PVC production in Russia up by 1% in January-August 2019

MOSCOW (MRC) -- Overall production of polyvinyl chloride (PVC) exceeded 631,100 tonnes in the first eight months of 2019, up by 1% year on year. At the same time, not all Russian producers raised their output of PVC, according to MRC's ScanPlast report.

August production of unmixed PVC was 77,400 tonnes against 51,200 tonnes a month earlier, last month, Russian producers increased capacity utilisation after July shutdown for the shutdowns of SayanskKhimPlast and the Bashkir Soda Company. Overall PVC production exceeded 631,100 tonnes in January-August 2019, compared to 622,500 tonnes a year earlier. The increase in output from RusVinyl and SayanskKhimPlast did not allow to compensate for the decrease in output from the other two producers.

The structure of PVC production by plants looked the following way over the stated period.

RusVinyl (JV of SIBUR and SolVin) produced about 30,100 tonnes of PVC in August, with emulsion polyvinyl chloride (EPVC) accounting for 2,300 tonnes, compared to 29,500 tonnes a month earlier. Overall PVC production at RusVinyl was 226,400 tonnes in January-August 2019, up by 6% year on year.

Such a significant increase in production was a result of the absence of long maintenance works.

Last month, SayanskKhimPlast produced 18,700 tonnes of suspension PVC (SPVC), while in July this figure amounted to 3,900 tonnes; the company stopped its facilities for monthly scheduled maintenances from 5 July. The Sayansk plant managed to produce about 184,900 tonnes of resin in January-August, compared to 173,100 tonnes a year earlier.

Bashkir Soda Company in August produced about 21,100 tonnes compared to 10,700 tonnes a month earlier; the plant shut PVC production capacities two-week turnaround from 14 July. Total SPVC production at Baskhir Soda Company increased to 169,100 tonnes in the first eight months of this year, compared to 173,500 tonnes in the same period in 2018.

Kaustik (Volgograd) produced about 7,500 tonnes of SPVC in August, compared with 7,200 tonnes in July. Kaustik's overall production of PVC reached 50,700 tonnes in the first eight months of 2019 versus 62,300 tonnes a year earlier.


MRC

MOSCOW (MRC) -- South African petrochemicals company Sasol's 2019 finical results will be delayed further after additional work was commissioned under a review at its US ethane cracker project, it said, sending its share price lower, reported Reuters.

Sasol has delayed release of its 2019 financial results to a date some time before the end of next month, spokesman Alex Anderson said.

The world's biggest maker of coal-derived motor fuel had previously postponed release of its results to Sept. 19 from Aug. 19, citing possible "control weaknesses" at its Lake Charles Chemicals Project (LCCP).

"The board has resolved to commission additional work under the independent review and to stipulate for in-depth investigation into certain aspects contemplated under the original scope," Sasol said in a statement on Friday.

Shares in Sasol were down 3.6% at 261.60 rand by 0841 GMT.

The project in Louisiana, which will convert natural gas into plastics ingredient ethylene, was initially expected to cost USD8.9 billion but that 2014 forecast has since been revised to as much as USD12.9 billion.

Sasol said it would make a further announcement on its results as soon as a date has been determined.

As MRC wrote previously, Sasol's world-scale US ethane cracker reached beneficial operation on 27 August 2019. Sasol’s new cracker, the heart of our Lake Charles Chemicals Project (LCCP), is the third and most significant of the seven LCCP facilities to come online and will provide feedstock to our six new derivative units at our Lake Charles multi-asset site.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,255,800 tonnes in the first seven months of 2019, up by 9% year on year. Shipments of all PE grades increased. At the same time, the estimated PP consumption in the Russian market was 796,120 tonnes in January-July 2019, up by 11% year on year. Shipments of PP block copolymer and homopolymer PP increased.

Sasol is an international integrated chemicals and energy company that leverages technologies and the expertise of our 31 270 people working in 32 countries. The company develops and commercialises technologies, and builds and operates world-scale facilities to produce a range of high-value product stream, including liquid fuels, petrochemicals and low-carbon electricity.
MRC

MOSCOW (MRC) -- Saudi Aramco signed a Memorandum of Understanding (MoU) with China’s Zhejiang Free Trade Zone, in which the Zhoushan Government emphasized its support for incentivizing Saudi Aramco’s greater investment in Zhejiang’s future downstream growth, reported Reuters.

The MoU was signed in conjunction with a visit to Saudi Aramco’s headquarters in Dhahran by Yuan Jiajun, Governor of the Chinese province of Zhejiang.

Together with prior agreements signed during HRH Crown Prince Mohammed Bin Salman’s visit to China in February this year, this MoU facilitates Saudi Aramco’s planned acquisition of a 9% stake in the Zhejiang integrated refinery and petrochemical complex. It will also include a long-term crude oil supply agreement and the ability to utilize Zhejiang Petrochemical’s large crude oil storage facility to serve its customers in Asia. These activities reflect the Company’s strategy to expand its presence in the Chinese energy sector.

