Shell shuts gasoline-producing FCC after fire

MOSCOW (MRC) -- Royal Dutch Shell Plc shut the gasoline-producing fluidic catalytic cracker (FCC) at its 318,000 bpd joint-venture Deer Park, Texas, refinery after a fire, sources familiar with plant operations said Reuters.

How long the 70,000-bpd FCC will be shut was unknown on Sunday, the sources said. Shell spokesman Curtis Smith said on Sunday that all individuals were safe and accounted for at the Shell Deer Park Complex, which includes the refinery and adjoining chemical plant.

"We responded to a small fire and leak at one of the units at our Deer Park Manufacturing Complex,” Smith said. “The fire is extinguished, all individuals are safe and accounted for and our operations team is working to stop the leak and safely repair the unit."

The Deer Park FCC outage will tighten supply when gasoline consumption is close to last year’s levels. U.S. finished gasoline consumption has recovered since April, when it was down by 48% from a year ago, to 6% of the 2019 level of 8.6 million bpd for the second week of July, according to the U.S. Energy Information Administration.

The FCC uses a catalyst under high heat and pressure to convert gas oil into gasoline.

Propylene is the main raw material for the production of polypropylene (PP).

According to MRC's ScanPlast, PP suppliy to the Russian market in January - May 2020 rechaed 457,930 tonnes (calculated using the formula production minus exports plus imports). The supply of only stat-copolymers of propylene (PP-random) increased.

The Deer Park refinery is a 50-50 joint venture between Shell and Pemex, Mexico’s national oil company. Shell is the managing partner.
MRC

MOSCOW (MRC) -- Oil major Chevron Corp said it agreed to buy Noble Energy Inc in an all-stock deal, valuing the Houston-based oil and gas producer at USD5 billion, said Hydrocarbonprocessing.

The offer values Noble at USD10.38 a share or 0.1191 Chevron share, a 7.5% premium to Noble’s Friday close. The deal would value Noble at roughly USD13 billion, including debt.

Noble’s assets will expand Chevron’s presence in the DJ Basin of Colorado and the Permian Basin across West Texas and New Mexico. They would also add to Chevron’s assets in the eastern Mediterranean and West Africa and yield potential annual cost savings of USD300 million.

Chevron’s offer comes more than a year after it was forced to abandon its takeover bid for Anadarko Petroleum Corp, outmaneuvered by Occidental Petroleum Corp’s higher offer.

Shale producers have been hit hard as oil prices collapsed in April due to the pandemic and a brief price war between Saudi Arabia and Russia, leading many companies to seek bankruptcy protection.

While prices have recovered from their lows, they remain depressed as a new surge of COVID-19 cases threaten to stall recovery in fuel demand.

As MRC informed earlier, Chevron Corp restarted the 112,229 barrel-per-day (bpd) Pasadena, Texas, refinery night after completing a multi-unit overhaul that was extended because of the COVID-19 pandemic.

We remind that US-based Phillips 66 remains open to developing another ethane cracker for its Chevron Phillips Chemical (CP Chem) joint venture, the refiner's CEO said in March 2018.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 595,170 tonnes in the first five month of 2020, up by 10% year on year. Deliveries of all ethylene polymers, except for linear low density polyethylene (LLDPE), rose partially because of an increase in capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market was 457,930 tonnes in January-May 2020 (calculated by the formula production minus export plus import). Deliveries of exclusively PP random copolymer increased.

Headquartered in San Ramon, California, Chevron Corporation is the the second-largest integrated energy company in the United States and among the largest corporations in the world. Chevron is involved in upstream activities including exploration and production, downstream activities including refining, marketing and transportation, and advanced energy technology. Chevron is also invested in power generation and gasification processes.
MRC

MOSCOW (MRC) -- Polish refineries increased crude oil imports by 2.2% to almost 6.5 million tons in the first quarter, mostly due to bigger purchases from Russia and Saudi Arabia, a report by the central bank said, said Reuters.

