Sinochem Hongrun Petrochemicals to produce cleaner-burning fuels with Honeywell alkylation technology

MOSCOW (MRC) -- Honeywell UOP has announced that Sinochem Hongrun Petrochemical Co., Ltd. will use Honeywell UOP's ISOALKY ionic liquids alkylation technology to produce cleaner-burning motor fuels at its refinery complex in China, as per Hydrocarbonprocessing.

Hongrun is the first petrochemicals manufacturer in China to license ISOALKY technology, a cost-effective solution for refining companies as an alternative to conventional liquid acid systems or solid catalyst systems to produce high-quality alkylate for clean-burning fuels.

Developed in conjunction with Chevron USA Inc. in 2016, the ISOALKY technology is the first successful liquid alkylation technology to be introduced in more than 75 years. The technology uses ionic liquids instead of conventional hydrofluoric or sulfuric acids as a catalyst to produce alkylate, a critical component for making high-octane motor fuels.

ISOALKY technology can be used in new refineries, as well as in existing facilities undergoing capital improvements. Alkylation units add high-octane hydrocarbons to gasoline, helping prevent knocking - or autoignition of the fuel - in an engine while helping the fuel to burn with fewer exhaust particulates.

"ISOALKY technology is a compelling solution to meeting the increased demand for cleaner-burning fuels, but with far simpler handling requirements than with conventional liquid acid technologies," said Bryan Glover, vice president and general manager of Honeywell UOP's Process Technology and Equipment business. "The ionic liquid catalyst at the heart of the process delivers equal or better yields of high-quality alkylate needed for refiners to meet new requirements for higher-octane, cleaner-burning fuels."

The technology was proven in a demonstration unit at Chevron's Salt Lake City refinery, where it operated successfully for five years, and where Chevron is currently converting its hydrofluoric acid alkylation unit to the new technology.

More than half of the world's approximately 700 refineries currently have alkylation units that use hydrofluoric or sulfuric acid.

Ionic liquids have strong acid properties that enable them to produce alkylate, but without the volatility of conventional acids. Ionic liquids are comprised largely of ions that convert C4 paraffins and other olefins into an excellent gasoline-range blending product. Due to their low vapor pressure, ionic liquids allow simpler handling procedures than sulfuric and hydrofluoric acids.

The technology also can produce alkylate from a wider range of feedstocks using a lower volume of catalyst. Operating at temperatures below 100 C, the liquid catalyst has a negligible vapor pressure and can be regenerated on-site.

Sinochem Hongrun Petrochemical Co., Ltd. produces and sells liquefied petroleum gas, diesel fuel, gasoline, asphalt, and lubricating oil. Headquartered in Qingzhou City, Weifang, China, Hongrun operates as a subsidiary of Sinochem Group.

As MRC wrote previously, in August 2018, Chinese state-run oil and chemicals group Sinochem was in advanced talks to transfer its 33.6 percent stake in a debt-laden refinery to state giant PetroChina, part of Sinochem’s plan to shed non-core assets ahead of a USD2 billion listing of its energy arm. The move is in line with a transformational strategy pushed by Sinochem chairman Ning Gaoning to zero in on core assets as it finalizes a merger with ChemChina that will create the world’s biggest industrial chemicals firm, worth around USD120 billion.
MRC

MOSCOW (MRC) -- Anadarko Petroleum Corporation announced that it intends to resume negotiations with Occidental Petroleum Corporation in response to Occidental's proposal to acquire Anadarko, which was announced by Occidental on April 24, 2019 (the "Occidental Proposal"), said the company.

As disclosed previously, Anadarko entered into a definitive merger agreement with Chevron Corporation on April 11, 2019 (the "Chevron Merger Agreement").

Anadarko is resuming its earlier negotiations with Occidental because Anadarko's board of directors, following consultation with its financial and legal advisors, has unanimously determined that the Occidental Proposal could reasonably be expected to result in a "Superior Proposal" as defined in the Chevron Merger Agreement. The Occidental Proposal reflects significant improvement with respect to indicative value, terms and conditions, and closing certainty as compared to any previous proposal Occidental made to Anadarko.

