SIBUR cuts LPG exports to Europe to feed ZapSibNefteKhim

MOSCOW (MRC) -- Russian petrochemical giant SIBUR has cut liquefied petroleum gas (LPG) exports to Europe by more than a third so far this month, redirecting flows to its newly built Siberian plant, reported Reuters with reference to data and traders.

SIBUR's complex in western Siberia, known as ZapSibNefteKhim, will be one of the world's five biggest petrochemical plants when it is fully operational and is part of Russia's plans to capture more value from the oil it produces.

SIBUR is supplying the plant with some of the LPG it produces domestically. The plant, also essential for SIBUR's plans to list its shares in Moscow and potentially in London, is operating in test mode, with full production capacity seen in 2021.

According to Refinitiv LPG trade flows data, SIBUR cut LPG exports via the Baltic Sea port of Ust-Luga by 36% on a daily basis between Oct. 1 and 20 to 4,170 t vs 6,512 t in January-September.

SIBUR declined to comment.

Ust-Luga is Sibur's main export route. The company exports LPG - chiefly used as fuel for cars, heating and to produce other petrochemicals - to Europe only.

According to Russian Energy Ministry data, Sibur supplied ZapSibNefteKhim with around 48,000 t of LPG last month vs 3,000 t in August.

SIBUR's Chief Executive Dmitry Konov said last month that the company planned to reduce its LPG exports to Europe to around 2 MMt next year as it holds back feedstock for its new plant in Siberia.

SIBUR exported 3.6 MMt of LPG last year and 1.9 MMt in the first half of 2019.

As MRC wrote previously, in September 2019, the Director General of SIBUR, Mikhail Karisalov, said that SIBUR intends to complete the commissioning and start up ZapSibNeftekhim early next year.

Besides, in October 2019,, ZapSibNeftekhim affiliate produced the first batch of polyethylene (PE) granules using its own ethylene feedstock at its Tobolsk complex in Siberia. Earlier this year, ZapSib produced a test batch of PE from imported feedstock, "while today the process is running smoothly using our own feedstock," SIBUR said. Commissioning and start-up are "well under way", and after ramping up to its full capacity, the petrochemical facility will produce 1.5m tonnes/year of PE - making ZapSib’s Tobolsk project Russia’s largest polymer production facility.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,436,390 tonnes in the first eight months of 2019, up by 9% year on year. Shipments of all PE grades increased. At the same time, the PP consumption in the Russian market was 909,260 tonnes in January-August 2019, up by 10% year on year. Shipments of PP block copolymer and homopolymer PP increased.

PAO SIBUR Holding is the largest petrochemical company in Russia and Eastern Europe with full coverage of the industry cycle from gas processing, production of monomers, plastics and synthetic rubbers to plastics processing.
MRC

MOSCOW (MRC) -- An electric fire Saturday morning on the ExxonMobil facilities in Notre-Dame-de-Gravenchon (Seine Maritime) resulted in a plume of smoke, below the regulatory thresholds, which could remain visible for several days, it was learned on Sunday, reported EN24 with reference to the industrial group.

"On Saturday, October 19, around 8 am, an electrical trip led to the shutdown of the ExxonMobil Chemical France steam cracker. To decompress the installation safely, the gases were sent to the torch, "said Sunday the petrochemical group in a" information to residents ".

In addition to the town hall, Atmo Normandie, a regional air quality monitoring association, approved by the Ministry in charge of the Environment, has been informed, as well as the Dreal (regional direction of the environment, of the planning and housing), we learned from the communication department of the group. "We have made information to residents to reassure them," said the same source.

"Further checks were conducted Saturday on the steam cracker and will lead to technical interventions before the restart phases of the facility. This is why the torch could remain visible for a few days. The current staff is making every effort to limit the duration and impact of this incident, "according to the information given by the group, which" apologizes to residents for the inconvenience. "

In a statement, Atmo Normandy ensures that, according to its measures, "a slight increase in sulfur dioxide concentrations is observed in the morning (Saturday) well below the regulatory threshold of information and recommendation."

The commune of Notre-Dame-de-Gravenchon, on which the ExxonMobil refinery is located, merged since 2016 with smaller neighboring municipalities to become Port-Jerome-sur-Seine, about forty kilometers from Havre.

As MRC informed before, in September 2019, ExxonMobil announced plans to spend GBP140 million over the next two years in an additional investment program at its Fife ethylene plant, which has a capacity of more than 800,000 t/y.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,436,390 tonnes in the first eight months of 2019, up by 9% year on year. Shipments of all PE grades increased. At the same time, the PP consumption in the Russian market was 909,260 tonnes in January-August 2019, up by 10% year on year. Shipments of PP block copolymer and homopolymer PP 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.
MRC

MOSCOW (MRC) -- Overall imports of general purpose polystyrene (GPPS) and high impact polystyrene (HIPS) to Kazakhstan remained in the first eight months of 2019 at the last year's level, totalling 5,300 tonnes, according to MRC's DataScope report.

