Irving Oil terminates purchase of North Atlantic Refinery Limited

MOSCOW (MRC) -- Canada-based oil refinery operator Irving Oil announced it has terminated an agreement for the purchase of North Atlantic Refinery Limited, said Hydrocarbonprocessing.

Irving made the announcement on its website. In May, it had agreed to buy the owner of the idled 135,000 barrels per day Come-by-Chance refinery in Newfoundland, for an undisclosed price. According to industry sources, Irving walked away from the purchase and share agreement shortly before it was set to close in mid-October.

“North Atlantic is actively looking for alternate buyer, but the market is very challenging,” said a source familiar with the matter. North Atlantic declined to comment on internal matters. U.S.-based energy company Origin International said it remained interested in purchasing Come-by-Chance after June media reports that it was interested in restarting fuel processing there in “a more environmentally sustainable model."

“We await further clarity on the status of Come by Chance,” an Origin spokesperson told Reuters. The spokesperson said Origin has not done due diligence and was unaware “if any new sale process has begun." It is too soon for Newfoundland and Labrador to consider whether to buy the refinery since Origin is interested, said the province’s Industry, Energy and Technology Minister Andrew Parsons.

Parsons said Canada’s Competition Bureau had never decided whether Irving would have been permitted to buy North Atlantic. Federal Natural Resources Minister Seamus O’Regan said he was monitoring developments and would be there for workers “no matter what the final outcome,” according to a statement from spokesman Ian Cameron.

“In the face of this global pandemic too many businesses are being closed and too many projects are being put on hold all over the world. And it’s workers who are bearing the brunt of it all,” Cameron said. Come-by-Chance was the first North American refinery to close as fuel demand collapsed during the coronavirus pandemic. It supplied major U.S. East Coast harbors including New York and Boston.

Refining margins have been pressured by lower processing rates due to an oversupply of distillate stocks, which include jet fuel. The crack spread - the difference between crude and fuel - is hovering around USD10.50 a barrel. The plant has been idled since early April. It was nearly sold in 2018, with Irving Oil as the leading bidder, but the two former oil traders at the helm of the refinery disagreed on the sale price and the sale subsequently fell apart.

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

Nouryon celebrates two-year anniversary with new growth strategy

MOSCOW (MRC) -- Nouryon is celebrating two years as a stand-alone company. During that time, it has made significant progress in driving efficiencies and increasing profitability while continuing to invest in supporting the growth of its customers. Now, the company is taking a further step to accelerate growth with a new company strategy that aims to exceed customer expectations, outgrow the competition, and increase the share of specialties in its portfolio, as per the company's press release.

“We have achieved phenomenal success during the past two years,” said Charlie Shaver, Nouryon’s Chairman and CEO. “We have set up a new organizational structure that allows our Businesses, Operations and Functions to focus on what they do best. That new structure, combined with our continued efforts to drive efficiencies has allowed us to increase our profitability, even in the challenging business environment of today.”

The company has taken several steps to further optimize its portfolio. These include three significant acquisitions; Brazilian peroxides producer Polinox; Chinese metal alkyls maker Zhejiang Friend Chemical; and the carboxymethyl cellulose (CMC) business of J.M. Huber, along with the divestment of its Elotex business. It has also continued investing to support the growth of its customers, with more than 20 capacity expansion projects announced or completed and the introduction of 20 new products with clear sustainability benefits.

“We are now ready to take the next step in our growth journey with a new strategy that will target the most attractive growth sectors and increase the focus on key emerging markets,” Shaver said. “With this stronger market focus, we want to transition from being an ingredient supplier to a true solution provider to our customers. At the same time, we will continue to execute successfully on the cost and productivity initiatives that will enable us to keep growing profitability.”

The new strategy will increase the focus on the following four segments: Agriculture, Buildings & Infrastructure, Cleaning goods and Personal care, as well as on emerging markets including China, Southeast Asia and India. Plans include growing in new applications and geographies through M&A and partnerships; further expanding the company’s sustainable product offering; and maximizing capacity utilization and flexibility of its manufacturing plants.

As MRC wrote previously, in February 2019, Nouryon (formerly AkzoNobel Specialty Chemicals) announced that it would license its innovative continuous initiator dosing (CiD) technology to Karpatnaftochim, Ukraine’s largest polyvinyl chloride (PVC) producer. Nouryon’s patented CiD technology allows PVC producers to increase reactor output by up to 40 percent, improve product quality, and make the production process intrinsically safer - all with minimum capital expenditure.

According to ICIS-MRC Price report, last week, Karpatneftekhim finalised prices for PVC shipments to the domestic market in October. Because of the situation in foreign markets, Ukrainian PVC significantly raised its prices, deals were negotiated in the range of USD1,095-1,120/tonne FCA, excluding VAT, for K 67, and USD1,150-1,170/tonne FCA, excluding VAT, for PVC K70. PVC in September was by USD150-200/tonne cheaper.
MRC

DNV GL, TCM and SINTEF join forces in international CCUS partnership

MOSCOW (MRC) -- Three international organizations specializing in technology research, testing, advisory services, and standardization have joined forces to find new ways to accelerate the adoption of carbon capture, utilization and storage (CCUS) technology in emissions-heavy industries, said Hydrocarbonprocessing.

