LyondellBasell to cut Houston refinery staff by 10% on pandemic losses

MOSCOW (MRC) -- LyondellBasell Industries said on Tuesday that it plans to cut salaried staff at its Houston oil refinery because of losses during the COVID-19 pandemic, said Hydrocarbonprocessing.

The company confirmed the contents of an email seen by Reuters, in which executive vice president Torkel Rhenman said Lyondell wants "a reduction of approximately 10% of the refinery population." Refiners have posted large losses this year as air and road travel have cratered amid widespread lockdowns and work-from-home policies to combat the spread of the coronavirus.

Several U.S. refineries have closed or reduced operations this year. In August, Marathon Petroleum said it would permanently close two plants in response to lower fuel demand. Calcasieu Refining idled its Louisiana plant for economic reasons the same month.

"The refinery utilization rate is within two to four bad weeks of taking out the all-time record low of 66.7%," Robert Yawger, director of energy futures at Mizuho Securities USA, said in a note on Tuesday. Gasoline margins are threatening to go negative, he said, and leave the price of a barrel of gasoline below the cost of the oil used to produce it. Lyondell employs about 800 workers at its Houston refinery.

The planned job cuts would not apply to refinery workers covered by a union contract, which prohibits layoffs. In a letter to employees, Refinery Manager Greg Nevermann said that before imposing involuntary layoffs the company would offer enhanced retirement packages to eligible employees and offer reassignments to the chemical maker’s other locations.

“Given the drop in demand and increase in industry refining capacity, we anticipate the outlook for the refinery will remain challenging for the next several years,” Nevermann said in the letter, which was seen by Reuters. Lyondell’s cost-cutting, including cutting travel and outside consultants and deferring non-safety-related maintenance, has not succeeded in reducing losses, he wrote.

In July, Lyondell said the refinery lost USD107 million in the first six months of this year before interest, taxes, depreciation and amortization. During the same period of 2019 it posted earnings before interest, taxes, depreciation and amortization for the refining business of USD81 million.

The refinery dates to 1918. Between 1985 and 2007, the 263,776 barrel-per-day plant was an integral part of Lyondell’s operations, supplying feedstocks to its chemical units.

Following a merger with Basell in 2007 and emergence from bankruptcy in 2012, the company expanded chemical production plants around the world, making the oil refinery secondary to its petrochemical business.

As MRC reported previously, in early August, 2020, China’s Bora LyondellBasell Petrochemical, a JV between the privately owned Bora Enterprise Group and the world's petrochemical major - LyondellBasell, has started up its new steam cracker at the Panjin complex in northeast China. The steam cracker, when fully operational, is able to produce up to 1 mln mt/year of ethylene.

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.

LyondellBasell is one of the largest plastics, chemicals and refining companies in the world. Driven by its 13,000 employees around the globe, LyondellBasell produces materials and products that are key to advancing solutions to modern challenges like enhancing food safety through lightweight and flexible packaging, protecting the purity of water supplies through stronger and more versatile pipes, and improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road. LyondellBasell sells products into approximately 100 countries and is the world's largest licensor of polyolefin technologies.
MRC

MOSCOW (MRC) -- Hanwha Total Petrochemical, is in plans to bring on-stream its No. 3 polypropylene (PP) unit in Daesan, according to Apic-online.

A Polymerupdate source in South Korea, informed that, the company is likely to restart its unit on September 24, 2020. The plant was shut for a brief maintenance on September 14, 2029.

Located at Daesan, South Korea, the No. 3 PP unit has a production capacity of 360,000 mt/year.

According to MRC's ScanPlast report, 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.

Daesan is one of Total's six world-class integrated complexes and a strategic asset for both shareholders. It comprises a flexible condensate splitter, a competitive steam cracker and units producing polymers, styrene and aromatics.

Hanwha Group, founded in 1952, is a global leader in a broad range of business spanning the spectrum of manufacturing, construction, finance, services and leisure industries. Hanwha Group consists of 56 domestic affiliates and 226 global networks, as of June 2016.

Total is a major energy player, which produces and markets fuels, natural gas and low-carbon electricity. Our 100,000 employees are committed to better energy that is safer, more affordable, cleaner and accessible to as many people as possible. Active in more than 130 countries, our ambition is to become the responsible energy major.
MRC

MOSCOW (MRC) -- Russia's output of chemical products rose in August 2020 by 5% year on year. At the same time, production of basic chemicals increased year on year by 5.3% in the first eight months of 2020, according to Rosstat's data.

