Kinder Morgan announces additional projects to enhance capabilities at Houston ship channel facilities

MOSCOW (MRC) -- Kinder Morgan, Inc.announced a series of projects, totaling over USD170 million of capital investment, that will increase efficiency, add product liquidity, and enhance blending capabilities at its Pasadena and Galena Park terminals, part of its best-in-class refined products storage hub on the Houston Ship Channel, said Financialpost.

In response to growing customer demand, KMI’s liquids terminal platform now boasts 10 ship docks, 38 barge spots, 20 inbound pipelines providing connectivity to 10 regional refineries and chemical plants, 15 outbound pipelines, 14 cross-channel lines, and approximately 43 million barrels of storage on the Houston Ship Channel, North America’s leading port for energy exports.

KMI will invest approximately USD125 million on enhancements to its Pasadena Terminal and Jefferson Street Truck Rack, including:

Increased flow rates on inbound pipeline connections and outbound dock lines, significantly reducing vessel load times and expanding effective dock capacity. Tank modifications that will provide for butane blending and vapor combustion capabilities on 10 storage tanks, with the option to extend those capabilities to an additional 25 tanks or more.

Expansion of the current methyl tert-butyl ether (MTBE) storage and blending platform, including a dedicated cross-channel MTBE line serving vessels being loaded at Pasadena’s North Docks.

A new, dedicated natural gasoline (C5) inbound connection, enhancing customers’ blendstock supply optionality and liquidity. The improvements, which are expected to be completed by the end of the second quarter of 2020, are supported by a long-term agreement with a major refiner for approximately 2.0 million barrels of refined petroleum products storage capacity at the terminal.

In addition to the enhancements at the Pasadena Terminal, KMI will also invest more than $45 million to develop and construct a butane-on-demand blending system for 25 tanks at its Galena Park Terminal. The project will include construction of a 30,000-barrel butane sphere, a new inbound C4 pipeline connection, as well as tank and piping modifications to extend butane blending capabilities to 25 tanks, two ship docks, and six cross-channel pipelines. The project is supported by a long-term agreement with an investment grade midstream company and is expected to be completed in the fourth quarter of 2020.

“These projects speak to Kinder Morgan’s continued commitment to excellence and to improving our already best-in-class facilities along the Houston Ship Channel,” said John Schlosser, president of Terminals for KMI. “The announced improvements only serve to enhance our position as the market-leading refined petroleum products storage hub on the U.S. Gulf Coast. This offers our customers unmatched supply optionality and liquidity and modal efficiencies as they aim to maximize storage and blending economics and access domestic and global energy markets in the most cost effective manner possible."

Kinder Morgan, Inc.is one of the largest energy infrastructure companies in North America. Our mission is to provide energy transportation and storage services in a safe, efficient and environmentally responsible manner for the benefit of people, communities and businesses. Our vision is delivering energy to improve lives and create a better world. We own an interest in or operate approximately 84,000 miles of pipelines and 157 terminals. Our pipelines transport natural gas, refined petroleum products, crude oil, condensate, CO2 and other products, and our terminals transload and store liquid commodities including petroleum products, ethanol and chemicals, and bulk products, including petroleum coke, metals and ores.
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MOSCOW (MRC) -- Dow (Midland, Mich) announced that it has reached an agreement for the divestiture of its Acetone Derivatives business to Altivia Ketones & Additives, LLC, an affiliate of Altivia, a privately held producer of chemicals headquartered in Houston, Texas, said Chemengonline.

“This divestiture illustrates Dow’s disciplined approach to portfolio management with a best owner mindset,” said Jim Fitterling, chief executive officer of Dow. “It is beneficial to both parties and, in the case of Dow, is directly aligned with our more focused portfolio and goal of driving a higher return on invested capital."

The divestiture includes production assets located in Institute, West Virginia, in addition to the site infrastructure, land and utilities. Dow will remain a tenant on the Institute site, retaining ownership of certain manufacturing assets.

The transaction enables the acetone derivatives business to continue reliably and safely serving its customers. Additionally, it allows the Institute site to continue providing site infrastructure services to partners at the site. Both companies are working together on a seamless transition plan for all stakeholders. The transaction is expected to close by the end of 2019, subject to customary closing conditions.

Acetone derivatives are widely used as solvents and as chemical intermediates. They are used in the coatings industry as solvents for nitrocellulose and other cellulose ethers and for vinyl chloride-vinyl acetate and other resins. They are also used in the manufacture of pharmaceuticals, plastics, fibers and films.
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MOSCOW (MRC) -- President Donald Trump told workers at a $6 billion petrochemicals plant being built in western Pennsylvania that more big U.S. energy projects were coming as his administration rolls back environmental regulations, said Hydrocarbonprocessing.

"This is just the beginning," Trump told workers wearing hard hats at Shell's ethylene cracker plant in Beaver County, Pennsylvania. "My administration is clearing the way for other massive, multibillion-dollar investments."

He praised the Shell plant as part of "the revolution in American energy that's helping make our economy the envy of the world" and said the project would have never happened without him, although its final permits were issued before he was elected in 2016.

Trump won Pennsylvania in that election by less than 1 percentage point, and he has visited the state often ahead of the 2020 vote.

