SABIC posts 55% decline in H1-2019 profit

MOSCOW (MRC) -- SABIC, of which 70% was acquired by Saudi Aramco from the kingdom’s Public Investment Fund (PIF) in March 2019, has recorded a decline of 54.5% in H1-2019 profits, with the drop attributed to “lower average selling prices and decrease in share of results of associates and joint ventures”, said Refiningandpetrochemicalsme.

Profit during the first half of 2019 reached USD1.5bn from USD3.3bn in the same period last year, the company said in a stock market filing.

H1-2019 revenues reached USD19.5bn, down 14% from H1-2018’s corresponding figure of USD22.7bn.

Quarterly results at the Riyadh-based firm followed the trend, declining by 68.6% to reach USD565.3mn in Q2-2019 from Q2-2018's USD1.8bn.

Q2-2019 revenues also dropped 17% for SABIC to reach USD9.6bn, down from Q2-2018's USD11.7bn.

MRC informed earlier, SABIC has announced that the company is making significant investments in expanding the capacity of its ULTEM and EXTEM high heat resin production in order to meet growing demand.
The new production plant in Singapore is due to come on-stream in the first half of 2021, making SABIC the only high heat resin producer with manufacturing capability in all regions.

SABIC is a global chemical company, employing over 540 people across two sites in Teesside. Its Wilton site is located on Wilton International, one of the UK’s leading process manufacturing sites.
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MOSCOW (MRC) -- Asahi Kasei has decided to expand its plant for the artificial suede LamousTM in Nobeoka, Miyazaki Prefecture, Japan, by four million m2/year, increasing the total production capacity to 14 million m2/year upon completion in 2021, said the company.

Dyed by Italian company Miko, LamousTM is sold under the brand name DinamicaTM in Europe. Lamous™ is a premium artificial suede featuring a unique three-layered microstructure. Because of its luxurious smooth texture and flexibility in design as well as superior environmental characteristics, the material can be found worldwide in a wide variety of applications including automotive interiors, furniture upholstery, IT accessories, or apparel. Sold in markets around the world, Lamous™ is enjoying particularly strong demand growth in auto-motive interiors and IT accessories. With the capacity expansion, Asahi Kasei will further strengthen its supply capabilities in this growing market.

The production at the plant in Nobeoka, Miyazaki Prefecture, Japan, is currently undergoing a capacity increase from six million m2/year to ten million m2/year. Starting from the second half of fiscal year 2019 (April 2019 – March 2020), the capacity will be further increased from then ten million m2/year to 14 million m2/year. The start-up of the plant with maximum capacity is scheduled for the second half of fiscal year 2021 (April 2021 – March 2022).

Koushiro Kudou, President of the Strategic Business Unit “Performance Products” at Asahi Kasei comments: “Asahi Kasei is determined to contribute to a more sustainable society. In Europe, Lamous™ is dyed by Italian company Miko and marketed under the brand name Dinamica™ mainly as material for automotive interiors. Partly made of recycled polyester, Lamous™ is processed with water-based polyurethane, making it a rather eco-friendly material. With our sustainable products and technologies, our Lamous™ business will further contribute to the growing market for artificial suede.”

The three-layer structured LamousTM is made of front, back, and core layers. They are three-dimen-sionally entangled with microfibers, and the core layer is composed of a fine, specially-woven fabric called “scrim,” which improves strength and dimensional stability. Impregnation with water-based polyurethane imparts a soft and highly flexible texture.
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MOSCOW (MRC) -- Saudi Arabia's Energy Minister Khalid al-Falih said state-run Saudi Aramco's talks with Reliance Industries to buy a minority stake in the Indian conglomerate's refining assets have not stalled, reported Reuters.

"The two companies, Reliance and Aramco, are talking with a lot of goodwill, with good intention," al-Falih told Reuters in an interview on Thursday.

Reliance, controlled by Asia's richest man Mukesh Ambani, operates the world's biggest refining complex with capacity to process 1.4 million barrels per day (bpd) of oil at Jamnagar in western India.

State-owned Aramco, the world's biggest oil producer, plans to boost investment in refining and petrochemicals to secure new markets for its crude amid a recent demand slowdown.

Reuters reported on Tuesday that talks between the companies had hit a roadblock as Reliance was keen on a higher valuation.

But Falih, who met Indian oil minister Dharmendra Pradhan in New Delhi on Thursday, said he was 'optimistic' that a deal between the two companies would work out.

"We still see daylight. We will announce the terms when they are concluded," he said.

Aramco and the United Arab Emirates' national oil company ADNOC teamed up with state-run Indian refiners last year in a plan to build a 1.2 million barrel per day refinery.

But the plan has faced delays as farmers refused to surrender land, forcing the Maharashtra government to find a new location.

India has invited Saudi Arabia to help build its strategic petroleum reserves, Pradhan tweeted after his meeting with Falih.

Pradhan asked Saudi Arabia to continue to ensure balance in oil markets, and raised concerns over disturbances in the Strait of Hormuz affecting the movement of crude and gas tankers.

Saudi is the second biggest oil supplier to India after Iraq.

Falih said the kingdom will supply additional oil to India if required. New Delhi has suspended purchases of Iranian oil from May, under pressure from U.S. sanctions against Tehran's nuclear programme.

As MRC wrote previously, in October 2018, Saudi Aramco signed a long-term deal with Zhejiang Rongsheng to supply crude oil to the Chinese company’s new refinery in eastern China.

