene polymers reached 50,000 tonnes in January-May 2018, compared to 46,600 tonnes a year earlier. Demand for all PP grades increased, but PP block copolymers accounted for the greatest growth.

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

May imports of homopolymer PP to the Ukrainian market grew to 8,500 tonnes from 7,300 tonnes a month earlier. The main increase occurred for the supply of homopolymer PP raffia grade from Saudi Arabia. Overall shipments of homopolymer PP reached 36,000 tonnes in the first five months of 2018, down by 2% year on year.

May imports of PP block copolymers into the country increased to 1,300 tonnes, compared with 0,800 tonnes in April. Demand for injection moulding propylene copolymers improved from local companies. About 5,400 tonnes of PP block copolymers were imported over the stated period, whereas this figure was slightly over 5,000 tonnes a year earlier.

May imports of PP random copolymers exceeded 1,300 tonnes versus 1,800 tonnes a month earlier, demand for PP increased from pipes producers. Overall imports of PP random copolymer reached 7,500 tonnes in January-May 2018, whereas this figure was 5,200 tonnes a year earlier.

Overall imports of other propylene copolymers totalled about 1,000 tonnes over the stated period.


MRC

SIDPEC chooses Honeywell propylene technology for new complex in Egypt

MOSCOW (MRC) — Honeywell announced that Sidi Kerir Petrochemicals Co. (SIDPEC) has chosen Honeywell UOP’s C3 Oleflex technology to produce 500,000 metric tons per year of on-purpose propylene at SIDPEC’s refinery in Amerya, near Alexandria, Egypt, as per Hydrocarbonprocessing.

Honeywell also will provide the process design package, proprietary and non-proprietary equipment, on-site operator training, technical services for startup and continuing operation, and catalysts and adsorbents for the project. Including this project, Honeywell UOP’s Oleflex technology has been selected for 52 out of 64 propane and isobutane dehydrogenation projects globally since 2011. When completed, the SIDPEC unit will be the first Oleflex unit operating in Egypt.

"This plant will allow SIDPEC to expand its portfolio and take advantage of domestically produced propane to make products such as polypropylene,” said John Gugel, president of Honeywell UOP. “The Oleflex technology converts propane into high-quality propylene, which is rising in demand, particularly in growing economies."

According to IHS Markit, annual demand for polypropylene in Africa was 1.9 million metric tons in 2016. But due to rapid population growth and urbanization, this demand is expected to rise by an additional 1 million metric tons in the next decade. Egypt is the top consumer of polypropylene in Africa, consuming about 4.4 kg per capita, and demand there is projected to grow by more than 5 percent annually through 2022.

Honeywell UOP’s C3 Oleflex technology uses catalytic dehydrogenation to convert propane to propylene and is designed to have a lower cash cost of production and higher return on investment among competing technologies. Its low energy consumption, low emissions and fully recyclable, platinum-alumina-based catalyst system minimizes its impact on the environment. The independent reaction and regeneration sections enable steady-state operations, improved operating flexibility, and a high on-stream factor and reliability.

Honeywell UOP also licenses C4 Oleflex technology, which converts butanes to butylenes, the primary ingredient for making high-octane fuel additives and synthetic rubber. Since the technology was first commercialized in 1990, Honeywell UOP has commissioned 30 Oleflex units for on-purpose propylene and isobutylene production. Global production capacity of propylene from Oleflex technology now stands at nearly 7 million metric tons per year from 20 operating units.
MRC