Thailand crude imports jump in Oct as refiners replenish light-end product stocks

MOSCOW (MRC) -- Thailand imported 792,600 b/d of crude and condensate in October, a 50.8% jump from a year earlier, with demand for light sweet crude from the US and Nigeria picking up sharply after the restart of the country's 215,000 b/d Rayong refinery, reported S&P Gllobal.

The country's crude oil imports in October rose by 46.8% year on year to 725,673 b/d, while condensate imports more than doubled to 66,927 b/d from 31,263 b/d in the same month a year earlier, according to data released Nov. 23 by the customs department.

A sharp monthly increase in Thailand's refinery feedstock imports from its major light sweet crude suppliers including the US and Nigeria stood out, with state-run refiner and upstream company PTT indicating that the country is in need of replenishing some light and middle distillates stocks after refinery runs fell sharply late in the third quarter.

Thailand received 35,357 b/d of crude oil from the US in October, up 90.2% from 18,586 b/d imported in September, the data showed. Imports from Nigeria also more than doubled to 62,251 b/d from 24,655 b/d in September.

In the first 10 months, Thailand imported 92,951 b/d from the US, up 33% from the same period a year earlier, placing the North American producer in the top three supplier list for the year.

"Looking at the WTI-Dubai and WTI-Brent spreads, light sweet US crude may not be as competitive as it was in the previous 2-3 years, but we believe [crude import] diversification should be maintained over the longer run," a trading manager at PTT told S&P Global Platts.

In mid-October, PTT's subsidiary IRPC Public Co. Ltd. competed repairs to its 215,000 b/d Rayong refinery and restarted units that were shut in early September due to a fire, a company official told Platts previously.

The operating rate of the Rayong refinery averaged 88% over the first half of 2020, down from the 94% in H1 2019, IRPC said in an operations update on Oct. 14.

With the units back online, however, market participants expect operating rates at the facility to be steadily increased to at least 80% of capacity, matching levels prior to the fire.

"Light crude and condensate are essential these days for petrochemical feedstock naphtha output ... demand for petrochemicals for plastic, as well as hygiene-related chemical production is rising rapidly during the [coronavirus] pandemic," a plant operation manager at IRPC said.

In addition, PTT Global Chemical plans to raise run rates at its 280,000 b/d refinery in Map Ta Phut to over 90% in December, from 80%-90% in November, due to some improvement in margins, a source close to the matter said Nov. 24.

However, it remain uncertain how far the country's refinery run rates would need to be increased as domestic transportation fuel demand remains fragile, industry and refinery sources said.

The ongoing political protests and fresh coronavirus outbreaks could emerge as challenges to Thailand's gasoline demand in the near term, sources added.

Reflecting the headwinds, driving activity in Thailand has been on a downtrend since the end of August and was seen at 7% below baseline levels Nov. 22, mobility data from Apple showed.

Thailand produced 120,677 b/d of crude oil in the first nine months of this year, down 3.1% year on year, with major output coming from Sirikit (29,553 b/d, 0.4% higher year on year), Erawan (24,656 b/d, down 0.1% year on year) and Tantawan (17,984 b/d, down 15.5% year on year).

Its condensate output between January and September declined 16.6% year on year to 85,529 b/d, with the main production coming from Erawan (40,758 b/d, down 21% year on year) and Pailin (12,544 b/d, dropping 28.2% from a year ago), according to data released Nov. 12 by the Energy Policy and Planning Office.

Domestic crude production data for January-October is scheduled to be released next month.

As MRC informed before, PTTGC might start up the newly constructed cracker in Map Ta Phut, Thailand this December, 2020. The company kickstarted the project in early 2018 as part of PTTGC’s USD4.5 billion projects to “retrofit” its Map Ta Phut site. The new cracker operates on flexible feeds, primarily to utilize the surplus naphtha from its refinery. The unit has an annual capacity of 500,000 tons/year of ethylene and 261,000 tons/year of propylene.

