Chinese October refinery output second highest on record, gas output at seven-month high

MOSCOW (MRC) -- China’s October refinery runs rose to the second highest on record for any month on a daily basis, official data showed, as refiners ramped up production amid strong margins for gasoline and diesel, reported Reuters.

The crude processing rate rose 4.6 percent from a year ago to 52.78 million tons, or 12.43 million barrels per day (bpd), just a touch off September’s record of 12.49 million bpd. The strong production echoed record crude oil imports in October.

For the first 10 months of the year, the processing rate rose 7.8 percent to 505.1 million tons, or 12.13 million bpd, data from the National Bureau of Statistics showed.

"China’s secondary industry growth and consumer spending supported major oil products consumption such as diesel, gasoline and kerosene," said Seng-Yick Tee, analyst with consultancy SIA Energy. The strong October output also reflected stock building ahead of winter, the analyst said.

Private refiners stepped up production amid a recovery in gasoline and diesel prices in October, although a two-month maintenance halt at CNOOC’s Huizhou refinery starting October eased overall crude run rates during the month.

Asia gasoline margins have since dipped into negative territory for the first time in more than 6-1/2 years, pulled down by a wave of unsold gasoline and a weaker outlook for the product market.

Privately run chemicals group Hengli Petrochemical is due to trial its 400,000-bpd crude distillate unit in November. The startup of the plant in northeast Dalian city is expected to lift refinery runs, but the main impact will only be felt in the first quarter of next year as the plant enters commercial production, company sources said.

For October, China’s crude oil output rose 0.3 percent on year to 16.09 million tons, or 3.79 million barrels per day, the second year-on-year increase recorded this year as state-run producers boosted drilling on higher oil prices.

Natural gas output last month grew 7.5 percent from a year ago to 13.4 billion cubic meters, the highest monthly amount since April, as firms stepped up production ahead of the start of this year’s winter heating season in China.

Sinopec and CNPC are speeding up drilling and exploration in the country’s western regions to boost domestic output.
MRC

MOSCOW (MRC) -- Sika Peru has opened new headquarters in the metropolitan area of Lima and introduced a modern plant for the production of concrete admixtures, mortar products, and acrylic liquid applied membranes (LAM), said the producer.

With this new plant, Sika is tripling its production capacities and strengthening its market position in Peru. At the new site in Lucumo, Sika has commissioned a modern plant for mortars and admixtures. The acrylic LAM manufacturing equipment has also been moved to the new site from the existing plant in Lurin, and further modernized. The new factory and supply center will result in a threefold increase in overall capacity. Optimal production processes and efficiency are key features of this new production plant. The new headquarters, with modern laboratories as well as new training facilities, will improve the customer experience and demonstrate the innovation power of Sika. Future expansion plans envisage the addition of facilities for the manufacturing of polymers for high-performance concrete admixtures, and waterproofing solutions for building structures.

Christoph Ganz, Regional Manager Americas: "With the new site, we have laid the foundations for further expanding our activities in Peru and sharpening our competitive position. With a population of 11 million, the greater Lima area is Peru’s social and economic powerhouse and has a flourishing construction industry. In Latin America our strategic focus is on big cities and metropolitan areas, and our aim is to fully unlock the potential of the growing market through our investment."

Substantial investment in the mining sector and in infrastructure projects is driving Peru’s construction industry. In autumn 2017, the Peruvian government launched an investment program with a volume of just under USD 9 billion. This program encompasses the construction of more than 7,500 kilometers of roads, 46,000 houses, and the renovation of drainage systems in several cities. Growth of 4.5% is expected for the construction industry in 2018.
MRC

MOSCOW (MRC) -- The Abu Dhabi National Oil Company (ADNOC) has announced it has concluded a new long-term Liquefied Petroleum Gas (LPG) sales agreement with Wanhua Chemical Group of China, according to Hydrocarbonprocessing.

Under the terms of the 10-year contract, Wanhua will purchase up to 1 million metric tonnes of LPG per annum.

The agreement, which was signed by Abdulla Salem Al Dhaheri, Marketing, Sales and Trading Director at ADNOC and Mr. Kou Guangwu, Executive Vice President of Wanhua Chemical Group, represents another important milestone in the expanding relationship between ADNOC and its partners and customers in China.

Commenting on the agreement, Abdulla Salem Al Dhaheri said: "Todays signing, of another important long-term sales agreement with a major end-user of LPG, further reinforces ADNOC’s position as a major supplier of crude oil and petroleum products to the growing economies of Asia. At ADNOC, we remain committed to achieving the best commercial value from our products, expanding our client base and penetrating new markets, through a combination of both short and long-term sales and trading opportunities."

In line with its strategy to maximise value from its downstream refining, petrochemical and gas processing operations, ADNOC produces up to 10,500,000 metric tonnes per year of LPG. This is sold both locally in the UAE and internationally.