Saudi Aramco is an integrated oil and chemicals company, a global leader in hydrocarbon production, refining processes and distribution, as well as one of the largest global oil exporters. It manages proven reserves of crude oil and condensate estimated at 261.1bn barrels, and produces 9.54 million bbl daily. Headquartered in Dhahran, Saudi Arabia, the company employs over 61,000 staff in 77 countries.

Reliance Industries is one of the world's largest producers of polymers. Thus, the company produces among others polypropylene, polyethylene and polyvinyl chloride.
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MOSCOW (MRC) -- The Texas Attorney General office filed a lawsuit Friday against Valero Energy for ongoing air pollution at its Port Arthur refinery in Texas, according to Hydrocarbonprocessing.

The lawsuit was filed in the Travis County District Court in Austin, Texas on behalf of the Texas Commission on Environmental Quality (TCEQ). The Attorney General's office claims that the Port Arthur refinery has engaged in air emissions violations since 2014, including releases of benzene, particulate matter, sulfur dioxide, volatile organic compounds and hydrogen sulfide.

“For several years, the Refinery has been plagued with continuing problems associated with operator errors and equipment malfunctions resulting in emissions events that emit unauthorized air contaminants into the environment. Since 2014, approximately 38 emissions events occurred at the Refinery - events caused by operator errors or equipment malfunctions.,” the Attorney General's office said in the filing.

The suit alleges that despite enforcement taken by the TCEQ and the US Environmental Protection Agency against Valero for past violations, "poor operational, maintenance and design practices continue to cause emissions events and unauthorized emissions of air contaminants from the Refinery into the environment."

According to the Houston Chronicle, Valero Energy spokeswoman Lillian Rojas said the refiner is working to address the concerns.

"Valero is committed to working cooperatively with the TCEQ and Attorney General to resolve the State of Texas’ enforcement concerns, Rojas said. "Valero takes compliance seriously and has made substantial strides in reducing emissions from the Port Arthur Refinery.

Harris County in Texas plans to sue Valero Energy Corp for pollution from its Houston refinery, the head of the county’s environmental law department said.

The suit will be brought under a provision of the US Clean Air Act that allows citizens to sue over pollution, said Rock Owens, managing attorney of the environmental practice group in the Harris County Attorney’s Office.

In recent years, environmental groups like the Sierra Club and Environment Texas have filed citizen lawsuits against refineries and chemical plants, but it is rare for governments to do so, Owens said.

"It’s been extremely unusual in Texas," he said. "I can’t speak to the rest of the nation."

The lawsuit, which would be filed in federal court must be preceded by a 60-day notice to Valero, the nation’s second largest refiner, the Texas Commission on Environmental Quality and the US Environmental Protection Agency. Owens expects that notice will be issued this summer.

The Valero refinery is bordered on one side by the Manchester neighborhood in east Houston along the Houston Ship Channel. Residents of the largely Hispanic neighborhood have repeatedly blamed pollution from area refineries and chemical plants for health problems.

"This is an area where people have been crying for relief for years," Owens said.

As MRC reported before, in early May 2018, CB&I has announced that its CDAlky technology had been selected by Valero Refining - New Orleans LLC for its St. Charles Alkylation Project located in Norco, Louisiana
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MOSCOW (MRC) -- The gasoline-producing unit at Marathon Petroleum Corp’s 585,000-barrel-per-day (bpd) Galveston Bay Refinery in Texas City, Texas, may remain shut for two to eight weeks for repairs, reported Reuters with reference to sources.

The 140,000-bpd gasoline-producing Fluidic Catalytic Cracking Unit 3 (FCCU 3) was shut on June 29 to repair a leak, the sources said.

The refinery’s 65,000 bpd reformer, called Ultraformer 4, is also shut down, according to the sources.

A Marathon spokesman was not immediately available to discuss operations at the refinery, which is the second-largest in the United States and the largest the company owns.

To repair the sour water stripper, which removes ammonia and hydrogen sulfide discharged by FCCU 3, Marathon may have to rebuild a needed transformer, which could take eight weeks, the sources said. If a replacement can be purchased, the repairs may only last two weeks.

"If they find one they can buy, it will be about two weeks before they can start again," one of the sources said. "The transformer they need is hard to get."

FCCU 3 was originally shut on June 29 to repair a leak in the regenerator section of the unit.

FCCUs are divided into two sections. In the reactor section, the fine powder catalyst mixes with gas oil under high heat and pressure to convert the gas oil into unfinished gasoline.

The catalyst then goes to the regenerator section to have excess carbon removed so it can be recycled into the reactor.

When FCCU 3 was shut in late June the key naphtha desulfurization unit (NDU) was also shut. The NDU, which removes sulfur in compliance with U.S. environmental rules, has restarted.

The reformer converts low-octane naphthas into octane-boosting components blended into gasoline.

As MRC wrote previously, on April 29, 2018, Andeavor, Marathon, Mahi Inc. and Andeavor LLC entered into an Agreement and Plan of Merger (the "Merger Agreement") providing for the acquisition of Andeavor by Marathon through a merger of Mahi Inc. with and into Andeavor, with Andeavor surviving the merger as a wholly owned subsidiary of Marathon and the subsequent merger of Andeavor with and into Andeavor LLC, with Andeavor LLC surviving the merger as a wholly owned subsidiary of Marathon.
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