Texas refineries, including largest, to keep running during weakened storm Beta

MOSCOW (MRC) -- Texas Gulf Coast refineries, including the nation’s largest, plan to maintain normal operations through the passage of weakened Tropical Storm Beta, which is forecast to keep losing strength after coming ashore on Tuesday, said Hydrocarbonprocessing.

Motiva Enterprises’ 607,000-barrel-per-day (bpd) Port Arthur, Texas, refinery, the country’s largest, plans to maintain operations this week, just one week after restarting from Hurricane Laura, said sources familiar with plant operations. Motiva said operations were normal at the refinery on Monday and the company was monitoring the storm for possible developments.

Valero Energy Corp and Total SA plan to keep their Port Arthur refineries in operation. Valero restarted the gasoline-producing unit on Saturday at its 335,000-bpd Port Arthur refinery, sources told Reuters. Valero shut the refinery for Laura on Aug. 25.

Total has advised night-shift workers to bring overnight bags in case heavy rains from Beta cause flooding that leaves them trapped in the 225,500-bpd refinery, said sources familiar with plant operations.

The refinery continues to restart following the Aug. 25 shutdown from Laura. Total spokeswoman Marie Maitre said the refinery had activated its severe weather preparation plan. Phillips 66 said operations were normal at its 265,000-bpd Sweeny, Texas, refinery on Monday.

Lyondell Basell Industries' Houston refinery, Chevron Corp's Pasadena, Texas, refinery, Royal Dutch Shell Plc's Deer Park, Texas, refinery and Exxon Mobil Corp's Baytown, Texas, refinery all plan to keep operating, said sources familiar with operations at the plants.

An Exxon spokesman said operations were normal at Baytown on Monday. Lyondell is monitoring the storm, said a company spokeswoman.

Marathon Petroleum Corp plans to continue normal operations at its 585,000 bpd Galveston Bay refinery in Texas City, Texas, the second-largest refinery in the United States. Marathon spokesman Sid Barth declined to discuss the refinery’s operations.

According to MRC's ScanPlast report, Russia's overall PE production totalled 1,712,400 tonnes in the first seven months of 2020, up by 58% year on year. Linear low density polyethylene (LLDPE) accounted for the greatest increase in the output. At the same time, overall PP production in Russia increased in January-July 2020 by 24% year on year to 1,063,700 tonne. ZapSibNeftekhim accounted for the main increase in the output.
MRC

MOSCOW (MRC) -- Danish coatings company Hempel has broken ground on a new 200,000 tonne/year plant at the Yangtze International Chemical Industrial Park in Zhangjiagang, China, said the company.

Production is due to start in 2022, when the plant will replace an existing facility at Kunshan. It will produce various coating types, including: high-solids, solvent-free, waterborne, antifouling. Together with another coatings project at Yantai, Hempel expects to invest a combined USD270m to expand its production capacities in China, it said.

According to MRC's ScanPlast report, Russia's overall PE production totalled 1,712,400 tonnes in the first seven months of 2020, up by 58% year on year. Linear low density polyethylene (LLDPE) accounted for the greatest increase in the output. At the same time, overall PP production in Russia increased in January-July 2020 by 24% year on year to 1,063,700 tonne. ZapSibNeftekhim accounted for the main increase in the output.

Hempel is a global company with strong values, working with customers in the protective, marine, decorative, container and yacht industries. Hempel factories, R&D centres and stock points are established in every region. Across the globe, Hempel’s coatings protect surfaces, structures and equipment. They extend asset lifetimes, reduce maintenance costs and make homes and workplaces safer and more colourful. Hempel was founded in Copenhagen, Denmark in 1915. It is proudly owned by the Hempel Foundation, which ensures a solid economic base for the Hempel Group and supports cultural, social, humanitarian and scientific purposes around the world.
MRC

MOSCOW (MRC) -- Brazilian oil company Petrobras said on Monday it will open another round of bidding for its Repar refinery in the state of Parana after receiving binding offers that were too similar in value, reported Reuters.

Repar is Brazil's fifth largest refinery, able to process 208,000 barrels per day, or 9% of the country's capacity.

