BASF-Yangzi to shut Nanjing LDPE plant

MOSCOW (MRC) -- BASF-Yangzi Petrochemical is in plans to take a low density polyethylene (LDPE) plant off-stream for a maintenance turnaround, as per Apic-online.

A Polymerupdate source in China informed that the company has schedule to start maintenance at the plant on April 6, 2020. The planned shutdown is expected to remain in force for about five weeks.

Located at Nanjing in China, the LDPE plant has a production capacity of 220,000 mt/year.

As MRC wrote before, BASF-YPC, a 50-50 joint venture of BASF and Sinopec, is likely to undertake a planned shutdown its naphtha cracker in April 2020. The company has planned to start turnaround at the cracker on April 5, 2020. The plant is expected to remain under maintenance for around two months. Located in Jiangsu, China, the cracker has an ethylene capacity of 750,000 mt/year and propylene capacity of 400,000 mt/year.

According to MRC's ScanPlast report, Russia's October estimated LDPE consumption grew to 54,650 tonnes from 47,980 tonnes a month earlier. Local producers increased significantly their polyethylene (PE) shipments partially due to the reduction in exports. The estimated LDPE consumption in Russia totalled 484,360 tonnes in the first ten months of 2019, up by 9% year on year. Some producers' LDPE exports decreased, whereas imports rose by 19%.

Yangzi Petrochemical - BASF Co., Ltd. is an enterprise located in China, with the main office in Nanjing. The enterprise currently operates in the Basic Chemical Manufacturing sector. It was established on December 04, 2000. There are currently 1,894 (2018) people employed by Yangzi Petrochemical - BASF Co., Ltd.. In 2018, the company reported a net sales revenue increase of 2.5%. Over the same period, its total assets decreased by 3.89%. The net profit margin of Yangzi Petrochemical - BASF Co., Ltd. decreased by 3.59% in 2018.
MRC

MOSCOW (MRC) -- TPSC Asia, formerly known as Total Petrochemicals SE Asia, is likely to shut its polystyrene (PS) plant for a turnaround, according to Apic-online.

A Polymerupdate source in Singapore informed that, the company has scheduled a maintenance at the plant in May 2020 for a period of around three weeks. The exact date of the shutdown could not be ascertained.

Located at Jurong, Singapore, the PS plant has a production capacity of 100,000 mt/year.

As MRC wrote previously, the company conducted a a one-month turnaround at its PS plant in Singapore from 12 April, 2015.

According to MRC's DataScope report, overall imports of general purpose polystyrene (GPPS) and high impact polystyrene (HIPS) to Russia rose in the first eleven months of 2019 by 11% year on year to 44,700 tonnes. This figure was at 40,200 tonnes in January-November 2018. At the same time, GPPS and HIPS imports to the Russian market slumped by 40% in November, totalling 3,600 tonnes versus 6,000 tonnes in November 2018. Imports of material into the country were 3,600 tonnes in October 2019.

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) -- U.S. oil refiner Phillips 66 said on Wednesday its 2020 capital spending budget could fall as much as 10% below this year’s plans, which include USD300 million for a West Coast marketing campaign, said Reuters.

Executives at the fourth-largest U.S. refiner by capacity said in a presentation to Wall Street analysts that next year’s outlays would range from USD3 billion to USD3.5 billion, compared with the estimated USD3.3 billion to USD3.5 billion this year.

"Phillips 66 has a consistent, proven strategy to create value for shareholders,” Chief Executive Greg Garland said in New York. “Our strategic priorities of growth, returns and distributions are supported by a strong foundation of operating excellence and a high-performing organization."

The 2019 capital budget was boosted in part by USD300 million to pay for a retail-fuels joint marketing campaign with an undisclosed partner on the West Coast, executives said. Phillips markets fuels under the Phillips 66 and Union 76 brands.

“The transaction has not yet been finalized,” said Phillips 66 spokesman Dennis Nuss. “We can confirm additional details once the transaction is closed."

At the high end of next year’s spending, the company would have “USD1.5 billion to USD2.5 billion for share repurchases, ahead of our expectations of USD1.2 billion,” Credit Suisse analysts said in a note on Wednesday. “Another strong dividend increase for 2020 indicated (we expect a 10% hike)."

