EIA reports draw in US propane/propylene stocks

MOSCOW (MRC) -- US propane and propylene stocks totaled 59.8 million bbl at the end of last week, down 6.2 million bbl, or 9.4%, from the previous week, reported Chemweek with reference to data from the US Energy Information Administration (EIA).

Year-on-year (YOY), stocks were down by 25.8%.

Production decreased by 45,000 b/d to 2.295 million b/d. YOY, it was up 2.6%. Propane and propylene product supplied fell by 225,000 b/d to 1.879 million b/d. YOY, it was up 28.5%.

Exports totaled 1.48 million b/d, up 133,000 b/d from the previous week. YOY, they were up 21%. Imports increased by 25,000 b/d to 174,000 b/d. YOY, they were up 13%.

Propylene is a feedstocks for producing polypropylene (PP).

As MRC informed earlier, PP exports from the US were up 4.2% year on year in the first eleven months of 2020, whereas imports were down 34% year on year over the stated period. Lower imports were mainly due to a sharp drop in imports from Brazil, which supplied large quantities of material in 2019 as a pre-sale of Braskem's new PP plant in La Porte, Texas, which was launched in 2020.

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) -- SK Advanced is planning to start up the new PP plant in Ulsan, South Korea this March 2021 as construction works are nearly completed, reported CommoPlast with reference to market sources.

The PP unit is a joint venture between PolyMirae and SK Advanced, using the “Spheripol” process of LyondellBasell, and have an annual output of 400,000 tons/year.

The unit will be utilizing the propylene output from SK’s 600,000 tons/year propane dehydrogenation (PDH) unit at the same complex. It is expected that SK Advanced would have a smaller propylene allocation for export once the new PP line comes online.

As MRC wrote previously, in October, 2020, Advanced Petrochemical signed an amendment to the partnership agreement between its subsidiary, Advanced Global Investment Co. (AGIC), and SK Gas Petrochemical Pte. Ltd. (SKGP), a unit of SK Gas Co. Ltd.. Under the amendment, an isopropanol (IPA) plant with a capacity of 70,000 tons per annum will be added, along with the Propane Dehydrogenation (PDH) and Polypropylene (PP) plants that were already announced earlier. The company said in a bourse statement that by adding the IPA plant with an estimated cost of SAR 300 million (USD80 million), the total cost of the project for the three factories is currently estimated to be approximately SAR 7.05 billion (USD1.88 billion).

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.

Advanced Petrochemical Company (before Advanced Polypropylene) is a Saudi Joint Stock Company, established in October 2005. The company was initially launched by National Polypropylene Limited, jointly owned by Mr. Khalifa Al Mulhim, the chief executive officer of Advanced, and Mr. Monther Laheeq, who negotiated all the main deals related to the project, either before or after the establishment of Advanced Petrochemical. Currently, National Polypropylene Limited controls 7.9% of Advanced Petrochemical. Advanced Petrochemical started the construction of its plants in May 2005. The company produces 455,000 tons per year of propylene and 450,000 tons per year of polypropylene from its production facility located in Jubail Industrial City, in the Eastern coast of the Kingdom of Saudi Arabia.
MRC

MOSCOW (MRC) -- Yeochun Naphtha Cracking Centre (YNCC) restarted the No. 2 naphtha cracker in Yeosu, South Korea with a delay on 17 January 2021 following a two-and-a-half-month shutdown for expansion, reported CommoPlast with reference to market sources.

The initial start-up was scheduled on 14 January, 2020.

The expanded cracker is now capable of producing 915,000 tons/year of ethylene, up from the previous 580,000 tons/year and 550,000 tons/year of propylene, up from 270,000 tons/year previously. Sources reported that the cracker has reached on-spec ethylene output at night on 20 January.

As MRC informed earlier, the company took No.2 cracker off-stream around the third week of October 2020 for two months of maintenance.

YNCC is a joint venture between South Korean firms Hanwha and Daelim. The new ethylene capacity would be supplied to Daelim’s new mPE plant at the adjacent location.

YNCC owns two other naphtha crackers in Yeosu with a combined capacity of 1.325 million tons/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.

