Repsol expands VLSFO offer to 15 Spanish ports

MOSCOW (MRC) -- Spanish integrated producer Repsol said June 8 it has begun to offer very low sulfur fuel oil for loading into trucks at 15 of its Spanish ports, said S&P Global.

The company said the service is available from June at the southern ports of Huelva, Cadiz, Algeciras, Tarifa, Sevilla, Malaga, Motril and Almeria and the northern ports of A Coruna, Ferrol, Vilagarcaa de Arousa, Marin, Vigo, Aviles and Gijon.

Previously the VLSFO (with 0.5% sulfur content) was made available via barge at the Mediterranean ports of Algeciras, Valencia and Barcelona as well as internationally at Callao, Peru, as well as Singapore and Panama.

Three of the company's Spanish refineries -- A Coruna, Bilbao and Tarragona -- have the capacity to process low sulfur crude and produce VLSFO in significant quantities, while its trading unit is used to optimize production and operations. The company also offers marine diesel (MGO) which is compatible with IMO 2020 regulations, it said.

As MRC wrote previously, in Q1 2016, Repsol completed the construction work of its new metallocene polyethelene plant at its Tarragona site. Repsol started up the plant and began production and marketing of this new product during Q2 2016.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 383,760 tonnes in the first two month of 2020, up by 14% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased due to the increased capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market were 192,760 tonnes in January-February 2020, down by 6% year on year. Homopolymer PP accounted for the main decrease in imports.

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.
MRC

1. China recovery raises hopes for US, Europe polyolefins, says LyondellBasell CEO

MOSCOW (MRC) -- Bob Patel, LyondellBasell's CEO, says polyolefins demand in China is recovering rapidly from the economic chaos created by the coronavirus disease 2019 (COVID-19) pandemic, reported Chemweek. He is optimistic that both the US and European markets will return at a similar pace, and that the company's capacity utilization could near previous levels by the end of 2020. "Demand is improving very well in China," Patel said during a webcast this morning with Lyn Tattum, vice president/events at IHS Markit and publisher of Chemical Week. "I read recently that oil consumption in China is back to almost 90% of the pre-pandemic level, and we see that in the demand for our products."


MRC

MOSCOW (MRC) -- LyondellBasell CEO Bob Patel says COVID-19 has cast uncertainty over both short- and long-term plans. Although he is optimistic about the overall economic outlook, he believes the pandemic could leave a deep imprint on the energy markets and global trade, challenging basic assumptions about project returns, supply, and demand, said Chemweek.

Patel discussed business conditions last week during a webcast with Lyn Tattum, vice president/events at IHS Markit and publisher of Chemical Week. "Near term, [we're] preparing for recovery and working through scenarios," Patel says. "Could there be a reduction in activity again? It's hard for me to imagine that we would go back to a complete lockdown like we just went through around the world, but we have to contemplate scenarios of a second wave and what might happen."

The company's medium-term planning revolves around finishing its large capital projects, particularly the propylene oxide/tert-butyl alcohol (PO/TBA) facility at Channelview, Texas. The project was originally slated for completion during the second half of 2021, but in late March, LyondellBasell announced that it would push the date back one year in response to the pandemic.

A new 550,000 metric tons/year high-density polyethylene (HDPE) plant at La Porte, Texas, the first to employ LyondellBasell's Hyperzone dual-reactor technology, has been online since February. "I think by July/August we should be running the operation very well and producing the grades we intended," says Patel.

LyondellBasell's longer-term planning has been complicated by the crude oil price collapse, which has significantly undercut the cost advantage of ethane-based polyethylene production in the US.

"We're thinking through feedstock scenarios," says Patel. "I believe that there will be advantage in the US, but the thing that we're really trying to assess is how wide that advantage will be. And then the implications on end-use demand--will people fly less, drive more? Will there be more work from home? And other market trends. What are the implications of all of that on demand for our end products? So we're also thinking through strategically what we need to do long-term." Patel says 2-3 years are likely to pass before the company decides to pursue another PE project.

Another major question is the effect of the pandemic on trade flows. "For the last 10-15 years, global trade has increased, [but] I do think that as a scenario we should contemplate whether what has happened in the last 90-120 days could slow that down," says Patel. "I don't think we significantly go backwards, but I could see that in China, for example, more of the local growth is met with local production."

LyondellBasell's polyolefins joint venture with China's Liaoning Bora, announced in September 2019, could play a key role in responding to such a shift. Patel says the project, which includes a steam cracker and downstream polyethylene (PE) and polypropylene (PP) units, is expected to begin production during the fourth-quarter of 2020.

"This could be a platform for us for future investment in China, in terms of adding onto the existing facilities over the next decade or so," says Patel. "While we didn't predict something like this at the time we undertook the Bora project, we were firmly of the mind that we want to be [both] where the market is and where the feedstock is. We wanted to kind of have diversity of investment, and I think it will prove out to be quite a good investment."

Patel points to the August 2018 acquisition of plastics compounder A. Schulman to illustrate the benefits of LyondellBasell's diversification strategy. "Our legacy compounding business was 95% automotive, and with the acquisition of A. Schulman, we're able to get into applications like food packaging, medical, other durable goods, and some other products in areas that are not just polypropylene based," he says. "With the slowdown in automotive in our compounding business, it's actually the A. Schulman part that's doing quite well, so I think this notion of diversifying our participation in end-use has really paid off."

