Stepan buys Invista aromatic polyols business

MOSCOW (MRC) -- Stepan Company (Northfield, Illinois) says it has acquired Invista’s aromatic polyols business, which has annual sales of about USD100 million, according to Chemweek.

The deal includes a manufacturing site in Wilmington, North Carolina, and another in Vlissingen, Netherlands, as well as intellectual property, customer relationships, inventory, and working capital. Terms of the deal, which was financed with cash on hand, were not disclosed.

F. Quinn Stepan, Jr., chairman and CEO, says the acquisition will support the growth of Stepan’s global rigid polyol business. “We expect that Invista's available spare capacity, plus debottlenecking opportunities in both plants, will allow Stepan to support market growth in a capital efficient way," he says. "We believe the long-term prospects for rigid polyol use in insulation remain strong, as energy conservation efforts and more stringent building codes should continue to drive market growth. Additionally, we believe the acquired technology will accelerate our product leadership initiatives, drive manufacturing efficiencies and output, and create increased value for the overall market."

Stepan already has polyester polyols capacity at Nanjing, China; Wesseling, Germany; Brzeg Dolny, Poland; Columbus, Georgia; and Millsdale, Illinois, according to IHS Markit's Directory of Chemical Producers.

As MRC informed before, Stepan conducted planned maintenance at its 90,000 tonnes/year phthalic anhydride (PA) plant Millsdale, Illinois, US, from early October to end-October, 2020.

Phthalic anhydride is widely used in for the production of paints and varnishes and plasticizers for PVC products. In a small amount it is used in the manufacture of rubber products, tires. In addition, it is used in the light, pharmaceutical and electrical industries.

According to MRC's ScanPlast report, Overall production of polyvinyl chloride (PVC) reached 976,500 tonnes in 2020, up by 0.2% year on year. Only two producers managed to increase their PVC output
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MOSCOW (MRC) -- BP completed the formation of its strategic US offshore wind partnership with Norway's Equinor, said the company.

Under the award, Equinor and incoming strategic partner BP will develop the 1,260 MW Empire Wind 2 and the 1,230 MW Beacon Wind 1 offshore wind projects. The execution of the procurement award is subject to the successful negotiation of a purchase and sale agreement.

Equinor and BP will also partner with the State of New York to transform the South Brooklyn Marine Terminal (SBMT) and the Port of Albany into large-scale offshore wind working industrial facilities.

“The U.S. East Coast is one of the most attractive growth markets for offshore wind in the world. The successful bids for Empire Wind 2 and Beacon Wind 1 represent a game-changer for our offshore wind business in the U.S. and underline Equinor’s commitment to be a leading company in the energy transition,” said Anders Opedal, CEO of Equinor.

The State of New York launched its second offshore wind solicitation in July 2020, seeking up to 2,500 MW of projects. Equinor is already developing the 816 MW Empire Wind Phase 1 wind farm which was selected in New York’s first-ever offshore wind solicitation in 2019 alongside Orsted and Eversource Energy’s Sunrise Wind project.

Empire Wind is located 15-30 miles southeast of Long Island and spans 80,000 ha, with water depths of between 65 and 131 feet. The lease was acquired in 2017 and is being developed in two phases. Beacon Wind is located 60 miles east of Montauk Point and 20 miles south of Nantucket and covers 128,000 ha. The lease was acquired in 2019 and has the potential to be developed with a total capacity of more than 2.4 GW.

The project, which was initially announced in September will be staffed equally from both companies once in in operation. This builds on BP’s strategy to become an integrated energy company, growing net renewable capacity from 2.5GW in 2019 to 20GW by 2025 and around 50GW by 2030.

The investment also contributes towards BP’s aim of increasing annual low-carbon investment ten-fold to around USD5bn a year by 2030.

We also remind that BP and Equinor confirmed they are shutting in production on their platforms, while Chevron, BHP and others said they are evacuating some personnel and considering decisions on production reductions.

Ethylene and propylene are feedstocks for producing 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.

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MOSCOW (MRC) -- Royal Dutch Shell Plc shut the gasoline-producing residual catalytic cracking unit (RCCU) at its 227,400 barrel-per-day (bpd) Norco, Louisiana refinery, according to Hydrocarbonprocessing with reference to sources familiar with plant operations.

The 112,000 bpd RCCU, which converts residual crude oil into unfinished gasoline, was shut to repair a leak, the sources said.

A Shell spokesman did not have information immediately available about operations at the Norco refinery on Monday morning.

