Indiaian BPCL to buy Iranian oil in Feb after 3-month gap

MOSCOW (MRC) -- State-run Bharat Petroleum Corp will import 1 million barrels of Iranian oil in February after a gap of three months, with the nation’s overall purchases from Tehran remaining at 9 million barrels, reported Reuters with reference to three industry sources' statement.

The United States in early November granted India a six-month waiver from sanctions on Iran’s oil exports.

Under the agreement, New Delhi must restrict its Iranian oil purchases to 1.25 million tonnes, or 9 million barrels.

BPCL and Hindustan Petroleum Corp will lift 1 million barrels each of Iranian crude oil in February, the sources said. HPCL this month resumed purchases of Iranian oil after a gap of six months. The company halted Iranian oil purchases in July after its insurance company refused to provide cover for the crude because of US sanctions, although its chairman said HPCL may resume buying Iranian oil under sanctions waivers.

Indian Oil Corp, the country’s top refiner, will lift 5 million barrels of Iranian oil in February, the same as this month. Mangalore Petrochemicals Ltd will buy 2 million barrels compared with 3 million barrels this month, the sources said.

An IOC official had previously said his firm would lift 180,000 bpd - the full volume contracted under an annual deal with Iran for this fiscal year ending March 31, 2019.

India recently exempted rupee payments to the National Iranian Oil Co (NIOC) for crude oil imports from a steep withholding tax, paving way for pending dues to be cleared.

HPCL, IOC and BPCL did not immediately respond to requests for comment, while MRPL declined comment.

As MRC informed previously, BPCL plans to set up a petrochemicals unit at its Bina refinery in Madhya Pradesh as part of its Rs25,000 crore expansion plan for the refinery. The petrochemical unit, which will include a 1.5 mln tpa naphtha cracker, is expected to cost Rs6,000-7,000 crore.

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.

Bharat Petroleum Corporation Limited (BPCL) is an Indian state-controlled oil and gas company headquartered in Mumbai, India. Bharat Petroleum owns refineries at Mumbai, Maharashtra and Kochi, Kerala (Kochi Refineries) with a capacity of 12 and 9.5 million metric tonnes per year.
MRC

MOSCOW (MRC) -- PKN Orlen has informed that on 5 February 2020, as a part of investment project called: "Visbreaking Installation at production plant in Plock", it signed an agreement with consortium of companies: KTI Poland S.A. and IDS-BUD S.A. for design, deliveries and building "in turn key" formula of the Visbreaking Basic Installation for a total amount of ca. PLN 750 m, as per the company's press release.

The project's implementation aims to improve crude oil production efficiency by increasing the yield of high-margin products as a result of in-depth conversion of vacuum residue from the Crude Distillation Unit.

The cost of investment will amount to ca. PLN 1 bn.

The finalization of the investment is planned by the end of 2022.

After realization of the project it is estimated that the operating profit EBITDA of PKN Orlen may increase in the range of PLN 340 to 415 m yearly.

As MRC informed before, in September 2019, Honeywell announced that PKN ORLEN had licensed the UOP MaxEne process, which can increase production of ethylene and aromatics and improve the flexibility of gasoline production. The project, for the PKN Orlen facility in Plock, Poland, was in the basic engineering stage then.

Ethylene is the main feedstock for the production of polyethylene (PE).

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.
MRC

MOSCOW (MRC) -- Trinseo, a global material solutions provider and manufacturer of plastics, latex binders, and synthetic rubber, plans to build a Thermoplastic Elastomers (TPE) pilot facility at the company's existing manufacturing site in Hsinchu, Taiwan, which will begin operations in 2020, as per the company's press release.

The investment in a state-of-the art TPE pilot facility in Asia Pacific is the next step of Trinseo’s TPE growth roadmap following the acquisition of Italian-based API S.p.A, in July 2017. Once the new pilot line in Hsinchu is operational, Trinseo will locally produce its custom engineered TPE and thermoplastic urethanes (TPU), including its leading bioplastics portfolio.

"The pilot facility demonstrates our commitment to offer a differentiated, globally available TPE portfolio to our customers in the automotive, consumer electronics, footwear and medical markets," said Tim Stedman, Senior Vice President, Strategy and Corporate Development at Trinseo. "This investment in growth in the Asia Pacific region will further strengthen our ability to create growth synergies with customers between our rigid and soft-touch polymers."

As MRC informed before, Trinseo have announced a price increase for all polystyrene (PS) grades, acrylonitrile-butadiene-styrene (ABS) and acrylonitrile styrene copolymer (SAN) grades in Europe. Effective February 1, 2020, or as existing contract terms allow, the contract and spot prices for the products listed below rose as follows:

-- STYRON general purpose polystyrene grades (GPPS) -- by EUR100 per metric ton;
-- STYRON and STYRON A-Tech and STYRON X- Tech high impact polystyrene grades (HIPS) - by EUR100 per metric ton;
- MAGNUM ABS resins - by EUR55 per metric ton;
- TYRIL SAN resins - by EUR55 per metric ton.