Petrobras has been trying to sell refineries since at least 2012 with no success, and still produces more than 98% of fuels in Brazil.

The new round starts as Brazil's Supreme Court considers blocking Petrobras' sale of Repar and other refineries, with justices set to rule on the matter by Friday.

Petroleo Brasileiro SA, as the state-controlled company is formally known, must follow specific legislation aimed at keeping asset sales competitive, including that bids be different. Sales also fall under scrutiny of governmental entities.

The company considered the offers low and is asking bidders to raise their prices for the Parana state refinery, according to two people involved in the negotiations who declined to be named as information is private.

Even if the Supreme Court approves the sales, Petrobras doesn't rule out keeping the asset if prices don't meet the minimum range set by its internal technical team, the people said.

Petrobras said in a statement on Monday that three separate groups led by Ultrapar, Raizen and China's Sinopec are part of this phase of the competition. The producer did not give any details about the companies' bids. The prices are highly secret in this phase of the competition.

Lack of buyers for fear of fuel price interference, restrictions by an audit court and anti-privatization movements have prevented sales in the past. More recently, Congress and the Supreme Court have also raised impediments.

The winner of this phase of the Repar competition would be able to exclusively negotiate the contract terms with Petrobras, a process which can take months.

According to Petrobras' internal rules, if the contract terms substantially change after the negotiation, which often happens, the oil company would need to call back competitors for a third round of bids, based on price only.

As MRC reported previously, Petrobras may need more than a year to divest its stake in Braskem, said Andrea Almeida, Petrobras CFO, in early July. She said during the companyпїЅs recent webinar that Petrobras plans to give more time for potential investors to make offers for the company"s assets, including for its refineries and stakes at its petrochemical and fuel distribution affiliates. The divestment of Petrobras"s stake in Braskem in 2020 would be desirable but "might not be possible" as the COVID-19 pandemic has changed market conditions, she said. The company plans to close part of its refinery sales in 2021. In December, Roberto Castello Branco, CEO of Petrobras, said that he wants to sell the companyпїЅs stake in Braskem within a year. Petrobras owns 32.15% of Braskem.

We remind that Braskem is no longer pursuing a petrochemical project, which would have included an ethane cracker, in West Virginia. And the company is seeking to sell the land that would have housed the cracker. The project, announced in 2013, had been on Braskem"s back burner for several years.

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

According to MRC's ScanPlast report, Russia's overall PE production totalled 1,712,400 tonnes in the first seven months of 2020, up by 58% year on year. Linear low density polyethylene (LLDPE) accounted for the greatest increase in the output. At the same time, overall PP production in Russia increased in January-July 2020 by 24% year on year to 1,063,700 tonne. ZapSibNeftekhim accounted for the main increase in the output.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras" activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

MOSCOW (MRC) -- Royal Dutch Shell Plc returned its 227,400 barrel-per-day (bpd) oil refinery at Norco, Louisiana, to normal operations on Monday, said sources familiar with plant operations, said Reuters.

Shell returned the 240,000-bpd crude distillation unit (CDU) and 14,800-bpd alkylation unit to production as well as restarting the 40,000-bpd reformer, the sources said.

Shell spokesman Curtis Smith declined to comment.

The reformer was shut for maintenance on Sept. 8. The CDU and the alkylation unit were taken out of production on Sept. 14 as the refinery reduced production because of the threat from Hurricane Sally. Shell then decided to keep the two units offline for maintenance.

As MRC informed earlier, in May 2020, CNOOC Oil & Petrochemicals Co. Ltd (CNOOC), Shell Nanhai B.V (Shell) and the Huizhou Government have announced a strategic cooperation agreement to further expand the CNOOC and Shell Petrochemical Company (CSPC) 50:50 joint venture in Huizhou, Guangdong Province, China.

The expansion is planned to serve the growing number of intermediate and performance chemicals customers in the key market of China, supplying products including SMPO, polyols, ethylene glycol, polyethylene (PE) and polypropylene (PP). These chemicals are used in a wide range of end products, in healthcare, construction, fabrics, packaging, transport and electronics. For the first time in Asia, Shell would apply its advanced technology for linear alpha olefins. The project is intended to include construction of a new 1.5 million-tonnes-per-year ethylene cracker, with the mega-site bringing economies of scale and enhanced competitiveness.

