Clearlake Capital acquires Pretium Packaging

MOSCOW (MRC) -- Clearlake Capital Group, L.P. (together with its affiliates, "Clearlake") in partnership with management announced that it has acquired Pretium Packaging ("Pretium" or the "Company") from Genstar Capital, said the company.

Pretium, of Chesterfield, Missouri, is focused on rigid packaging for end markets such as food and specialty beverage, healthcare, sports nutrition, personal care, beauty, and household products.

Its packaging solutions are based primarily on polyethylene terephthalate (PET), high density polyethylene (HPDE), and polypropylene (PP) resin, with an array of options, including up to 100% post-consumer recycled material content.

The company has 19 manufacturing facilities in the US.

Clearlake teamed up with Pretium’s management to buy the company from Genstar Capital. Paul Kayser, Pretium’s CEO, and the existing management team will continue to lead the company.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,904,410 tonnes in the first eleven months of 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments increased from both domestic producers and foreign suppliers. The PP consumption in the Russian market was 1,161,830 tonnes in January-November 2019, up by 7% year on year. Deliveries of all grades of propylene polymers increased, with the homopolymer PP segment accounting for the largest increase.

Pretium Packaging is a leading North American manufacturer of customized, short-to-medium volume, rigid plastic packaging solutions. The company produces containers, bottles, and closures for the food and specialty beverage, healthcare, sports nutrition, personal care, beauty, and household products end markets. Pretium serves its customers through nineteen facilities across the U.S. and Canada, and is headquartered in Chesterfield, Missouri.

Clearlake Capital Group, L.P. is a leading private investment firm founded in 2006. With a sector-focused approach, the firm seeks to partner with world-class management teams by providing patient, long-term capital to dynamic businesses that can benefit from Clearlake's operational improvement approach, O.P.S.® The firm's core target sectors are industrials and energy; software and technology-enabled services; and consumer. Clearlake has managed over USD16 billion of institutional capital since inception and its senior investment principals have led or co-led over 200 investments.
MRC

BASF to move UK headquarters to 2 Stockport Exchange

MOSCOW (MRC) -- Global chemical giant BASF is set to move its UK headquarters to 2 Stockport Exchange, said the company.

The company has been operating in the UK since 1880, with its companies supplying raw materials to most industries including agriculture, automotive chemicals, construction, energy and pharmaceuticals.

Its new home – which covers six storeys – will sit at the heart of the wider ?145m development and reach completion in February 2020.

Richard Carter, managing director of BASF in the UK and Ireland, said: "We are looking forward to moving our UK headquarters from Cheadle to this exciting new connected location later this year. Our new office space in Stockport Exchange will feature open and collaborative workspace to enable new and more agile ways of working.

"The move is part of an ongoing Future of Work project which will deliver a better workplace experience through improved digitalisation, increased flexibility and empowered leadership."

The wider transformation is being brought forward in partnership by Stockport Council and Muse Developments.

Council leader Elise Wilson added: "Today marks a real milestone in what we have achieved in Stockport. The building is looking fantastic and has been finished to a really high standard, complementing our ambitious plans for the town centre, like the Mayoral Development Corporation and the thousands of new homes and business opportunities it will create, the new Transport Interchange and improvements to Merseyway.

BASF has 13 locations in the UK, eight of them manufacturing sites, where it employs about 850 people.

As MRC informed before, BASF, the world's petrochemical major, restarted its No. 1 steam cracker on September 30, 2019, following a maintenance turnaorund. The plant was shut for maintenance in mid-August, 2019. Located at Ludwigshafen in Germany, the No. 1 cracker has an ethylene production capacity of 235,000 mt/year and a propylene production capacity of 125,000 mt/year.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,904,410 tonnes in the first eleven months of 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments increased from both domestic producers and foreign suppliers. The PP consumption in the Russian market was 1,161,830 tonnes in January-November 2019, up by 7% year on year. Deliveries of all grades of propylene polymers increased, with the homopolymer PP segment accounting for the largest increase.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries. BASF generated sales of around EUR63 billion in 2018.
MRC

US crude oil inventories fall more than expected last week

MOSCOW (MRC) -- US crude stocks fell in the latest week while gasoline and distillate inventories rose, reported Reuters with reference to the Energy Information Administration's statment.

US crude oil production rose to a record high of 13 million barrels per day in the week, the EIA said.

Crude inventories fell by 2.5 million barrels in the last week to 428.5 million barrels, much more sharply than the 474,000-barrel drop analysts had expected in a Reuters poll.

"What sticks out for me is the dramatic builds we saw in products decidedly overtaking the sentiment here, despite the draw in crude oil," said Tony Headrick, energy markets analyst at CHS Hedging.

Crude and products futures turned negative after the data. US crude traded down 57 cents at USD57.67 a barrel by 11:27 a.m.

Crude stocks at the Cushing, Oklahoma, delivery hub rose by 342,000 barrels in the last week, EIA said.

Refinery crude runs rose by 76,000 barrels per day in the last week, EIA said.

Refinery utilization rates fell by 0.8 percentage points, in the week

US gasoline stocks rose by 6.7 million barrels in the week to 258.3 million barrels, the EIA said, compared with analysts’ expectations in a Reuters poll for a 3.4 million-barrel rise.

Distillate stockpiles, which include diesel and heating oil, rose by 8.2 million barrels in the week to 147.2 million barrels, versus expectations for a 1.2 million-barrel rise, the EIA data showed.

"That’s just a gigantic build at a time of year when you’re supposed to be getting draws to heat people’s houses," said Bob Yawger, director of energy futures at Mizuho in New York.

Net US crude imports fell last week by 595,000 barrels per day in the last week, EIA said.
MRC

SAGIA, Shell and AMG to build catalyst recycling facility

MOSCOW (MRC) -- The Saudi Arabian General Investment Authority (SAGIA), Shell Overseas Services Ltd. (Shell) and Advanced Metallurgical Group N.V. (AMG) have recently signed a memorandum of understanding (MOU) to evaluate the potential for construction and operation, subject to regulatory approvals, of a spent catalyst recycling facility in Jubail Industrial City, Saudi Arabia, reported Kemicalinfo.

The signing took place in Riyadh, Saudi Arabia.

The MOU will allow SAGIA, Shell and AMG to explore the feasibility of building a world class facility to reclaim valuable metals by recycling spent residue upgrading catalysts generated by refineries in Saudi Arabia and the surrounding region.

Residue upgrading catalysts help refineries upgrade the bottom of the oil barrel into more valuable products, including generation of petrochemicals feedstocks. Such a facility would help maximise the benefits from the Kingdom’s natural resources while addressing the need to provide environmentally responsible management of spent residue upgrading catalysts.

"We are pleased to sign this MOU with AMG and Shell for the safe, efficient and clean processing of the growing quantities of spent catalysts in the region and recovery of vanadium and other precious metals for utilization in specialty steel production," said H.E. Ibrahim Alomar.

"This MOU reflects Shell’s interest in growing its presence in Saudi Arabia and serving its clients locally and regionally. New global fuel regulations, combined with the growing trend of crude oil to chemicals production, are leading refiners to develop sustainable waste management plans for their spent catalyst," said Andy Gosse.

"The recycling process also allows for the extraction of specialty alloys from spent catalysts for use by the steel market. Reclamation of these alloys in the recycling process allows steel manufacturers to benefit from a low CO2 method of sourcing the alloys as an alternative to mining. It is also the basis for building stationary batteries used for grid stabilisation for the growing renewable energy sector in Saudi Arabia. All of that is in line with AMG’s vision to enable CO2 reduction through its technologies and products," said Heinz Schimmelbusch.

The MOU will provide a framework for conducting the required studies to assess the commercial feasibility of this proposed project and, subject to regulatory approvals, the potential construction of a spent catalyst recycling facility in the region.