The agreement solidifies Saudi Aramco’s participation in the 400,000 barrels per day refinery from Phase III of the Zhoushan Petrochemical Greenfield project, and also allows the parties to evaluate potential opportunities for investment in other parts of the value chain. These may include refining and petrochemical production, storage and trade of crude oil and natural gas, retail, as well as distribution of oil products within the Zhejiang Free Trade Zone.

As MRC informed earlier, Motiva Enterprises LLC, a unit of global energy giant Saudi Aramco, is acquiring a materials production site from Flint Hills Resources Port Arthur LLC for an undisclosed price. The site in Port Arthur, Texas, includes production of plastics feedstocks ethylene, propylene and cyclohexane. Officials said in an 19 Aug news release that the acquisition is set to close in the fourth quarter of 2019. Flint Hills retains its other operations.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polyprolypele (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,255,800 tonnes in the first seven months of 2019, up by 9% year on year. Shipments of all PE grades increased. At the same time, the estimated PP consumption in the Russian market was 796,120 tonnes in January-July 2019, up by 11% year on year. Shipments of PP block copolymer and homopolymer PP increased.

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.
MRC

MOSCOW (MRC) - Exxon Mobil has agreed to sell its Norwegian oil and gas assets for up to $4 billion, ending its production in a country where it started operations more than a century ago, three sources familiar with the matter told Reuters.

U.S. oil major Exxon said in June it was looking to sell its Norwegian upstream portfolio, which comprises minority stakes in more than 20 fields, operated by local producer Equinor (EQNR.OL) and Anglo-Dutch oil major Royal Dutch Shell.

Norwegian daily Dagens Naeringsliv reported after the Reuters report that the buyer was Var Energi, citing anonymous sources. The deal was due to be announced at the end of September, it added. An Exxon spokeswoman said: “As a matter of practice, we don’t comment on commercial discussions." Var declined to comment.

Shares in Exxon, the world’s biggest publicly traded oil company, rose 1.7% to a session high in New York after Reuters reported a sale had been agreed.

The Irving, Texas-based company has held talks in recent weeks with a number of interested parties including Oslo-listed companies Equinor, Aker BP (AKERBP.OL), and DNO (DNO.OL), Stockholm-listed Lundin Petroleum (LUPE.ST) as well as Var Energi, backed by Italy’s Eni (ENI.MI), and private equity firm Hitech Vision, industry sources said.

Equinor, Lundin and DNO were not immediately available to comment. The three sources told Reuters that Exxon had closed the sale process in recent days with one buyer after agreeing on the terms of a sale.

Exxon hired investment bank Jefferies to run the sale process, banking sources told Reuters last month. Jefferies declined to comment.

In 2017, Exxon’s net production from fields off Norway was around 170,000 barrels of oil equivalent per day, according to its website.

The sale, if approved by regulators and completed, comes after Exxon focused in recent years on growing its onshore U.S. shale production, particularly in the Permian basin, as well as developing huge oil discoveries in Guyana.

Oslo-based consultancy Rystad Energy said in a note in June that as of Jan 1, 2019, Exxon held 530 million barrels of oil equivalent on the Norwegian Continental Shelf.

“The profile is mature and declining, but nevertheless sizeable in terms of current production. A portfolio generating high cash flow and with limited tax balances, given the Norwegian fiscal regime with 90% nominal tax relief on investment, will be highly attractive for any E&P company without sufficient revenue,” Rystad analyst Simon Sjothun said.

Exxon is also considering selling its assets in the British North Sea after more than 50 years, industry sources told Reuters last month.

MRC

MOSCOW (MRC) -- Trinseo, a global materials company and manufacturer of plastics, latex binders and synthetic rubber, and its affiliate companies in Europe have announced a price increase for all polycarbonate (PC) grades, as per the company's press release.

Effective September 3, 2019, or as existing contract terms allow, the contract and spot prices for the products listed below increased as follows:

- CALIBRE PC resins - by EUR100 per metric ton.

As MRC informed earlier, Trinseo also raised its prices for all PS grades in Europe on 1 September 2019, as stated below:

- STYRON general purpose polystyrene grades (GPPS) - by EUR100 per metric ton;
- STYRON and STYRON A-Tech high impact polystyrene grades (HIPS) - by EUR100 per metric ton.

According to ICIS-MRC Price report, July imports of PC granules and compounds to Russia, excluding deliveries from Belarus, were 2,3400 tonnes, compared to 1,840 tonnes a month earlier and 1,070 tonnes in July 2018. Last month's imports of PC granules, excluding Belarusian shipments, were 1,940 tonnes (extrusion grade PC - 1,290 tonnes, injection moulding PC - 580 tonnes, blow moulding PC - 80 tonnes) versus 790 tonnes in July 2018. In June 2019, imports of PC granules reached 1,350 tonnes. Shipments of PC granules, excluding imports of Sabic material from Belarus, rose in January-July 2019 by 87% year on year to 9,140 tonnes from 4,890 tonnes a year earlier.

Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo's technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015. Trinseo had approximately USD4.6 billion in net sales in 2018, with 16 manufacturing sites around the world, and approximately 2,500 employees.
MRC