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Fire at Philippines JG Summit Petrochemical has no impact on units

September 30/2020

MOSCOW (MRC) -- A fire at Philippines JG Summit Petrochemical's Batangas complex on Sept. 26 did not have any impact on the olefins production units, company sources told S&P Global.

The company plans to restart its naphtha-fed steam cracker later in the week ending Oct. 3. The company's cracker and polymer units were undamaged by the fire that occurred at an effluent containment area of the complex, the sources said.

"The polymer units are running; while, the expected restart of the cracker is within the week," said a company source, adding that the fire occurred near the pier area and did not spread to the main manufacturing sites.

"The cracker was shut for a short while for other reasons even before the fire, and the fire has no relation to cracker operations," said another company source.

JG Summit plans to run the cracker at full capacity after the restart, the first source said. Asia's steam crackers have mostly been operating at full or close to full capacity to capitalize on positive olefin margins.

The spread between CFR Northeast Asia ethylene and feedstock CFR Japan naphtha physical assessments widened USD3.75/mt week on week and USD120.50/mt, or 35.77%, since Sept. 1, to a 13-month high of USD457.375/mt at the Asian market close on Sept. 28, Platts data showed.

The spread was last higher on Aug. 12, 2019, at USD458.50/mt. Since Sept. 3, the spread had risen above the typical breakeven spread of USD350/mt, as per market sources and Platts data. It has remained above integrated producers' breakeven spread of around USD250/mt since May 12.

The company's naphtha-fed steam cracker at Batangas can produce 216,000 mt/year of pyrolysis gasoline, or pygas; 320,000 mt/year of ethylene, 190,000 mt/year of propylene; and 110,000 mt/year of mixed C4.

At the Batangas complex, JG Summit has new projects in the pipeline to expand its olefins capacity and produce aromatics. The company plans to complete a 250,000 mt/year high density polyethylene plant by the fourth quarter of 2021. In addition to the new HDPE plant at Batangas, the capacity of an existing polypropylene plant at the same site will be upgraded to 300,000 mt/year from 190,000 mt/year. There are currently two existing HDPE /linear low density polyethylene swing plants at Batangas with a combined nameplate capacity of 320,000 mt/year.

Construction of the company's maiden benzene-toluene-xylenes unit had been delayed due to the spread of COVID-19 in the Philippines, as the works were initially planned to be completed by June, but is now planned for the first quarter of 2021.

However, broadly, fundamentals on the aromatics markets were still mixed. Lower run rate in some refineries in the region was described to be lending some support by slowing the previous supply overhang.

As MRC informed earlier, a fire struck the plant of the JG Summit Petrochemicals Group, a Gokongwei company, in Barangay Simlong in Batangas City on Saturday night, according to the Batangas City Fire Station. It was the police that informed firefighters about the blaze, which started at around 10 p.m. One person was reported injured, according to Col. Rex Malimban.

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.

JG Summit's BTX unit would have a production capacity of 126,000 mt/year of benzene, 76,000 mt/year of toluene, 46,000 mt/year of mixed xylenes, 29,000 mt/year of non-aromatics with some 21,000 mt/year materials of mixed aromatics, including C9+, all derived using the pygas feedstock produced from the existing steam cracker.
The Batangas PE facility is a joint venture between JG Summit Holdings and Marubeni Corp.


mrcplast.com
Author:Anna Larionova
Tags:PP, PE, ethylene, propylene, JG Summit Petrochimcal.
Category:General News
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