DNV GL, SINTEF and Technology Centre Mongstad (TCM) have signed a memorandum of understanding to further develop carbon capture, utilization and storage technologies to make full-scale CCS a reality globally. CCS is the only currently available technology to deeply decarbonize hydrocarbon use. Scaling the technology will be critical to a range of industry sector’s ability to align with national and international climate targets. DNV GL’s 2020 Energy Transition Outlook forecasts that the technology will help mitigate more than 2 gigatons of CO2 emissions by mid-century. However, the forecasts also indicate that CCS will not begin to scale until 2030, and not to a significant level until 2040 without government incentives and with industry focusing on finding ways to reduce the cost of CCS technology.

On September 21, the Norwegian government announced its decision to provide 13.8-16.8 billion NOK funding to support the realization of the Norwegian Longship CCS project. All parties have provided consultancy support to enable the realization of this project, which boasts many first-of-a-kind elements, including capture of CO2 emissions from the cement industry, transport of CO2 by ship, and temporary storage of CO2 prior to pipeline transportation and storage.

The aim of the memorandum of understanding is to assist technologies and projects to move more rapidly from demonstration to commercial deployment. TCM’s capability to facilitate large scale testing and verification of CO2 capture technology allows technology developers the lowest possible technological and financial risk. DNV GL and SINTEF can provide confidence to technology developers and stakeholders by guiding and supporting processes to qualify CO2 capture technology, and providing verification of assets, infrastructure and storage sites.

“TCM’s capability to allow large scale demonstration of CO2 capture technologies is key to lower the cost and risk of deployment of the technologies at scale. Our mandate is to reduce cost and risk for emerging CCS projects through our own and two partners knowledge”, said Ernst Petter Axelsen, managing director at TCM.

“There is a significant need to accelerate efforts to scale CCS technology to allow the world to move toward its net-zero targets with greater confidence. Our partnership with TCM and SINTEF will allow us to work closely together to accelerate the deployment of CCS as a critical technology to deliver on nationally and internationally agreed climate targets.” said Liv A. Hovem, CEO, DNV GL – Oil & Gas.

"We are finally at a moment in time where CCS is being recognized as a key driver for sustainable growth, and we must succeed on the global scale quickly, according to both the IPCC, the European Commission among many others. This partnership will build on a deep knowledge-base, which SINTEF has actively contributed to for more than three decades, enabling a fast track to full scale and global use of CCS." said Alexandra Bech Gjorv, president and CEO SINTEF.

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

Sinopec starts ethylene production at new Zhanjiang refinery

MOSCOW (MRC) -- China's Sinopec has started operation of a 800,000 tons-per-year ethylene facility at its Zhanjiang refinery, reported Reuters with reference to the company's statement.

The refinery, located in the southern Chinese coastal city of Zhanjiang, commenced operation of its 200,000 barrel per day crude oil refining units in June.

As MRC informed before, Sinopec SABIC Tianjin Petrochemical Co. (SSTPC), a 50-50 joint venture of Sinopec and SABIC, completed the debottlenecking of its ethylene cracker on 11 July 2020, adding another 30,000 tons/year output to its current capacity. Followed the expansion, the Tianjin based plant become the country's largest compressor unit, producing 1.3 million tons of ethylene annually.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,496,500 tonnes in the first eight months of 2020, up by 5% year on year. Shipments of all ethylene polymers increased, except for linear low desnity polyethylene (LLDPE). At the same time, PP shipments to the Russian market reached 767,2900 tonnes in the eight months of 2020 (calculated using the formula - production minus exports plus imports - and not counting producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group"s key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.
MRC

Nearly 92% of US Gulf of Mexico oil output still shut in after Hurricane Delta's landfall

MOSCOW (MRC) -- Nearly 92% of US Gulf of Mexico oil output remained shut in Oct. 10, a day after Hurricane Delta made landfall in Louisiana, as upstream operators began to return crews to producing platforms, reported S&P Global.

Offshore producers have now shut in 1.697 million b/d of oil, or 91.7% of the US Gulf's total, up slightly from 1.694 million b/d Oct. 9, the US Bureau of Safety and Environmental Enforcement said in its daily bulletin. Operators have also shut in 1.692 Bcf/d of natural gas, or 62% of the total, up from 1.685 Bcf/d Oct. 9.
In addition, 276 producing platforms remained offline, up from 274 on Oct. 9.

The Oct. 10 figures reflect the reporting of 44 companies, BSEE said.

"The US Gulf had been producing close to 1.8 million b/d of crude pre-Delta," said S&P Global Platts Analytics analyst Sami Yahya. "Given widespread curtailments, volume recovery may take up to two weeks post peak impact, which has likely been reached."