The Trump administration is pursuing a policy of "energy dominance" that seeks to maximize oil, gas and coal production in part by slashing regulations.

Last week, its Environmental Protection Agency, or EPA, unveiled a proposal that would limit the power of states to block pipelines and other energy projects, months after Trump ordered the agency to change a section of the U.S. Clean Water Act that states including New York and Washington have used to delay the building of pipelines and terminals.

At the Shell plant, Trump apparently tried to take credit for a liquefied natural gas (LNG) plant, called Cameron LNG, he visited in May. Full approvals for that plant were made before Trump was elected. "We just did one in Louisiana, it's a USD10 billion plant," Trump said.

U.S. Energy Secretary Rick Perry, who accompanied Trump to the Shell plant, has embraced an up-to USD10 billion Appalachian Storage and Trading Hub project to hold liquids from natural gas production. The project could help support the building of more petrochemical plants in West Virginia, Ohio and Pennsylvania, where a natural gas boom is at risk from falling prices.

Regional officials hope to secure a USD1.9 billion federal loan guarantee being considered by the Energy Department for the hub. But critics say that U.S. taxpayers would be on the hook if the project fails.

And environmentalists worried about plastic garbage ending up in the world's oceans slammed the hub.

The project would "expose Appalachian residents to increased harm from fracking and industrial toxic emissions, while creating more plastic trash that is filling our oceans," said Wenonah Hauter, executive director at Food & Water Watch.

Petrochemical manufacturers say that demand for plastics, used in food storage, surgical devices, and in car parts, will increase as the global middle class expands. Shell says it supports plastics recycling and reuse.
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MOSCOW (MRC) -- Huntsman Corp, the US chemicals group, is selling two of its businesses to Thailand-based petrochemicals company Indorama Ventures for more than USD2bn, said FT.

Texas-based Huntsman said in a statement late on Wednesday that the Bangkok-listed group would pay $2bn in cash and transfer about $76m of net underfunded pension and other liabilities to buy its chemical intermediaries and surfactants divisions, which make ingredients for lubricants and cleaning products.

As part of the deal, Indorama will acquire Huntsman manufacturing facilities in Texas, India and Australia.

Peter Huntsman, the US group’s chief executive, said that the deal “further transforms Huntsman’s balance sheet and future”, and was in line with its strategy of focusing more on its downstream and specialty businesses. Huntsman, with revenues of more than USD9bn last year, makes and markets differentiated and specialty chemicals, and has business in about 30 countries.

In 2017, it was forced to call off a USD20bn tie-up with Switzerland’s Clariant due to investor opposition, during a time of significant consolidation in the chemicals industry.

Indorama Ventures is part of Singapore-based Indorama Corp. The group is headed by the Indian-born Indonesian billionaire Sri Prakash Lohia and makes a range of petrochemical products, including PET, packaging, fibers, and recycled products.

Aloke Lohia, group chief executive of Indorama Ventures, said: “This acquisition is a momentous propellant in our journey towards our stated goal of being a global, diversified chemicals company with multiple, and related earnings streams."

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MOSCOW (MRC) -- U.S. crude oil stockpiles rose unexpectedly for a second week in row as refineries cut output last week, while fuel inventories posted surprise drawdowns with gasoline demand hitting a record high, the Energy Information Administration said, as per Hydrocarbonprocessing.

Crude inventories rose by 1.6 million barrels in the week to Aug. 9, compared with analysts' expectations in a Reuters poll for a decrease of 2.8 million barrels. At 440.5 million barrels, inventories were about 3% above the five-year average for this time of year, the EIA said in its weekly report.

Crude stocks at the Cushing, Oklahoma, delivery hub for U.S. crude futures fell 2.5 million barrels, the EIA said. Stocks in Cushing have declined steadily since July to their lowest in four months due to heavy activity from Midwest refiners, who tend to pull barrels from the Cushing hub.

Midwest crude stocks fell 3.3 million barrels to 132.6 million barrels, their lowest since late January.

Refinery crude runs fell by 475,000 barrels per day, EIA data showed. Refinery utilization rates fell by 1.6 percentage points to 94.8% of overall capacity.

"We might be starting to see the signs of seasonal maintenance creep in and extended maintenance coming into play and so that's one of the headwinds that oil will have to deal with," said Phil Flynn, analyst at Price Futures Group in Chicago.

Oil prices were under pressure prior to the report due to widening fears about slowed global economic growth. Following the EIA report, the market extended loses. U.S. crude futures were down $1.99 per barrel, or 3.5%, at $55.12 by 10:52 a.m. EDT (1452 GMT), while Brent fell $1.94 a barrel, or 3.1%, to $59.40.

Gasoline stocks fell 1.4 million barrels, compared with forecasts for 25,000 barrel-build and were about 4% above the five-year average for this time of year, the EIA said.

U.S. gasoline demand jumped by 281,000 bpd to a record 9.93 million bpd last week, according to EIA data going back to 1991.

Distillate stockpiles, which include diesel and heating oil, fell by 1.9 million barrels, versus expectations for a 1 million-barrel increase, the EIA data showed.

Net U.S. crude imports fell last week by 252,000 bpd. Exports rebounded from the previous week, rising to 2.7 million bpd. U.S crude production was flat last week at 12.3 million bpd.
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