Under the Occidental Proposal, Occidental would acquire Anadarko in a transaction with consideration comprised of USD38.00 in cash and 0.6094 of a share of Occidental common stock per share of Anadarko common stock.

Under the Chevron Merger Agreement, Chevron would acquire Anadarko in a transaction with consideration comprised of USD16.25 in cash and 0.3869 of a share of Chevron common stock per share of Anadarko common stock.

The Anadarko board's determination allows Anadarko to resume negotiations with Occidental in accordance with the Chevron Merger Agreement. The Chevron Merger Agreement remains in effect and accordingly the Anadarko board reaffirms its existing recommendation of the transaction with Chevron at this time.

There can be no assurance that negotiations with Occidental will result in a transaction that is superior to the pending transaction with Chevron. Further, the terms of any transaction with Occidental may vary from those reflected in the Occidental Proposal.

Evercore and Goldman Sachs & Co. LLC are acting as financial advisors to Anadarko. Wachtell, Lipton, Rosen & Katz is acting as legal advisor to Anadarko.
MRC

MOSCOW (MRC) -- Fines for violations of air, water and waste regulations by U.S. petroleum storage facilities this year have exceeded last year's totals - without including two major Houston-area disasters in the last month still under investigation - according to a Reuters analysis of federal data, as per Hydrocarbonprocessing.

Federal and state fines of storage-tank operators totaled USD5.2 million as of April, from USD4.1 million for all of 2018 and USD2.5 million in 2017, according to data on federal and state penalties analyzed by Reuters from the U.S. Environmental Protection Agency.

U.S. petroleum storage operators have added millions of barrels of capacity since 2015 when the United States lifted a 40-year ban on crude exports.

The nation is now shipping as much as 3.6 million barrels per day (bpd) overseas, and cheap natural gas prices have fueled a boom in petrochemical production that also necessitates more storage, particularly on the U.S. Gulf Coast. With that, however, have been more air and water quality incidents.

"There have been some accidents and an awful lot of expansion," said Eric Schaeffer, executive director of nonprofit Environmental Integrity Project and a former director of civil enforcement at the EPA. “There’s been a drop in resources available for enforcement. There have been mixed signals on how much enforcement to do."

This year, the average penalty is $218,000, up from $52,000 in 2018. The total number of actions for violations of Clean Air and Clean Water Act regulations was 24, up from 17 by this time last year, the data showed.

That figure does not include two incidents in Texas for which federal and state investigations are underway, but no fines have yet been assessed.

A March fire at a Houston-area petrochemical storage facility raged for days, sending millions of pounds of carbon monoxide and other gases into the air, and leaking thousands of gallons of fuel and toxic foam into waterways.

The blaze at a site along the Houston Ship Channel in Deer Park, Texas, started when a leak from a tank containing volatile naphtha ignited and spread to others in the same complex. Those tanks hold tens of thousands of barrels of products used to boost gasoline octane, and make solvents and plastics.

Weeks later, a blast and fire at a separate plant north of Houston that makes an aviation fuel component killed one worker and injured two others.

Crude storage capacity is up 17 percent across the nation to 573.6 million barrels since 2015, according to the U.S. Energy Information Administration. Companies including LBC Tank Terminals and Moda Midstream LLC are among those expanding to handle the growing U.S. crude exports.

Operators are expanding 23 storage terminals in Texas and seven in Louisiana, according to market data provider TankTerminals. Texas terminal operators are projected to boost capacity 7 percent by the end of 2019 to 393 million barrels, TankTerminals data shows.
MRC

MOSCOW (MRC) -- The fire at Malaysian Petronas' Refinery and Petrochemical Integrated Development, or PRefChem, at the Pengerang Integrated Complex in Johor early Friday is expected to delay the start of production of olefins, polymers and MEG at the plant, according to Apic-online with reference to market sources.

