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

North America weekly chemical rail maintains YOY gains

MOSCOW (MRC) -- Chemical railcar traffic in North America continued to strengthen during the week ended 21 November, reported Chemweek.

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.

The year-to-date deficit declined to 3.5% versus 2019 and 5.1% versus 2018, compared to 3.7% and 5.4%, respectively, the previous week.

Chemical railcar traffic in the US contributed 32,721 carloads to the total, up 2.9% YOY and up 2.5% from the previous week. For the year to date, US chemical railcar traffic was down 4.3%.

Canadian chemical rail traffic totaled 11,172 carloads, up 15.2% YOY and down 3.4% from the previous week. For the year to date, Canadian chemical railcar traffic was down 1.4%.

Chemical railcar traffic in Mexico totaled 950 carloads, a YOY increase of 8.3% and a sequential decrease of 11.5%. For the year to date, Mexican chemical railcar traffic was down 3.2%.

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

Croda completes acquisition of Iberchem

MOSCOW (MRC) -- Croda says it has completed the acquisition of the entire issued share capital of flavors and fragrances company Iberchem Group (Murcia, Spain) from investment company Eurazeo, said Chemweek.

It follows an announcement by Croda last week. Croda says it has agreed to acquire the entire issued share capital of flavors and fragrances company Iberchem Group (Murcia, Spain) from investment company Eurazeo for EUR820 million (USD975 million) on a debt-free, cash-free basis. The sum will be funded via a combination of Croda's existing debt facilities and the proceeds of a ?600-million (USD798 million) equity placing representing 8% of Croda's issued share capital, the company says. Acquiring Iberchem marks Croda's entry into the flavors and fragrances market. The transaction is expected to close by the end of 2020, Croda says.

The acquisition price represents a multiple of 20.5 times Iberchem's estimated 2020 EBITDA, according to Croda. “We have known Iberchem’s team for many years and their business is highly compatible with Croda’s. Iberchem stands out with its significant exposure to emerging markets, extensive product portfolio well placed to adapt to sustainability trends, strong customer focus and R&D capability, and 10-year track record of consistent year-on-year growth. By bringing our businesses together, we are creating a new, full-service offering to our customers in consumer-care markets and a compelling platform from which to grow the combined business in the years ahead,” says Steve Foots, CEO of Croda.

Eurazeo acquired 71.5% of Iberchem in 2017 for EUR405 million, less than half what Croda is paying for the business. Iberchem's management owns the rest of the company. Iberchem's sales have increased at a compound annual growth rate of 15% since 2010, Croda says.

As MRC informed earlier, Croda International (Goole, UK) says it has entered a partnership with Sentient Science (Buffalo, New York), an asset management and software services company, for the recommended use of Croda’s Rewitec additives for wind turbine gearboxes and main bearings.

As MRC informed earlier, Nexam Chemical has received an order from an existing customer in the area of PET additives for deliveries to the USA. The customer is a market-leading manufacturer of PET foam. It is the single largest order in the United States and also one of the largest ever for Nexam Chemical globally. Nexam Chemical has previously delivered products to this customer and this order confirms good growth in the business. The value of the order is SEK 9 million and applies to deliveries up to and including the spring of 2021.

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.

Croda acquired Rewitec in 2019 and began to offer to energy technology customers nano- and micro-particle-based additives to increase the durability of machinery by lowering friction and reducing wear, the company says. Prior to the acquisition in 2017, Sentient Science validated Rewitec’s DuraGear gearbox oil additives for use in wind turbine gearboxes, it says.
MRC