Klockner Pentaplast plans multimillion-dollar rPET expansion in North America

MOSCOW (MRC) -- Protective packaging maker Klockner Pentaplast Group (KP) has announced plans for a “multimillion-dollar investment” to expand its post-consumer recycled PET (rPET) extrusion capacity in North America, said Canplastics.

In an Aug. 19 statement, the company said it is still deciding on the precise location for the expansion, and will announce at a later date which of its eight North American sites is best situation for the project to serve KP’s thermoformed protein and sustainable consumer packaging customers.

"The 17,500-tonne extrusion expansion supports the increased consumer demand for curb-side recyclable options, supporting closed loop packaging, and a circular economy," KP’s statement said.

"As major brands announce robust, sustainability initiatives that includes post-consumer and recyclable packaging, KP will be positioned to service those market needs for the foreseeable future,” said KP CEO Scott Tracey. “The extra capacity will also go a long way in supporting our company’s goals for product innovations and sustainability."

Globally, this is the fourth major expansion for KP. In March, the company announced a 30 per cent capacity expansion at their Cotia, Brazil location, and in June KP broke ground at their central Virginia location that increased it pharmaceutical films capacity by 6,000 metric tonnes.

As MRC informed earlier, Russia's output of chemical products rose by 4.4% year on year in May 2020 . Thus, production of basic chemicals increased year on year by 5.4% in the first five 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-May. Production of benzene was 110,000 tonnes in May 2020, which equalled the figure a month earlier. Overall output of this product reached 615,000 tonnes over the stated period, up by 1.7% year on year.

Founded in 1965, KP has 32 plants in 18 countries and employs over 5,900 people.
MRC

Crude moves higher amid China's US import boost ahead of key OPEC meet

MOSCOW (MRC) -- Crude oil futures were higher in mid-morning trade in Asia on Aug.17 as sentiment remained buoyed ahead of a key OPEC+ production review meeting on Aug.19 despite a postponement in the US-China trade deal review over the weekend amid expectations of a continued uptick in China's US crude import, reported S&P Global.

At 11:33 am Singapore time (0333 GMT), the ICE Brent October crude futures were up 31 cents/b (0.69%) from the previous settle at USD45.11/b, while NYMEX September light sweet crude contract was up 35 cents/b (0.83%) at USD42.36/b.

"Oil remains buoyed by optimism that a sustained recovery in energy demand is underway boosted by US government data showing crude oil, gasoline, and distillate inventories all declined the week-ending Aug.7," AxiCorp chief global markets strategist Stephen Innes said in a note Aug. 17.

A delay in the meeting between US and China, which was to occur over the weekend, to review its trade agreement did not dampen investors' sentiment on expectations that China plans to continue shipping large volumes of US crude in the near-term.

"China increasing US oil imports is the most apparent trade deal reaffirmation," Innes said. "From a trade talk risk perspective, wiping down the last remnants of escalation risk is favorable for oil prices."

China's independent refineries ramped up US crude imports in July, picking up 1.37 million mt in the month, according to market information collected by S&P Global Platts earlier this month.

In addition, at least 965,000 mt of North American crude cargoes are waiting to be discharged for the private companies in August.

China's total crude imports from US, meanwhile, had jumped to an eight-month high of 143,452 b/d, or 587,118 mt, in June with expectations that US imports could rise further in July and August, analysts and traders said last month.

Oil prices moved higher ahead of a meeting this week to review OPEC+ cut agreement. The Joint Ministerial Monitoring Committee (JMCC), which is co-chaired by Saudi Arabia and Russia, is set to meet on Aug. 19 to assess compliance with quotas and recommend any adjustments to the cuts if needed.

"The OPEC+ meeting this week is expected to yield little surprises, with production curbs expected to continue as outlined in April," OCBC Bank researchers wrote in a note on Aug. 17.

OPEC and 10 allies, including Russia, had implemented the largest coordinated production cut in history of 9.7 million b/d, equivalent to about 10% of pre-pandemic demand.

The cuts have been scaled back to 7.7 million b/d from August through the end of the year and will relax even further to 5.8 million b/d from January 2021 through April 2022.