As MRC reported earlier, global petrochemical producer LyondellBasell has reduced rates across its system to accommodate lower demand wrought by shutdowns around the globe to stem the spread of the coronavirus pandemic, said the company's CEO Bob Patel. LyondellBasell's overall global petrochemical and refining assets were expected to operate at 60% to 80% of nameplate capacity through the second quarter, Patel said during the company's first-quarter earnings call. European crackers were seen running at 80% to 85%, while US crackers were expected to run at about 75%, he said.

We also remind that to further aid in the fight against the COVID-19 pandemic, LyondellBasell (LBI) donated a key ingredient to Huntsman Corporation to produce hand sanitizer for US first responders.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 721,290 tonnes in the first four month of 2020, up by 4% year on year. Low density polyethylene (LDPE) and linear low density polyethylene (LLDPE) shipments grew partially because of the increased capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market totalled 347,440 tonnes in January-April 2020 (calculated by the formula production minus export plus import). Supply exclusively of PP random copolymer increased.

LyondellBasell is one of the largest plastics, chemicals and refining companies in the world. Driven by its 13,000 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, and improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road. LyondellBasell sells products into approximately 100 countries and is the world's largest licensor of polyolefin technologies.
MRC

MOSCOW (MRC) -- Sika has acquired Modern Waterproofing Group, a leading manufacturer of roofing and waterproofing systems in Egypt, said the company.

The acquisition supplements and rounds off the product portfolio of Sika Egypt and offers new opportunities for growth in the Egyptian construction market. The acquired business generates annual sales of CHF 26 million.

The Egyptian company manufactures solutions for the waterproofing and roofing markets, focusing on a comprehensive range of modified bitumen membranes; as well as offers liquid coatings and insulation boards.

“The expanded product portfolio will significantly strengthen our position in the Egyptian construction market,” said Ivo Schadler, regional manager for Europe, Middle East and Africa (EMEA) at Sika.

As MRC informed earlier, French building materials group Saint-Gobain (Paris, France), through its subsidiary Schenker-Winkler Holding AG (SWH), has started to dispose of its entire 10.75% stake in the Swiss construction chemicals company Sika (Baar, Switzerland) through a private placement to institutional investors.

As MRC informed earlier, Russia's output of products from polymers grew in April 2020 by 11.2% year on year due to quarantine restrictions. However, this figure increased by 3.4% year on year in the first four months of 2020. According to the Russian Federal State Statistics Service, April production of unreinforced and non-combined films decreased to 107,000 tonnes from 110,400 tonnes a month earlier. Output of films products grew in the first four months of 2020 by 12.5% year on year to 402,800 tonnes.

Sika, a specialist in sealants and adhesives with origins dating back to 1910, employs some 25,000 people and has more than 300 plants worldwide. The group reported sales of CHF8.1 billion in the financial year 2019.
MRC

MOSCOW (MRC) -- Iraq wants OPEC+ to take into consideration the economic and living conditions of countries when assigning quotas in oil production cuts, the country's finance minister said, as OPEC's second-largest oil producer struggles to adhere to it production limits, said S&P Global.

"Iraq's decision to comply with OPEC+ agreement is good and sound and we are committed to it until its expiry," Ali Allawi said in a televised press conference June 7. "But we want also to have new future rules in order to distribute this burden on countries, taking into consideration economic conditions of these countries and living standards when these amounts of cuts are implemented."

Allawi, who used to be acting oil minister in the cabinet of Prime Minister Mustafa al-Kadhimi, blamed on June 2 "technical issues" for the country's failure to further cut its output and reiterated the country's commitment to the OPEC+ agreement.

Iraq pumped 4.213 million b/d in May and exported 3.63 million b/d, oil marketer SOMO said June 7. The production figure was above the country's 3.592 million b/d quota for May under the OPEC+ agreement.

OPEC+ agreed on June 6 to extend its record 9.7 million b/d cut for May and June to July and mandated oil quota busters such as Iraq to over-comply with cuts in July, August and September to make up for overproduction.

Iraq has failed over the past three years to stick to its quota as it grappled with the aftermath of its war with the Islamic State group between 2014-2017 and ensuing financial problems.

The country has also struggled with internal political upheavel, with protests erupting in October and leading to the resignation of the government of Adel Abdul Mahdi.

Iraq stayed under the caretaker government of Abdul Madhi until the appointment of the Kadhimi government in May. The outbreak of the coronavirus has also taken a toll on Iraq.

As MRC informed earlier, Iraq's oil exports, excluding those from the semi-autonomous Kurdish region, fell 6.6% in May, according to the oil ministry, indicating that OPEC's second-biggest oil producer may have struggled to cut its output by about 23% in accordance with the new OPEC+ agreement. Iraq's oil exports in May averaged 3.212 million b/d, the ministry said in a statement on June 1. In April, exports were 3.438 million b/d.

As MRC informed previously, Iraq's oil-rig count has tumbled by almost two-thirds this year after international oil companies were ordered to cut spending because of the oil crash and OPEC's second-largest producer agreed to stringent new OPEC+ cuts.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 557,060 tonnes in the first three month of 2020, up by 7% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments rose because of the increased capacity utilisation at ZapSibNeftekhim. Demand for LDPE subsided. At the same time, PP shipments to the Russian market was 267,630 tonnes in January-March 2020, down 20% year on year. Homopolymer PP and PP block copolymers accounted for the main decrease in imports.
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