Huntsman adjusted earnings down Q4 2019 on volume, pricing

MOSCOW (MRC) -- Huntsman reports fourth-quarter net income of USD308 million, swinging from a loss of USD315 million in the year-ago period, according to Chemweek.

Adjusted net income came to USD65 million, down 28% year over year (YOY) from USD90 million. Sales totaled USD1.657 billion, down 9% YOY from USD1.821 billion. Volume declined in all segments except polyurethanes, while pricing declined in all segments except advanced materials.

Adjusted earnings per share of 29 cents/share matched the average analyst estimate as compiled by Refinitiv (New York).

"Heading into 2020 we remain focused on what we can control, which will include investing both organically and through acquisitions into our downstream and specialty platforms, and being balanced in our approach to capital allocation, including maintaining a competitive dividend and ongoing opportunistic share repurchases,” says Peter R. Huntsman, chairman, president, and CEO.

Huntsman expects continued demand headwinds for polyurethanes, but growth in insulation, particularly spray foams. Industrial markets for advanced materials will remain weak. In the performance products segment, amines volumes will continue to grow, although demand for maleic acid will remain soft. The company also expects stable volume in textile effects, with continued growth for specialty products.

The polyurethanes segment recorded revenue of USD980 million, down 3% YOY, and adjusted EBITDA of USD122 million, down 13%. Lower average selling prices for methylene di-para-phenylene isocyanate (MDI), mainly in China and Europe, were partially offset by higher volumes in most major markets.

Revenue in performance products totaled USD278 million, down 10% YOY, and adjusted EBITDA was USD43 million, up 10%. Weaker market conditions pulled down both sales volumes and average selling prices, which also reflected lower raw material costs. Profitability increased owing to lower fixed costs and the acquisition of Sasol’s half of their German maleic anhydride joint venture.

The advanced materials segment reported revenue of USD241 million, down 9% YOY, and adjusted EBITDA of USD42 million, down 13%. The economic slowdown and customer destocking pulled down volumes in most markets, says Huntsman. Average selling prices were stable locally, but the US dollar was stronger YOY.

Revenue in the textile effects segment declined 7% YOY to USD180 million, and adjusted EBITDA declined 14% to USD18 million. Volume declined as trade uncertainty cut into demand, says the company, and average selling price declined in line with market prices.

As MRC reported earlier, in January 2020, Indorama Ventures Public Company Limited (IVL), a global chemical producer, completed its acquisition of Huntsman’s world-class integrated oxides and derivative businesses, including a large flagship site on the US Gulf Coast (USGC) at Port Neches, as well as Chocolate Bayou and Dayton in Texas, Ankleshwar in India, and Botany in Australia, as per IVL's press release.

The acquisition is a profitable and growing end applications business along with unique products and geographical profile among the crowded olefins space. It has a well-integrated assets base with an extensive infrastructure and future expansion possibilities. The area is adjacent to many USGC feedstock suppliers. The cash value of USD2.0 billion makes it the largest acquisition by Indorama Ventures ever and now our capital employed is nicely spread over plastic, chemicals and fibers. The transaction value translates to an EV/EBITDA of ~5.7x and is expected to add substantial synergies to Indorama’s existing 450kta Ethane/Propane Cracker and our 550kta EO/EG. IVL will now be integrated from Ethane to PET as well as the high-margin EO and PO derivative businesses.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).

Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated and specialty chemicals with 2017 revenues of more than USD8 billion. Its chemical products number in the thousands and are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets. The company operate more than 75 manufacturing, R&D and operations facilities in approximately 30 countries and employ approximately 10,000 associates within its four distinct business divisions.
MRC

Shell and Gasunie plan to build massive Dutch green hydrogen plant

MOSCOW (MRC) -- Oil and gas company Royal Dutch Shell and Dutch gas company Gasunie plan to build a massive green hydrogen plant in the northern Netherlands in the next decade, the companies said, to cut emissions, reported Reuters.

Fuelled by a large new wind farm off the coast of Groningen province, the plant would ultimately be able to produce 800,000 tonnes of hydrogen by 2040, the companies said, cutting the Netherlands’ CO2 emissions by about 7 megaton per year.

The companies expect to start a feasibility study this year, while they seek other industrial and energy partners to join.

"In order to realise this project, we will need several new partners," said Shell Netherlands director Marjan van Loon.

"Together we will have to pioneer and innovate to bring together all the available knowledge and skills."

The plant would use a water electrolysis unit to convert sustainable electricity into hydrogen, which can then be stored for reconversion into power or for direct industrial use.

Its capacity would be roughly equal to the hydrogen produced by natural gas now used by industrial factories in the Netherlands, helping the Dutch to reach their target of reducing CO2 emissions to 49% of their 1990 level by 2030.

The small but densely populated Netherlands still has the fifth highest level of CO2 emissions per capita in the European Union, while deriving just 7% of its energy from renewable sources.

