Petronas steps ups investments in hydrogen as part of carbon-free energy goals

MOSCOW (MRC) -- Malaysia’s state energy firm Petronas said it is stepping up investments in hydrogen as part of a global push to produce carbon-free energy, even as the firm expands its portfolio in LNG and renewable energy, said Hydrocarbonprocessing.

"The trajectory for moving towards hydrogen is really picking up space,” chief executive Tengku Muhammad Taufik Tengku Aziz said during the APEC CEO Dialogues. "It is typically the same customer base in emerging Asia, who are making more pronounced noises and desire to create a market for hydrogen," he added.

Petronas, the world’s fourth-largest exporter of LNG, this month announced its goal to become a net zero emitter of greenhouse gases by 2050 and also plans to increase its investments in renewable energy. Tengku Muhammad Taufik said, however, the challenge with hydrogen is in managing the supply chain and logistics.

Petronas is working through Memorandum of Understanding and partnerships with technology players to ensure it has the right capital and expertise to pursue the hydrogen agenda, he added.

During the dialogue, Japan’s Ministry of Economy, Trade and Industry (METI) said it has already formulated its hydrogen strategy, but prices need to fall to the same level as LNG within the next two decades.

"We believe hydrogen has one of the most important roles in achieving carbon neutrality, and is especially important to decarbonize sectors which are hard to electrify,"” said Takeshi Soda, METI director of oil & natural gas division.

The economic trauma caused by the coronavirus pandemic has pushed energy companies to increase investment in renewables, hydrogen and other low carbon alternatives, but fossil fuels will be their dominant business for the foreseeable future, industry executives say.

As MRC informed earlier, BASF and PETRONAS will close a butanediol (BDO) plant at their joint venture site in Kuantan, Malaysia, in the first quarter of 2021. BASF PETRONAS Chemicals (BPC) intends to shut down the unit, which produces BDO and derivatives, by March 2021, the companies said, due to “significant” overcapacity in the region due to new investments by competitors into coal-fired production units.

As MRC informed earlier, BASF and Petronas were considering jointly investing around EUR1bn (USD1.34bn) to produce specialty chemicals in Malaysia.

However, Petronas and German chemical company BASF said they had scrapped a proposed joint venture to develop a specialty chemicals production facility in Malaysia. The proposed partnership was terminated because both parties couldn't agree on the "terms and conditions" for the project in the southern state of Johor, the companies said in a joint statement.

As MRC informed earlier, BASF had put a project to build a petrochemicals complex in India worth up to USD4 billion on hold due to the economic uncertainty caused by the COVID-19 pandemic.

We remind that Russia's output of chemical products rose in September 2020 by 6.7% year on year. At the same time, production of basic chemicals increased by 6.1% year on year in the first nine 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-September output. Last month's production of primary polymers decreased to 852,000 tonnes from 888,000 tonnes in August due to shutdowns in Tomsk, Ufa and Kazan. Overall output of polymers in primary form totalled 7,480,000 tonnes over the stated period, up by 16.4% year on year.
MRC

MOSCOW (MRC) -- ENEOS Corporation (formerly known as JXTG Nippon Oil & Energy) is planning to take its larger naphtha cracker in Kawasaki off-line on 1 December 2020 for repairment after a technical issue reported at the butadiene separation unit last week, reported CommoPlast.

The cracker is currently operating at 95% capacity and would slowly reduce the run rates to completely shut down by the beginning of December.

The cracker with an annual capacity of 515,000 tons/year of ethylene, 300,000 tons/year of propylene, and 105,000 tons/year of butadiene would be shut for a month.

The company’s smaller cracker at the same location is not affected by the issue.

As MRC informed before, Eneos Corporation has restarted its fluid catalytic cracker (FCC) unit following a planned outage. The company resumed operations at the unit on August 31, 2020. The unit was shut for maintenance in end-April, 2020. Located at Kawasaki, Japan, the FCC unit has a propylene capacity of 150,000 mt/year.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, excluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

Japan's largest refiner JXTG Nippon Oil & Energy was renamed ENEOS Corporation on 25 June, 2020, as part of a wider re-organization of the parent company JXTG Holdings. The move, which also involved renaming the parent company to ENEOS Holdings upon approval at its annual shareholders meeting in June 2020, comes as it strives to be a more comprehensive energy and materials company under its 2040 vision announced in May, 2019. JXTG Holdings was formed as a result of a merger between JX Holdings and TonenGeneral in April 2017. This followed the establishment of JX Holdings as a result of the merger between Nippon Oil and Nippon Mining Holdings in April 2010.
MRC

MOSCOW (MRC) -- Crude oil futures ticked lower during morning trade in Asia Nov. 19, after data from the Energy Information Administration showed a small build in US commercial crude inventories, and as concerns over the uninhibited progression of the coronavirus pandemic festered in the market, reported S&P Global.

At 10:26 am Singapore time (0226 GMT), ICE Brent January crude futures were down 9 cents/b (0.20%) from the Nov. 18 settle at USD44.25/b, while the NYMEX December light sweet crude contract was down 18 cents/b (0.43%) at USD41.64/b.

Both ICE Brent January contract and December WTI contract rose on Nov. 18 after Pfizer and BioNtech said that a final analysis of clinical-trial data showed that their vaccine was 95% effective, and that they would submit an application for US regulatory authorization in the coming days.

However, the uptrend in oil prices was stymied by Nov. 18 data from the EIA, which showed that, in the week ended Nov. 13, US commercial crude inventories rose 770,000 barrels to 489.48 million barrels and were now 6.4% above the five-year average.