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

MOSCOW (MRC) -- The continued revival of the chemical tanker market has driven a strong rise in second-quarter net earnings to USD30.9 million for Odfjell (Bergen, Norway) from a loss of USD10.2 million in the prior-year period, reported Chemweek.

EBITDA rose 44% year on year (YOY) to ГЫВ81.9 million on sales that rose 4% to USD252.4 million. CEO Kristian Morch says the “continued firming” of the chemical tanker market and a firm spot market drove the results, but that COVID-19 “continues to cast high uncertainty about the future.” The company expects the third quarter to be impacted by more usual seasonal trends and says it anticipates reporting “weaker, but still positive, results in the next quarter,” Morch says.

The chemical tankers segment reported EBITDA of USD73.9 million, up almost 50% YOY, on a 4% YOY rise in sales to USD234.6 million, due mainly to stronger spot rates in the quarter. A migration of swing tonnage towards the clean petroleum products (CPP) market led to reduced competition for chemical and vegetable oil cargoes, Odfjell says. The company shipped 3.2 million metric tons of product in the second quarter, in line with the first quarter of the year. A reduction in tanker supply exceeded a marginal drop in demand, mostly from the automotive and construction sectors, it says. The global chemical tanker orderbook stands at 4.1% of the current fleet, with no new orders for core chemical tankers concluded during the quarter, it adds.

Odfjell says it is forecasting a scenario “where chemical tanker demand will continue its current disconnect from global GDP growth, driven by the wide variety of cargoes transported and the majority of end-use applications being relatively resilient to an economic downturn of this type.” A recovery in worldwide demand led by Asia-Pacific looks set to support demand, with a gradual economic recovery noted across most industries and geographies “pivotal for chemical tanker demand. We expect to see continued demand growth from packaging, food related industries, home care and pharma, health and hygiene and electronics and various other consumer goods,” it states. This is expected to mitigate negative demand growth from the automotive and construction industries, it notes.

The company’s terminals business in the second quarter was marked by oil price contango, COVID-19, and the sale by Odfjell of its joint and indirect stake in its China terminal business. The sale of the stake “represents another milestone in the restructuring of our terminal portfolio and is in line with our strategy to focus on chemical terminals where we can harvest synergies with Odfjell Tankers,” it says. The sale resulted in a net cash gain of USD27 million.

Underlying demand for storage continues to be strong due to COVID-19, further accentuated in the quarter by the oil price contango, with the company’s terminals reaching an average commercial occupancy rate of 97%. A notable drop in handlings at its terminals in the US and Antwerp, Belgium, was in part the result of preventive pandemic measures, as well as weaker downstream demand in sectors such as automotive and construction, it says. Although lower activity impacted throughput and service fees, a substantial share of the terminal business’ revenues come from rented capacity based on take-or-pay and other throughput, highlighting the resilience of the terminals platform, it says. The overall terminal occupancy rate is expected to remain high going forward, with the company seeing “some signs of recovery in activity levels in the US in the third quarter.” The Antwerp terminal also commissioned 12,700 cubic meters of new, fully automated capacity for specialty chemicals storage during the quarter, it adds.

Odfjell says it plans capital expenditure of USD38 million for its terminals business, the majority relating to the expansion of its Houston terminal. Planned maintenance spending will amount to USD33 million, it adds.

As MRC informed earlier, in July, 2020, Odfjell (Bergen, Norway) says a significant expansion of its European chemicals storage capacity has been completed at the port of Antwerp, Belgium.

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

According to MRC's ScanPlast report, Russia's overall PE production totalled 1,712,400 tonnes in the first seven months of 2020, up by 58% year on year. Linear low density polyethylene (LLDPE) accounted for the greatest increase in the output. At the same time, overall PP production in Russia increased in January-July 2020 by 24% year on year to 1,063,700 tonne. ZapSibNeftekhim accounted for the main increase in the output.
MRC