According to ICIS-MRC Price report, significant changes are not expected in the Russian PS market this month. Nizhnekamskneftekhim rolled over January prices of material for shipments in February. Penoplex also maintained its GPPS prices the same, whereas Gazprom neftekhim Salavat will finally set February prices this week, but no major changes are expected.

Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo's technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015. Trinseo had approximately USD4.6 billion in net sales in 2018, with 16 manufacturing sites around the world, and approximately 2,500 employees.
MRC

MOSCOW (MRC) -- Negotiations on prices of European polyvinyl chloride (PVC) for February shipments to the CIS markets have begun this week. Prices of raw materials in Europe remained steady, however, European producers have announced an increase in PVC export prices, according to the ICIS-MRC Price Report.

February contract price of ethylene was agreed at the level of January , which theoretically suggests the unchanged cost of production of polyvinyl chloride. Nevertheless, a balanced domestic market and good demand from key export markets allow European producers to play to increase PVC export prices.

Export prices of PVC for CIS countries are discussed at an increase of EUR20-30/tonne against the price of January.
Also, by increasing of the price of polyvinyl chloride, European producers are trying to compensate for the decrease in margins in caustic soda, which has been seen in the last few months.

The demand for PVC is not strong in the CIS countries in February due to a number of reasons, and basically reduced to the procurement of PVC K 58 and K 70.

European producers have no serious restrictions on export volumes, but most sellers try to sell PVC for export at the highest possible prices. Several producers intend to achieve an increase in export prices by EUR40/tonne compared to January, but some consumers report that they managed to limit the price increase to EUR20-30/tonne.

But in general, deals for February shipments of suspension PVC (SPVC) to the CIS markets were held in the range of EUR725-795/tonne FCA.
MRC

MOSCOW (MRC) -- China said it would slash tariffs on USD75 billion of US imports in half as part of its efforts to implement a recently signed trade agreement with Washington, reported The Wall Street Journal.

Beginning Feb. 14, China will cut tariffs on some US goods to 5% from 10%, while levies on some other items will be reduced to 2.5% from 5%, China’s Ministry of Finance said in a statement Thursday. The tariffs were imposed in September and December during a brutal trade fight between the world’s two largest economies.

The tariff cuts come amid growing doubts about Beijing’s ability to follow through on the phase-one trade deal, in which China has pledged to boost its purchases of American merchandise and services by USD200 billion over two years.

A coronavirus outbreak that began in China in late January and has spread to more than a dozen countries has caused a near-standstill in economic activity in the country. Chinese authorities have placed many parts of the country on lockdown in an effort to contain the epidemic.

Even before the outbreak, many economists and analysts cast doubt on Beijing’s ability to meet the agreement’s purchasing targets, which cover products ranging from soybeans and poultry, oil and gas to manufactured goods. Now, with the health crisis threatening an already weakening economy, Beijing could find it more difficult to follow through on all of its pledges.

Even so, the decision to reduce tariffs indicates that the Chinese leadership remains intent on implementing the deal that has helped halt the nearly two-year trade war between the two nations.

In a statement accompanying Thursday’s announcement, the Finance Ministry said the decision was intended to "alleviate economic and trade frictions and expand economic and trade cooperation" between the two countries. "We hope to work with the United States towards the ultimate elimination of all increased tariffs," it added.

As a condition of Beijing signing the initial trade deal, inked on Jan. 15, the US agreed to cut tariffs on USD120 billion of Chinese goods by half, to 7.5%, within about 30 days, and to forgo other planned tariffs.

The biggest section of the phase-one deal covers Chinese pledges to increase US imports. Beijing agreed to buy an additional USD200 billion in goods, split across 2020 and 2021, with USD77 billion in additional trade the first year and USD123 billion the second year.

Over the two years, China agreed to boost its purchasing of US goods above 2017 levels, including an increase of about USD78 billion in manufacturing, USD32 billion in agriculture, USD52 billion in energy and USD38 billion in services. In 2017, the US exported USD186 billion of goods and services.

To fulfill the targets, US exports to China would need to climb to USD263 billion in 2020 and USD309 billion in 2021, an increase without precedent in the history of US trade.

Chinese officials have indicated that it would cut tariffs in a bid to fulfill these pledges.

As MRC informed earlier, in H2 2019, tariffs sharply reduced exports of two grades of US polyethylene (PE) amid the ongoing US-China trade dispute. As new US startups brought more high density and linear low density polyethylene production (HDPE and LLDPE) on line, flows into China, the largest global demand center, retreated since China imposed 25% tariffs on those grades in August last year. Those tariffs, like the rest China imposed on the US products, were in response to tariffs the US first imposed on Chinese products.

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.
MRC