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

MOSCOW (MRC) -- PPG Industries today reported fourth-quarter net income down 7% year-on-year (YOY), to USD272 million, on net sales up 2%, to USD3.76 billion. Adjusted earnings, which exclude some impairment charges, totaled USD1.59/share, up 21% YOY and slightly ahead of analysts’ consensus estimate of USD1.58/share, according to Chemweek with reference to Refinitiv (New York, New York).

Sales volumes were down 1.5% YOY, but this was offset by a 1.5% increase in selling prices, favorable exchange rates, and acquisitions.

“The more than 20% increase in our adjusted EPS (earnings per share) was the result of strengthening year-over-year sales growth in our industrial coatings reportable segment, led by the automotive original equipment manufacturer (OEM), general industrial, and packaging coatings businesses,” says PPG chairman and CEO Michael McGarry. “In addition, the global architectural coatings business continued its excellent execution as we leveraged higher year-over-year sales into strong earnings growth. Consistent with the third quarter, we achieved improved operating results despite continued weakness in several key end-use markets, including aerospace and automotive refinish coatings, which are still being heavily impacted by the ongoing pandemic.”

Performance coatings segment sales declined 1% YOY, to US2.2 billion, while segment income was down 3%, to USD8 million. Volumes fell 6% YOY, while selling prices were up 3%. The declines were mostly due to a 30% drop in sales for aerospace coatings, and smaller declines in protective and marine and automotive refinish coatings. However, architectural coatings sales grew YOY, and automotive refinish coatings sales increased on a sequential basis.

Industrial coatings segment sales grew 7% YOY, to USD1.6 billion, while segment income was up 40%, to USD282 million. Sales volumes grew in the automotive OEM, industrial coatings, and packaging coatings businesses. Automotive OEM sales growth differed by region, with particularly large increases in China.

For the year ahead, PPG expects “overall global coatings demand continues to improve in many of the end-use markets we serve and across all our major regions, and we expect overall global economic activity to strengthen in the first half of 2021,” McGarry says. “However, due to increasing pandemic-related restrictions and certain supply chain disruptions, there is uncertainty regarding when this coatings demand growth will fully materialize.”

The company cut costs by about USD115 million in full-year 2020, a result of restructuring programs put in place partly in response to the pandemic. PPG generated about USD2.1 billion in cash during 2020, McGarry says.

As MRC informed before, the board of Tikkurila (Helsinki, Finland) says it “unanimously recommends” that the company’s shareholders accept a planned tender offer for the company from PPG Industries. PPG’s offer will be at EUR27.75/share, valuing Tikkurila at about EUR1.24 billion (USD1.50 billion), after PPG raised its bid price on 5 January in response to a competing offer from an unspecified company. The Tikkurila board says in a statement that its assessment of PPG’s revised bid took the rival offer into consideration.

We remind that in February 2020, PPG said it had completed its acquisition of Industria Chimica Reggiana (ICR, Reggio Emilia, Italy), a maker of automotive refinish products. Financial terms of the deal, including purchase price, were not disclosed. The deal was announced on 8 January. ICR was founded in 1961 and employs about 180 people. ICR manufactures automotive refinish products, including putties, primers, basecoats and clear coats. It also makes a range of coatings, enamels and primers for light commercial vehicles and other light industrial coatings applications. ICR employs about 180 people and sells its products in more than 70 countries in Europe, Africa, the Middle East, the US and Latin America.

We also remind that Russia's output of chemical products rose in November 2020 by 9.5% year on year. At the same time, production of basic chemicals increased in the first eleven months of 2020 by 6.6% year on year, 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-November 2020 output. November production of polymers in primary form rose to 896,000 tonnes from 852,000 tonnes in October. Overall output of polymers in primary form totalled 9,240,000 tonnes over the stated period, up by 17.1% year on year.
MRC

MOSCOW (MRC) -- A global EPC and turnkey project management company, Nuberg EPC has been awarded the prestigious 500 TPD Sulfuric Acid Plant project on EPC & LSTK basis in Egypt, said Hydrocarbonprocessing.

