LyondellBasell begins start-up process of new PE plant in USA

MOSCOW (MRC) -- LyondellBasell has begun the commissioning works of its new high density polyethylene (HDPE) plant in La Porte, Texas, reported NCT with reference to the company's statement during an earnings conference call.

The brand new plant will utilize LyondellBasell’s patented Hyperzone technology to produce 500,000 tons/year of HDPE. Sales volumes from the plant are expected to increase during the first quarter of 2020.

The cost of the project is estimated at USD900 million, the company reported.

As MRC wrote before, in October 2019, LyondellBasell sarted up a new, fifth production line at its polypropylene (PP) compounding plant in Knapsack, Germany capable of producing 25 kt/yr. With this, capacity of the Knapsack facility is over 200 kt/yr, making the site "the world’s largest polypropylene compounding facility".

According to MRC's ScanPlast report, Russia's September estimated HDPE consumption fell to 70,570 tonnes from 108,320 tonnes a month earlier. Russian producers reduced their output due to maintenance works, whereas imports were high partially because of an increase in US shipments. The estimated HDPE consumption in Russia totalled 862,170 tonnes in January-September 2019, up by 7% year on year. HDPE imports increased by 47%, whereas production dropped by 5% due to a long period of maintenance works at three production capacities.

LyondellBasell is one of the largest plastics, chemicals and refining companies in the world. Driven by its 13,000 employees around the globe, LyondellBasell produces materials and products that are key to advancing solutions to modern challenges like enhancing food safety through lightweight and flexible packaging, protecting the purity of water supplies through stronger and more versatile pipes, and improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road. LyondellBasell sells products into approximately 100 countries and is the world's largest licensor of polyolefin technologies.
MRC

MOSCOW (MRC) -- German chemicals group Evonik Industries reported a 6% drop in its third-quarter adjusted core profit, citing global economic slowdown, said Reuters.

Third-quarter earnings before interest, taxes, depreciation and amortisation (EBITDA), adjusted for one-offs, dropped to 543 million euros (USD604 million), but slightly above the average estimate of 537 million euros in a company-provided poll.

Evonik confirmed its full-year outlook of adjusted EBITDA to at least reach last year’s level of 2.15 billion euros, excluding its methacrylates unit, the maker of plastics for clear acrylic sheet it sold to buyout group Advent in August.

In September 2019, Evonik expanded its production capacity for the high-purity C13 alcohol isotridecanol (ITDA) at the Marl Chemical Park. This will enable the specialty chemicals group to continue to build on its position as manufacturer of this product, and to grow with its customers.

Evonik is one of the world leaders in specialty chemicals. The focus on more specialty businesses, customer-oriented innovative prowess and a trustful and performance-oriented corporate culture form the heart of Evonik’s corporate strategy. They are the lever for profitable growth and a sustained increase in the value of the company. Evonik benefits specifically from its customer proximity and leading market positions. Evonik is active in over 100 countries around the world with more than 36,000 employees.
MRC

MOSCOW (MRC) -- Altivia Ketones & Additives, LLC an affiliate of Altivia Petrochemicals, announced that it acquired Dow’s Acetone Derivatives Business and associated chemical manufacturing assets at Institute, W.Va., as well as the Institute Industrial Park, said Chemengonline.

Altivia successfully assumed operations and product distribution without delay on November 1.

The Acetone Derivatives Business manufactures ketones and carbinols, used primarily in the coatings, adhesive and pharmaceutical industries. It is the largest North American production facility of its kind.

"We have implemented a thorough transition plan over the past 12 weeks to ensure continuity and avoid disruptions during our assumption of operations at Institute, West Virginia,” said Altivia’s Chief Executive Officer J. Michael Jusbasche. “Customers of our Ketones business and stakeholders at our Institute Industrial Park will experience a seamless transition to Altivia."

The 460-acre Institute Industrial Park was originally operated by Union Carbide and became an industrial park in the mid-1980s. The facility houses the acetone derivatives business acquired by Altivia, as well as other Dow and DuPont businesses, which receive utility and logistics services to support chemical production activities.

Earlier in 2019, Dow had said that the business's acetone derivatives are used as solvents and as chemical intermediates. The coatings industry uses the solvents for nitrocellulose and other cellulose ethers as well as for vinyl chloride-vinyl acetone and other resins. The companies announced the deal in mid-August.

As MRC informed earlier, Dow Chemical's propylene dehydrogenation (PDH) unit in Freeport, Texas, is offline for a turnaround. Sources said the PDH unit went offline for scheduled maintenance September 26, and the work is expected to last 45-60 days. Originally, sources expected the turnaround to begin in early September, but then learned it had been delayed.

As MRC informed previously, Dow Chemical began major maintenance on the LHC 1 cracker at Terneuzen, Netherlands from 9 September, 2019. More than 1,500 extra employees from various external companies will carry out maintenance work in the subsequent period.

Propylene is a feedstock for producing polyprolypele (PP).

According to MRC's ScanPlast report, 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.

Dow believes that plastic waste has value and can be transformed into new products and energy. In addition to plastic roads, Dow is working with key partners in South America to use recycled plastics to develop construction materials for schools in Colombia. Dow is also at the forefront of developing and scaling chemical recycling technology to take recycled plastic waste back to feedstock for the creation of new products. By reimagining new ways to reuse, recycle and repurpose plastic waste, Dow and its partners are leading the way in the development of innovative circular economy solutions.

