Xinfengming partially starts up new 2.2 million mt/year PTA unit

MOSCOW (MRC) -- China's Dushan Energy Ltd., a subsidiary of Xinfengming Group Co., Ltd, has partially started up its new 2.2 million mt/year purified terephthalic acid unit at Zhejiang Wednesday, reported S&P Global with reference ot sources familiar with the matter.

The unit consists of two trains with 1.1 million mt/year each, and the raw material paraxylene was fed into one of the trains on Wednesday morning, the sources added.

There is continuous flaring at the moment, indicating operation of the oxidation unit, one of the sources added.

The company should be able to produce some PTA materials by Thursday if the operation continues to run well, they said.

The new 2.2 million mt/year PTA unit will be the first phase of the company's Yuan 7 billion (USD1 billion) investment project, which includes another PTA line with the same capacity that will be in the second phase, the company announced in its official website earlier.

Phase two of its PTA line is expected to be online in the third quarter of 2020, sources close to the company said.

We remind that, as MRC wrote before, China's Hengli Petrochemical took off-stream its No. 1 PTA plant for a two-week turnaround on October 7, 2019. Located in Dalian, China, the No. 1 PTA plant has a production capacity of 2.2 million mt/year.

PTA is used to produce polyethylene terephthalate (PET), which is used in the manufacturing of plastic bottles, films, packaging containers, in the textile and food industries.

According to MRC's DataScope report, Chinese bottle grade PET deliveries to Russia increased 34% in the first eight months of 2019 to 95,600 tonnes. China accounted for 90% of the total imports, compared to 85% a year earlier.
August imports of material from China decreased by 41% to 7,600 tonnes from 12,800 tonnes in July. Jiangsu Sanfangxiang, Yisheng, Wankai and Sinopec were the leading Chinese suppliersof material to the Russian market.
MRC

Arkema Q3 profit fell, earnings increased

MOSCOW (MRC) -- Arkema’s third-quarter net profit fell year on year despite an increase in earnings amid an ongoing trend of customer destocking in a challenging demand environment, said the company.

Company earnings before interest, taxes, depreciation and amortisation (EBITDA) rose year on year as a stronger performance from its core adhesives and advanced materials division offset a weaker quarter for its industrial specialties operations.

Net profit fell over the same period as a result of start-up costs during the quarter, expenditure on the consolidation of specialty surfactants firm ArrMaz, which it acquired in July, and unfavourable currency effects.

The first half of the year was characterised by industry adjustments across many of the company’s end markets, and Arkema had expressed hopes in August that those headwinds would dissipate through the second half of the year, but this has yet to occur, according to CEO Thierry Le Henaff.

Despite weaker profitability for the quarter, group earnings remain resilient and are expected to match the €1.39bn earnings posted in 2018 this year.

Third-quarter high-performance materials division EBITDA rose over 12% year on year on the back of an improved product mix and more favourable raw materials pricing, while industrial specialties earnings fell 8%, with fluorogases volumes “strongly penalised” by illegal imports into Europe.

As it was infromed earlier, Arkema is to divest its Functional Polyolefins business to South Korea’s SK Global Chemical for EUR335m. Functional Polyolefins produces ethylene copolymers and terpolymers for the food packaging, cable, electronics and coatings markets.

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.

Arkema is a leading European supplier of chlorochemicals and PVC. Kynar and Kynar Flex are registered trademarks of Arkema Inc.
MRC

EQUATE reports 65% decrease in net income for Q3-2019

MOSCOW (MRC) -- EQUATE Group announced its Q3-2019 unaudited earnings, reporting USD264mn in EBITDA, a 52% decrease from USD547mn in Q3-2018, and $811mn in revenue, a 35% decrease from USD1,247mn in Q3-2018, said Refiningandpetrochemicalsme.

Net income after tax stood at USD143mn in Q3-2019, a 65% decrease from $406mn in the same period last year.

Commenting on the results, Dr Ramesh Ramachandran, CEO and president of EQUATE Group, said: “We continue to see steady demand in the market but are experiencing compressed margins due to uncertainty related to tariffs notably in Asia. EQUATE’s lowest cost position at all of its assets across the globe allows us to continue to run at maximum rates.

Dr Ramachandran added: "We are very pleased to announce the start-up of the MEGlobal Oyster Creek, TX, site in October 2019, ahead of schedule and in line with budgets, once again demonstrating EQUATE’s operational excellence and ability to deliver on its commitments to customers and shareholders."

