COVID-19 - News digest as of 19.10.2020

1. SABIC Specialties business on track to establish stand-alone operations

MOSCOW (MRC) -- SABIC has confirmed that the establishment of its Specialties strategic business unit (SBU), as a separate, stand-alone business, which will remain owned by SABIC, is on track, as per the company's press release. While SABIC continues to monitor the business impacts of COVID-19, at this time, it anticipates that the timing of the “go-live” for the stand-alone operations of the group of companies embedding its Specialties strategic business unit (SBU) will be November 1, 2020. The establishment of the stand-alone model for the Specialties SBU will bring additional value to its customers who depend on the Specialties business for its innovation expertise and highly differentiated ULTEM and NORYL resins, LNP compounds and copolymers.



MRC

Lotte Chemical to resume operations at its Daesan cracker in end-November

MOSCOW (MRC) -- South Korea’s Lotte Chemical has delayed the restart of its fire-hit naphtha-fed steam cracker in Daesan for the third time to end-November, from October, reported S&P Global.

And this is likely to reduce the propylene supply to China and push up CFR China price.

It had initially planned to restart the cracker in September, then - in mid-November.

"The restart has been moved back to mid-November, but could be delayed again," a company source told S&P Global Platts previously. Lotte Chemical has plans for the cracker to operate as per normal by the end of 2020.

As MRC wrote before, the cracker was shut on March 4 following an explosion, which injured more than 30 people.

Lotte Chemical has two steam crackers. The steam cracker in Daesan has a production capacity of 1.1 million mt/year of ethylene, 550,000 mt/year of propylene and 150,000 mt/year of butadiene, while the Yeosu steam cracker is able to produce 1.18 million mt/year of ethylene, 550,000 mt/year of propylene and 130,000 mt/year of butadiene.

We remind that Lotte Chemical shut down its Deasan cracker for maintenance turnaround on October 14, 2019. The cracker resumed production on November 10, 2019.

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.

Lotte Chemical runs two naphtha crackers in South Korea. One cracker is located in Daesan county in Seosan which can produce 1.1 million tonnes per year of ethylene with the other 1.2 million tonnes per year cracker in the southwestern city of Yeosu.
MRC

Formosa Plastics USA force majeure on PVC supply remaines in force

MOSCOW (MRC) -- Formosa Plastics USA, part of Formosa Petrochemical, has left a force majeure on polyvinyl chloride (PVC) supplies from its Texas and Louisiana plants in force as of 12 October, reported S&P Global.

The force majeure circumstansed were announced in mid-August, 2020, due to difficulties to produce the product amid upstream steam cracker problems.

"Formosa Plastics Corporation, USA, on behalf of Formosa Plastics Corporation, Texas, and Formosa Plastics Corporation, Louisiana, has experienced unexpected difficulties in its upstream facility at Point Comfort, Texas, impacting the PVC production at both manufacturing sites," the company said in the letter as of Aug. 14.

As MRC informed before, in March, 2020, Formosa Plastics was emerging from a turnaround at its 798,000 mt/year PVC plant and upstream 753,000 mt/year vinyl chloride monomer unit at its Point Comfort, Texas, complex.

According to MRC's ScanPlast report, Russia's overall PVC production totalled 718,500 tonnes in January-September 2020, down by 0.3% year on year. At the same time, only two producers managed to increase their PVC output.

Formosa Petrochemical is involved primarily in the business of refining crude oil, selling refined petroleum products and producing and selling olefins (including ethylene, propylene, butadiene and BTX) from its naphtha cracking operations. Formosa Petrochemical is also the largest olefins producer in Taiwan and its olefins products are mostly sold to companies within the Formosa Group. Among the company's chemical products are paraxylene (PX), phenyl ethylene, acetone and pure terephthalic acid (PTA). The company"s plastic products include acrylonitrile butadiene styrene (ABS) resins, polystyrene (PS), polypropylene (PP) and panlite (PC).
MRC

Force majeure on Lake Charles polymer units of Westlake Polymer remains in force

MOSCOW (MRC) -- Westlake Polymers has left in force the declared on Aug. 31 force majeure on its North American polymer facilities after Hurricane Laura adversely impacted its unit sites, reported S&P Global.

