US weekly propane/propylene stocks draw in line with expections

MOSCOW (MRC) -- US combined propane and propylene stocks slid 2.3 million barrels (bbl) in the week ended 18 December to 81.6 million bbl, according to Chemweek with reference to the Energy Information Administration's report Wednesday.

An OPIS survey of traders and analysts published on 22 December produced an average forecast of a propane drop of 2.375 million bbl with a range of 1.5 million to minus 3.25 million bbl, all draws.

Products supplied for propane and propylene fell 379,000 b/d on the week to 1.292 million b/d. Exports climbed 145,000 b/d to 1.5 million b/d. The four-week average for exports advanced 271,000 b/d to 1.43 million b/d. Propane imports for the week retreated 27,000 b/d to 148,000 b/d.

The Gulf Coast (PADD3) region inventories slid 1.5 million bbl to 44.3 million bbl in the latest week. The Midwest (PADD2) region stocks slipped 1 million bbl to 23.1 million bbl. PADD 1 inventories added 200,000 bbl to 8.5 million bbl while PADDs 4 and 5 stocks were unchanged at 5.7 million bbl.

Mont Belvieu TET propane remained at 69.5 cents/gal from before the report. Non-TET propane was at 69.125 cents/gal. Conway propane showed moved higher to 66.25 cents/gal.

As MRC wrote before, Enterprise Products Partners LP (EPP), through one of its affiliates, has entered a long-term agreement with Marubeni Corp. of Japan, under which Marubeni will offtake polymer-grade propylene (PGP) produced from a second (PDH 2) plant currently under construction at EPP’s operations in Mont Belvieu, Tex., for supply to global customers. Concluded on June 16, the PGP offtake agreement is part of a long-term collaboration between EPP and Marubeni that also includes the export of liquefied ethylene, the first 25-million lb vessel of which loaded and sailed from EPP and Navigator Holdings Ltd.’s 50-50 joint venture marine terminal at Morgan’s Point, Tex., in early January, EPP and Marubeni said on June 30.

We remind that in July, 2020, Enterprise Products conducted maintenance at its propane dehydrogenation (PDH) unit in Mont Belvieu, Texas. This PDH unit has the capacity of 750,000 mt/y of propylene.

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

According to MRC's DataScope report, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC

MOSCOW (MRC) - Energy companies Eni and Snam are joining forces with Italian state-lender CDP to work on energy transition projects aimed at cutting carbon emissions, said Reuters.

The three groups said in a joint statement on Wednesday that they would team up to produce, transport and market green hydrogen as well as to use the gas for rail transport.

Italy is targeting investments of around EUR10 B (USD12.2 B) in hydrogen by 2030 as part of its strategy to decarbonize the economy as it moves to phase out fossil fuels. Cassa Depositi e Prestiti (CDP), controlled by the Italian Treasury, is the main shareholder of oil and gas major Eni and gas infrastructure group Snam.

The three groups said they would be working together to roll out hydrogen, natural gas and LNG (liquefied natural gas) refueling stations as well as build infrastructure to supply LNG nationally for transport. They will also develop carbon capture and storage units (CCUS) to produce hydrogen to cut emissions in sectors that are hard to decarbonize, such as refineries. The deal is part of a broader commitment to help reach European targets for cutting carbon emissions by 55% by 2030.

"Collaboration between companies is essential for achieving national and European decarbonization objectives," Snam CEO Marco Alvera said.

Snam, which makes most of its revenue from gas transport in Italy, has pledged to spend more on new green business lines. Eni, which has pledged to slash its greenhouse gas emissions by 80%, is betting on large-scale CCUS investments to help clean up the gas in its portfolio as oil is wound down after 2025.

Abu Dhabi National Oil Co, the UAE's biggest energy producer, has awarded Italy's Eni and Thailand's PTTEP an exploration concession amid plans to boost oil production capacity by 25% to 5 million b/d by 2030.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,760,950 tonnes in the first ten months of 2020, up by 3% year on year. Only high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased. At the same time, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.
MRC

MOSCOW (MRC) - Venezuela has resumed direct shipments of oil to China after U.S. sanctions sent the trade underground for more than a year, according to Refinitiv Eikon vessel-tracking data and internal documents from state company Petroleos de Venezuela (PDVSA), said Reuters.

Chinese state companies China National Petroleum Corp (CNPC) and its listed subsidiary PetroChina - long among PDVSA's top customers - stopped loading crude and fuel at Venezuelan ports in August 2019 after Washington extended its sanctions on PDVSA to include any companies trading with the Venezuelan state firm.

The imposition of the sanctions was part of a push by the Trump administration to oust Venezuelan President Nicolas Maduro, but they failed to completely halt the South American nation's oil exports or to loosen Maduro's grip on power.

PDVSA's customers instead boosted shipments to Malaysia, where transfers of cargoes between vessels at sea have allowed most of Venezuela's crude to continue flowing to China after changing hands and using trade intermediaries.

