US refiner Phillips 66 enters offshore oil export race

MOSCOW (MRC) -- US oil refiner Phillips 66 is proposing a deepwater crude export terminal off the US Gulf Coast, the company said on Wednesday, challenging at least eight other projects aiming to send US shale oil to world markets, according to Hydrocarbonprocessing.

The project, called Bluewater Texas Terminal LLC, signals another major expansion of its logistics operations. The fourth-largest US refiner last week formed joint ventures to build pipelines linking shale fields in West Texas and North Dakota to the Cushing, Oklahoma, oil hub and the US Gulf Coast.

Phillips 66 has applied for federal and state permits to build an export port about 20 miles (32 km) off Corpus Christi, Texas, and related crude pipelines, according to documents viewed by Reuters and people familiar with the filings.

The people did not want to be named because the information is not public.

The project, which is being developed with the Port of Corpus Christi, would compete with nearby shale export terminals proposed by investor Carlyle Group and commodities trader Trafigura AG. Its project would be at least the ninth project proposed for the Gulf Coast.

US crude exports hit 3.12 million barrels per day (bpd) this month from zero before the US lifted a ban on exports in late 2015. Shale oil from fields in Texas, Colorado, New Mexico and North Dakota is projected to push US output to 12.32 million bpd this year, according to US forecasts.

Phillips 66’s proposed project "would provide an additional safe and environmentally sustainable solution for the export of abundant domestic crude oil supplies from major shale basins to global markets," spokesman Dennis Nuss said.

The offshore port would provide an outlet for oil coming from recently proposed Liberty and Red Oak pipeline joint ventures that start in early 2021. Phillips will operate the USD1.6 billion Liberty pipeline and help finance the USD2.5 billion Red Oak pipeline.

Phillips 66 aims to reinvest 60 percent of its annual cash flow into its business, Chief Executive Greg Garland said on Tuesday during a presentation at a JPMorgan Chase & Co energy conference in New York. He did not mention the project at the conference.

"We’ll do USD1.5 billion to USD2.5 billion of growth investments" and spend a similar amount of cash flow on share buybacks each year, Garland said.

Bluewater Texas Terminal has proposed to run two 30-inch oil pipelines to buoys off San Jose Island in San Patricio County, according to a May 2019 document outlining the project.

The facility could load up to 1.56 million bpd, nearly the capacity of a supertanker. If approved by the U.S. Maritime Administration, U.S. Coast Guard and Texas regulators, operations could begin in mid-2021, said a person familiar with its plans.

Phillips 66 currently owns a 25% stake in Buckeye Partners LP’s South Texas Gateway export terminal, which is under construction in Corpus Christi.

US pipeline operator Enterprise Products Partners LP in May had hired RBC Capital Markets LLC to advise on the sale of its 50% stake in a recently completed Corpus Christi oil export terminal, according to a marketing document viewed by Reuters.

As MRC wrote previously, US-based Phillips 66 remains open to developing another ethane cracker for its Chevron Phillips Chemical (CP Chem) joint venture, the refiner's CEO said in March 2018.
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MOSCOW (MRC) -- Packaging and tubing supplier Tekni-Plex Inc. has completed its acquisition of three manufacturing facilities from Amcor Flexible Packaging that serve medical device OEMs, said Canplastics.

The acquisitions were first announced in late-April, and the terms of the deal have not been disclosed.

Located in Madison and Milwaukee, Wis., and Ashland, Mass., the facilities provide a broad portfolio of sterilizable medical device packaging substrates, including coated and uncoated Tyvek, heat-seal and cold-seal coated paper and films, medical-grade laminates, and die-cut lids and labels, Wayne, Pa.-based Tekni-Plex said in a statement.

Combined, the three plants employ approximately 150 workers.

"The acquisition expands our complex packaging solution portfolio for medical device manufacturers, many of whom have been supplied by our Colorite, Natvar and Dunn medical products businesses for decades,” said Paul Young, president and CEO of Tekni-Plex. “The acquisition of these three plants also brings us 150 highly qualified and experienced employees who form the backbone of the business. We are happy to welcome them to the Tekni team of 3,000 strong across the world."

This is the eleventh acquisition Tekni-Plex has made in the past five years, supporting its strategy to grow its business though transformative acquisitions and strategic add-ons, the company said.

As MRC informed earlier, Amcor Ltd. has entered into an agreement to buy an Indonesian flexible packaging business, Jakarta-based Bella Prima Packaging Ltd., for USD25.2 million.

Amcor Limited is an Australian-based multinational packaging company. It operates manufacturing plants in 42 countries. It is the world's largest manufacturer of plastic bottles.
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MOSCOW (MRC) -- Qatar Petroleum has signed an agreement with Chevron Phillips Chemical to build a new petrochemicals complex, part of plans by the world’s top liquefied natural gas (LNG) exporter to broaden its energy interests, said Reuters.