MRC

MOSCOW (MRC) -- Seven months after loading a cargo of Urals crude that was contaminated with excess organic chlorides, reported S&P Global with reference to Total said Thursday a trading house bought the oil in a tender on Wednesday.

The price, a steep discount to the market, highlighted the ongoing costs of the contamination of the Russian crude earlier this year.

The sale came on the same day that Hungary settled with Russia over the contaminated oil that it had received through the Druzhba pipeline as part of the same episode, which damaged the reputation of the world's second largest crude exporter. None of the parties to the agreement - Lukoil, MOL and Transneft - gave financial details.

Totsa awarded its tender for a 100,000 mt cargo - equivalent to 720,000 barrels - of contaminated oil to an undisclosed energy trader on Wednesday at a discount of more than USD25/b to Dated Brent, Totsa - Total's trading arm - said Thursday.

The cargo was sold on an FOB basis and was expected to be lifted in November.

A representative from Totsa said the tender "was sold at a hefty loss (but) we have been able to sell everything".

Total has held similar tenders in recent months that failed to find any interest, and the conditions of Wednesday's tender showed flexibility on the part of the French major, with bidders able to request as little as 50,000 barrels and choose between oil that contained organic chlorides in a concentration of 27.3 ppm and 22.1 ppm.

Exports of Urals crude via the 1 million b/d Druzhba pipeline system were suspended mid-April after dangerous levels of corrosive organic chlorides were found in crude transported via the northern route into Belarus.

At the height of the episode, the levels of organic chlorides detected in the Urals stream at Ust-Luga rose to more than 60 ppm in several instances.

As MRC informed earlier, Total has decided to double the production capacity of its affiliate Synova to meet growing market demand for high-performance recycled materials. By early 2021, Normandy-based Synova, a French leader in its sector, will produce 40,000 tons per year of recycled polypropylene (PP) that meets the demanding quality standards of automotive OEMs and carmakers.

According to MRC's ScanPlast report, 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.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
MRC

MOSCOW (MRC) -- Plans for the expansion of Russia's Sakhalin-2 liquefied natural gas (LNG) plant have been put on hold, according to three sources involved in the project, a potential setback to Russia's ambition to lift its global LNG market share, as per Hydrocarbonprocessing.

The main reasons for the hold-up are the lack of gas resources and international sanctions, the sources said, but plans of Russian gas giant Gazprom to boost its pipeline gas supplies to China, have also had an impact.

Equity holders in the Sakhalin Energy consortium include Gazprom which controls the project with a majority share, as well as oil major Royal Dutch Shell, Japan's Mitsui and Mitsubishi Corp.

Russia plans to raise its global LNG market share from less than 10% now to 20% by 2035, mainly thanks to cranking up of output by non-state producer Novatek and its partners in the Arctic.

Gazprom, Russia's sole exporter of natural gas via pipelines, has been slower in its LNG plans, focusing on pumping the fuel via pipes instead.

Sakhalin-2, off the country's eastern shores, is Russia's first LNG producing plant with a capacity of over 10 million tonnes per year. Its two production units, or trains, were launched in 2009 in strategic proximity to Japan, the world's largest consumer of the sea-borne LNG.

The consortium, Sakhalin Energy, has plans to expand and build a third train with a capacity of 5 million tonnes per year. Gazprom had said the expansion could happen in 2021.

"There have been no movements on the third line," a source from within the consortium said.

Shareholders have considered several options for the expansion: buying gas from the neighbouring Sakhalin-1 project led by ExxonMobil, developing new resources or a combination.

Yet, Sakhalin-1, where the state oil company Rosneft is also a shareholder, is aiming for its own LNG plant.

The talks about usage of Sakhalin-1 gas for the Sakhalin-2 LNG plant's expansion have dragged on for years.

Gazprom had initially planned to use resources from the Yuzhno-Kirinskoye field - yet to be commercially drilled and developed - for the Sakhalin-2 expansion.

Gazprom and Sakhalin Energy have not responded to requests for comment. Shell in Russia said the company remains committed to the expansion.

"The project is very robust from the technical and commercial point of view. However we need to confirm the feed gas supply source," it said in emailed comments.

"Only after such a source is determined, it will be possible to progress the project to FID and further construction."

In 2015, the United States restricted exports, re-exports and transfers of technology and equipment to the Yuzhno-Kirinskoye field, making it harder to develop, in response to Russia's annexation of Crimea from Ukraine a year earlier.

Gazprom has discovered another field, Yuzhno-Lunskoye, but the resources there are not enough for a third train at Sakhalin-2, according to a company source.

Next month, Gazprom plans to start landmark gas supplies to China via the Power of Siberia pipeline through which flows are expected to gradually rise to 38 billion cubic metres (bcm) per year during the next five years.

Other ways of pipeline gas delivery to China have been under discussion and one of the new possible routes of supplies is the existing Sakhalin - Khabarovsk - Vladivostok pipeline.

Russia wants to build a spur from the pipeline to China to the tune of 10 bcm per year but no deal has been clinched with China on that route yet.
MRC