PKN says refineries oil supply secure despite Saudi attacks

MOSCOW (MRC) -- Despite attacks on Saudi Arabian oil facilities, Poland’s PKN Orlen says oil supplies to its refineries are secure due to its diversified sourcing and it does not expect near-term fuel prices in Poland will rise, reported Hydrocarbonprocessing.

State-run PKN, whose Plock refinery crude used to be sourced almost exclusively from Russia, started to diversify its buying a few years ago aiming to reduce its reliance on Russian supply.

That approach helped PKN keep Plock running when deliveries of Russian oil via the Druzhba pipeline were suspended in April due to contamination.

PKN Orlen has a long-term deal with Saudi Aramco on deliveries of 300,000 tonnes of crude per month.

It was also supposed to receive up to 800,000 tonnes of crude oil from Saudi Aramco Products Trading company in six spot deliveries between May and October.

"We are in constant contact with Saudi Aramco. Supplies to the Orlen Group refineries are secured," the PKN press office said in an-email sent to Reuters on Monday evening, noting it receives oil from various sources.

"The next oil transport will be delivered from Nigeria at the end of September. We will soon inform you about further deliveries from other directions," PKN said.

The Plock refinery receives around 1.4 million tonnes of crude per month, 700,000 tonnes of which comes from non-Russian sources, including 300,000 tonnes from Saudi Arabia. In total, PKN’s refineries - in Poland, the Czech Republic and Lithuania - receive 30% of their crude oil from outside Russia.

"We are constantly monitoring the situation on the oil markets, also in the context of recent events in Saudi Arabia. However, it is too early to clearly state to what extent they will translate into the oil market in the coming months," PKN said.

"The current information does not constitute a risk of changes in the structure of fuel supply on the Polish market and should not affect prices in the near future".

Saudi Arabia is the world’s biggest oil exporter and the attack on state-owned producer Saudi Aramco’s crude processing facilities at Abqaiq and Khurais has cut output by 5.7 million barrels per day. The company has not given a timeline for the resumption of full output.

As MRC wrote previously, in H1 September 2019, Honeywell announced that PKN ORLEN had licensed the UOP MaxEne process, which can increase production of ethylene and aromatics and improve the flexibility of gasoline production. The project, for the PKN ORLEN facility in Plock, Poland, currently is in the basic engineering stage. Honeywell UOP, a leading provider of technologies for the oil and gas industry, first commercialized the UOP MaxEne process in 2013. The process enables refiners and petrochemical producers to direct molecules within the naphtha feed to the processes that deliver the greatest value and improve yields of fuels and petrochemicals.

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.

PKN ORLEN would be the first refining and petrochemicals company in Europe to use the Honeywell UOP MaxEne technology for molecule management of a naphtha stream to produce high-quality products including olefins, aromatics and gasoline.
MRC

MOSCOW (MRC) - Export deliveries of injection moulded PET chips from the Lithuanian company Neo Group to Ukraine in January-August increased by 3% compared to the same period last year and amounted to 24,400 tonnes against 23,600 tonnes year on year, according to MRC DataScope.

At the same time, August imports of Lithuanian PET into the country more than doubled - from 2,300 tonnes to 4,900 tonnes. Deliveries of Lithuanian PET in August accounted for 45% from total imports against a share of 16% in July and 26% in August last year.

The main buyers of Lithuanian bottled PET were Coca-Cola Beverages Ukraine Limited and Retal.

The company increased supplies of material to Ukraine, despite the force majeure, announced in July of this year.

It was earlier reported that the Lithuanian Neo Group, one of the largest European producers of polyethylene terephthalate (PET), announced force majeure circumstances on 10 July on the supply of PET from a plant in the city of Klaipeda (Lithuania) due to technical problems on the back of the shortage of purified terephthalic acid (PTA) - to a new PET line at this site. Force majeure at this plant with a total capacity of three lines of 480,000 tonnes/year (160,000 tonnes/year each) is still in force. The lines operate at reduced loading.