The RCCU repairs led Shell to issue a notice to nearby residents on Thursday that the Norco refinery and chemical plant complex would using the safety flare system because of maintenance on a unidentified unit.

Safety flares are used to burn off hydrocarbons that cannot be processed normally because of unit shutdowns or startups.

The RCCU, unlike the more common fluidic catalytic cracker (FCC), uses residual crude oil from distillation units to make unfinished gasoline. FCCUs use gas oil as their feedstock.

As MRC wrote before, Royal Dutch Shell has reported an outage at its olefins plant in Deer Park, Texas, USA, on 5 January, 2021. The plant flared for 16 hours following unspecified process upset. Maximum steam cracker operating rate in Texas falls to 89%.

Ethylene and propylene are feedstocks for producing 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.

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.
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1. Phillips 66 posts wider-than-expected loss on pandemic hit

MOSCOW (MRC) -- Phillips 66 reported a wider-than-expected loss on Friday, as rising oil prices and lower fuel demand hit the US refiner's marketing and specialties business, reported Reuters. While crude prices rallied more than 20% in the last quarter, driven by optimism over the development of COVID-19 vaccines, refiners struggled with uneven demand for fuel and related products as fresh lockdowns due to a resurgence in COVID-19 infections threatened that recovery. Consumption of liquid fuels globally is estimated to have fallen by 9 million barrels per day in 2020, according to U.S. Energy Information Administration. Data also shows that travel on U.S. roads also fell 11% in November from the year-ago period, after a 9% drop in October. Like rival Valero, Phillips 66 also expects COVID-19 vaccination efforts to boost economic recovery.



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MOSCOW (MRC) -- Weekly US crude exports jumped 1.1 million b/d to 3.36 million b/d over the week ended on Jan. 22, reported S&P Global with reference to data from the US Energy Information Administration Jan. 27, despite difficult arbitrage economics.

The rise took exports to their highest average weekly export level since the week ended on Jan. 1, and kept the four-week moving-average above 3 million b/d.

The arbitrage for WTI MEH crude into Rotterdam against local Forties crude fell to a minus 34 cents/b incentive on Jan. 26 and has averaged just a 4 cents/b incentive through the first 26 days on January, according to the S&P Global Platts Crude Arbflow calculator. Through December, by comparison, the arbitrage incentive averaged 57 cents/b, according to Platts Arbflow.

Refinery runs and margins are expected to remain weak through 1Q21 in Europe as demand recovery remains slow and product stocks are generally high, according to S&P Global Platts Analytics.

Furthermore, Europe could already be facing a "double-dip" recession following the tightening of COVID-19 restrictions. The early release of the euro area composite Purchasing Managers Index was reported at 47.5 for January, implying a more negative outlook from the previous month. Indeed, the euro area composite PMI averaged just 48.1 in 4Q20, showing the depressed outlook held at the end of 2020 was continuing into January 2021.

Platts Analytics expects European oil demand to fall 5-6 million b/d lower during January and February of 2021 compared to the same time in 2019. Some recovery, however, is expected after mid-year.

The arbitrage for WTI MEH crude into Northeast Asia against local ESPO crude has also come under pressure in recent days, however, values for ESPO crude have fallen significantly amid a larger monthly supply of ESPO in the market and limited demand amid recent lockdowns in China.

WTI MEH against ESPO in Japan fell to minus 74 cents/b on Jan. 26, down from a minus 26 cents/b incentive just the day prior. Through the first 26 days of January, the arbitrage incentive averaged 60 cents/b, and in December, the incentive averaged USD1.02/b. ESPO has weakened significantly in recent weeks to a 75 cents/b premium to Dubai on Jan. 27, down from plus USD2.70/b on Jan. 7.

US crude exports in 2021 face further pressure from falling US crude production and recovering refinery runs, which would leave fewer barrels available for export. Despite these headwinds, Platts Analytics expects US crude exports to average more than 2 million b/d in 2021.

As MRC informed before, global oil demand is expected to rise by nearly 7% this year, boosted by quicker vaccine distribution and a better economic outlook, according to consultancy Wood Mackenzie's statement. Total liquids demand is expected to average 96.7 million barrels per day (bpd) in 2021, 6.3 million bpd higher than last year when the Covid-19 pandemic caused an unprecedented oil demand shock. Refineries under the threat of closure could repurpose the facilities to produce liquid renewables instead of converting into a terminal, which could help oil companies’ aim of achieving carbon neutrality.

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.
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