PVC imports to Ukraine fell by 46% in H1 2019, exports down by 6%

MOSCOW (MRC) -- Imports of suspension polyvinyl chloride (SPVC) into Ukraine decreased by 46% in the first half of 2019 year on year to about 21,000 tonnes. At the same time, sales of Ukrainian PVC to foreign markets dropped by 6% year on year, according to a MRC's DataScope report.

Last month's SPVC imports to the Ukrainian market fell to 2,600 tonnes from 2,900 tonnes in May, local companies significantly reduced their purchasing in foreign markets in the past two months amid high prices and sufficient supply from the domestic producer. Overall SPVC imports reached 21,000 tonnes in January-June 2019, compared to 38,800 tonnes a year earlier.

European producers with the share of about 69% of the total imports were the key suppliers of resin to the Ukrainian market in the first half of 2019. USA producers with the share of about 31% were the second largest suppliers.
Stronger demand for Ukrainian PVC from the domestic market led to lower imports. 13,400 tonnes of suspension were shipped to foreign markets in June, whereas this figure was 16,400 tonnes a year earlier. Overall, over 80,000 tonnes of PVC were shipped for export in January-June 2019 versus 84,700 tonnes a year earlier.

MRC

Refiners test the waters with exports of IMO 2020-compliant fuel

MOSCOW (MRC) -- Refineries in Taiwan and South Korea are testing the market for fuels that meet new rules for low-sulfur ship fuel starting next year, exporting some cargoes of very low-sulfur fuel oil (VLSFO) this month, said Hydrocarbonprocessing.

Oil market participants are uncertain what kind of fuel product shipping companies will use to meet the International Maritime Organization's (IMO) 0.5% sulphur standard for ship fuels starting in 2020. The VLSFO shipments demonstrate that this type of fuel is a viable option that refineries could readily market.

The refiners in Taiwan and South Korea have redirected low-sulfur feedstocks, that would normally undergo further refining into gasoline, toward making the VLSFO, with 0.5% or less sulfur content, as a result of recent low profits for gasoline and to test their ability to produce the fuel.

One refining official based in Seoul said their plant primarily runs high-sulfur crude oil so they take the fuel oil produced after initial refining and remove the sulfur through a residue desulphurization process. Instead of passing the feedstock through a residue fluid catalytic cracker (RFCC) to make gasoline, they are selling it as VLSFO.

He declined to be named as he is not authorized to speak to the media. This would "reduce gasoline output while increasing LSFO output so the gasoline market could recover," the official said.

Taiwan's Formosa Petrochemical, South Korea's GS Caltex, S-Oil Corp and Hyundai Oilbank Corp have sold VLSFO cargoes since June, Reuters has reported. More VLSFO supply could offset demand for marine gasoil (MGO), a more expensive alternative that is being considered by shippers.

Consultancy Energy Aspects said in a report that the "growing VLSFO production provides a threat to diesel demand in 2020 and provides a floor to Asian gasoline markets as more FCCs trim runs to free up VGO to be blended into VLSFO."

Formosa has sold two July cargoes, their first exports of VLSFO in at least a decade, in a pre-marketing effort, company spokesman K.Y. Lin said.

"We'll see how big the market can be," he said, adding that the company also plans to supply VLSFO to tankers calling at its refinery in Mailiao, Taiwan.

GS Caltex sold three VLSFO cargoes for July to September delivery and the company's spokesman said it plans to increase supplies by replacing fuel oil used at their refineries for power generation with liquefied natural gas (LNG).

However, gasoline margins have rebounded this month, reducing the incentive for refiners to switch production.
MRC

Iran set to invest in south Indian refinery

MOSCOW (MRC) -- Iran is ready to invest in the expansion of a South Indian refinery, an Iranian official said in New Delhi, as the country seeks new avenues of growth amid debilitating U.S. sanctions, said Reuters.

Iran has seen a massive drop in export earnings which is eating into funds for social development. This has raised questions that it might not invest in the expansion of a refinery in South India where it already holds a minority stake.

Iran’s participation has also been questioned after India cut back its Iranian crude oil imports following U.S. sanctions and stopped them completely from May.