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

Momentum for hydrogen transit grows

MOSCOW (MRC) -- In conjunction with European Hydrogen Week, global power leader Cummins Inc. shared new research revealing that more than half of the United Kingdom (UK) commuters would be willing to travel to work on a train or bus powered by hydrogen to lower their carbon footprint and reduce emissions and nearly half of commuters in Belgium and Germany expressed the same view, said Hydrocarbonprocessing.

This new data was obtained through a survey of 6,000 respondents in Belgium, Germany and the United Kingdom in October 2020. "It is encouraging to see that citizens and governments across Europe are prioritizing the climate and understand that investment in hydrogen technologies is a path to improve the environment and fuel economic recovery from the impact of COVID-19,” said Amy Adams, vice president of Fuel Cell & Hydrogen Technologies at Cummins. “With both the EU and the UK pledging to be carbon-neutral by 2050, there is, in short, real appetite from policymakers and citizens to make a collective difference. Hydrogen is a key part of Cummins’ portfolio of solutions to help our customers succeed and as a path toward zero emissions."

The survey results demonstrate positive attitudes towards clean technology alternatives for public transport, with about 40% consumers in Belgium, Germany and the UK willing to pay GBP1 or EUR1 more for their daily commute in order to lower their carbon footprint.

48% of British citizens expressed that low-carbon technologies are important for the UK’s economic recovery from COVID-19. In addition, more than 40% of citizens in Belgium and Germany agreed that low-carbon technologies are important for their country’s economic recovery plans.

When asked about buying or renting a car powered by hydrogen, over a quarter of respondents in Belgium and the UK reported concerns with the upfront cost. Less than 20 percent of consumers in Germany, the UK and Belgium were also deterred by the limited amount of hydrogen refuelers available. Furthermore, one in five UK citizens believe that it will take 20-30 years for there to be more cars powered by hydrogen fuel on the road than gas-powered cars, and nearly a quarter believe this will never happen. A third of consumers in Germany and more than a quarter in Belgium agreed.

Fortunately, European consumers are willing to switch to more sustainable public transport – and this technology is available now. For example, hydrogen trains are an effective solution for more sustainable rail networks in Europe. With the right commercial technologies in place, consumers can lower their carbon footprints without facing additional costs.

As MRC informed earlier, Chemical railcar traffic in North America continued to strengthen during the week ended 21 November. Weekly volume totaled 44,843 carloads, up 5.8% year-over-year (YOY) and up 0.6% sequentially, according to data released on 25 November by the Association of American Railroads (AAR). On a four-week basis, volume was up 2.4% from 2019 and down 0.8% from 2018 (chart). By contrast, volume during the four weeks ending 14 November was up just 1.3% from 2019 and down 4.3% from 2018.

As MRC informed earlier, 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.

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 density 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

Shell may permanently shut Louisiana refinery next week

MOSCOW (MRC) -- Royal Dutch Shell may begin the permanent shutdown of its 211,146 bpd Convent, Louisiana, refinery early next week, people familiar with plant operations said, said Hydrocarbonprocessing.

Shell announced on Nov. 5 the refinery, located 57 miles (92 km) west of New Orleans, was to close after the company failed to find a buyer amid the COVID-19 pandemic. A Shell spokesman did not reply to a request for comment.

The Convent refinery is the first U.S. Gulf Coast refinery to permanently close because of the pandemic-related decline in demand for refined products. Eight other North American plants have been idled or targeted for shutdowns.

The coronavirus pandemic cut fuel demand by up to 30% earlier this year, and even as economies recover, the outbreak will likely reduce global demand by 4.7 MMbpd over the next five years, analysts have said. Three U.S. oil refineries have shut already this year because of weak demand for jet fuel, diesel and gasoline amid a slowing economy.

In August, Calcasieu Refining idled its 135,500-bpd Lake Charles, Louisiana, facility, citing weak margins from falling demand. Marathon Petroleum Corp has said it will not restart production at its refineries in Martinez, California, and Gallup, New Mexico. Shell this month halved its crude processing capacity at its 500,000 bpd Pulau Bukom plant in Singapore. Plants in the U.S. and Europe are considering converting some facilities to produce biofuels.