The project, which was awarded during the pandemic, is owned by Sprea Misr, a leading chemicals and plastics manufacturer in Ramadan City, Egypt. Nuberg EPC will be the single-point solution company responsible from concept to commissioning of the project. It is also the globally recognized Sulfuric Acid technology supplier.

The 500 TPD Sulfuric Acid Plant project will be based on the latest Double Contact Double Absorption (DCDA) process technology. The Double contact process is used for the production of sulfuric acid in high concentrations which is required for industrial purposes. The project also incorporates a 5MW turbine with a steam-based power generation plant with a complete bypass arrangement. This is the first time that Nuberg EPC is building a turbine unit for electricity production. Sulfuric Acid produced in the plants will be provided to the agriculture industry for the production of urea and other fertilizers.

This project comes as another milestone for Nuberg EPC, the Sulfuric Acid technology licensor, in Egypt, as it is the fourth turnkey project for the company. Nuberg has also completed three other turnkey projects in Egypt namely, a Caustic Soda plant for the Egyptian Petrochemical Company in Alexandria, a Calcium Chloride plant for TCI Sanmar Chemicals in Port Said, and a Sulfuric Acid plant for AGROCHEM in Alexandria.

Signing the contract amidst the pandemic is yet another achievement for Nuberg EPC. In the Middle East, Nuberg EPC has successfully delivered over fifteen turnkey projects in countries like Oman, Qatar, Saudi Arabia, Turkey, and the UAE. This has positioned Nuberg EPC as one of the top EPC companies in the region.

On being awarded the project, Mr. A. K. Tyagi, MD, Nuberg Engineering commented, "We are thankful to Sprea Misr for entrusting our turnkey project engineering capabilities and our EPC services and solutions with its Sulfuric Acid plant. We are excited to partner with them and strengthen our relationship even further. Armed with competent, qualified, and professional engineers along with advancements in sulfuric acid plant technology, we are committed to commission the project by the first quarter of 2022 faster than the industry average of 16 months."

He further stated, "Nuberg EPC's scope of services for this project includes Process Design & Technology including Product and Technology Development, Process Know-how & Licensing, Basic Engineering, Front End Engineering Design (FEED), Construction Management, Operation & Maintenance, Detailed Engineering, Project Management, Commissioning, EPC & LSTK Solutions, Heavy Fabrication, and start-up of the plant."

As MRC informed previously, oil producers face an unprecedented challenge to balance supply and demand as factors including the pace and response to COVID-19 vaccines cloud the outlook, according to an official with International Energy Agency's (IEA) statement.

We remind that the COVID-19 outbreak has led to an unprecedented decline in demand affecting all sections of the Russian economy, which has impacted the demand for petrochemicals in the short-term. However, the pandemic triggered an increase in the demand for polymers in food packaging, and cleaning and hygiene products, according to GlobalData, a leading data and analytics company. With Russian petrochemical companies having the advantage of access to low-cost feedstock, and proximity to demand-rich Asian (primarily China) and European markets for the supply of petrochemical products, these companies appear to be well-positioned to derive full benefits from an improving market environment and global economy post-COVID-19, says GlobalData.

We also remind that in December 2020, Sibur, Gazprom Neft, and Uzbekneftegaz agreed to cooperate on potential investments in Uzbekistan including a major expansion of Uzbekneftegaz’s existing Shurtan Gas Chemical Complex (SGCC) and the proposed construction of a new gas chemicals facility. The signed cooperation agreement for the projects includes “the creation of a gas chemical complex using methanol-to-olefins (MTO) technology, and the expansion of the production capacity of the Shurtan Gas Chemical Complex”.

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.

Nuberg EPC has been providing plant design, engineering, technology, and turnkey solutions to the sulphuric acid industry for 25 years. Nuberg EPC has its own technology specially designed and developed to increase the efficiency and cost-effectiveness of Sulphuric Acid plants. The company is a global leader for not only executing turnkey Chemical and Fertilizer projects worldwide but also serves Hydrocarbon, Steel, and Nuclear & Defense industries globally.


MRC