Refinery closures a benefit to Magellan refined product systems

MOSCOW (MRC) -- The closure of some U.S. oil refineries will have a net benefit to Magellan Midstream Partners LP’s refined products pipeline systems, the company’s chief executive officer said, said Hydrocarbonprocessing.

“It creates the opportunity for more volume movement to replace what the refinery was putting into the market directly and it will create a longer-haul movement for existing volumes because they need to be transported from farther away,” said CEO Mike Mears, speaking at the Barclay’s CEO Energy-Power conference.

Multiple North American oil refiners have announced closures, or plans to repurpose their plants, as global fuel demand remains lower after plummeting from stay-at-home orders caused by the coronavirus health crisis.

Crude oil benchmarks are trading near three-month lows as the pandemic continues, with coronavirus cases rising in parts of Europe, India and in areas of the United States.

HollyFrontier’s Cheyenne, Wyoming refinery, which is being converted into a renewable diesel plant, and Marathon Petroleum’s shuttering Gallup, New Mexico, refinery are among the recently announced closures that would benefit Magellan’s system, Mears said. He said expects the trend to continue as the country moves away from traditional fuel sources in the coming decades.

"It’s very hard to predict when and who, but it will happen over the course of time," Mears said. The Tulsa, Oklahoma-based midstream company, which also transports crude oil, said it has seen demand for gasoline linger at lower levels than predicted. Metropolitan areas have lagged behind rural communities, where fuel demand has come close to fully recovering, Mears said.

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

MOSCOW (MRC) -- Dow announced that it is halfway to it meeting its goal of delivering USD1 billion in business value from projects that “enhance nature, said Chemweek.

The 2025 sustainability target dubbed “Valuing Nature” was announced in 2015 and builds on Dow’s long-running collaboration with The Nature Conservancy.

Dow says the Valuing Nature goal is the first-ever commitment by a corporation to systematically consider nature in its business decisions on such a major scale. Savings are primarily achieved by considering capital costs and lowered long-term operational and maintenance costs.

"By systematically providing the tools, structure, and business environment, we are demonstrating how investing in nature can help businesses and other organizations save money, reduce risks, and build value for all stakeholders," says Mary Draves, chief sustainability officer and vice president of Environment, Health & Safety for Dow.

Projects that contributed to the goal include a collaboration with Dutch water treatment company Evides to use local wastewater for industrial purposes, resulting in a 96.5% reduction in energy consumption and lower maintenance costs; the use of readily available stone and reinforced vegetation to stabilize brine wells in Aratu, Brazil, that reduced carbon emissions and impact on the local forest compared with traditional steel and concrete solutions; and the use of biochemical processes to treat zinc seepage in Arkansas instead of traditional neutralization systems.

As MRC informed earlier, Dow said its sites along the US Gulf Coast reported no major damage from Hurricane Laura. Dow’s sites in Sabine, Beaumont, Deer Park, La Porte, Bayport and Texas City, Texas shut down operations prior to Laura making landfall. Dow's Freeport, Texas site continued operating as did facilities across Louisiana. Dow said it has not identified any significant structural damage or flooding at any of the facilities.

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

The Dow Chemical Company is an American multinational chemical corporation. Dow is a large producer of plastics, including polystyrene, polyurethane, polyethylene, polypropylene, and synthetic rubber.

MRC

MOSCOW (MRC) -- Ascend Performance Materials (Houston) says it will increase prices immediately for adiponitrile (ADN), acrylonitrile (ACN), adipic acid, and hexamethylenediamine (HMDA), reported Chemweek.

The prices of ADN and HMD have each been raised by USD100/metric ton, while ACN has been increased by USD85/metric ton. The price of adipic acid has been hiked by USD80/metric ton. All the price rises are as contracts allow, Ascend says.

As MRC informed before, in February, 2020, Ascend Performance Materials, an integrated polyamide (PA) 66 supplier, signed an agreement to purchase Poliblend and Esseti Plast GD from D’Ottavio Groupo The acquisition includes a manufacturing facility in Mozzate, Italy, the masterbatch portfolio of Esseti Plast GD and the engineering plastics portfolio of Poliblend, which consists of virgin and recycled grades of PA 66, PA 6, PBT and POM.

ACN is a feedstock for the production of acrylonitrile-butadiene-styrene (ABS).

According to MRC's ScanPlast report, the estimated consumption decreased in January-June 2020 by 18% year on year in the Russian ABS sector, totalling 19,360 tonnes. 2,680 tonnes of ABS plastics were processed in Russia in June 2020.