Most of the crude refined by Polish refineries owned by state-run PKN Orlen and Lotos comes from Russia via pipelines, but Warsaw has reduced its reliance in recent years and buys more oil from other sources, including the United States and Nigeria.

However, the report showed that oil supplies from Russia rose after six consecutive quarters of falls and accounted for more than 70% of total oil imports, compared with 61.5% in 2019 and 68% in 2018.

The central bank also said that the average price of oil imported to Poland rose to 229 zlotys (46.62 pounds) per barrel in the first quarter from 223 zlotys a year ago, mostly due to zloty weakening against the dollar.

The price was not yet affected by the slump in oil prices globally amid the coronavirus pandemic as the market oil price is reflected in imports with a monthly delay, the report said.

As MRC informed earlier, The European Commission has approved PKN Orlen’s acquisition of Grupa Lotos. The approval is conditional on full compliance with a commitments package offered by PKN Orlen.

As MRC informed earlier, in H1 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, currently is in the basic engineering stage. Honeywell UOP, a leading provider of technologies for the oil and gas industry, first commercialized the UOP MaxEne process in 2013. The process enables refiners and petrochemical producers to direct molecules within the naphtha feed to the processes that deliver the greatest value and improve yields of fuels and petrochemicals.

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.
MRC

MOSCOW (MRC) -- Celanese Corp. (Dallas, Tex.) announced it has reached a definitive agreement to sell its 45% equity investment in the Polyplastics joint venture (JV) to Daicel Corporation for USD1.575 billion, said Chemengonline.

Following the completion of the transaction, Daicel will own 100% of Polyplastics. "Celanese has been investing in and rapidly growing our base business in Engineered Materials globally over the last 10 years,” said Lori Ryerkerk, Celanese Chairman and Chief Executive Officer. “Among the advantages that set Celanese apart from our peers is our ability to leverage our unique business models and flexible strategy to deliver sustainable growth, especially in key markets served by our Engineered Materials business. We plan to use this opportunity to monetize a historically passive investment and allocate significant capital to higher growth businesses within Celanese.

At the conclusion of this joint venture relationship with Daicel, we extend our gratitude for their partnership and collaboration over the past 50-plus years in jointly bringing innovative products to customers and consumers worldwide."Celanese’s Engineered Materials presence in Asia is significantly greater now than when the Company entered the region more than 50 years ago. This definitive agreement with Daicel is an intentional departure from a legacy relationship to a contemporary approach which will drive future growth and greater customer development and expansion opportunities. Celanese will continue to compete with Polyplastics (Daicel) in markets and regions where there is overlapping product lines.

"The Engineered Materials business of Celanese is well-positioned to continue its growth trajectory as we increase investment in new product development to serve customer demand in growth segments and key geographies,” said Tom Kelly, Senior Vice President, Engineered Materials, Celanese. "We will continue to invest in product expansion to serve the growing demand in applications such as 5G, advanced mobility, medical/pharma, and sustainable materials. Celanese also plans to expand its manufacturing capacity and advance its T&I capabilities in Asia to meet rapidly growing demand in the region." Celanese is expected to deploy the proceeds from this all-cash transaction in value-generating opportunities, including the increase in share repurchases described below that will be accretive to EPS to offset earnings from the Polyplastics joint venture, investments in organic growth, and the judicious use of cash consistent with Celanese’s disciplined capital deployment strategy. Celanese expects to complete this transaction in the second half of this fiscal year, subject to necessary regulatory approvals and customary closing conditions. Until then, Polyplastics will continue to operate under its current joint venture ownership and management structure.

Celanese also announced that its Board of Directors has approved an increase of USD500 million to its existing share repurchase authorization. The additional authorization represents approximately 5 percent of the Company’s shares outstanding. Prior to this increase, approximately USD1.063 billion remained on the existing share repurchase authorization which remains available in addition to the new USD500 million share repurchase authorization, bringing the total authorization to USD1.563 billion, or approximately 15 percent of the Company’s shares outstanding.