Shell and Gasunie’s plans, however, are still in an early stage and depend, among other things, on government permits, the assignment of new wind farm locations in the North Sea and the availability of Dutch and European subsidies for green energy.

The project envisages a wind farm that would grow from a capacity of 3 gigawatt (GW) to 4 GW in 2030 to possibly 10 GW by 2040, sufficient to meet the current electricity consumption of about 12.5 million Dutch households.

The first wind turbines could be ready in 2027, Shell and Gasunie said, and would be used to start the production of green hydrogen in a large plant in the town of Eemshaven and possibly also in facilities at sea.

The hydrogen would then be carried by Gasunie’s existing pipelines to industrial customers in the Netherlands and northwest Europe.

As MRC wrote previously, in late February 2020, Royal Dutch Shell Plc shut the large crude distillation unit (CDU) at its 211,270 barrel-per-day (bpd) Convent, Louisiana, refinery for an overhaul. Shell shut the 130,000 bpd VPS-1 CDU for an overhaul expected to take 30 days to complete.

Besides, a catalytic reformer was shut last Sunday night at Royal Dutch Shell Plc’s 211,270-barrel-per-day (bpd) refinery in Convent, Louisiana, after a brief fire.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).

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

LyondellBasell to start turnaround at Texas BD unit in early March

MOSCOW (MRC) -- LyondellBasell, one of the largest plastics, chemicals and refining companies in the world, is likely to undertake a planned shutdown at its butadiene (BD) unit, according to Apic-online.

A Polymerupdate source in the U.S. informed that, the company has planned to halt operations at the unit for maintenance in early-March, 2020. The unit is expected to remain off-line for around two months.

Located at Channelview, Texas in the US, the BD unit has a production capacity of 390,000 mt/year.

LyondellBasell also operates several crackers at the site with the combined capacity of 1,900,000 tonnes of ethylene and 1,5000,000 tonnes of propylene per year.

We remind that, as MRC informed before, LyondellBasell shut down its cracker in La Porte (Texas, USA) on 19 September 2019 because of the flooding, caused by the tropical storm Imelda. According to the company's statement, this plant, which can produce 1,150,000 tonnes of ethylene per year, was shut on Wednesday when water entered a building containing electrical components and damaged critical process control equipment.

Butadiene is one of the feedstocks for the production of acrylonitrile-butadiene-styrene (ABS).

According to MRC's DataScopr report, overall ABS imports to the Russian market decreased in 2019 by 4% year on year to 33,700 tonnes.

LyondellBasell is one of the largest plastics, chemicals and refining companies in the world. Driven by its employees around the globe, LyondellBasell produces materials and products that are key to advancing solutions to modern challenges like enhancing food safety through lightweight and flexible packaging, protecting the purity of water supplies through stronger and more versatile pipes, improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road, and ensuring the safe and effective functionality in electronics and appliances. LyondellBasell sells products into more than 100 countries and is the world's largest producer of polymer compounds and the largest licensor of polyolefin technologies.
MRC

Oil plunges to 14-month lows as coronavirus spread outside China sparks demand fears

MOSCOW (MRC) -- Dated Brent was assessed by S&P Global at USD50.49/b Friday, the lowest since December 31, 2018 and down nearly 22% from January 20, reported S&P Global.

Year-ahead Brent futures settled at a 19 cents/b contango to the front month Friday, flipping from a USD1.75/b backwardation February 21.

The one-year NYMEX WTI spread finished Friday in a USD1.41/b contango, compared to an 81 cent/b backwardation February 21.

The Singapore jet crack spread against Brent ended Friday at 5.68/b, down from USD11.34/b January 20.

The Rotterdam jet fuel crack against Brent ended Friday at USD8.58/b, down from USD14.17/b January 20.

The New York jet crack ended Friday at USD10.024/b, down from USD14.19/b January 20.

Oil prices moved sharply lower last week amid a renewed focus on demand destruction following a flurry of new coronavirus cases outside of China.

Now ICE front-month Brent futures settled at USD50.52/b Friday, down USD7.98 on the week, and down 22.5% since January 20, when commodities markets began to react to the virus.

S&P Global Platts Analytics has adjusted its 2020 global oil demand growth outlook down to 860,000 b/d, marking the weakest forecast since 2011. Asian refined products demand is expected to grow by 380,000 b/d in 2020, "posting its weakest growth since the global financial crisis in 2009," according to Platts Analytics.

Globally, 84,161 cases of Covid-19 coronavirus have been confirmed in 59 countries as of Friday, according to University of Virginia data.

While the overall number of new cases continues to fall, the growth rate outside of China accelerated last week, with major outbreak emerging in South Korea, Italy, and Iran.

"COVID-19 is arguably the biggest risk to global growth since the Great Recession," warned Platts Analytics in a recent update. "The rolling geographic nature of the virus's spread means its duration could be extended into the second quarter."

Major stock indicies fell into correction territory with the S&P 500 closing Friday down 11% from week-ago levels.

S&P Global Platts Analytics has adjusted its 2020 global oil demand growth outlook down to 860,000 b/d, marking the weakest since 2011. Asian refined products demand is expected to grow by 380,000 b/d in 2020, its weakest since 2009.

Key international airlines have suspended or reduced flights due to the virus, reducing jet fuel demand. United Airlines and Delta this week extended route modifications beyond China, while IAG, the parent company of British Airways, Iberia, Aer Lingus and Vueling, Friday said it would significantly cut capacity on its routes to and from Italy in March and would announce further capacity cuts soon.

While Sentinel Midstream's Texas GulfLink deepwater crude export terminal project remains on schedule, the spread of the virus comes just as the company is trying to nail down contracted shippers and buyers, especially in Asian markets, putting talks on hold.

The Port of Corpus Christi expects February crude exports to slip from January's record-high 1.38 million b/d due to ripple effects from coronavirus.

European refiners are starting to cut runs and alter their refining yields as middle distillate margins sink.

Demand for Chinese mainstays such as Russian ESPO Blend crude and medium sour Oman is expected to take a hit in February, with trade and economic activity declining.

Refinery run rates at China's state-owned oil giants - Sinopec, PetroChina, CNOOC and Sinochem - fell to a record low 67% of nameplate capacity in February, from 85% in January. Run rates for independent refineries in Shandong plunged to 35-36% from 63.5% in January, with 15 refineries idle in February.

With Asia's crude buying curtailed while the region tackles the outbreak, more oil from West Africa is being offered in Europe.

OPEC still planning to meet in Vienna March 5-6, but is monitoring situation after coronavirus case was reported there. A technical committee February 7 recommended deepening the OPEC+ 1.7 million b/d production cut accord by 600,000 b/d through the end of Q2. Russia has yet to endorse the plan.

As MRC informed before, state-owned PetroChina shut its Guangxi Petrochemical in southern Guangxi province on February 9 for scheduled 50-day maintenance. The maintenance should help the refinery to offset stock pressure after product demand slumped due to the coronavirus outbreak.

We also remind that Sichuan Petrochemical (part of PetroChina) undertook an emergency shutdown at its naphtha cracker in Sichuan province of China on July 11, 2018 owing to a gas leak at its natural gas supply pipeline. Further details on duration of the outage could not be ascertained. Located at Sichuan province of China, the cracker has an ethylene capacity of 800,000 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 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).
MRC

Repsol certifies petrochemical complexes for the production of circular polyolefins

MOSCOW (MRC) -- After the certification of its industrial complex in Puertollano at the end of 2019, Repsol accomplished another critical milestone in its commitment to boost the circular economy of its materials, by obtaining the ISCC PLUS certification for the rest of its polyolefin production centers, said Hydrocarbonprocessing.

By certifying its Tarragona and Sines complexes, Repsol reaffirms its leadership, being the first petrochemical company to certify all its complexes for the production of circular polyolefins.

The certificates were handed out on February 14, 2020, to Jose Luis Bernal, Executive Director at Repsol Quimica, by Fabian Campillay, Executive Director of Control Union Espana.

“Our commitment to the circularity of our materials began long ago when in 2015 we began to experimentally feed oil from chemical recycling of plastic waste, becoming the first company to do it on an industrial scale. This new milestone reaffirms our leadership and commitment to circular polyolefins. A commitment that we already made public last October when we obtained the ISCC PLUS certification in our Puertollano complex and that allowed us to offer our customers in Europe the first tons of circular polyethylene and polypropylene," Jose Luis Bernal said.

To produce circular polyolefins, Repsol feeds, as an alternative raw material, oil obtained from the use of plastic waste not suitable for mechanical recycling. A waste that, otherwise, would end up in the landfill. This new raw material is fed alongside conventional raw material, reducing the consumption of non-renewable resources.

This certification guarantees the traceability of the plastic waste used at the source and, at the same time, offers the same quality and functionality of virgin polyolefins. This way, Repsol provides its customers with a portfolio of products with recycled material for applications that demand high standards of hygiene and safety, ideal for food packaging.

Once again, Repsol is committed to innovation, the excellence of its processes, and the collaboration with third parties to anticipate offering pioneering products that help its customers meet the demand of consumers for more sustainable products and that contribute to the transition towards a circular economy.

As MRC infotmed earlier, Repsol plans in the first half of March to bring capacity utilization at the plant for the production of styrene and propylene oxide in Tarragona (Tarragona, Spain) to the standard level. Repsol S.A is an integrated Spanish oil and gas company with operations in 28 countries. The bulk of its assets are located in Spain.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).

Repsol S.A is an integrated Spanish oil and gas company with operations in 28 countries. The bulk of its assets are located in Spain.Repsol
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