“We have announced our readiness for that (to invest in the refinery),” said Ali Chegeni, ambassador of Iran in India. “We have no limit to work with India whether an investment, whether any kind of joint venture, we are ready for that.”

India was Iran’s top oil client after China, but halted imports after Washington withdrew exemptions in May to eight nations, including India, who were earlier allowed to import some Iranian oil. Naftiran Intertrade, the Swiss subsidiary of National Iranian Oil Company, holds a 15.4% stake in Chennai Petroleum Corporation Ltd, a subsidiary of India’s biggest state-owned refiner Indian Oil Corp Ltd.

Indian Oil has about 52 percent share in the refinery. Chennai Petroleum plans to invest up to 356.98 billion rupees (USD5.1 billion) to replace the 20,000 bpd Nagapattinam refinery in Southern Tamil Nadu state with a 180,000 bpd plant.

Chegeni said he hoped that Bank Pasargad, a major Iranian bank which offers commercial and retail services, will soon open a branch in India and will directory deal with India’s UCO Bank and IDBI Bank Ltd that were handling India’s oil payments in rupees to Tehran.

India was paying for oil imports in rupees before suspending its purchases.
MRC

Shenhua Ningxia resumes No. 3 PP unit

MOSCOW (MRC) -- Shenhua Ningxia Сoal Industry (SNCG), a subsidiary of Shenhua Group, one of the largest petrochemical producers in China, has restarted its (coal-to-propylene) No. 3 polypropylene (PP) unit, according to Apic-online.

A Polymerupdate source in China informed that the company has resumed operations at the unit on July 14, 2019 following a maintenance turnaround. The unit was shut on June 25, 2019.

Located at Ningxia province of China, the No. 3 PP unit has a production capacity of 300,000 mt/year.

As MRC informed previously, SNCG brought on-stream its linear low density polyethylene (LLDPE) plant on January 19, 2019, following an unplanned outage. The unit remained off-line for around one week owing to technical issues.Located at Ningxia province of China, the plant has a production capacity of 450,000 mt/year.

Shenhua Ningxia Coal Industry Group Co., Ltd. engages in coal mining and washing, coal deep processing, coal chemical industry, electric power, real estate, and other businesses.
MRC

US Gulf of Mexico oil, gas producers begin restarting after Barry

MOSCOW (MRC) -- US oil companies began restoring some of the more than nearly 74% production shut at US Gulf of Mexico platforms ahead of Hurricane Barry, reported Reuters with reference to the US offshore drilling regulator's statement.

There was 1.3 million barrels per day (bpd) of oil production off line in the US-regulated areas of the Gulf of Mexico on Monday, about 80,000 barrels less than on Sunday, according to the US Bureau of Safety and Environmental Enforcement (BSEE).

Workers also were returning to the more than 280 production platforms evacuated. It can take several days for full production to be resumed after a storm leaves the Gulf of Mexico.

Anadarko Petroleum, BHP Group and Chevron on Monday said they had begun returning staff to evacuated platforms and were in the process of restoring operations.

Barry went ashore in central Louisiana as a category one hurricane with at least 74 miles per hour (119 km per hour) on Saturday after emerging into the Gulf from Florida earlier in the week. On Monday, it was a tropical depression and dropping up to four inches (10 cm) of rain on Arkansas on Monday.

In its wake, offshore natural gas production in the Gulf of Mexico was down 61%, or 1.7 billion cubic feet per day (cfd), on Monday, BSEE said.

The amount of gas flowing to Cheniere Energy Inc's Sabine Pass liquified natural gas (LNG) export facility in Louisiana, rose to a one-week high of 3.7 billion cfd.

Last week, the amount of gas flowing to Sabine fell to a 13-week low of 2.9 billion cfd on Thursday, according to Refinitiv.

Most refineries in southeast Louisiana kept running through the storm except for Phillips 66's 253,600 bpd Alliance, Louisiana, refinery, which the company began restarting on Monday.

The Alliance refinery was shut on Friday due to the threat of flooding and a mandatory evacuation order in Plaquemines Parish, where the refinery is located along the Mississippi River.
MRC