As MRC informed earlier, Clariant, Celanese, and Orbia have been fined a total of EUR260 million (USD296 million) by the European Commission for breaching EU competition rules by participating in a cartel related to ethylene purchases in Europe. Westlake, which also participated in the cartel, received full immunity by revealing the breach, avoiding an aggregate fine of about EUR190 million, the Commission says.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 595,170 tonnes in the first five month of 2020, up by 10% year on year. Deliveries of all ethylene polymers, except for linear low density polyethylene (LLDPE), rose partially because of an increase in capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market was 457,930 tonnes in January-May 2020 (calculated by the formula production minus export plus import). Deliveris of exclusively PP random copolymer increased.

Celanese Corporation is a global technology leader in the production of differentiated chemistry solutions and specialty materials used in most major industries and consumer applications. Based in Dallas, Celanese employs approximately 7,700 employees worldwide and had 2019 net sales of USD6.3 billion.
MRC

MOSCOW (MRC) -- If action is not taken to deal with a deteriorating oil tanker stranded off the coast of war-torn Yemen there is a risk it could spill four times as much oil as the 1989 Exxon Valdez disaster near Alaska, the United Nations warned, said Hydrocarbonprocessing.

The Safer tanker is carrying 1.1 million barrels of crude oil and has been stranded off Yemen’s Red Sea oil terminal of Ras Issa for more than five years. On May 27 water began leaking into the engine room, threatening to destabilize it, U.N. aid chief Mark Lowcock told a Security Council meeting on the issue.

While divers from the Safer Corporation were able to fix the leak, Lowcock - who has mentioned the plight of the tanker during monthly council briefings on Yemen for more than a year - warned that “it is impossible to say how long it might hold." “The Safer is carrying 1.1 million barrels of oil. That’s about four times as much oil as was discharged in the Exxon Valdez disaster – a spill the world still talks about thirty years later,” Lowcock said.

In a statement after the briefing, the 15-member Security Council “expressed deep alarm at the growing risk that the Safer oil tanker could rupture or explode, causing an environmental, economic, and humanitarian catastrophe for Yemen and its neighbors." Last week Houthi officials said they would agree to allow a U.N. mission to conduct a technical assessment and whatever initial repairs might be feasible on the tanker. But Lowcock said similar assurances were given in August 2019 and then the Houthis cancelled the mission one day before departure.

“The U.N. team can deploy within three weeks of receiving all the necessary permits,” he said, adding that experts say eventually “extracting the oil is probably the only way to remove the threat of a spill from the 44-year-old tanker for good." The Security Council called on the Houthis to facilitate unconditional U.N. access to the tanker as soon as possible.

Yemen has been mired in conflict since the Iran-allied Houthi group ousted the government from the capital Sanaa in 2014. A Saudi-led military coalition in 2015 intervened in a bid to restore the government. Lowcock said both Yemen’s government and the Houthis first requested U.N. help with the tanker in March 2018, but then a Saudi-coalition backed offensive in the area for much of 2018 made it too dangerous to visit the site.

Then while the Houthis previously agreed to the visit they imposed preconditions and linked it with other issues, he said.

We remind that in September 2019, six world's major petrochemical companies in Flanders, Belgium, North Rhine-Westphalia, Germany, and the Netherlands (Trilateral Region) announced the creation of a consortium to jointly investigate how naphtha or gas steam crackers could be operated using renewable electricity instead of fossil fuels. The Cracker of the Future consortium, which includes BASF, Borealis, BP, LyondellBasell, SABIC and Total, aims to produce base chemicals while also significantly reducing carbon emissions. The companies agreed to invest in R&D and knowledge sharing as they assess the possibility of transitioning their base chemical production to renewable electricity.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 595,170 tonnes in the first five month of 2020, up by 10% year on year. Deliveries of all ethylene polymers, except for linear low density polyethylene (LLDPE), rose partially because of an increase in capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market was 457,930 tonnes in January-May 2020 (calculated by the formula production minus export plus import). Deliveris of exclusively PP random copolymer increased.
MRC