Petronas said in a statement released early Friday, 12 April, that a fire and a subsequent explosion took place at the complex at 1.25 am local time.

The fire was contained within 30 minutes and the situation is under control, the state-owned refiner said. As investigations are being carried out, Petronas did not reveal details as to which units of the plant were affected by the fire.

RAPID had earlier targeted to produce ethylene by April 15, and has been running its cracker since mid-March, according to earlier reports by Platts.However, market sources said they now anticipate a delay in the production of ethylene and other downstream products.

The steam cracker at PRefChem is able to produce 1.2 million mt/year of ethylene, 600,000 mt/year of propylene and 180,000 mt/year of butadiene.

A butadiene trader said that Petronas executives had told him previously that PRefchem was targetting to export butadiene in H2 May. "I think it will be delayed now," he said.

For its downstream operations, its linear low density polyethylene and polypropylene units have been in operation since last week, with the first cargo due to be shipped, a company source said.

"We do not have any idea on the impact, and are waiting for the production report to comment," the source said.

PRefChem's polymer facilities consist of a 400,000 mt/year of high density polyethylene unit, 900,000 mt/year polypropylene plant and 350,000 mt/year LLDPE unit, which may be converted to mLLDPE production in the future, other company officials had said previously.

The company's other plants were running smoothly, according to the source, with plans to shut its 250,000 mt/year low density polyethylene plant in Kertih in August for around 45 days of maintenance, the same company source said.

There are no plans to take its 200,000 mt/year high density/linear low density polyethylene swing plant at the same site for a similar maintenance as of yet, the source added.

The LDPE plant is owned by Petlin (Malaysia), a 60%-owned subsidiary of Petronas, while the HDPE/LLDPE plant is owned by Polyethylene Malaysia in which Petronas has a 40% share.

For monoethylene glycol, its downstream 740,000 mt/year MEG unit managed to produce on-specification MEG end-March via imported ethylene. It was currently offline waiting for stable ethylene supply from the cracker unit, S&P Global Platts reported previously.

Two Southeast Asian market sources said that they expect the start up of ethylene cracker to be delayed, and in turn, the delay of the MEG unit.

As MRC wrote before, in late January 2017, Petronas said its new USD27 billion refining and petrochemical complex project in the southeast Asian country is on track for start-up in 2019. RAPID, located within the Pengerang Integrated Complex in the southern Malaysian state of Johor, is designed to have a 300,000-bpd oil refinery and a petrochemical complex with a production capacity of 7.7 MMt.

Petronas, short for Petroliam Nasional Berhad, is a Malaysian oil and gas company wholly owned by the Government of Malaysia. The Group is engaged in a wide spectrum of petroleum activities, including upstream exploration and production of oil and gas to downstream oil refining; marketing and distribution of petroleum products; trading; gas processing and liquefaction; gas transmission pipeline network operations; marketing of liquefied natural gas; petrochemical manufacturing and marketing; shipping; automotive engineering; and property investment.
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MOSCOW (MRC) -- Russian billionaire Mikhail Gutseriyev is set to gain control over a debt-ridden Afipsky oil refinery, sources said, as per Reuters.

The refinery in southern Russia has a capacity of 6 million tons per year (120,000 barrels per day). Since last year, it has been under the management of Russia’s largest bank, Sberbank, its top lender.

The sources said that a company called Forteinvest, where Gutseriyev’s son, Said, is director-general will take over the Afipsky refinery next month and will supply oil to the plant.

Business daily Kommersant citing sources said that Mikhail Gutseriyev’s Safmar company had bought a controlling stake in the refinery from the family of businessman Vladimir Kogan.

"Sberbank wants to get its money back. Forteinvest is appointed as operator," an industry source told Reuters. Sberbank declined to comment. Forteinvest did not respond to a request for comment.

Gutseriyev’s oil assets include mid-sized companies Russneft and Neftisa which combined produce 280,000 barrels per day.
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