The project highlights how Middle East oil producers are expanding further into petrochemicals, used in the production of plastics and packaging materials, to move into new markets and find new sources of income beyond exporting crude oil and natural gas.

Saudi Arabia’s and UAE’s national oil companies have both already announced plans to boost their refining capacity and petrochemicals operations.

Qatar is one of the most influential players in the LNG market due to its annual production of about 77 million tonnes, which is expected to grow about 43 percent by 2024 from a major expansion to the country’s North Field, the world’s largest natural gas field, which it shares with Iran.

The new petrochemical plant will be built north of Doha in Ras Laffan Industrial City and will come online by 2025 and tap the increased North Field production for feedstock, Qatar Petroleum CEO Saad al-Kaabi told a news conference.

MRC

MOSCOW (MRC) -- LG Chem, a South Korean petrochemical major, has restarted its Deasan cracker following an unplanned outage, as per Apic-online.

A Polymerupdate source in South Korea, informed that, the company has resumed operations at the cracker on June 18, 2019. The cracker was shut owing to a technical issues on June 8, 2019.

Located at Daesan,South Korea, the cracker has an ethylene capacity of 1.27 million mt/year and propylene capacity of 650,000 mt/year.

As MRC reported earlier, the company already shut its cracker in Daesan for an unscheduled maintenancethis month - from 2 to 4 June.

We also remind that LG Chem is planning to spend USD2.4-billion to expand its naphtha cracking center (NCC) and polyolefin (PO) plant in Yeosu, South Korea. The project, which will expand the NCC and PO facility by 800,000 t/y each, is expected to be completed in the second half of 2021.

LG Chem Ltd., often referred to as LG Chemical, is the largest Korean chemical company and is headquartered in Seoul, South Korea. According to ICIS report, it is 15th biggest chemical company in the world in 2011. It has eight domestic factories and global network of 29 business locations in 15 countries. LG Chem is a manufacturer, supplier, and exporter of petrochemical goods, IT&E Materials and Energy Solutions.
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MOSCOW (MRC) -- Singapore-based polyolefin supplier Borouge Pte. Ltd. is making investments in specialized grades of polyethylene to meet demand for higher-quality pipe in Asia, including in response to China upgrading its water pipe standards, said Plasticsnews.

CEO Wim Roels declined to release details of the investment, but a company news release said it was a "significant" increase in capacity for specialized precompounded black PE resin for pressure pipe applications for Asian markets and would be completed next year.

In an interview at Chinaplas, held May 21-24 in Guangzhou, Roels said the investment will come at the company's facility in Ruwais, United Arab Emirates.

He said China's Water Standards Committee last year adopted new rules for PE pipe that will promote the use of precompounded materials. The new capacity is also targeting Africa, the Middle East and other parts of Asia-Pacific, including the Indian subcontinent, Southeast Asia and Australia, he said.

"Countries are moving," he said. "China has now decided to use precompounded black material for water pipe.

"This will improve the quality of pipe," Roels said. "At the end, we believe it's crucial to secure quality standards for pipe. If you put pipe in the ground, it's supposed to be there for 50 years plus, up to 100 years."

He said the adoption of higher standards as China has done is important for the company's market development because without more stringent rules, "there are always cheaper solutions" for pipe infrastructure. But he said lower-quality pipe can leak water or, in the case of gas, cause explosions.

"This is a raising of the standard, a raising of the quality requirements, which I believe long term is the right thing to do," Roels said. "We are leading support to this development of new standards like China did. Substandard pipe is very dangerous for society and for the industry.

"We have been pioneering in these countries black pipe, precompounded pipe as a solution," he said. "That's a position we want to maintain and we want to further develop."

Roels said most of Borouge's business in China that targets the domestic market, like pipe, is doing well.

The automotive sector is struggling and some of Borouge's export-oriented customers are pinched because of the trade conflict with the United States, but in general the market in China is in good shape for Borouge, he said.

"Overall, we still see the business is quite good," he said. "So far we see that most of the businesses we are serving are actually doing quite OK. They're more domestic, and domestic demand fundamentally has not changed very much."

Even with China's economic growth slowing to 5 or 6 percent, as the world's second-largest economy, that's still "massive" growth, he said.

The announcement of added capacity for pipe materials comes shortly after Borouge announced an expansion of its petrochemical complex in Ruwais, including what would be the world's largest mixed-feed cracker with an ethylene output of 1.8 million metric tons.

Borouge is a joint venture of Vienna, Austria-based Borealis AG and the Abu Dhabi National Oil Co.
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