Gurit names new CEO

MOSCOW (MRC) -- Gurit (Zurich, Switzerland) says it has appointed Mitja Schulz as CEO and member of the executive committee, said Chemweek.

The advanced composite materials producer has been in the process of recruiting the successor to its current CEO, Rudolf Hadorn, since April, it says. The exact date when Schulz will take up his position at Gurit will be announced at a later stage, the company says.

Schulz was senior vice president and CEO of ZF Wind Power Antwerpen NV, part of ZF Friedrichshafen (Friedrichshafen, Germany) prior to joining Gurit, it says. He had previously held "a number of senior management positions within ZF Friedrichshafen and Porsche where he successfully executed major business transformation and growth programs," it adds.

As MRC informed earlier, in 2018, Gurit, a Swiss manufacturer of composite materials, completed the transfer of its polyvinyl chloride (PVC) production site in Qingdao, China to Zhengyu Sunshine Industrial.

As per MRC's ScanPlast report, July total production of unmixed PVC was about 47,700 tonnes versus 77,200 tonnes a month earlier, SayanskKhimPlast and RusVinyl increased their capacity utilisation last month. Overall output of polymer rose to 557,000 tonnes in the first seven months of 2020 from 553,700 tonnes a year earlier, only three producers increased their production, whereas RusVinyl reduced its PVC production.

The group of companies Gurit Holding, Switzerland specializes in the development and production of composite materials, polymers, resins and paints and varnishes, as well as modern technologies for the automotive and construction markets.
MRC

Flaring at Shell Moerdijk complex due to unit failure

MOSCOW (MRC) -- Flaring at Shell's Moerdijk petrochemical complex near Rotterdam, Netherlands, on Wednesday has sparked rumors in the European aromatics market that one or both of the two propylene oxide/styrene monomer (POSM) units situated there have been impacted, said Chemweek.

Shell said in a statement on Friday: "Shell Moerdijk is flaring due to a factory failure. We have identified the cause of the failure, allowing us to restart the factory. The full restart takes a few days, with the flaring gradually decreasing." A Shell spokesperson declined to specify which unit or units were impacted, when asked by OPIS.

Players in the styrene market said they saw a sudden pulling of offers by producers Thursday. One styrene player said spot offers for September- and October-delivery styrene cargoes rose by about USD30/metric ton Thursday, having seen very little movement over the first half of the week. August styrene parcels were talked in the first half of the week at USD655/metric ton FOB Rotterdam, but they ended the week at USD665/metric ton. Meanwhile, prices for September slid over the week to USD667.50/metric ton from about USD675/metric ton.

Moerdijk is one of the biggest petrochemical complexes in Europe with an ethylene capacity of 940,000 metric tons/year. Feedstock supply and other petchems output at the plant are not yet noted to have been impacted by the events around the flaring.|

Market speculation revolved around the potential restart date. One source said it "seems the unit is expected to restart this weekend [15–16 August]," and another placed the restart in about one week and a third source suggested that it could be as long as two weeks.

In April, OPIS reported that heavy maintenance is scheduled for parts of the Moerdijk complex this fall, having been delayed from its original May start date. The work will occur at the same time as maintenance at Shell's 300,000-metric tons/year Wesseling, Germany, plant.

As MRC wrote before, Shell will announce a major restructure by the end of the year as the company prepares to accelerate its shift toward its net-zero emissions goal by 2050, said CEO Ben van Beurden to employees. The restructuring will include workforce reductions as part of broader cost-cutting measures, although no figures have been decided yet, the CEO reportedly said during an internal webcast.

We remind that Royal Dutch Shell Plc plans to idle a sulfur recovery unit (SRU) at the joint-venture Deer Park, Texas, refinery in 2021, said Shell spokesman Curtis Smith in July 2020. Currently, the refinery is operating at about 75% of its 318,000 barrel-per-day capacity because of reduced demand due to the COVID-19 pandemic.

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.

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

Oil refinery intake recovers but lags behind demand rebound: IEA

MOSCOW (MRC) -- Global refinery crude intake is recovering but it lags behind the demand increase due to high inventories, reported S&P Global with reference to the International Energy Agency's statement Aug. 13.

In the second quarter, global refining throughput fell 11.5 million b/d year on year to 69.5 million b/d "the lowest quarterly level in 17 years."

However runs returned to monthly growth in June, "putting the global refining industry on a recovery track, which is expected to be a long and arduous journey," the IEA said.

The pace of demand and refining rebound in China was "one of the unexpected developments" in Q2, as coronavirus lockdowns were lifted, the agency said in its latest report. It expects China to fully offset the Q1 declines by August and for the whole 2020 to be "the only country registering any significant year-on-year growth."

The agency estimated global July crude runs at 3.7 million b/d above the "low point" in May when runs totaled 68.7 million b/d. By the end of 2020, refinery runs are expected to ramp up by another 5.6 million b/d although overall will decline by 6.9 million b/d in 2020 to 74.8 million b/d.

Runs are forecast to rebound by "only" 4.5 million b/d next year to 79.4 million b/d. They will be 2.7 million b/d "below the historical peak seen in 2018."

IEA sees "more existential threats in the near future" for refining assets, as new capacity additions are further exacerbated by declining profits in trading operations, which have provided a "cushion" thanks to the Q2 "super-contango in the crude oil market."

