HDPE production in Russia grew 10% in 2019

MOSCOW (MRC) -- Russia's production of high density polyethylene (HDPE) totalled about 868,000 tonnes in 2019, down by 10% year on year. All manufacturers reduced production volumes, primarily due to long scheduled maintenance works, according to MRC's ScanPlast.

December HDPE production in Russia grew to 72,500 tonnes, whereas this figure was 65,800 tonnes a month earlier. Only Gazprom neftekhim Salavat and Kazanorgsintez raised their output. Thus, overall HDPE production reached 868,500 tonnes in 2019, compared to 960,800 tonnes a year earlier. All manufacturers reduced polyethylene production volumes, while Gazprom Neftekhim Salavat and Stavrolen showed the greatest reductions due to long stops for scheduled repairs.

The structure of polyethylene production by plants looked the following way over the stated period.

Russia's December HDPE production at Kazanorgsintez increased to 40,800 tonnes from 36,600 tonnes a month earlier. The Kazan producer partially shifted its capacities to the production of linear low density polyethylene (LLDPE). The Kazan plant's overall HDPE output reached 495,700 tonnes in January-December 2019, down by 2% year on year. At the same time, it is worth noting that the decrease in the production of HDPE helped to increase LLDPE production.

Stavrolen produced about 20,700 tonnes last month versus 20,400 tonnes in November, the Budenovsk producer limited its production capacities due to restrictions on ethylene production. The plant's overall output reached 262,300 tonnes over the stated period, down by 11% year on year.

Gazprom neftekhim Salavat increased its capacity utilisation in December, the plant's total production grew to 10,400 tonnes from 8,100 tonnes a month earlier. The Bashkir plant's overall HDPE output reached 106,000 tonnes in 2019, down by 11% year on year. Such a great reduction in HDPE production was caused by a long turnaround in July, whereas the Salavat producer did not shut its production capacities for maintenance last year.

In the period under review, Nizhnekamskneftekhim produced mainly linear polyethylene (LLDPE), the volumes of HDPE production was insignificant.


MRC

MOSCOW (MRC) -- Zagros Petrochemicals has brought on-stream its No.1 methanol plant following an unplanned outage, as per Apic-online.

A Polymerupdate source in Iran. informed that the company resumed operations at the plant on December 23, 2019. The plants was shut on December 20, 2019 owing to a technical glitch.

Located in Assaluyeh, Iran, the No. 1 plant has a production capacity of 1.65 million mt/year.

As MRC informed earlier, in August 2019, Haldor Topsoe, Mitsubishi Heavy Industries Engineering, and GTM ONE have signed a licence agreement for the design, construction, and operation of a 3000 tpd methanol plant based on Topsoe’s SynCOR MethanolTM technology. The plant will be erected at the Khimprom site in Volgograd, Russia.
MRC

MOSCOW (MRC) -- EU antitrust regulators said they had cleared polymer maker Synthomer Plc’s planned acquisition of U.S. rival Omnova Solutions Inc, subject to conditions, said the Reuters.

The approval is conditional on Synthomer’s offer to divest its global VP Latex business to address concerns of the European Commission that competition of vinyl pyridine latex would be reduced. The product is used by tyre manufacturers to make safer and more solid tyres.

"Synthomer and Omnova are the only two manufacturers of this type of latex in Europe but we can approve their merger because the companies offered to divest all of Synthomer’s VP Latex production," - Margrethe Vestager, commissioner in charge of competition, said in a statement.

Synthomer announced its plans to buy Omnova for an enterprise value of USD824 million in July to strengthen its global position.

As per MRC's ScanPlast, Russia's overall production of polyvinyl chloride (PVC) reached 975,000 tonnes in 2019, up by 2% year on year. At the same time, not all Russian producers raised their output. December total production of unmixed PVC was about 81,400 tonnes versus 84,600 tonnes a month earlier, RusVinyl decreased their capacity utilisation in November. Overall PVC production reached 975,000 tonnes in January-December 2019, compared to 958,600 tonnes a year earlier. All plants raised their output, except for Kaustik Volgograd.

Omnova is a US based specialty chemical company which develops, manufactures and markets emulsion polymers, speciality chemicals and decorative products and provides engineered surfaces for various commercial, industrial and residential end uses. On completion of the acquisition of Omnova, Synthomer will strengthen further its position as a major global player in water-based polymer solutions, with best-in-class process technology and a strong R&D platform with global geographic coverage and increased customer proximity.
MRC

MOSCOW (MRC) -- Pretium Packaging LLC, one of the largest packaging blow molders in North America, has a new private equity owner. Santa Monica, Calif.-based Clearlake Capital Group LP announced Jan. 15 that it has purchased Pretium from Genstar Capital LLC, said Plasticstoday.