Mr. Kou Guangwu, Executive Vice President of Wanhua Chemical Group said: "Wanhua Chemical Group is government owned but also publicly listed on the Shanghai Stock Exchange. The company has investment grade credit ratings from Moody’s, S&P and Fitch Ratings. Wanhua is one of the world’s leading chemical companies and the largest user of LPG in China. Through this long-term supply agreement, we look forward to strengthening our strategic partnership with ADNOC. We will continue working on potential collaborations between our companies, either in China or in the UAE, to add more value to the ‘One Belt One Road’ project."

Wanhua Chemical is the world’s largest MDI producer and the biggest TDI supplier in Europe. It operates a world-scale, advanced C3/C4 petrochemical industrial chain in China, as well as high value-added specialty chemical clusters.

LPG is the main feedstock for Wanhua petrochemical units, with consumption demand of up to 6 million tons per annum projected by 2021. Wanhua owns the world largest LPG underground cavern storage with total capacity of 2.4 million CBM as well as excellent port conditions with two 50K DWT dedicated VLGC berths.

As MRC reported earlier, in November 2018, Saudi Aramco and ADNOC signed a framework agreement to explore opportunities for collaboration in the Natural Gas and Liquefied Natural Gas (LNG) sector. The cooperation brings together two of the world’s leading energy producers from the Arabian Gulf to jointly work together in an area of strategic importance for both companies as they seek to boost revenues from the natural gas and LNG business segments.
MRC

MOSCOW (MRC) -- Sika has acquired the global Concrete Fibers business from Propex Holding, LLC, which includes a US plant manufacturing synthetic fibers for use in concrete reinforcement, sales operations in Sika’s three geographical regions, and a strong brand, said the producer.

The acquired business is a perfect addition to Sika’s concrete systems for high value-added solutions required in the construction of high-rise buildings and demanding infrastructure projects. The acquired business generates annual sales of CHF 30 million.

The acquisition of the Concrete Fibers business, based in Chattanooga, Tennessee, is a further step in Sika’s expansion in fibers, following the acquisitions of Radmix, Australia, and FRC Industries, USA, as well as the opening of a fiber production line in Germany. The acquired business brings the well-established Fibermesh brand and industry-leading technical expertise. Combined with Sika’s existing global fiber portfolio and concrete admixture product range, this will further expand Sika’s offering to concrete customers worldwide. Furthermore, the 12,000 m2 production facility creates significant additional capacity for both micro and macro synthetic fibers to support Sika’s growth going forward, particularly in the region Americas.

Christoph Ganz, Regional Manager Americas: "The acquisition of the global Concrete Fibers business of Propex and the Fibermesh brand is a great fit with Sika’s current portfolio. It brings even greater value to existing and new Sika customers within the ready-mix and precast concrete market. The Fibermesh brand is the industry standard for quality and performance. As part of Sika, we see enormous growth opportunities for Fibermesh, especially in our solutions for construction in big city environments and for our Tunneling & Mining business. We are very happy to welcome the Fibermesh employees to our Sika team."
MRC

MOSCOW (MRC) -- KBR, Inc. has announced that it has been awarded a contract by Linggu Chemical Co. Ltd (Linggu) for an ammonia plant in Yixing City, Jiangsu Province in China, as per Hydrocarbonprocessing.

Under the terms of the contract, KBR will provide the technology licensing and basic engineering design (LBED) package for building a new 1,500 metric tons per day ammonia synthesis unit as a replacement for one of their existing units in Yixing, China. The plant will utilize KBR's proprietary ammonia synloop technology.

KBR's ammonia synloop provides a cost-effective ammonia synthesis solution with low energy consumption, and low CAPEX and OPEX for a reliable and efficient plant. This is the second grassroots ammonia synthesis unit for Linggu using KBR technology. KBR licensed the first synloop unit to Linggu in 2015.

"With KBR's advanced ammonia synthesis technology, we believe our plants will stand out in the coal-to-ammonia market in China," said Mr. Tan Fuyuan, Chairman of Linggu.

"We are honored to deliver this second ammonia unit to Linggu," said John Derbyshire, KBR President, Technology. "This project award showcases the superiority of KBR's Ammonia Synthesis Technology and its great fit for the market needs in China."

KBR is a leader in ammonia technology and has been involved in the licensing, design, engineering, and/or construction of more than 230 grass roots ammonia plants and over 100 revamp ammonia projects globally.

As MRC wrote before, this autumn, KBR, Inc. Houston was awarded contracts for a technology license, basic engineering design services and proprietary catalyst supply by Lihuayi Lijin Refining & Chemical Co., Ltd., for a new olefins production unit in Dongying, China. The unit will use KBR’s proprietary Catalytic Olefins Technology (K-COT) and Selective Cracking Optimum Recovery (SCORE) Technology.
MRC