PDVSA and Venezuela's oil ministry did not reply to requests for comment.

We remind that PetroChina has nearly doubled the amount of Russian crude being processed at its refinery in Dalian, the company's biggest, since January 2018, as a new supply agreement had come into effect. The Dalian Petrochemical Corp, located in the northeast port city of Dalian, was expected to process 13 million tonnes, or 260,000 bpd of Russian pipeline crude in 2018, up by about 85 to 90 percent from the previous year's level. Dalian has the capacity to process about 410,000 bpd of crude. The increase follows an agreement worked out between the Russian and Chinese governments under which Russia's top oil producer Rosneft was to supply 30 million tonnes of ESPO Blend crude to PetroChina in 2018, or about 600,000 bpd. That would have represented an increase of 50 percent over 2017 volumes.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,760,950 tonnes in the first ten months of 2020, up by 3% year on year. Only high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased. At the same time, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.
MRC

MOSCOW (MRC) - Asia's refining margins for jet fuel dipped on Tuesday but remained within close sight of multi-month highs touched last week, supported by seasonal heating demand for kerosene and a slow but gradual recovery in regional aviation demand, Reuters.

However, a fast-spreading new coronavirus strain that has shut down much of Britain has prompted several countries to reimpose travel curbs on UK routes, triggering worries about fuel demand recovery and near-term air travel outlook. Refining margins, or cracks, for jet fuel slipped 24 cents to $4.36 per barrel over Dubai crude during Asian trade on Tuesday.

The jet cracks, which also determine the profitability of closely-related kerosene, have gained 37% in the last month, Refinitiv Eikon data showed. Cold season in the northern hemisphere typically brings peak demand for kerosene in Japan and Korea, where the fuel is used as a heating oil to fend off winter chill.

Temperatures in Seoul are expected to stay mostly below normal over the next 15-day period, while temperatures in Tokyo are predicted to be lower than normal in the first week of January, weather forecast models on Refinitiv Eikon showed.

Meanwhile, supporting a steady uptick in aviation demand, scheduled flights operating globally were 40.5% lower in the week to Monday, an improvement from 43.5% a week earlier, according to aviation data firm OAG.

Flights in India were down 34.2% year-on-year in the week to Dec. 21, compared with a 36.4% drop in the preceding week, while flights in Australia were 38% lesser from the corresponding period last year, as against a 45.5% drop in the previous week, OAG data showed.

As MRC informed earlier, Asia's cash differentials for 10 ppm gasoil firmed to their highest level in four-and-a-half months on Monday, while refining margins for the industrial fuel slipped despite weaker prices of raw material crude. Cash discounts for gasoil with 10 ppm sulphur content narrowed by a cent to 4 cents a barrel to Singapore quotes, the smallest discount since differentials plunged into a negative territory on Aug. 11.

We remind that PetroChina has nearly doubled the amount of Russian crude being processed at its refinery in Dalian, the company's biggest, since January 2018, as a new supply agreement had come into effect. The Dalian Petrochemical Corp, located in the northeast port city of Dalian, was expected to process 13 million tonnes, or 260,000 bpd of Russian pipeline crude in 2018, up by about 85 to 90 percent from the previous year's level. Dalian has the capacity to process about 410,000 bpd of crude. The increase follows an agreement worked out between the Russian and Chinese governments under which Russia's top oil producer Rosneft was to supply 30 million tonnes of ESPO Blend crude to PetroChina in 2018, or about 600,000 bpd. That would have represented an increase of 50 percent over 2017 volumes.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,760,950 tonnes in the first ten months of 2020, up by 3% year on year. Only high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased. At the same time, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.
MRC

MOSCOW (MRC) -- Solvay says it has appointed Philippe Kehren, currently head of the company's Soda Ash Europe business, as president of its global business unit Soda Ash & Derivatives, according to Chemweek.

He will start from 1 January 2021.

Kehren succeeds Christophe Clemente, who is leaving Solvay after nine years with the company, the last six of which have been as president of Soda Ash & Derivatives.

As MRC reported earlier, in August, 2020, through the acquisition of the Solvay polyamide (PA) business, BASF enhanced its R&D capabilities in Asia Pacific with new technologies, technical expertise, and upgraded material and part testing services. BASF is planning to integrate the R&D centers from Solvay into its R&D existing facilities in Shanghai, China, and Seoul, Korea. The enhanced capabilities will boost BASF’s position as a solution provider to develop advanced material solutions for key industries.

We remind that BASF-YPC, a 50-50 joint venture of BASF and Sinopec, undertook a planned shutdown at its naphtha cracker on 30 April 2020. The company initially planned to start turnaround at the cracker on April 5, 2020. The plant remained under maintenance unitl 18 June, 2020. Located in Jiangsu, China, the cracker has an ethylene capacity of 750,000 mt/year and propylene capacity of 400,000 mt/year.

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

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC