Shell forced to burn off gas it cannot sell in Mossmorran

MOSOCW (MRC) -- Shell has been forced to burn off "significant" volumes of ethane because it cannot sell it to a firm that has temporarily shut down its plant with flaring issues in Fife, reported BBC News.

Residents living near the Mossmorran site thought flaring would be reduced after Exxonmobil closed in August.
However, flares have continued to burn because Shell's only ethane customer is Exxonmobil, which shares the site.
Shell said it was "actively exploring alternative ethane outlets".

Exxonmobil chose to temporarily close its plant to undertake maintenance on its boilers.

Shell's Fife Natural Gas Liquids plant separates natural gas liquids into ethane, propane, butane and natural gasoline for storage and onward distribution.

It sells its ethane to Exxonmobil's neighbouring Fife Ethylene plant, which turns it into ethylene.

Since the Fife Ethylene Plant was temporarily closed down Shell said it "did not have the storage capacity for the significant quantities of ethane produced from North Sea gas".

Exxonmobil's plant at the site will be closed until at least November for work to be carried out to make the plant more "reliable".

A total of GBP140m of work will also be spent by Exxonmobil improving the plant.

ExxonMobil said it had started recruiting 850 temporary workers to carry out the work over the next 12 months.
The operator said the investment was on top of the GBP20m it spends annually on maintaining its Mossmorran site.

A Shell Fife Natural Gas Liquids spokesman said: "The (ExxonMobil) Fife Ethylene Plant is currently the primary customer for ethane supplied by the Shell Fife Natural Gas Liquids plant, and processes ethane into ethylene.
"Our ground flares are burning excess ethane as the Fife Ethylene plant is currently not available for receiving the ethane to process it into ethylene.

"We have taken measures within the North Sea (SEGAL) supply system to help to manage the situation and are actively exploring alternative ethane outlets during the temporary shutdown.

"However, the volume taken by the Fife Ethylene plant is significant and any solution is likely to be for some volume rather than the full volume of ethane the Fife Natural Gas Liquids plant produces."

James Glen, chairman of the Mossmorran Action Group, said: "I think it is ironic that Shell is being forced to flare off excess product because of the problems at Exxonmobil.

"Residents had hoped for some respite but they are having to continue to suffer from light and noise impact as a result of Shell's flaring."

As MRC wrote earlier, Exxon Mobil Corp is planning to spend more than 500 million pounds (USD650 million) to upgrade the UK’s largest oil refinery, Fawley, on England’s south coast.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption was 1,081,100 tonnes in the first half of 2019, up by 8% year on year. Deliveries of all PE grades increased. Meanwhile, the estimated consumption of PP in the Russian market totalled 694,210 tonnes in January-June 2019, up by 14% year on year. The supply of propylene block copolymers (PP-block) and propylene homopolymers (PP-homo) increased.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.
MRC

MOSCOW (MRC) -- HPCL's proposed plan to acquire the Mangalore Refinery and Petrochemical Led (MRPL) for synergy is yet to reach board level discussions, reported EconomicTimes with reference to the company's CMD M K Surana.

"We are working on that. Earlier we have said that makes a synergy for HPCL and we are working with the ONGC for this. It is work in progress. It has not reached the board stage and once finalized, it will go to the three boards - HPCL, MRPL and ONGC," Hindustan Petroleum Corporation Ltd Chairman and Managing Director Surana told IANS on the sidelines of India Economic Summit here.

In August, ONGC Chairman and Managing Director Shashank Sekhar had said the proposed merger of its two subsidiaries - HPCL and MRPL - would happen next year.

ONGC had acquired HPCL by buying out the entire government stake of 51.11 per cent by paying Rs 36,915 crore. HPCL holds 16.93 per cent and ONGC has 71.63 per cent.

The proposed consolidation exercise has seen HPCL reluctant to give parent status to ONGC soon after the government exited HPCL by selling its stake. HPCL, for quite some time, did not recognize ONGC as its promoter.

