U.S. crude stocks jump sharply as refiners cut activity

MOSCOW (MRC) -- U.S. crude stocks rose last week as refineries cut output sharply, while gasoline stocks decreased and distillate inventories fell, the Energy Information Administration said, said Hydrocarbonprocessing.

Crude inventories rose by 7.9 million barrels in the week to Nov. 1, compared with analysts’ expectations for an increase of 1.5 million barrels.

Crude stocks at the Cushing, Oklahoma, delivery hub rose by 1.7 million barrels, EIA said.

Refinery crude runs fell by 237,000 barrels per day, EIA data showed. Refinery utilization rates fell by 1.7 percentage points.

Gasoline stocks fell by 2.8 million barrels, compared with analysts’ expectations in a Reuters poll for a 1.8 million-barrel drop.

Distillate stockpiles, which include diesel and heating oil, fell by 622,000 barrels, versus expectations for a 949,000-barrel drop, the EIA data showed.

Net U.S. crude imports rose last week by 336,000 barrels per day.

As MRC informed earlier, in mid October U.S. crude stocks rose last week as refineries cut output to the lowest level in nearly two years and production edged higher to a record of 12.6 million barrels per day (bpd).
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MOSCOW (MRC) -- Total has disclosed that it is evaluating construction of a new gas cracker at its Deasan, South Korea, joint venture (JV) with Hanwha Chemical, reported Chemweek.

The company in its strategy and outlook presentations in New York on 24 September, said that petrochemicals are a major feature in the company’s future investments. Speaking about the segment, Bernard Pinatel, president/refining and chemicals at Total, said that the company is focusing on growing petrochemicals, not refining. The petchems market, he said, is growing at 3%/year, driven by demographics, growing world population, the emergence of the middle class and megatrends around lightweight materials. "All of this drives the growth in plastics and polymers."

Pinatel says that there are three main principles the company adheres to when considering expansion: access to low-cost gas feedstock, including ethane, propane, and butane; balance between monomers and polymers in any given project; and investing in low-carbon solutions by leveraging biofuels, biopolymers, and embracing the circular economy. "Today, the petchems market is in a short-term imbalance because of new capacities coming onstream on the US Gulf Coast and in Asia…We have the first wave in the US investments coming onstream in the 2017–20 period, so the bulk of it is almost beyond us. But this weighs heavily on the supply and at the same time on the demand. We see a slowdown most notably linked to the trade war between China and the US, so short term, this market is suffering from some kind of imbalance," he said.

For Total, this is not so much of a concern because most of its projects are due to start up post-2020. Total operates six global petrochemical platforms and the new investments will rely on low-cost feedstock, competitive capex by leveraging the company’s platforms, and by balancing capacities between monomers and polymers.

The company is developing four major petchems projects: in the US, South Korea, Algeria, and Saudi Arabia. At Daesan, South Korea, the JV is investing USD1.3 billion to add 400,000 metric tons/year - a 40% increase - to its steam cracker capacity, using propane feedstock shipped from the US, which will give the company an extra 400,000 metric tons/year each of polyethylene (PE) and polypropylene (PP) capacity by 2021. The Daesan operation has been a tremendous success, delivering cashflow of USD1 billion in 2018. "We are so happy with Daesan that we are evaluating new opportunities there, notably a new gas cracker, which will benefit from the platform’s synergies." The downstream product slate is still being developed.

Total is also happy with its operations in Saudi Arabia, where it is a partner with Saudi Aramco in Satorp (Jubail). Satorp, a 62.5/37.5 JV between Aramco and Total, currently includes a refinery and an aromatics complex, which started up in 2014. It has on average provided USD1 billion/year in cashflow since 2015. The 4,000 b/d refinery was debottlenecked by 10% in 2018 and the JV plans to increase the capacity to 4,800 b/d by 2024. "We now plan to further integrate with petrochemicals." Aramco and Total have announced plans to invest USD5.5 billion in a new petchems complex at the site, which will include a 1.5-million metric tons/year (MMt/y) steam cracker and a 1 MMt/y PE plant. The project is currently in the front-end engineering and design (FEED) phase and the final investment decision (FID) is due in 2021. Completion is targeted for 2024. This is a very attractive project and has already attracted downstream investors. Ineos will invest USD2 billion in specialty chemicals and Daelim is also a partner.

Referring to the US, Pinatel said that Total has very good assets there and a profitable base providing USD1 billion of cashflow last year. A JV in which Total has 50% and Nova and Borealis 50% is developing a 1 MMt/y ethane cracker. The project is 70% complete and will start up in 2021, post the first wave. "We are also investing in a new PE line by 2021, fully integrated with the cracker. Total brings integration and synergies with our platform, Borealis its Borstar technology and Nova its market presence. We are well on track to start up in 2021."

Total is also developing a USD1.4-billion propane dehydrogenation and PP complex at Arzew, Algeria, in partnership with Algeria’s state-owned oil company Sonatrach. The facilities will be designed to produce 600,000 metric tons/year each of propylene and PP. The project is in FEED phase with FID due 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 1,589,580 tonnes in the first nine months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market was 976,790 tonnes in January-September 2019, up by 4% 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.
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MOSCOW (MRC)--US thermoset resins producer Hexion will expand its plant at Brimbank near Melbourne, Australia by adding phenolic resin capacity, as part of its strategy to expand its adhesives and binders business, said the company.

The addition at the facility is expected to meet the increasing demand for phenolic resins for several applications, including fire-resistant cladding material for commercial, residential and institutional properties.

Construction of a new reactor and associated infrastructure is to begin early next year, with startup of production expected in Q1 2021, Hexion said in a statement this week. Financial or capacity details were not disclosed.

The new capacity will help Hexion meet growing regional demand for phenolic resins in a range of commercial, institutional and residential applications.

“As the main phenolic resin producer in Australia, we remain committed to growing with our regional customers and delivering innovative solutions,” said Rob Schmidt, Hexion vice president and managing director, Asia Pacific.

Adhesives and phenolic resins are used as binders in construction applications, especially where there is a need for high heat performance and long-term durability. Phenolic adhesives are used for load-bearing engineered wood members such as structural plywood and laminated veneer lumber to provide thermal stability at high temperatures.

As MRC informed earlier, Hexion plans to resume production of BPA in Pernis (Pernis, Netherlands) in the third week of November after a scheduled repair. This production with a capacity of 120 thousand tons of BPA per year was closed in the last week of October.

Phenol is the main feedstock component for the production of bisphenol A (BPA), which, in its turn, is used to produce polycarbonate (PC).

According to ICIS-MRC Price report, Russia's estimated consumption of polycarbonate (PC) rose in in the first three quarters of 2019 by 11% year on year to 61,000 tonnes (54,800 tonnes a year earlier). Consumption in the injection moulding sector grew in the first nine months of 2019 by 10% year on year to 7,900 tonnes from 7,200 tonnes a year earlier.
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MOSCOW (MRC) -- ExxonMobil and FuelCell Energy have signed a new two-year expanded joint development agreement to enhance carbonate fuel cell technology in order to capture carbon dioxide (CO2) from industrial facilities, said Gasworld.

Worth up to USD60m, the agreement will focus on optimising the core technology, process integration and large-scale deployment of carbon capture solutions.

FuelCell Energy’s technology uses carbonate fuel cells to capture and concentrate CO2 stream from large industrial sources. Combustion exhaust is directed to the fuel cell which produces power while capturing and concentration CO2 for permanent storage.

ExxonMobil and FuelCell Energy have been working together since 2016 with a focus on carbonate fuel cells and how to increase efficiency in separating and concentration CO2 from the exhaust of natural gas-fuelled power generation.

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) -- Borouge, the Abu Dhabi polymers producer, has joined Project STOP, the programme co-founded by parent company Borealis to prevent ocean plastic leakage, said Borealis in its press release.

Establishing new solutions and models that can be rapidly scaled up across the whole plastics chain, from plastic usage to waste collection and recycling.

Project STOP, co-founded by Borealis and SYSTEMIQ to prevent ocean plastic leakage, welcomes Borouge, a leading petrochemicals company that provides innovative and value creating plastics solutions, as a strategic partner, joining the Norwegian Ministry of Foreign Affairs, NOVA Chemicals, Nestle and the Alliance to End Plastic Waste.

“Project STOP’s positive impact is proof that partnerships between industry and government can generate effective solutions for sustainable waste management and the prevention of marine litter,” said Alfred Stern, Borealis Chief Executive. “We are pleased that Borouge, our Joint Venture with the Abu Dhabi National Oil Company (ADNOC), has decided to increase their engagement and become a strategic partner in Project STOP. We also look forward to welcoming new partners and alliances on our journey to scale up this industry-leading initiative, which is an important step towards creating a circular economy for plastics."

Since its inception, Project STOP has welcomed a number of strategic partners, the newest one being Borouge, which originally joined the project in 2017 as a supporting partner. Project STOP works hand in hand with local municipalities and environmental agencies in Southeast Asia to contribute to developing a low cost and circular waste management infrastructure through city partnership projects in Indonesia.

Project STOP partners with industry players, as well as governments and the local community, and has three key objectives: to achieve zero leakage of waste into the environment, increase resource efficiency and recycle more plastics, as well as create benefits for the local communities. Since the launch of Project STOP’s first city partnership in Muncar, in 2018, 1,800 tonnes of waste, of which 300 tonnes are plastic, have been collected. Furthermore, 60 local jobs have been created and waste management collection has been made accessible to more than 30,000 people, most of them for the first time.

Borouge is 40% owned by the Austrian polymers and fertilizers major, with the remaining 60% belonging to Abu Dhabi’s national oil company ADNOC.

Other members of Project STOP include the Norwegian Ministry of Foreign Affairs, NOVA Chemicals, Nestle and the Alliance to End Plastic Waste (AEPW). Project STOP is working with local municipalities and environmental agencies in southeast Asia to develop a circular waste management infrastructure through city partnership projects in Indonesia.

As MRC informed in the late October, The Abu Dhabi National Oil Company (ADNOC), Adani Group (Adani), BASF SE (BASF) and Borealis AG (Borealis) have signed a Memorandum of Understanding (MoU) to engage in a joint feasibility study to further evaluate a collaboration for the establishment of a chemical complex in Mundra, Gujarat, India. The collaboration includes evaluating a joint world-scale propane dehydrogenation (PDH) plant to produce propylene based on propane feedstock to be supplied by ADNOC. Propylene will be partially used as feedstock for a polypropylene (PP) complex, owned by ADNOC and Borealis, based on proprietary state-of-the-art Borealis Borstar technology.

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.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. With headquarters in Vienna, Austria, Borealis currently employs around 6,500 and operates in over 120 countries.
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