Ascend Performance Materials is a global leader in the production of Nylon 6,6.
MRC

MOSCOW (MRC) -- Nigeria is holding talks to give up majority stakes in all four of its moribund oil refineries, Mele Kyari, head of the state oil firm NNPC, said, as per Hydrocarbonprocessing.

He disclosed that discussions were taking place on an operating model in which the state oil company NNPC or the government would be a minority shareholder in the assets. "It means there will be more scrutiny of shareholders and also becoming more efficient to operate. That conversation is on the table,” said Kyari, NNPC’s group managing director, without specifying how the government planned to transfer ownership, or to whom.

The refineries have for years worked only sporadically due to chronic underinvestment. NNPC said in April that it had shut them all down to secure funding for their refurbishment, and would no longer manage them when they reopened. The four refineries are located at three sites in Kaduna, Warri and Port Harcourt. Kyari said the pipelines that feed them with crude oil were badly damaged.

The refineries processed almost no crude in the 13 months to end June, according to NNPC data last month, even though their operating costs totaled USD367 million.

As per MRC, Nigerian National Petroleum Corporation (NNPC) has fired 850 workers, many of them from refineries, amidst the coronavirus pandemic, an oil union said. The workers are both skilled and unskilled contractors, including technicians who helped maintain Nigeria’s oil refineries, said Lumumba Okugbawa, general secretary of the Petroleum and Natural Gas Senior Staff Association of Nigeria, speaking on the phone.

As MRC informed earlier, NNPC has issued a crude-for-product swap tender, the company said. The Direct Sale Direct Purchase (DSDP) tender document did not specify the start date or the quantities involved but said the arrangement would be for one year. The tender is set to close on May 2 at noon (1100 GMT), NNPC said on its official Twitter account. Crude-for-product swap contracts are the country’s main avenue to meet the bulk of its gasoline and gasoil needs.

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

MOSCOW (MRC) -- A stalled global economic recovery from the coronavirus pandemic is leading to a fresh build-up of global oil supplies, pushing traders including Trafigura to book tankers to store millions of barrels of crude oil and refined fuels at sea again, said Hydrocarbonprocessing.

The use of so-called floating storage onboard tankers comes as traditional onshore storage remains close to capacity as supplies outpace demand. Trading house Trafigura has chartered at least five of the largest tankers each capable of storing 2 million barrels of oil, known as very large crude-oil carriers (VLCCs), according to trading sources and shipping data.

A number of the vessels are newly-built and are due to store gasoil and diesel, for which unsold volumes are especially high after a modest recovery mid-summer. The inventory build-up comes despite major oil producers including Saudi Arabia and Russia sharply cutting back output and refineries slowing operations in recent months in response to an unprecedented drop in consumption.

Other top traders including Vitol, Litasco and Glencore have also in recent days booked large tankers to store diesel for up to 90 days, according to shipping data and traders. Brent crude oil futures are languishing around USD40 a barrel after posting their biggest weekly decline since June.

"The market is soft and bearish and floating storage is returning again," a market source said. The spread between Brent crude for prompt delivery and six-months in the future Lcoc1-lcoc7 has been declining steadily toward USD3 near lows last seen in late May.

"Freight rates are low and the inter-month Brent spreads are now probably wide enough to cover storage costs and cost of cash,” one trader selling crude oil said. "It is increasingly clear that market fundamentals are not improving as quickly as expected, particularly on the demand side,” Morgan Stanley analyst Martijn Rats said in a note.
Global oil inventories remain sharply above average when looking at recent years. Although stocks have drawn at a pace of around 1.6 million barrels per day over the past 30 days, they are still some 600 million barrels above last year’s levels, according to Morgan Stanley.

Most of the draws were in crude oil inventories, but refined products stocks remained “stubbornly” high, Rats said. Compounding the bleak picture are weak margins and signs of an erosion in demand from China, whose record crude purchases in the summer months as it emerged from economic lockdown to scoop up cheap oil, mitigated demand damage globally.

Saudi oil giant Aramco sharply cut its October official selling price (OSP) for its flagship Arab Light crude to Asia by USD1.40 a barrel, hoping to salvage buying interest. But one top Chinese buyer said the outlook appeared grim.

“There are fewer refinery runs in China, teapots (independent refiners) have used up a lot of their import quotas, inventories are still pretty high and crude at current levels are not great for margins."

Sagging crude futures tracked sputtering physical crude prices worldwide, as price differentials for North Sea Brent stood at their lowest since June. West African oil sales suffered, with Nigeria still seeking buyers for oil planned for export last month, Angolan crude selling at the lowest rates since May and key buyer China reselling unwanted cargoes it received in term allocations.

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