As MRC informed earlier, Shell Singapore restarted its naphtha cracker in Bukom Island in early December 2019, following a two months maintenance shutdown since the beginning of October 2019. Thus, this cracker was taken off-stream for the turnaround on 1 October 2019. The cracker is able to produce 960,000 tons/year of ethylene and 550,000 tons/year of propylene.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,904,410 tonnes in the first eleven months of 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments increased from both domestic producers and foreign suppliers. The PP consumption in the Russian market was 1,161,830 tonnes in January-November 2019, up by 7% year on year. Deliveries of all grades of propylene polymers increased, with the homopolymer PP segment accounting for the largest increase.

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

US energy exports to climb as China pledges ramp-up in purchases

MOSCOW (MRC) -- US energy exports to China, mostly crude oil and natural gas, will climb as the world’s two largest economies struck a trade agreement after a more than year-long tariff war, reported Reuters with reference to executives and traders' statement.

The accord did not specify quantities of the products. Energy executives and analysts welcomed the deal after liquefied natural gas (LNG) and crude exports to China largely dried up last year, but said plenty of uncertainties remained. Market reaction was mixed with oil trading lower and US stock indexes higher.

China committed under the deal to add at least USD52.4 billion in energy purchases over two years, from USD9.1 billion in 2017. This amounts to USD18.5 billion more in 2020 and another USD33.9 billion next year.

The agreement "is a step in the right direction that will hopefully restore the burgeoning U.S. LNG trade with China," said Jack Fusco, chief executive of Cheniere Energy Inc, the largest exporter of US gas. Fusco attended the ceremonial signing at the White House.

Despite China’s withdrawal from most US LNG purchases last year, U.S. sales to other Asian countries, Europe and Latin America still drove the United States to become the world’s third-biggest LNG supplier in 2019, behind Qatar and Australia.

In crude, China may increase its imports to 500,000 barrels per day (bpd) in 2020 and 800,000 bpd in 2021, analysts at Goldman Sachs said in a Jan. 10 report. It also said LNG imports could hit 10 million tonnes this year and 15 million next, valued at USD38.2 billion combined.

Traders including Vitol SA and Trafigura AG provisionally chartered four to eight supertankers to load US crude for China this month and next, data from Refinitiv, Kpler and Vortexa showed. The companies declined to comment.

One Singapore oil trader said economics favor U.S. crude as freight rates are dropping and rising shale production has US crudes selling at a discount to international Brent. But he warned that the price window "is really tricky as it can open and shut within days."

A shale boom propelled the United States to rank as the world’s largest producer of crude and natural gas, with China’s purchases of US crude and LNG surging, before the trade dispute flared.

Analysts, US energy trade executives and Asian buyers said demand, pricing and transportation costs would determine whether exports over two years hit the USD52.4 billion mark.

"We are in uncharted territory here; quota sales are not the norm," said Sandy Fielden, an energy analyst at financial services firm Morningstar.

Tariffs will remain on many products the two countries sell to one another, including LNG. China imposed a 25% tariff on LNG, crimping most activity with the United States.

"We have to have some sort of clarity around how China is going to either exclude the tariffs that are currently in place against LNG or ultimately lift them before we start to see a real sort of sizeable amount of US LNG finding its way to China," said Charlie Riedl, executive director of trade group Center for LNG.

"The purchases would require China to buy the bulk of U.S. exports and China’s refineries are also not currently set up for light US oil," said analysts at research firm Capital Economics.

China’s share of total US crude exports dropped from over 20% in the first half of 2018 before the trade war to nearly 6% in the first half of 2019.

The United States exported about USD5.4 billion worth of crude to China in 2018, but the value of those shipments slid to just USD2.6 billion in 2019 through October, according to data from the US Census Bureau and the Energy Information Administration. "This is a good first step in removing barriers with one of our most critical trading partners," said Derrick Morgan, a senior vice president at trade group American Fuel and Petrochemical Manufacturers (AFPM).

"We hope this will be the first in a series of steps to open a key market for American exports of all kinds - including energy and petrochemical products, which still are in need of tariff relief," he added.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,904,410 tonnes in the first eleven months of 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments increased from both domestic producers and foreign suppliers. The PP consumption in the Russian market was 1,161,830 tonnes in January-November 2019, up by 7% year on year. Deliveries of all grades of propylene polymers increased, with the homopolymer PP segment accounting for the largest increase.
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