Sinopec Maoming Petrochemical resumes production at No. 1 PP plant

MOSCOW (MRC) -- Sinopec Maoming Petrochemical, part of Sinopec Corporation, has brought on-stream its No.1 polypropylene (PP) unit in Guangdong, according to Apic-online.

A Polymerupdate source in China informed that, the company resumed operations at the unit following turnaround on July 27, 2020. The PP unit was shut on July 15, 2020.

Located in Guangdong, China, the No. 1 PP unit has a capacity of 170,000 mt/year.

As MRC wrote before, Sinopec Maoming Petrochemical has brought on-stream its No. 2 low density polyethylene (LDPE) unit in Guangdong. The company resumed operations at the unit on May 22, 2020. The unit was shut for a brief maintenance on May 18, 2020. Located at Guangdong in China, the No. 2 LDPE unit has a production capacity of 280,000 mt/year.

According to MRC's DataScope report, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.

Sinopec corp. is one of the world's largest integrated energy and chemical companies. Business Sinopec Corp. includes oil and gas exploration, production and transportation of oil and gas, oil refining, petrochemical production, production of mineral fertilizers and other chemical products. In terms of refining capacity, Sinopec Corp. ranks second in the world, in terms of ethylene capacity - fourth.
MRC

Russia says July oil output in line with OPEC+ deal

MOSCOW (MRC) -- Russia’s Energy Ministry said that the country’s oil output in July was unchanged from levels seen in June, in line with an OPEC+ agreement, said Reuters.

The ministry added that its level of compliance with the deal in July was close that recorded in June, when it stood at 99%. Energy ministry data published earlier on Sunday by Interfax news agency showed that Russia’s oil and gas condensate production had increased to 9.37 million barrels per day (bpd) in July, up from 9.32 million bpd in June. Oil output cuts, agreed between the Organization of the Petroleum Exporting Countries (OPEC) and other major producers including Russia, a group known as OPEC+, are due to be eased in August. Under the OPEC+ agreement, Moscow pledged to reduce its output to around 8.5 million bpd in May-July to support oil prices.

The deal does not include output of gas condensate, a light oil. The cuts under the global deal should be eased starting from August because of a recovery in oil prices. Russia has said it would increase its oil production by 400,000 bpd.

The ministry data showed that Russian oil and gas condensate production rose to 39.63 million tonnes in July from 38.16 million tonnes in June, the Interfax news agency reported. Russia usually produces 700,000 to 800,000 bpd of gas condensate. That means that excluding gas condensate, Russia could have produced around 8.57 million to 8.67 million bpd of crude oil in July.

Russian oil exports outside the former Soviet Union stood last month at 15.72 million tonnes, down 27.1% from July 2019. In barrels per day, exports reached 3.72 million, according to Interfax. The news agency also said on Sunday that Russian natural gas output reached 50.33 billion cubic metres in July, down 7.9% from a year earlier.

As MRC informed previously, data collected and tabulated by the American Chemistry Council (ACC) show that due to growth in China, global chemicals production rose by 0.6 percent in June, an improvement from the 0.5 percent decline in May, Production has been declining throughout this year, with the last monthly gain occurring in December 2019. During June, chemical production fell in major regions except Asia-Pacific. Headline global production was off 7.2 percent year-over-year (Y/Y) on a three-month moving average (3MMA) basis and was off 7.4 percent from the peak December level. Global output stood at 109.8 percent of its average 2012 levels.

At the same time, Russia's output of chemical products rose in June 2020 by 2.6% year on year. However, production of basic chemicals increased year on year by 4.9% in the first six months of 2020. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the output in January-June. Production of benzene was 106,000 tonnes in June 2020, compared to 110,000 tonnes a month earlier. Overall output of this product reached 721,000 tonnes over the stated period, up by 3.9% year on year. June production of polymers in primary form fell to 791,000 tonnes from 820,000 tonnes in May partially because of a scheduled shutdown for maintenance at ZapSibNeftekhim. Output of polymers in primary form totalled 4,900,000 tonnes over the stated period, up by 14.8% year on year.

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

According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC

Celanese to establish European compounding centre of excellence in Italy

MOSCOW (MRC) -- Celanese Corporation, a global chemical and specialty materials company, has announced that it is establishing a European Compounding Center of Excellence at the Company’s Forli, Italy facility, which includes the intended consolidation of its compounding operations in Kaiserslautern, Germany; Wehr, Germany; and Ferrara Marconi, Italy, according to the company's press release.

Creating a European Compounding Center of Excellence aligns with Celanese’s global compounding model already in place in the Americas and Asia regions. Forli is a viable choice for this model, not only due to having the largest existing infrastructure and capabilities for specialty compounding, but also because of its physical layout which allows for future expansion, paired with existing knowledge and expertise of the Company’s extensive engineering polymers portfolio.

“The Engineered Materials business is a critical growth engine for Celanese and we continue to take the strategic steps needed to ensure the future success and expansion of this business,” said Tom Kelly, Senior Vice President, Engineered Materials, Celanese. “For this reason, Celanese today announced to employees and employee representation bodies the intention to create a European Compounding Center of Excellence in Forli, Italy, and transition the compounding operations from our Ferrara Marconi, Italy; and Wehr and Kaiserslautern, Germany sites, to the Company’s Forli, Italy facility. This action is being taken to further optimize the global manufacturing footprint of our Engineered Materials facilities as part of a long-term strategy to be the preferred partner for our customers, as well as maintain our competitive position in the specialty materials market.”

