Two German refineries arrange additional tanker supply in Russia pipeline crisis

MOSCOW (MRC) -- Shareholders of two German refineries are arranging crude tanker shipments via the Baltic Sea in response to the halt of import flows on the Russian Druzhba pipeline, a spokesman for industry group MWV said, as per Reuters.

He said that one tanker had been discharged in the Polish port of Gdansk to ship oil to the Leuna refinery while the German port of Rostock was preparing to receive a shipment to feed to the nearby Schwedt refinery.

Both refineries had sufficient on-site inventories to keep operating for the time being, he said.

He declined to give further details, saying it is policy in the Mineraloelwirtschaftsverband to leave further internal communications up to member firms.
MRC

MOSCOW (MRC) -- Total is set to start up a biodiesel refinery using palm oil whose planned launch last summer sparked opposition from farmers producing vegetable oil and from environmental activists, reported Reuters.

The refinery in La Mede in southern France will begin production in two weeks, Chief Executive Patrick Pouyanne told journalists on the sidelines of the company’s annual shareholders’ meeting last Wednesday.

"Operationally the project is starting," he said.

The start-up of the 500,000 tons-per-year refinery has been delayed several times.

Farmers expressed concern about palm oil competing with locally produced vegetable oil and environmental activists cited the deforestation caused in producing it.

Palm oil cultivation results in excessive deforestation and its use in transport fuel should be phased out, the European Commission concluded in February, although it granted some exemptions production by smallholdings or on unused land.

Total, which has invested around 200 million euros (USD223 million) to convert the loss-making crude refining unit to biodiesel, hopes those exemptions help convince France to overturn its plan to end subsidies for adding palm oil to diesel.

"We can have a refinery that is competitive," Pouyanne said. If the French law is not changed, La Mede will not be competitive with its European peers," he said.

Total has committed to using less than 300,000 tons of crude palm oil per year at La Mede out of a total of 650,000 tons, with the rest coming from oils from other plants, recycled animal fat, cooking oil and industrial oil.

As MRC wrote before, in December 2017, Total inaugurated the new units at its Antwerp integrated refining & petrochemicals platform, which havdprogressively started up in the previous few months.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
MRC

MOSCOW (MRC) -- OMV, the international integrated oil and gas company based in Vienna, Austria, and Aker BP ASA, the oil exploration and development company headquartered in Oslo, Norway, signed a Memorandum of Understanding, committing to share digitalization competencies and technology across borders and advancing both companies’ digital agendas, said the company.

Together, the two companies will collaborate on projects that explore how to set up and execute wide-scale digital transformation processes. Aker BP will share best practices from Eureka, their digital transformation program that started two years ago. These insights will advance the digital maturity of OMV Upstream and also benefit a wide range of suppliers and partners connected to OMV’s operations. In turn, OMV will share the insights from its digitalization program DigitUP to advance the digital transformation of Aker BP.

Aker BP and OMV are also planning joint collaboration and technology projects within the areas of operational efficiency, drilling and subsurface. These projects will involve agile ways of co-developing use cases and advancing technology together with Cognite, Scandinavia’s fastest-growing technology company.

In addition to the Memorandum of Understanding between OMV and Aker BP, OMV today also formally entered into a long-term agreement with Cognite, a Norway-based company that works with heavy-asset industries. Cognite will be OMV’s technology partner in digital transformation.

As Aker BP’s technology partner for the past two years, Cognite has helped Aker BP with their digital transformation and delivered measureable bottom line results. Cognite is providing foundational digital twins for all Aker BP’s operations, and with the support of Cognite Data Fusion, Cognite’s data contextualization software, Aker BP’s digital transformation program has increased worker safety and improved worker efficiency, reduced maintenance costs, and optimized production across installations.
MRC

MOSCOW (MRC) -- Negotiations over June shipments of suspension polyvinyl chloride (SPVC) began in the Russian market on 28 May 2019. Local producers announced a price increase of Rb2,000-4,000/tonne for shipments to the domestic market, according to ICIS-MRC Price report.

Expectedly for the majority of market participants, Russian producers intend to achieve an increase in the June contract prices of suspension polyvinyl chloride (SPVC). Many consumers do not have an alternative to Russian raw materials due to a number of factors, and in such conditions customers understand that it will not be possible to avoid further price increases.

PVC supply was tight in some segments in May, and producers intend to achieve a maximum increase in contract prices - Rb4,000/tonnes in comparison with the level of May for deficient positions. The large volumes of Russian PVC exports since the beginning of the year and the insignificant volumes of imports allowed the market to be balanced in terms of supply and demand.

The shutdown of Kaustik Volgograd facilities in the middle of May even led to a slight lack of supply of K70 PVC.
Two producers together will shut down their production capacities for maintenance works in July. Bashkir soda company and Sayanskkhimplast, the total capacity of which is slightly less than 600,000 tonnes per year.

Several companies, understanding the situation with the availability of PVC in the summer months, began to contract raw materials in China and the United States in March - April . But the volume of purchases was small relative to the need for "high season", moreover, due to the complexity in logistics, the period from the moment of purchase to the moment of delivery takes up to two months.

Some Russian producers have built additional stocks of PVC for a period of high demand and scheduled maintenances. But it is likely that these stocks will not be enough to fully meet the possible demand.

June deals for K64/67 PVC were negotiated in the range of Rb79,000-80,000/tonne CPT Moscow, including VAT, for lots of less than 500 tonnes. Some producers increased prices for special brands, in particular, for K70, by Rb4,000/tonne, and the offer price for the June supply to the level of Rb84,000/tonne CPT Moscow, including VAT.
MRC

MOSCOW (MRC) -- Asahi Kasei has taken off-stream its cracker for a maintenance turnaround, according to Apic-online.

A Polymerupdate source in Japan informed that the company has commenced turnaround at the cracker on May 22, 2019. The cracker is expected to remain shut for around one month.

Located at Mizushima, Japan, the cracker has an ethylene production capacity of 570,000 mt/year and propylene production capacity of 300,000 mt/year.

As MRC reported earlier, Japan’s Asahi Kasei Chemicals shut its cracker permanently on Feb 12, 2016. The cracker in Mizushima had an ethylene capacity of 504,000 mt/year and a propylene capacity of 300,000 mt/year. Feedstock ethylene for its 390,000 mt/year of styrene monomer (SM) plant will come from a new 750,000 mt/year steamcracker which is a joint venture between Asahi Kasei and Mitsubishi Chemical. The new unified cracker started up on April 1, 2016.

Asahi Kasei Corporation is a global Japanese chemical company. Its main products are chemicals and materials science.
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