Westlake's Lake Charles, Louisiana, complex had "incurred limited physical damage" then and restarts primarily depended on the availability of electric power, industrial gases, and other feedstocks.

Westlake Chemical was in the process of a restart following the loss of electricity from Hurricane Laura on 27 August when the arrival of Hurricane Delta on 9 October interrupted the process.

Westlake's facility at Lake Charles, Louisiana, has a 200,000 mt/year linear low density polyethylene (LLDPE) unit; a 60,000 mt/year high density polyethylene (HDPE)/LLDPE unit; a 386,000 mt/year low density polyethylene (LDPE) plant.

Westlake Chemical also declared a force majeure on Aug. 31 for all its North American PVC and VCM, which is also left in force in mid-October. Westlake's shutdown of its Lake Charles complex has idled 38% of its US VCM production, resulting in two VCM plants with a combined capacity of 952,318 mt/year going offline. The complex also has three upstream chlor-alkali plants with a combined capacity of 1.27 million mt/year of chlorine and 1.36 million mt/year of caustic soda - 46% of the company's overall North American chlor-alkali capacity.

Hurricane Delta appears to have wreaked minimal damage to chemical facilities in Lake Charles, Louisiana, just six weeks after Hurricane Laura blew through the region, severely damaging major electricity transmission lines that left facilities offline for weeks.

Westlake Chemical said in a statement on Oct. 12 that initial assessments after Delta's Oct. 9 landfall showed "very limited physical damage" to its Lake Charles complex, and facilities were "in the process of restarting."

According to MRC's ScanPlast report, Russia's overall PVC production totalled 718,500 tonnes in January-September 2020, down by 0.3% year on year. At the same time, only two producers managed to increase their PVC output.

As per 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).

Westlake Chemical Corporation is an international manufacturer and supplier of petrochemicals, polymers and building products with headquarters in Houston, Texas. The company's range of products includes: ethylene, polyethylene, styrene, propylene, chlor-alkali and derivative products, PVC suspension and specialty resins, PVC Compounds, and PVC building products including siding, pipe, fittings and specialty components, windows, fence, deck and film.
MRC

YNCC to start up new butadiene plant in Yeosu

MOSCOW (MRC) -- Yeochun Naphtha Cracking Centre (YNCC) plans to start up its new butadiene plant in Yeosu around the end of this year, reported S&P Global with reference to market participants.

The new plant's capacity will be 130,000 mt/year of butadiene.

Market participants see supplies in Asian butadiene to likely increase as new butadiene plants, including the one of YNCC, are due to start up in the region.

As reported earlier, YNCC has restarted its No. 1 naphtha cracker following a maintenance turnaround. The company resumed operations at the cracker on June 21, 2019. The cracker was taken off-stream on May 20, 2019. Located at Yeosu,South Korea, the cracker has an ethylene capacity of 860,000 mt/year and propylene capacity of 485,000 mt/year.

YNCC also has two other crackers at this site. Thus, the production capacity of its No. 2 naphtha cracker in Yeosu is 578,000 tonnes of ethylene per year ant that of its No.3 cracker - 470,000 tonnes of ethylene per year.

Butadiene is the main feedstock for the production of acrylonitrile-butadiene-styrene (ABS).

According to MRC's ScanPlast report, Russia produced 42,900 tonnes of polystyrene (PS) and styrene plastics in July, 2020, up by 5% year on year. Russia's ABS output totalled 1,100 tonnes over the stated period. At the same time, July estimated consumption grew in the ABS sector by 13% year on year to 4,300 tonnes (3,790 tonnes a year earlier).

South Korea’s Yeochun NCC (YNCC) pyrolyzes naphtha to produce basic feedstock materials for the petrochemical industry. YNCC, a joint venture between South Korean firms Hanwha and Daelim, is a key exporter of ethylene and propylene in the country.
MRC