Some US refiners have decided to close their sites or transform them into terminals or biodiesel plants. Marathon said it is indefinitely idling its 26,000 b/d El Paso, Texas, plant and its 161,000 b/d Martinez, California, plant, two refineries shut when demand first crashed due to the pandemic, and is evaluating re-purposing Martinez into a 48,000 b/d renewable diesel plant. In Europe, Total may convert its 101,000 b/d Grandpuits refinery into a bio plant.

The IEA said the performance of middle distillate cracks had "helped boost refinery margins worldwide" and in Europe, Brent cracking margins increased in July for the first time in three months. Singapore Dubai cracking margins also benefited from middle distillates and the fuel oil complex, but mostly from weaker freight and the easing of sour versus sweet crude prices "to the detriment of Dubai", the IEA said. In the US, Midwest margins "remain in the high single digits, better than anywhere else."

As MRC informed before, US crude oil inventories moved sharply lower during the week ended July 24 as exports and refinery demand climbed to multi-month highs, US Energy Information Administration data showed July 29. Commercial crude stocks fell 10.61 million barrels to 525.97 million barrels that week, EIA data showed. While the draw pushed stockpiles to 14-week lows, they remained more than 17% above the five-year average for this time of year.

Earlier this year, BP said the deadly coronavirus outbreak could cut global oil demand growth by 40 per cent in 2020, putting pressure on Opec producers and Russia to curb supplies to keep prices in check.

And 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 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

EIA forecasts rising US ethane production, prices through 2021

MOSCOW (MRC) -- Ethane production in the US is forecast to top 2 million b/d by the last quarter of 2020, nearly 9% higher than the 1.92 million b/d reported for the first quarter of this year, according to the Energy Information Administration (EIA), said Chemweek.

Ethane output will then continue to grow through 2021, reaching nearly 2.27 million b/d by the last quarter of next year, which would be 18% higher than the first quarter of 2020, it says. The EIA’s short-term energy outlook for August calls for continued growth in ethane production to satisfy growing demand, including demand from three new petrochemical plants in the US that started up in the first half of the year and which use ethane as feedstock, it says.

In contrast, the EIA forecasts US crude oil and marketed natural gas production to decline by close to 10% from the first quarter of 2020 to the last quarter of 2021. It expects oil output to remain lower than the average of 12.75 million b/d achieved in the first quarter of this year throughout the forecast period, forecasting a recovery to a peak of 11.40 million b/d by the last quarter of 2021. Natural gas production will also remain lower than the 98.3 billion cubic feet/day (Bcf/d) production level reached in the first quarter, with output in the fourth quarter of 2021 forecast at 89.3 Bcf/d.

Ethane can be left in the natural gas stream, a process known as ethane rejection, to be sold along with natural gas instead of being separated at natural gas processing plants along with other NGLs such as propane, butane, and isobutane. The decision to recover the ethane or reject it is based primarily on the price of ethane relative to natural gas on a heating-value equivalent basis.

After the prices of NGLs collapsed alongside crude in March, prices have started recovering, especially ethane, the EIA says. Ethane has been “one of the few petroleum products that had a higher average price in July than in January. Strong domestic and international petrochemical demand for US ethane has resulted in ethane prices remaining higher than natural gas prices on a heating content equivalent basis since the second half of April,” it says. “This price signal, a persistent $1.00 premium to natural gas, has given natural gas processing plant operators an incentive to recover more ethane from the raw natural gas stream and ship that ethane to the Gulf Coast for consumption or export,” it adds.

IHS Markit said in June a fall in US ethane availability by 2021 due to the effects of COVID-19 and the oil price collapse would coincide with an increase in demand for the gas as feedstock from petchem producers, leading to tighter market fundamentals and a forecast rise in US ethane prices. Tighter ethane fundamentals and higher natural gas prices going into 2021 would result in a “double whammy for ethane prices, with the gas price floor rising and ethane markets tightening,” it said.

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. 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

Oil refiners shut plants as demand losses seen continuing

MOSCOW (MRC) -- Oil refiners are permanently closing processing plants in Asia and North America and facilities in Europe could be next as uncertain prospects for a recovery in fuel demand after the coronavirus pandemic triggered losses, according to Hydrocarbonprocessing.

The pandemic initially cut fuel demand 30% and refiners temporarily idled plants. But consumption has not returned to pre-pandemic levels and lower travel may be here to stay, leading to tough decisions for permanent shutdowns. Here are some of the plants involved:

Royal Dutch Shell will permanently shut its 110,000-barrel-per-day Tabangao facility in Philippines’ Batangas province, one of only two oil refineries in the country. Shell blamed a pandemic-led slump in margins for turning the plant into an import terminal.

There have been no permanent plant closures in Europe due to the virus. However, Gunvor Group said in June it was considering mothballing its 110,000 bpd refinery in Antwerp as COVID-19 hurt the plant’s economic viability.

Marathon Petroleum, the largest US refiner by volume, plans to permanently halt processing at refineries in Martinez, California, and Gallup, New Mexico. The larger plant in California will become an oil-storage facility and may convert to produce renewable diesel, a fuel made from industry waste and used cooking oil.

Other plants in Japan, Australia and New Zealand could be likely candidates for closure ahead, said Mi Gene, at consultancy FGE.

Energy consultancy Wood Mackenzie separately estimated 1.4 million barrels per day, about 9%, of refining capacity in Europe is at risk of shut-downs by 2022-2023. It put plants in Netherlands, France, and Scotland on a list of potential closures.

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