Members that exceeded their production quotas will have to make compensatory cuts in the coming months, moderating the full impact of relaxing the OPEC+ deal, ministers have said.

"Russia's Energy Minister Alexander Novak said the global oil market is stabilizing gradually, so [there is] no need to ease OPEC+ output cuts ahead of schedule," Innes said on Aug. 17.

Meanwhile, OPEC+ member Oman has reported a 13.5% month-on-month decline in its crude oil exports in July to around 778,012 b/d.

China accounted for 88.81% of the total exports in July, while India took the remaining 11.19%, the oil and gas ministry said Aug.16.

Oman's crude oil production averaged 671,275 b/d in July, down 1.85% on the month, and lower than the 682,000 b/d quota under the OPEC+ agreement for May-July. Its quota for will rise to 722,000 b/d from August through the end of the year.

As MRC informed before, Navigator Holdings (London, UK) says US ethylene exports are back on the rise, driven by recovering Asian demand and a continuing arbitrage. The company shared its assessment in preliminary second-quarter financial results released on 13 August. Ethylene shipments slowed late in the first quarter as COVID-19 lockdowns and the related global economic downturn weighed on demand, says Navigator. “However, as Asian economies restarted during the latter half of the second quarter, so too did the demand for ethylene. An upsurge in US ethylene export capacity from our([Morgan’s Point) marine export terminal, drove an uptake in cargo liftings from the second half of May onwards, positively impacting handysize ethylene tonnage.”

We remind that Enterprise Products Partners (Houston, Texas) co-loaded olefins and natural gas liquids (NGLs) twice in July, the first time such cargoes have been loaded for export from the US. A VLGC (very large gas carrier) received propane and polymer-grade propylene (PGP) simultaneously into separate compartments at the Enterprise Houston Ship Channel terminal. Another vessel took on ethane and ethylene simultaneously at the company’s Morgan’s Point facility in Houston.

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

Indian Oil to fully restart Paradip refinery by Saturday

MOSCOW (MRC) -- Indian Oil Corporation Ltd, the country’s top refiner, will restart all units at its 300,000 barrels per day (bpd) Paradip refinery in Odisha by Saturday, reported Reuters with reference to a government official.

The refinery’s maintenance shutdown has been extended by a few days due to shortage of laborers amid the COVID-19 pandemic.

“Out of about 1,400 workers and supervisors mobilized for shutdown jobs from outside, less than 400 are there,” said Sangram Keshari Mohapatra, the top bureaucrat in the district of Jagatsinghpur, where the refinery is located.

He said only two of the nine major units that had undergone shutdown have started.

“Remaining seven are being started in sequence as all are connected and start up will complete over the next two days,” Mohapatra told Reuters.

Separately, an IOC official said some secondary units have resumed operations using feedstock available with the plant, while others including the crude unit will start by Saturday.

The company did not immediately respond to a Reuters request for comment.

As MRC infromed before, Indian Oil Corp will continue to operate its refineries below capacity in 2020/21 as it sees local and overseas fuel demand remaining subdued.

We remind that Indian Oil Corp restarted operation at its naphtha cracker in India in early-October, 2019, after completing maintenance works. The cracker was shut in early-September, 2019 for a maintenance turnaround. Located in Panipat, in the northern Indian state of Haryana, the cracker has an ethylene production capacity of 857,000 mt/year and propylene capacity of 425,000 mt/year.

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.

Indian Oil Corporation Limited, or IndianOil, is an Indian state-owned oil and gas corporation with its headquarters in New Delhi, India.
MRC

SCG cracker configured to take as much as 80% propane as feedstock

MOSCOW (MRC) -- Siam Cement Group’s (SCG) proposed flexible-feed cracker project in Vietnam is being configured to take as much as 80% propane as feedstock for production, said Vir.

The USD5.4bn Long Son Petrochemical (LSP) Complex in Vietnam’s Ba Ria-Vung Tao province “is designed to use up to 20% - 80% propane”, SCG stated in a July presentation to investors, citing low cost of this feedstock during the summer and winter seasons.

SCG’s Vietnam project progress rate was at 34% as of the first quarter and is on track to start up in 2023, SCG said. Construction stared in the fourth quarter of 2018. Under a 15-year contract signed in the second quarter of 2018 with Qatar Petroleum, an annual feedstock supply of 2m tonnes of propane + naphtha was secured for the project.

SCG’s configuration of the Vietnam cracker provide it with options to adjust feedstock based on cost advantage.

SCG expects its chemical production capacity to increase by 70% in 2023, largely on account of the Vietnam project. Apart from olefins, the project is expected to produce 1.3m tonnes/year of polyethylene (PE) and polypropylene (PP). The project is proceeding as planned and was not a casualty in SCG’s decision to expunge capital expenditures (capex) 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

China set to expand commercial crude storage capacity by 15.11 mil cu m in 2020

MOSCOW (MRC) -- China is set to expand its commercial crude storage capacity by at least 15.11 million cubic meters, or 95.04 million barrels, by the end of 2020, reported S&P Global with reference to company sources and media reports.

The new capacity, which will create more space to stockpile imports, comes as recent customs data showed China's crude imports hit an all-time high of 11.37 million b/d in May.

Data from trade flow and inventory tracker Kpler showed that China's crude stocks have been rising since the week starting May 10 and hit a record high of 831 million barrels in the week starting May 31. This was up 6.8% from the previous all-time high of 778 million barrels recorded in the week starting June 9, 2019.

Among the new storage facilities, Hengli Petrochemical (Dalian) will have the biggest capacity at 3.6 million cu m, or 22.64 million barrels, a company source told S&P Global Platts.

Hengli started construction of the storage tanks in late first-quarter of 2020 and plans to complete in the shortest time possible by July so that it can start storing crude at current low prices. Typically, a storage facility of this size takes more than a year to complete.

Hengli will construct a total of 24 new crude storage tanks, each of 150,000 cu m capacity. "We plan to start up six of the new tanks (or 900,000 cu m) in July, and gradually put the rest into use in the second half of the year," the company source with Hengli said.

Located on the Changxing Island in Northeast China, the Hengli storage facility currently has 32 crude storage tanks, each of 100,000 cu m. With the addition of the 24 new tanks, Hengli's total storage capacity will be more than doubled to 6.8 million cu m.

Chinese refiner Sinopec started operations at its new Baisha Bay Phase II storage facility in Shanghai from June 1, according to Shanghai Petrochemical's WeChat platform.

In addition to the 950,000 cu m of storage that is already under operation at the site, the startup of the Phase II storage facility brings the total capacity of the Baisha Bay facility to 1.4 million cu m, Shanghai Petrochemical said.

Sinopec also completed construction of a 800,000 cu m storage facility in central China's Luoyang city in May. This is expected to be online from second-half of 2020, Platts has reported. Another 800,000 cu m of storage capacity will be added to the Luoyang site by June 2021.

The Luoyang storage facility will support Sinopec Luoyang Petrochemical's requirements as it expands refining capacity from the current 160,000 b/d to 200,000 b/d in 2021.

Sinopec also started operating its storage tanks - with capacity of 1.6 million cu m - at Dongjiakou port in east China's Shandong province from March.

With all these additions, Sinopec's total commercial crude storage capacity is set to increase by at least 2.85 million cu m, or 17.93 million barrels, in 2020.

Most of the new storage capacity will be added in the Shandong province - long considered the Texas of China and home to about 80% of China's small independent refiners.

The province will see its crude storage capacity rise by 10.26 million cu m, or 64.54 million barrels, by the end of 2020, Platts has reported.

As MRC reported earlier, Sinopec Zhongyuan Petrochemical, part of Sinopec Group, is in plans to bring on-stream its cracker following a maintenance turnaround. The company is likely to resume operations at the cracker by mid-September, 2020. The cracker was shut for maintenance on August 1, 2020. Located at Henan in China, the cracker has a ethylene capacity of 220,000 mt/year and propylene capacity of 95,000 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