During the presentation, which was webcast, analysts questioned whether the capital budget fully reflected spending for major oil pipeline and other projects being constructed.

Garland said two major pipelines being developed were financed by shippers. Phillips 66 discloses its financing arrangements to credit rating agencies, he added, saying: “We’re completely transparent."

Phillips 66’s budget will include work on gasoline-producing fluidic catalytic cracking units (FCCU) at its Sweeny, Texas, and Ponca City, Oklahoma, refineries in 2020.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,724,670 tonnes in the first ten months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market in January-October 2019 totalled 1,066,520 tonnes, up by 7% year on year. Supply of block copolymers of propylene (PP block copolymer) and homopolymer of propylene (homopolymer PP) increased, demand for statistical copolymers (PP random copolymer) decreased.
MRC

MOSCOW (MRC) -- Asia is expected to receive up to 1.7 million tonnes of naphtha from the West, including Europe, the Mediterranean and the United States in January, which is more than 6% higher versus 2019's monthly average, reported Reuters with reference to industry sources' statement on Friday.

But low supplies from the Middle East, which is the largest naphtha supplier to Asia, will keep a supply crunch going for a while more, they added.

According to data from Refinitiv's Oil Research Team, up to 2.3 million tonnes of naphtha are expected in Asia from the Middle East, down from a monthly average of close to 2.5 million tonnes in 2019.

"We probably are still short of some 300,000 tonnes of naphtha next month," said one of the sources who tracks eastbound cargoes.

The supply crunch has persisted since September, when drone attacks hit Saudi oilfields.

That prompted Saudi oil giant Aramco to snap up available spot cargoes to meet customers' needs.

Refinery maintenance in the Middle East in the fourth quarter including facilities in Qatar and Saudi Arabia, and an upcoming turnaround in the United Arab Emirates added to the supply woes, industry sources said.

These factors have driven naphtha premiums to multi-year highs and crack spreads (the premiums of refining a barrel of Brent crude into naphtha) to a two-year high.

Asia's naphtha crack was near a two-year high on Thursday at USD124.60 a tonne but fell on Friday to a five-session low of USD116.15 a tonne.

That still contrasted with the situation in June when the value turned negative for the first time in a decade.

"Naphtha was extremely bearish for a long time but it's now overheated and petrochemical margins are so squeezed that makers are contemplating cracker run cuts," said a Singapore-based source.

Naphtha is a feedstock for plastics. The latter's prices typically have to be USD400 to USD450 above naphtha to reach a break-even point.

At present, plastics are sold between USD800 and USD900 a tonne on a cost-and-freight (C&F) Southeast Asia basis, depending on the grades, while naphtha is over USD600 a tonne.

"It's getting harder to keep crackers running at maximum mode given the naphtha prices," said a North Asian source, echoing the view of many other buyers.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,724,670 tonnes in the first ten months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market in January-October 2019 totalled 1,066,520 tonnes, up by 7% year on year. Supply of block copolymers of propylene (PP block copolymer) and homopolymer of propylene (homopolymer PP) increased, demand for statistical copolymers (PP random copolymer) decreased.
MRC

MOSCOW (MRC) -- Insurers of Philadelphia Energy Solutions (PES) have indicated they will make a second payment of USD15 million from its property policy in connection to the June fire and subsequent shutdown of the plant, court documents showedsaid Hydrocarbonprocessing.

The payout will be distributed among debtors who were insured under the company’s commercial property coverage policy, according to the documents.

Earlier this year, the insurers made an initial USD50 million payment to the refiner, which is currently navigating Chapter 11 bankruptcy.

PES entered bankruptcy a month after a June 21 fire and series of blasts destroyed an alkylation unit at its massive refinery complex. Shortly after the blaze, the company requested an advance payment on USD1.25 billion in property damage and business interruption insurance coverage, but it was denied.

The plant, which was the largest refinery on the U.S. East Coast, shut its last crude distillation unit in late July.

The refinery has since been put up for sale and has attracted interest from parties ranging from biofuels producers to real estate developers.

The company’s bankruptcy case hinges on receiving insurance proceeds for up to $1 billion for property damage and as much as USD250 million for loss of business after the fire, according to earlier filings with the U.S. bankruptcy court for the District of Delaware.

Without the payouts, PES could be forced into Chapter 7 liquidation.
MRC