EIA data was more bullish than the Nov. 17 data from the American Petroleum Institute, which had shown a 4.174 million-barrel build in crude inventories in the same week, while analysts surveyed by S&P Global Platts had expected crude stocks to rise by only 100,000 barrels.

EIA data was also indicative of unimproved fundamentals in downstream markets as it showed that US gasoline inventories rose 2.61 million barrels to 227.97 million barrels in the week ended Nov. 13, with weekly product supplied for gasoline, EIA's proxy for demand, sliding 500,000 b/d to 8.26 million b/d, the lowest since the week ended Jun. 12.

The one positive from the report was a 5.22 million-barrel draw in distillate inventories to 144.07 million barrels, with distillate demand climbing 170,000 b/d to 4.23 million b/d.

At 10:26 am Singapore time, the NYMEX December RBOB contract was trading 0.52 cent/gal (0.45%) lower than the Nov. 18 settle at USD1.1577/gal and the NYMEX December ULSD contract was up by 0.17 cent/gal (0.13%) at USD1.2657/gal.

Meanwhile, concerns over the coronavirus pandemic were exacerbated by media reports that New York City's public schools will close temporarily to stem the rise in COVID-19 infections, after the city recorded a seven-day average positive rate of 3%.

Market analysts lamented the unabated rise in infection numbers in major US cities could culminate in increased restrictions during the holiday season.

ANZ analysts said in a Nov. 19 note: "[A vaccine] approval can't come quickly enough for the oil market, with the outlook for demand darkening amid ever increasing restrictions. A survey by GasBuddy says that only 35% of Americans will be taking to the roads during the Thanksgiving holiday. This is down from 65% last year."

As MRC informed previously, global oil demand may have already peaked, according to BP's latest long-term energy outlook, as the COVID-19 pandemic kicks the world economy onto a weaker growth trajectory and accelerates the shift to cleaner fuels.

Earlier this year, BP said the deadly coronavirus outbreak could cut global oil demand growth by 40 per cent in 2020, putting pressure on Opec producers and Russia to curb supplies to keep prices in check.

And in September 2019, six world's major petrochemical companies in Flanders, Belgium, North Rhine-Westphalia, Germany, and the Netherlands (Trilateral Region) announced the creation of a consortium to jointly investigate how naphtha or gas steam crackers could be operated using renewable electricity instead of fossil fuels. The Cracker of the Future consortium, which includes BASF, Borealis, BP, LyondellBasell, SABIC and Total, aims to produce base chemicals while also significantly reducing carbon emissions. The companies agreed to invest in R&D and knowledge sharing as they assess the possibility of transitioning their base chemical production to renewable electricity.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, excluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
MRC

MOSCOW (MRC) -- Nexus Fuels LLC (Nexus) and Shell announce a supply agreement, for 60,000 tons over four years, of pyrolysis liquid made from plastic waste, which is then converted into chemical products, according to Hydrocarbonprocessing.

Nexus, a leader in plastic waste molecular recycling, will supply fully circular, ISCC Plus-certified product from its plant in Atlanta.

This enhanced collaboration follows a year of continuous, high-quality supply to Shell’s chemical plant in Norco, Louisiana, USA, where it has been used in the liquid cracker to make chemicals that are the raw materials for everyday items. The new agreement builds on that success and on a common desire to find solutions to plastic waste pollution and progressing a low-carbon future. It is a next step towards Shell’s ambition to use one million tons of plastic waste a year in its global chemical plants by 2025.

Jeff Gold, Nexus chief executive officer, said “We appreciate Shell’s support of Nexus to convert waste plastics to virgin-molecule feedstocks and back into chemical products. Their teams have been great partners and share our philosophy and vision for improving our environment.”

Thomas Casparie, executive vice president of Shell’s global chemicals business, said “Real-world, in-plant testing and application is key to proving technologies and scaling up production of chemicals from plastic waste. This new supply agreement with Nexus is built on that solid foundation and is a positive step towards providing our customers with bigger volumes of sustainable, circular chemicals.”

As MRC informed before, Royal Dutch Shell plc. said earlier this month that its petrochemical complex of several billion dollars in Western Pennsylvania is about 70% complete and in the process to enter service in the early 2020s. The plant's costs are estimated to be USD6-USD10 billion, where ethane will be transformed into plastic feedstock. The facility is equipped to produce 1.5 million metric tons per year (mmty) of ethylene and 1.6 mmty of polyethylene (PE), two important constituents of plastics.

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

According to MRC"s ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers" inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

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) -- Led by the wood, chemical, and food industries, Canadian manufacturing sales rose 1.5 per cent to USD53.8 billion in September, according to new figures from Statistics Canada, said Canplastics.

The increase followed a revised drop of 1.4 per cent in August compared with the 2.0 per cent decrease that was initially reported.

The result for September matched the average expectations of economists surveyed by financial data firm Refinitiv. Sales rose in 13 of the 21 manufacturing sectors as the wood industry climbed 9.6 per cent in September to a record $3.3 billion due to higher sales at sawmills and wood preservation manufacturers.

The chemical industry rose 6.7 per cent to USD4.5 billion, while the food industry increased 1.3 per cent to USD9.2 billion for the month.

StatCan also said that manufacturing sales in constant dollars rose 2.1 per cent, indicating a larger volume of products was sold in September.

We remind that Russia's output of chemical products rose in September 2020 by 6.7% year on year. At the same time, production of basic chemicals increased by 6.1% year on year in the first nine 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-September output. Last month's production of primary polymers decreased to 852,000 tonnes from 888,000 tonnes in August due to shutdowns in Tomsk, Ufa and Kazan. Overall output of polymers in primary form totalled 7,480,000 tonnes over the stated period, up by 16.4% year on year.
MRC