EQUATE, a joint venture between Kuwait’s Petrochemicals Industry Company (PIC), Dow, Boubyan Petrochemical Company and Qurain Petrochemical Industries Company, opened a new monoethylene glycol in the US. The Oyster Creek, Texas, site has a production capacity of 750,000 tonnes/year.

MEG is one of the main feedstocks for the production of polyethylene terephthalate (PET).

According to MRC's ScanPlast report, Russia's estimated PET consumption reached 62,540 tonnes in August 2019, up 9% year on year. The estimated consumption of PET in the Russian market increased in January-August 2019 to 493,240 tonnes, up by 12% year on year.

MRC

Shell buys out Brunei deepwater block from Total for USD300 million

MOSCOW (MRC) -- Shell has agreed to buy Total's majority stake in a large exploration block off Brunei in the South China Sea for USD300 million, according to S&P Global with reference to the French oil major's statement Wednesday.

Total holds a 86.95% interest in 5,850 sq km Block CA1, which is located 100 km off the coast of Brunei in water depths ranging from 1,000 to 2,500 meters. Total currently operates the block alongside partners Murphy Oil (8.05%) and Petronas (5%).

"This transaction fits with our strategy of actively managing our portfolio and will contribute to our program to dispose of USD5 billion of non-core assets over the period 2019-2020," Total's upstream head Arnaud Breuillac said in a statement.

Total said the transaction is subject to approval by the local authorities and is expected to close by December.

As MRC reported previously, in mid-October, Royal Dutch Shell Plc restarted the hydrocracker at its 225,300 barrel-per-day (bpd) Norco, Louisiana, refinery. The 40,000 bpd hydrocracker was shut on Sept. 9 for a planned month-long overhaul. A longer than expected restart of the unit stretched the outage to six weeks.

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.

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

Clariant Q3 earnings rise 6% on lower exceptional cost

MOSCOW (MRC) -- Switzerland’s Clariant expects its markets to stabilise at a lower level next year, the speciality chemicals company said after reporting weaker than expected earnings and sales in its third quarter, as per Reuters.

The company, which lost its chief executive earlier this year as its joint venture with Saudi Basic Industries (SABIC) collapsed, blamed a worsening economic climate for the downturn.

In particular, Clariant was hit in its care chemicals business that supplies ingredients for soaps and shampoos. The company also felt the impact of weakness in the automobile and electronics sectors. “From today’s point of view I would not expect any recovery, I would rather expect a stability of the current environment,” Chief Financial Officer Patrick Jany said when asked about prospects for 2020.

"We will see a counter-effect at one stage, but it is too early to say when,” Jany said. “Looking into 2020, I see a rather stable environment with a bit of fluctuation, quarter by quarter. We have to organise our company in a way to be profitable at a lower level."

Jany said the search for a permanent CEO may carry into next year. Clariant’s third-quarter sales fell 1% to 1.043 billion Swiss francs ($1 billion), missing an average analyst forecast of 1.06 billion, according to Refinitiv data.

Core earnings (EBITDA) also declined by 1% to 169 million francs, but after exceptional items rose 6% to 151 million francs, missing expectations for 178 million. Clariant increased its profit margin to 14.5% from 13.5%. Margins should improve during the fourth quarter, Jany said.

The Basel company maintained its 2021 outlook for continuing businesses to achieve above-market growth, higher profitability and stronger cash generation, though some analysts said those targets were too optimistic.

“Clariant did not show any underlying progress towards its too ambitious 2021 targets and today’s results do not provide more confidence,” said Vontobel analyst Daniel Buchta. Clariant stock was down 1.6% by 0910 GMT after losing 2.5% in early trading.

A revival of the joint venture with SABIC, which holds a 25% stake in Clariant, is off the table, Jany said, since Clariant now plans to sell major portions of the business it had originally hoped to combine with the Saudis’ operations.

That plan was scrapped after a disagreement about how much Clariant would pay for the SABIC assets.

As MRC informed earlier, Clariant announced that it has been awarded a contract by Dongguan Grand Resource Science & Technology Co. Ltd. to develop a new propane dehydrogenation unit in cooperation with CB&I. The Dongguan plant will be one of the largest single-train dehydrogenation units in the world. Clariant's technology partner CB&I will base the plant's design on its Catofin® catalytic dehydrogenation technology, which uses Clariant's tailor-made Catofin catalyst and Heat Generating Material (HGM).

Propylene is the main feedstock for producing polyprolypele (PP).

According to MRC's ScanPlast report, 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.

Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints. Clariant India has local masterbatch production activities at Rania, Kalol and Nandesari (Gujarat) and Vashere (Maharashtra) sites in India.
MRC