San Francisco-based Genstar has owned Pretium since 2014. Terms of the deal were not disclosed. Under Genstar's ownership, Pretium has been on an acquisition spree. That may continue under Clearlake, according to Arta Tabaee, managing director of the investment firm.

In a news release, Tabaee said Clearlake will support Pretium CEO Paul Kayser and his team "in completing strategic acquisitions in this highly fragmented market."

Pretium is No. 14 on Plastics News' ranking of North American blow molders, with sales of $425 million. The company has 19 plants and 1,800 employees. Key end markets include food and specialty beverage, health care, sports nutrition, personal care, beauty and household products.

The Chesterfield, Mo.-based company primarily molds PET, high density polyethylene and polypropylene, including both virgin and post-consumer resins.

In a 2019 interview with Plastics News, Kayser said he expected Pretium to be a $1 billion company within the next five years, as the firm continues to seek out acquisition candidates and expand existing business. The company focuses on customers in the small-to-medium run market where orders can range from maybe a million to 20 million units per year. That's a sweet spot where Pretium can use its flexibility and automation expertise, he said.

Clearlake does not currently own any other plastics processing companies, according to a list of portfolio firms on its website. The company touts its Operational Improvement Approach to acquisitions, a proprietary framework that offers firms "resources and expertise that small- and medium-sized companies typically do not possess."

In the release, Kayser said: "We are thrilled to welcome Clearlake as Pretium continues driving organic growth and executes our platform consolidation strategy. With strategic resources, operational insights, and support from Clearlake, we look forward to continuing to deliver quality rigid packaging solutions to our valued customers."

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's recent acquisitions include Custom Blow Molding of Escondido, Calif., in 2016; Patrick Products Inc. of Leipsic, Ohio, in 2017; Cox Container LLC of Troy, Ala., in 2018; and two deals in 2019: Olcott Plastics Inc. of St. Charles, Ill., and Starplex Scientific Inc. of Toronto.
MRC

MOSCOW (MRC) -- Sempra Energy and Saudi Aramco announced their respective subsidiaries, Sempra LNG and Aramco Services Company, have signed an Interim Project Participation Agreement (IPPA) for the Port Arthur LNG export project under development in Jefferson County, Texas, said Hydrocarbonprocessing.

The IPPA represents another milestone for both companies after having signed a heads of agreement in May last year for the purchase of 5 million tonnes per annum (Mtpa) of liquefied natural gas (LNG) and a 25% equity investment in the Port Arthur LNG project.

"Today's announcement is a reflection of the growing alignment between our companies' interest in the overall success of the Port Arthur LNG project," said Jeffrey W. Martin, chairman and CEO of Sempra Energy. "We have a tremendous amount of respect for Saudi Aramco and its leadership team and we are pleased we can support their success in the global natural gas markets."

Saudi Aramco's President and CEO Amin H. Nasser said, "The global demand growth for LNG is expected to continue in the coming years, and we see significant opportunities in this market. This agreement with Sempra Energy is another step forward for Saudi Aramco's long-term gas strategy, and towards becoming the global leading integrated energy and chemicals company."

The initial phase of the Port Arthur LNG project is fully permitted and it is expected to include two liquefaction trains, up to three LNG storage tanks and associated facilities to enable the export of approximately 11 Mtpa of LNG on a long-term basis. Earlier this year, Sempra LNG initiated the Federal Energy Regulatory Commission pre-filing review for a subsequent potential expansion of the proposed project that would add two additional liquefaction trains for a total export capacity of approximately 22 Mtpa of LNG.

"Port Arthur LNG is expected to play a critical role in helping shape the future of global energy trade," added Martin. "This multibillion-dollar initiative is among the largest LNG projects in development anywhere in the world and is expected to deliver a cleaner energy supply to foreign markets, while creating important, high-skilled jobs right here at home."

The definitive agreements in the Port Arthur LNG export project remain subject to finalization and corporate approvals by each party in its sole discretion before they are executed. Each party's ultimate participation in the Port Arthur LNG export project also remains subject to the execution of related agreements and the fulfillment or waiver of certain conditions precedent contemplated by these agreements, including the condition that each party shall have taken a final investment decision (FID) with respect to its investment in the project at its sole discretion. The IPPA sets forth certain mechanisms for the parties to work towards these and other pre-FID activities.

Port Arthur LNG is one of Sempra LNG's five strategically located LNG development opportunities in North America and is a component of Sempra LNG's goal of developing the LNG infrastructure needed to export 45 Mtpa of clean natural gas to the global LNG market.

Development of Sempra Energy's LNG export projects is contingent upon obtaining binding customer commitments, completing the required commercial agreements, securing all necessary permits, obtaining financing and reaching final investment decisions, among other factors.

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.
MRC