Celanese intends to consolidate the compounding production volumes from the Ferrara Marconi, Wehr and Kaiserslautern sites to the Company’s manufacturing facility in Forli to improve the overall utilization of compounding assets. Celanese will transfer respective engineered materials product items (SKUs) to the Forli facility depending on customer needs and logistical considerations with the expectation that all compounding volumes from the Ferrara Marconi, Wehr and Kaiserslautern sites will be relocated there.

Celanese expects to complete this transfer and consolidation of compounding operations in the next 12-24 months. During this timeframe inventory build, customer requalification and transfer of compounding assets will take place and key dates will be communicated to customers and employees as the effort progresses.

“We would like thank all employees at our Ferrara Marconi, Wehr and Kaiserslautern sites for the tremendous work they have performed over many years and their ongoing support transitioning the sites while maintaining a safe operating environment,” added Kelly. “We are fully committed to making this transition as smooth as possible and treating our employees with respect and dignity. Our dedicated team will work out a comprehensive social plan together with Works Council and Unions over the coming months.”

As MRC reported earlier, Celanese raised its list and off-list selling Vinyl Acetate Monomer (VAM) prices for Europe, Middle East and Africa on July 1, 2020, by EUR100/mt.

VAM is the main feedstock for the production of ethylene-vinyl-acetate (EVA).

According to MRC's DataScope report, June EVA imports to Russia fell by 22,5% year on year to 2,940 tonnes from 3,800 tonnes a year earlier, and overall imports of this grade of ethylene copolymer into the Russian Federation dropped in January-June 2020 by 8,16% year on year to 17,440 tonnes (18,980 tonnes a year earlier).

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

Olin earnings tumble on weak demand, maintenance outages

MOSCOW (MRC) -- Olin Corporation (Clayton, Missouri) reports a second-quarter net loss of USD120 million, down from a net loss of USD20 million in the year-ago quarter, reflecting weak demand and maintenance outages on the chemical side, reorted Chemweek.

Adjusted EBITDA totaled USD71.5 million versus USD205 million in the year-ago period. Sales totaled USD1.241 billion, down 22% year-over-year (YOY) from USD1.593 billion.

Adjusted earnings per share came to a 60-cent loss, down from breakeven in the year-ago period and short of the average analyst estimate of a 49-cent loss as compiled by Refinitiv (New York).

“Second quarter 2020 sales for the combined chlor-alkali products and vinyls and epoxy businesses declined year-over-year by approximately 27%,” says John E. Fischer, chairman, president, and CEO. “The sales decline reflects weaker customer demand and a high level of planned maintenance turnaround activity which occurred early in the second quarter. Overall chemical businesses sales increased each month during the quarter from the April low point and have continued to increase during July.”

Fischer expects third-quarter adjusted EBITDA to double that of the second quarter owing to lower maintenance turnaround costs, improved sales volumes, and higher product pricing.

Chlor-alkali products and vinyls sales totaled USD651 million, down 28% YOY from USD909 million. Segment earnings came to a USD57 million loss, swinging from profit of USD71 million in the year-ago period. Fischer cites weaker broad-based customer demand from almost all end-use chemical customers. “Shipments to our urethane customers were particularly weak and declined by approximately 44% compared to first quarter 2020,” he says. Caustic soda pricing increased sequentially by about 8%, while ethylene dichloride pricing declined sequentially by about 50%. Olin expects pricing to improve during the third quarter, and for volume to increase owing to lower maintenance turnaround activity.

Epoxy segment sales totaled USD397 million, down 24% YOY from USD519 million, mainly on roughly 30% lower epoxy resin volume and lower product prices. The segment recorded a loss of USD13 million compared to earnings of USD4 million in the year-ago period. Lower product prices and lower epoxy resin volumes were partially offset by lower raw material costs, primarily benzene and propylene, and lower operating costs, says the company.

The Winchester ammunition segment turned in sales of USD193 million, up 17% YOY from USD165 million on higher commercial ammunition sales. Segment earnings were USD16 million, up from USD10 million in the year-ago period, mainly on higher commercial ammunition volumes and pricing.

As MRC informed earlier, in December 2019, Olin Corporation announced that it plans to permanently shut down a chlor alkali plant with a capacity of 230,000 tons and its Vinylidene Chloride (VDC) production facility, both in Freeport, Texas. These closures are expected to be completed before the end of 2020.

As MRC also reported before, May production of sodium hydroxide (caustic soda) in Russia was 112,000 tonnes (100% of the basic substance) versus 101,000 tonnes a month earlier. Overall output of caustic soda totalled 543,000 tonnes in the first five months of 2020, up by 1.4% year on year.
MRC

Construction of SCG Long Son petchems project nears halfway

MOSCOW (MRC) -- SCG has no plans to delay development projects, including the Long Son Petrochemicals complex in Vietnam, with construction 45% complete, reported Chemweek.

The project is worth USD5.4 billion.

The start-up of Vietnam's first fully integrated petchems facility is scheduled for 2023.

Thammasak Sethaudom, vice-president of finance and investment as well as chief financial officer, said the company maintains its total investment budget of 55-65 billion baht in 2020.

SCG hopes the government's key development projects like the Eastern Economic Corridor scheme as well as the economic rehabilitation plans will boost the domestic economy and investment sentiment in the second half this year.

As MRC wrote previously, SCG Plastics, part of SCG, took its high density polyethylene (HDPE) plant off-stream for a maintenance turnaround on November 26, 2019. It remained under maintenance until December 14, 2019. Located in Map Ta Phut, Thailand, the plant has a production capacity of 200,000 mt/year.

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

According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC