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MOL accelerates USD4.5-billion fuels-to-chemicals transition

February 26/2021

MOSCOW (MRC) -- MOL Group (Budapest, Hungary) plans to invest up to USD4.5 billion in capital expenditure over the next 10 years accelerating the transformation of its downstream business, including investments to convert about 1.8 million metric tons/year (MMt/y) of existing refinery fuels yield into chemicals, said Chemweek.

A further USD1 billion is forecast to be spent over the next five years on new, low-carbon, sustainable projects as part of MOLs newly updated 2030+ long-term goal to become a key player in central and eastern Europes emerging circular economy, it says. The company will target waste-to-chemicals integration and utilization, carbon capture, utilization, and storage (CCUS), advanced biofuels production, and potential green and blue hydrogen-related opportunities, it says.

MOL says group EBITDA is forecast to rise from USD2.3 billion in 2021 to USD2.6 billion in 2025, which will cover strategic capex of at least USD3.5 billion over the next five years in its downstream transformation and new, low-carbon, circular economy businesses.

The companys downstream segment, meanwhile, will retain its top-tier cash generation position in European refining, targeting EBITDA of at least USD1.2 billion by 2025, supported by a further USD150 million in refinery-efficiency improvements, it says. This will help to fuel its fuel-to-chemicals transformation, which will continue at full speed to reduce motor fuel yield in the refining system and to convert 1.8 million metric tons to petrochemical feedstock by 2030."

Two investment cycles will employ highly efficient technologies and targeted start-up dates in 2027 and 2030, respectively, it says. The first cycle will see MOL select a site location and technology before the end of 2021 focused on gasoline conversion, with between USD700 million and USD1.2 billion to be invested in a project to convert between 500,000 metric tons/year and 1.0 MMt/y of fuels to chemicals, it says. Three technology processes have been shortlisted by MOL for the project, due onstream by 2027, although no further details were given. Up to USD900 million in capex will be spent by 2025 on the companys first wave of fuel transformation projects and chemical yield increases, according to MOL.

MOL has also committed to reduce group-level carbon emissions by 2030 for its existing operations by 30%, make its upstream and consumer services carbon-neutral (Scope 1 and 2 emissions) by 2030, and cut its downstream segment emissions (Scope 1 and 2) by 20% by the same date, versus a 2019 base. It further aims to be fully climate-neutral by 2050, it says.

MOLs downstream operations currently include three refineries and two petrochemical plants in Hungary, Slovakia, and Croatia.

The company also confirms that its 220,000-metric tons/year polyol project at Tiszaujvaros, Hungary, currently under construction and 75% complete, is now expected to be ready for startup in the second half of 2022. The project has been delayed due to the COVID-19 pandemic from its original completion date later in 2021, it says. The projects total capex figure may also rise by about EUR100 million (USD121 million) from the original total of EUR1.3 billion because of the delay, it adds.

As MRC informed earlier, MOL Petrochemicals Company (formerly TVK, part of the MOL Group), the only Hungarian producer of olefins and polyolefins, plans to close the maleic anhydride plant in Szazhalombatta (Hungary) in October in order to carry out repair work to eliminate technical problems. prevented the company from increasing the capacity utilization at this production in September. It is expected that repair work at this 22,000 tonnes of maleic anhydride per year facility will continue for several days, but the exact timing of maintenance has not been told.

Plasticizers are substances introduced into a polymer material to make it elastic and plastic during processing and operation. In particular, plasticizers are used for the production of polyvinyl chloride (PVC). The share of plasticizers used for the production of PVC products is about 80%.

According to MRC's DataScope report, January external supplies of SPVC in Russia fell to 500 tonnes against 1,600 tonnes and 6,000 tonnes in January and December last year. High prices of PVC in the foreign markets and long New Year holidays put serious pressure on import purchases of PVC from Russian companies.

MOL is the largest Hungarian oil, gas and petrochemical group, engaged in exploration and production, transportation of hydrocarbons, as well as the operation of a network of trunk gas pipelines. TVK is a 100% subsidiary of MOL. TVK manufactures HDPE, LDPE, and PP.
Author:Anna Larionova
Tags:PVC, MOL Group, MOL Petrochemicals, Romania.
Category:General News
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