According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the January-July output. August production of benzene fell to 102,000 tonnes from 95,300 tonnes a month earlier due to scheduled shutdowns for maintenance at several producers. Overall output of this product reached 918,300 tonnes over the stated period, down by 0.9% year on year.

August production of sodium hydroxide (caustic soda) were 99,200 tonnes (100% of the basic substance) versus 89,400 tonnes a month earlier. Overall output of caustic soda totalled 837,600 tonnes in the first eight months of 2020, down by only 2% year on year.

1,939,000 tonnes of mineral fertilizers (in terms of 100% nutrients) were produced in August versus 2,113 mln tonnes a month earlier. Overall, Russian plants produced slightly less than 16,500,000 tonnes of fertilizers in January-August 2020, up by 3.2% year on year.

Last month, the production of primary polymers rose to 888,000 tonnes against 838,000 tonnes in July due to increased capacity utilisation at ZapSibNeftekhim, Stavrolen and Gazprom neftekhim Salavat. Overall output of polymers in primary form totalled 6,630,000 tonnes over the stated period, up by 15.2% year on year.
MRC

MOSCOW (MRC) -- Air Liquide (Paris:AI) China will invest around 60 million euros to build an Air Separation Unit (ASU) in the Lingang Economic District, Tianjin Port Free Trade Zone. Air Liquide has been supplying industrial gases to this major Chinese industrial basin for more than 25 years, and already operates 7 production facilities there, said Chemweek.

With an oxygen production capacity of more than 2,000 tons per day, this ASU will notably allow Air Liquide to support the growth of the chemical and steel industries in the Tianjin basin, secured by a new long term supply agreement with a major customer.

Air Liquide will build, own and operate this new ASU, which has been designed leveraging the Group’s latest state-of-the-art technology, for a low carbon and energy efficient production of oxygen, nitrogen and argon. This facility will also incorporate a dedicated capacity to support small-and-medium sized customers of liquid and packaged gases, including local hospitals requiring high-purity medical gases. It is planned to be operational in 2022.

Air Liquide China operates seven ASUs in Tianjin, as well as a network of multi-sourced pipelines that deliver oxygen, nitrogen and hydrogen to adjacent customers.

Francois Abrial, member of the Air Liquide Group’s Executive Committee supervising Asia Pacific, said: “One of the most important industrial cities in the country and the largest port in Northern China, Tianjin is a key basin for Air Liquide in China. This new investment in the 8th ASU built and operated by Air Liquide in Tianjin since 1995 clearly demonstrates our commitment to the long-term partnership we have built with our customers there. It also shows our confidence in the sustained growth of the Chinese industry towards cleaner, more efficient ways of producing."

As per MRC, Air Liquide has finalised an agreement with Sasol to acquire the biggest oxygen production site in the world with a plan to reduce its carbon dioxide (CO2) emissions by 30%. We remind that Sasol's world-scale US ethane cracker with the capacity of 1.5 mln tonnes per year reached beneficial operation on 27 August 2019. SasolпїЅs new cracker, the heart of LCCP, is the third and most significant of the seven LCCP facilities to come online and will provide feedstock to our six new derivative units at the company"s Lake Charles multi-asset site.

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.

Air Liquide in China operates nearly 100 plants and employs close to 5,000 employees today. With a strong presence in the key coastal industrial areas, Air Liquide is now expanding into the center, south and west. Its main business activities include industrial and medical gas operations, home health service, Engineering & Construction (designing, manufacturing and installing air separation units/hydrogen facilities), as well as Innovation activities.
MRC

1. BASF to cut up to 2,000 jobs by 2022 from business services unit

MOSCOW (MRC) -- BASF says it will reduce the number of employees in its global business services unit, which it established at the start of this year, by up to 2,000, almost 24% of the unit's total, by the end of 2022, said Chemweek. The decision follows the bundling of services and resources and the implementation of a wide-ranging digitalization strategy, BASF says. From 2023, the unit expects to achieve annualized cost savings of more than EUR200 million (USD235 million) from the move, the company says. Details of the planned worldwide workforce reduction will be worked out in the coming months with employee representatives involved, according to local rules and regulations, it says.

MRC