U.S. refineries in August ran at 78.8% of their 18.6 MMbpd capacity, according to the U.S. Energy Information Administration, down from 83.1% in March.

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

US Flint Hills to keep non-essential staff out of Pine Bend refinery after Thanksgiving holiday

MOSCOW (MRC) -- Flint Hills Resources will keep non-essential staff out its of 375,000-bpd Pine Bend refinery in Rosemount, Minnesota, for one week after Thanksgiving to prevent the spread of COVID-19, reported Reuters with reference to a source familiar with the matter.

The plant is expected to continue operating normally. The decision affects most refinery staff and outside contractors other than those essential to the plant's operations, according to the source.

The company declined to comment on the decision, but a spokesman said Flint Hills continues to focus on operations and the health and safety of its staff.

Minnesota has seen an uptick in coronavirus cases in recent weeks. The state's health department reported 6,423 newly confirmed or probable cases of the disease on Tuesday, as well as 38 additional deaths.

Millions of Americans have flocked to airports and highways in the days before Thursday’s Thanksgiving holiday against the advice of the Centers for Disease Control and Prevention (CDC), the US surgeon general and Dr. Anthony Fauci, the nation’s top infectious disease expert.

This has led to the busiest US travel period since the early days of the pandemic in March, though well below pre-pandemic holiday levels.

The daily US death toll from COVID-19 surpassed 2,000 on Tuesday for the first time since May.

As MRC informed previously, in November 2019, Motiva Enterprises, the US refining arm of Saudi Aramco, acquired 100% of Flint Hills Resources chemical plant, adjacent to its Port Arthur, Texas, oil refinery. The Flint Hills plant operates a 1.57 billion-pound-per-year ethylene cracker, a unit producing nylon component cyclohexane, and a network of pipelines and storage caverns.

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

Clariant to cut up to 1,000 jobs as part of reorganization

MOSCOW (MRC) -- Clariant AG plans to cut about 1,000 jobs as it slims down amid a series of divestments, the Swiss speciality chemicals company said, as per Reuters.

"The rightsizing programme foresees a reduction of approximately 1,000 positions in service and regional structures. Approximately one-third of the reductions will be included in the divestment transfers," it said, adding it would book a provision of around 70 million Swiss francs (USD76.9 million) in the fourth quarter for the programme.

The reductions will extend over two years and will include departures attributable to natural fluctuation, Clariant said. A previously announced cost-cutting programme aims to reduce around 600 positions at continuing operations and generate 50 million Swiss francs in savings by the end of 2021.

"By avoiding remnant cost and consequently reducing complexity, putting an even stronger focus on innovation, sustainability and operational excellence, we put our company’s high value speciality businesses in a position to operate in an even more focused and agile manner. This will help us deliver above-market growth, higher profitability and stronger cash generation," Chairman Hariolf Kottmann said.

Clariant continues to emphasise organic and inorganic growth to drive its portfolio upgrade, it added.

As MRC reported before, earlier this month, Clariant (Muttenz, Switzerland) announced the construction of a new state-of-the-art catalyst production site in China. This project represents a significant investment which further strengthens Clariant’s position in China and enhances its ability to support its customers in the country’s thriving petrochemicals industry.

The new facility will be primarily responsible for producing the Catofin catalyst for propane dehydrogenation, which is used in the production of olefins such as propylene. Thanks to its excellent reliability and productivity, Catofin delivers superior annual production output compared to alternative technologies, resulting in increased overall profitability for propylene producers, says the company. Construction at the Dushan Port Economic Development Zone in Jiaxing, Zhejiang Province was scheduled to commence in Q3 2020, and Clariant expects to be at full production capacity by 2022.

Propylene is the main feedstocks for the production of polypropylene (PP).

According to MRC's ScanPlast report, 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.

Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints.
MRC