Nevertheless, August shipments of material to the country more than quadrupled and were 900 tonnes, compared to 200 tonnes in August 2018. HIPS and GPPS imports into Kazakhstan were 710 tonnes in July 2019.

HIPS and GPPS are shipped to Kazakhstan mainly from Russia. Russia accounted for 64% of the total imports.
MRC

MOSCOW (MRC) -- INEOS has recently announced its intention to consult with employees on the proposed closure of the acrylonitrile (ACN) manufacturing plant at Seal Sands on Teesside, as per the company's press release.

The site which employs 224 people has been in INEOS ownership since 2008. In the event the plant closes, not all of these positions will be at risk of redundancy due to the continuation of other activities at Seal Sands.

Over the past 10 years, INEOS has invested almost EUR200m in the site to try to counter decades of significant under investment. Despite the company’s best efforts and the fact that every penny of profit has been ploughed back into the site to reverse this situation, the company is of the view that nothing more can be done to ensure that operations are both safe and economically viable. It would require another EUR200m just to meet INEOS standards and environmental regulations. The company intends to consult on any viable alternatives to closure.

The ACN process needs careful management and involves handling significant quantities of hazardous material. The company feels that it would not be possible to guarantee the long-term safety of our employees or our neighbours through continued operation of the plant and have thus reluctantly concluded that we should consider the option to close.

Paul Overment, CEO of INEOS Nitriles said, "After considering many options, we feel that we must now consult with employees on the potential closure of the plant. We do so with a heavy heart but there is no escaping the fact that decades of under investment on the site have led us to this point. Manufacturing assets need constant renewal if they are to survive. The last 10 years have proven that it is almost impossible to play catch-up and the lesson for us and other UK manufacturers is that constant reinvestment is vital for long term prosperity."

As MRC informed before, the restart of the ACN plant of INEOS Nitriles in Seal Sands, UK with the capacity of 280,000 mt/year from the planned maintenance, which began on 27 July 2019, was delayed in late September for a second time because of technical issues. The plant was initially expected to restart at the end of August.

ACN is a feedstock for the production of acrylonitrile-butadiene-styrene (ABS).

According to ICIS-MRC Price report, on the back of low Asian prices, August ABS imports to Russia were 3,600 tonnes versus 2,800 tonnes a month earlier and 2,700 tonnes in August 2018. ABS imports to the country did not change year on year in January-August 2019, totalling 21,900 tonnes.
MRC

MOSCOW (MRC) -- Russia's overall production of polypropylene (PP) decreased in the first nine months of 2019 by 1.3% year on year to 1,059,400 tonnes. Three producers out of seven reduced the capacity utilisation, according to MRC ScanPlast.

September PP production in the country decreased to 85,700 tonnes, compared with 119,000 tonnes in August, as four producers shut their capacities for scheduled maintenance works at once. Russia's overall PP production reached 1,059,400 tonnes in January-September 2019, compared to 1,072,900 tonnes a year earlier. Poliom, Stavrolen and SIBUR Tobolsk reduced production volumes.

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

SIBUR Tobolsk reduced its capacity utilisation in September, its total production fell to 26,600 tonnes from 32,900 tonnes a month earlier. The Tobolsk plant's total PP production reached 346,500 tonnes in January-September 2019, down by 5% year on year.

Poliom (Omsk) produced 10,100 tonnes of PP last month, compared to 19,500 tonnes in August. Overall, the Omsk plant produced 156,700 tonnes of PP over the stated period, down by 6% year on year.

Nizhnekamskneftekhim produced 18,000 tonnes of propylene polymers in September versus 18,500 tonnes a month earlier. The Nizhnekamsk plant's overall output of polymer exceeded 161,300 tonnes in the first nine months of 2019, compared to 160,700 tonnes a year earlier.

Last month Tomskneftekhim produced 9,500 tonnes of propylene polymers versus 12,500 tonnes in August, the decline in production was a result of a short scheduled turnaround. The Tomsk plant's total PP output reached 108,800 tonnes over the stated period, up 5% year on year.

Ufaorgsintez last month shut its capacity utilisation for 12 days scheduled maintenance works, total polypropylene production had dropped to 6,300 tonnes against 11,500 tonnes in August. The Ufa plant's overall output of polymer reached 96,200 tonnes in January-September 2019, up 2% year on year.

NPP Neftekhimiya (Kapotnya) produced 12,400 tonnes last month, compared to 13,000 tonnes in August. The plant's overall PP output reached 108,600 tonnes over the stated period, up by 10% year on year.

Stavrolen (LUKOIL) last month shut its capacity utilisation for 39 days scheduled maintenance works, total polypropylene production had dropped to 2,700 tonnes against 11,100 tonnes in August. The Budennovsk plant's overall output of propylene polymers increased in the nine months of 2019 to 78,600 tonnes from 74,100 tonnes a year earlier.


MRC