Closed Joint Stock Company (CJSC) "Neo Group" is one of the largest producers of polyethylene terephthalate (PET) chips in Europe.
The company's enterprises are located in Lithuania, not far from Klaipeda seaport. The total production capacity of the plants is 320,000 tonnes/year, which is 12% of the quantity of PET produced in Europe. Neo Group CJSC is a part of Retal Industries Group, the leader in the production of PET preforms.

MRC

MOSCOW (MRC) - Import deliveries of injection moulded PET chips to Ukraine decreased by 2% in January-August compared to the same period last year and amounted to 102,200 tonnes, according to MRC DataScope.

Russia's imports of injection moulding PET chips in January-August last year amounted to 104,700 tonnes.

August imports of injection moulding PET chips to the country decreased by a quarter and amounted to 10,900 tonnes against 14,700 tonnes a month earlier. In August of the previous year, shipments of PET chips were 14,600 tonnes.

It was earlier reported, that price of Chinese PET from traders in the domestic market of Ukraine remained stable last week, despite the continuing trend of strengthening the hryvnya against the dollar. So, the prices of Chinese PET in Ukraine last week remained in the range of hryvnyas (UAH) 33,000-33,500/tonne, CPT Kiev, including VAT.

At the same time, the export price of Chinese PET last week was still in the range of USD900-920/tonne, CIF Odessa, excluding VAT.
Prices of Belarusian PET for delivery to Ukraine also remained at the level of the previous week in the range of UAH31,500-32,000/tonne CPT Kiev, including VAT.

MRC

MOSCOW (MRC) - Imports of polypropylene (PP) into Belarus increased to about 64,600 tonnes in the seven months of this year, up 10.8% year on year, compared to the same period of 2018. All PP grades accounted for the increase in shipments, according to a MRC's DataScope report.

July PP imports into Belarus decreased to about 8,700 tonnes against 10,200 tonnes a month earlier, the local companies reduced the volume of purchases of polypropylene copolymers, whereas homopolymer PP purchases increased. Overall imports of propylene polymers reached 64,600 tonnes in January-July 2019, compared to 58,300 tonnes a year earlier, demand increased for all PP grades, with propylene copolymers accounting for the greatest rise.

The structure of PP imports by grades looked the following way over the stated period.

July imports of homopolymer PP to the Belarusian market increased to 6,700 tonnes from 5,800 tonnes a month earlier, shipments of homopolymer PP from Russia increased. Overall imports of homopolymer PP reached 43,000 tonnes in the first seven months of the year, up by 9.5% year on year. Russian producers with the share of about 86% of the total shipments were the key suppliers.

July imports of propylene copolymers to Belarus were 2,100 tonnes versus 4,400 tonnes a month earlier, local companies decreased their procurement of injection moulding block copolymers of propylene in Russia. Total imports of propylene copolymers in the country reached 21,600 tonnes in Jan-July 2019, up 13.3% year on year.
MRC

MOSCOW (MRC) -- Ufaorgsintez (part of Bashneft) has shut its polypropylene (PP) production and some of its low density polyethylene (LDPE) production capacities for a scheduled turnaround, the plant's customers said to MRC.

The plant's clients said Ufaorgsintez fully took off-stream its PP production for the scheduled maintenance on Tuesday, 17 September. The plant's second LDPE line (158 and 153 grades) was also shut for a scheduled turnaround. The shutdown will be short and will last for about 12 days. The plant's PP and LDPE production capacities are 120,000 and 90,000 tonnes per year, respectively.

It is also worth noting that this is the fourth shutdown for maintenance at Russian PP plants in September. Tomskneftekhim, Stavrolen and Poliom have taken off-stream their production capacities since the beginning of the month.

And as regards LDPE production, this is the second outage for a turnaround this month and not the last one. Tomskneftekhim shut its facilities for a two-week maintenance at the beginning of the month, and Kazanogsintez will take off-stream its LDPE production capacities from 16 September.

PJSC Ufaorgsintez produces phenol, acetone, synthetic ethylene-propylene rubber, high and low pressure polyethylene, polypropylene, more than 30 types of petrochemical products and over 25 consumer products.
MRC