Now a tropical storm, Hurricane Delta made landfall around 6 p.m. local time Oct. 9 at Creole, Louisiana – about 35 miles east of the Texas-Louisiana border – as a Category 2 storm with maximum sustained winds around 100 mph, the National Hurricane Service said.

Delta continues to degrade as it moves further inland.

At the same time, producers Oct. 10 began to assess conditions offshore and started to return crews to producing platforms, where they will inspect the infrastructure for damages and make needed repairs prior to restoring production.

"As conditions continue to improve today and tomorrow (i.e., Oct. 10-11), we are beginning the process of redeploying personnel to our assets," said Shell, which had shut down nine assets prior to the storm's passage through the US Gulf.

"All of our mobile drilling units are returning to drill sites to restart operations," Shell added.

BHP was also flying crews out to its two operated US Gulf platforms.

"We are in the process of remobilizing at Neptune and Shenzi and we expect to be completed by tomorrow morning (Oct. 11)," BHP spokeswoman Judy Dane said. "Production restart will be dependent on our midstream providers."

Winds had not totally died down in parts of the US Gulf Oct. 10, which impaired some operator preparatory work.

"Winds have to subside before the platforms can be inspected for damage and be declared safe to be re-manned," Al Petrie, a spokesman for W&T Offshore, said. "It will take several days to get that all done."

W&T, one of the few small public independent pure-play US Gulf operators, produced 42,037 boe/d in the second quarter. It does not disclose specific platform shut-ins during storms, Petrie said.

Delta's cone narrowed from earlier in the week, putting fewer area refineries at risk. Of the four Louisiana refineries in Delta's path, only Alon's 80,000 b/d Krotz Springs plant was operating.

Citgo's 418,000 b/d Lake Charles refinery, and Phillips 66's 260,000 b/d Westlake refinery, both remained down because of power outages caused by Hurricane Laura in late August. Hurricane Delta might cause a delay in the return of those two plants. Citgo and Phillips 66 could not be reached for comment.

Hurricane Delta left roughly 575,000 thousand customers without electricity as of late morning Oct. 10, according to poweroutage.us.

Entergy Louisiana, which serves over a million customers, had over 300,000 customer outages on the morning of Oct. 10, poweroutage.us data showed, and regional utility Cleco, serving 288,000 customers in Louisiana, had 124,861 outages, according to an emailed statement.

Entergy did not have any generating plants knocked offline due to the storm, which includes the investor-owned utility's 992-MW River Bend-1 nuclear power plants in Louisiana and the 1.5-GW Grand Gulf-1 plant in Mississippi, spokesman Jerry Nappi said in an email.

The 1.2-GW Waterford-3 nuclear plant located in Louisiana had been previously shut down for a scheduled refueling and maintenance outage, Nappi noted.

"Now that the storm has passed and conditions are improving, damage assessments will begin by land and air, and crews will begin making any necessary system repairs and restoring power," James Lass, Cleco's director of distribution operations and emergency management, said in the statement.

Delta was the tenth named storm in what as been the busiest Atlantic hurricane season in years.

The nearly 1.7 million b/d peak oil shut-in figure in the US Gulf represented "the most [production taken offline at one time] since Hurricane Katrina," James West, an analyst with boutique investment bank Evercore ISI observed in an Oct. 9 investor note, referring to a legendary US Gulf storm which battered the New Orleans area in 2005.

Hurricane Delta hit in roughly the same area of far southwestern Louisiana that Hurricane Laura, an even more dangerous storm, had pounded six weeks before.

While it seems "strange" having two hurricanes land in the same area during the same storm season, "it actually has happened 17 times in the US since 1950," West said.

Many analysts are comparing this year's storm season to 2005, when Louisiana was hit by Hurricanes Cindy, Katrina and Rita, West noted. The latter two storms were legendary for their Category 5-intensity – the highest on the five-level Saffir-Simpson Hurricane Wind Scale – and the severity of their damages to life and property.

Rita also was unforgettable for parking-lot traffic created on Houston freeways for dozens of miles heading north and west the day before the storm made landfall, since it been predicted to hit that city before making a last-minute turn to the east. Rita ultimately made landfall 100 miles away from Houston, around Sabine Pass at the Louisiana-Texas state line.

In contrast, Katrina made landfall near the "toe" of Louisiana and devastated New Orleans, 50 miles northwest.

As MRC wrote before, Total SA on Thursday began shutting an oil processing unit at its 225,500 bpd, Port Arthur, Texas refinery because of the threat from Hurricane Delta, people familiar with plant operations said. And Royal Dutch Shell Plc said it would continue operating its refineries in Convent, Geismar and Norco, Louisiana, through the storm.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,496,500 tonnes in the first eight months of 2020, up by 5% year on year. Shipments of all ethylene polymers increased, except for linear low desnity polyethylene (LLDPE). At the same time, PP shipments to the Russian market reached 767,2900 tonnes in the eight months of 2020 (calculated using the formula - production minus exports plus imports - and not counting producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
MRC