As MRC wrote before, in March 2018, HMEL received clearance from India’s ministry of environments for the polymer addition project at its Guru Gobind Singh refinery and Petrochemical complex. The proposed units at the petrochemical complex include a 1.2m tonnes/year naphtha cracker, two linear low density polyethylene/high density polyethylene (LLDPE/HDPE) swing plants of 400,000 tonnes/year capacity each. The complex, in Bhatinda region of Punjab province, will also house a 450,000 tonnes/year HDPE unit, a 500,000 tonnes/year polypropylene (PP) plant and a 55,000 tonnes/year butane-1 line.

In December 2018, it became know that HPCL-Mittal Energy Limited, or HMEL, will start its new 500,000 mt/year PP plant in Bhatinda in 2021.

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.

Hindustan Petroleum Corporation Limited (HPCL) is an Indian state-owned oil and natural gas company with its headquarters at Mumbai, Maharashtra and with Navratna status. HPCL has about 25% marketing share in India among PSUs and a strong marketing infrastructure. The Government of India owns 51.11% shares in HPCL and others are distributed amongst financial institutes, public and other investors.
MRC

MOSOCW (MRC) - Negotiations on European polyvinyl chloride (PVC) prices for October delivery to the CIS markets began last week. Raw materials in Europe grew in price, and many local producers increased PVC export prices, according to the ICIS-MRC Price Report.

The October contract price of ethylene was agreed up by EUR20/tonne from September, which theoretically should lead to an increase of EUR10/tonne in PVC production costs.

Due to the increase in the cost of the main raw material - ethylene, many European producers raised their export prices for PVC for supply to the markets of the CIS countries in October, but the price increase is disproportionate in some cases and amounts to EUR5-20/tonne to the September price.

The demand for PVC from consumers from the CIS countries in October, as well as a month earlier, is low, many consumers reduced their purchases, since they expect a seasonal reduction in demand for finished products in November. Some producers had restrictions for export shipments because of shutdowns, but they were not critical for most buyers.

Several producers intend to achieve an increase in export prices by EUR20/tonne compared to September, but some consumers report that they managed to limit the price increase to EUR5/tonne. But in general, deals for October shipments of suspension PVC (SPVC) to the CIS markets were held in the range of EUR700-785/tonne FCA.
MRC

MOSCOW (MRC) -- DFE Chemical is in plans to restart its polystyrene (PS) plant following an unplanned outage, according to Apic-online.

A Polymerupdate source in the Philippines informed that the company is likely to resume operations at the plant in mid-October, 2019. The plant was shut in 2H August 2019 owing to bearish market conditions.

Located in Manila, the Philippines, the plant has a production capacity of 30,000 mt/year.

As MRC wrote before, DFE Chemical restarted its PS plant in Manila following a maintenance turnaround on April 2, 2018. The plant was shut for maintenance in mid-December 2017.

According to MRC's ScanPlast report, Russia's estimated consumption of PS and styrene plastics was 39,130 tonnes in July 2019, down by 1% year on year (39,600 tonnes in 2018). Consumption of PS and styrene plastics in the country was 287,370 tonnes in January-July 2019, up by 2% year on year.
MRC

MOSCOW (MRC) -- The Trump administration is close to finalizing a package of measures to adjust the policy mandating the use of biofuels, two sources familiar with the matter said and is aiming to get the final deal signed by President Donald Trump, said Hydrocarbonprocessing.

Sources said the deal is unlikely to include a price cap for the trading of the biofuel credits, a measure that has been advocated by the oil industry.

As MRC informed earlier, U.S. President Donald Trump has tentatively approved a plan to increase the amount of biofuels that oil refiners are required to blend each year to compensate for exemptions handed out to small refiners by the Environmental Protection Agency.

The plan is intended to address a major source of anger in U.S. farm country as Trump seeks to hold favor in the Midwest ahead of next year’s election, but it is likely to upset the oil industry, another important political constituency, underscoring the pitfalls of U.S. biofuel policy.
MRC