Shell aims to produce clean aviation fuel, naphtha

MOSCOW (MRC) -- Royal Dutch Shell in Germany aims to produce aviation fuel and naphtha made from crops and renewable power and to increase to commercial scale an electrolysis plant that makes fossil-free hydrogen, as it seeks to move away from crude oil, said Hydrocarbonprocessing.

The energy major told an online conference it had applied for subsidies to carry out the work from the European Union and from German funds earmarked for decarbonisation. Fabian Ziegler, head of Shell Deutschland, said several hundred million euros should be spent per year, but he did not give a desired ratio between company and public funding.

The global Shell group has set itself a goal of net zero emissions by 2050. At Wesseling, part of the Rheinland refinery, Shell plans to use green electricity and biomass to produce synthetic power-to-liquids (ptl) in a carbon-free way to replace, over the long term, conventional jet fuel and naphtha. The 100,000 tonnes/p.a. ptl plant could be built from 2023 and start producing in 2025.

Shell also gave a timeline for building a 100 megawatt (MW) electrolysis plant, to be called Refhyne II, scaling up from an existing 10 MW plant. Hydrogen is considered a green fuel when electricity from renewable energy sources is used in its production. Shell has begun securing offshore wind power assets whose electricity it could use as feedstock for electrolysis.

Through its latest purchase of Next Kraftwerke, a virtual power plant (VPP) operator, it gets access to aggregated biomass-to-power and solar plants. A final investment decision for Refhyne II is due this year and production could start by the end of 2025, Ziegler said.

The Berlin government last summer earmarked 7 billion euros for the build-up of green hydrogen in Germany, plus a further 2 billion euros to set up partnerships with other countries, to introduce the alternative fuel across industries and energy. The market's build-up will take many years but there are clear targets in place for 2030, accompanied by plans to repurpose existing gas and oil transport infrastructure for example around existing refinery clusters.

Hydrogen has a high energy content by mass, but conversion losses from electrolysis and high costs involved in readying it for delivery pose challenges. Costs of producing green hydrogen of 5-6 euros per kg must come down, given that fossil fuels-based hydrogen costs 1.50 euros/kg, he said. The plans for Wesseling tie in with other European Shell initiatives, with partners, to build electrolysis production in Hamburg and in the Netherlands. Shell wants to build up transport sector delivery chains for hydrogen and provide electric charging.

We remind that 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 polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.

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. Solvay posts lower earnings, sales on COVID-19 impacts, raises cost-savings target

MOSCOW (MRC) -- Solvay reports declines in fourth-quarter and full-year 2020 earnings and sales because of lower demand caused by COVID-19, said Chemweek. The company, meanwhile, has announced an increase in its cost-savings target and confirmed 500 additional job cuts. The company recorded a 41% decline in underlying fourth-quarter net profit to EUR96 million (USD117 million) compared with the corresponding period of the previous year, on sales down 9.3%, to EUR2.2 billion. Underlying EBITDA was down 11.7% year on year (YOY) in the fourth quarter, to EUR464 million, mainly due to lower volumes and adverse foreign-exchange impacts.

MRC

MOSCOW (MRC) -- Ampol Ltd, Australia’s biggest fuel seller, said on Monday it expects market conditions to remain challenging in 2021, with travel restrictions due to the coronavirus pandemic likely to continue denting fuel demand, said Hydrocarbonprocessing.

Ampol reported a AD145 million (USD114 million) loss in its refining business for 2020, down from earnings before interest and tax of AD70 million a year earlier, as it shut its Lytton refinery for an extended period of maintenance after fuel consumption collapsed.

The big refining loss comes as the company is set to decide in the second quarter whether it will close the refinery, potentially following BP Plc and Exxon Mobil Corp , which have decided to stop refining in Australia. Ampol said assuming a delayed recovery in jet fuel demand and continued domestic travel restrictions, it expects Australian fuel sales of around 13.5 billion to 14 billion litres in 2021.

That would be barely changed from the 13.6 billion litres sold in 2020, which was down 17% on the previous year. “Demand for jet fuel continues to be most impacted ... with significant uncertainty that international travel will resume in 2021,” Ampol said in its annual results.

Ampol’s jet volumes, which in normal times are largely linked to international travel, slumped 56% in the fourth quarter from the same period a year earlier. Diesel demand held up well, supported by demand from the mining sector, however a recovery in gasoline demand in late 2020 was curbed by snap lockdowns in some states in Australia.

“Current regional refining margins remain weak, but Lytton has the ability to produce around 6 billion litres in 2021, subject to market conditions,” the company said. Lytton produced 3.5 billion litres in 2020, down 40% on the previous year. Increased production will reduce the level of product imports in 2021, it added.

As MRC wrote before, Ampol brought forward the refinery turnaround to May, 2020, as refining margins crashed and extended the outage from two months to four months to the end of August to allow for social distancing of workers at the site.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.
MRC

MOSCOW (MRC) -- Element Solutions today reported fourth-quarter net income down 59.8% year-on-year (YOY), to $29.9 million, on net sales up 18.0%, to USD536.6 millio, said Chemweek.

Adjusted earnings, excluding some tax rate changes which cut into net income, totaled 31 cents/share, up 40.9% YOY and beating analysts’ consensus estimate of 28 cents/share, as reported by Refinitiv (New York, New York). Net sales were up 10% YOY on an organic basis, excluding currency impacts, pass-through metal prices, and acquisitions.

"In 2020, we saw an acceleration of the compelling secular trends we expect to propel our business in the future,” says Element Solutions president and CEO Benjamn Gliklich. “Investment in 5G infrastructure and new mobile technologies and the development of electric vehicles all gained ground. In the fourth quarter, our industrially oriented businesses recovered from the impact of COVID-related shutdowns, while our high-end electronics business experienced strong demand driven by these trends.” Strong demand trends have carried over into 2021, Gliklich adds.

Electronics segment net sales grew 26% YOY, to USD343 million, while segment adjusted EBITDA was up 30%, to USD81 million. Industrial and specialty segment sales increased 6% YOY, to USD193 million, while segment adjusted EBITDA rose 13%, to USD45 million.

As per MRC, Element Solutions says it has acquired DMP Corporation (Rock Hill, South Carolina), a provider of turnkey wastewater treatment and recycling products and services for the manufacturing sector. Terms of the transaction, including purchase price, were not disclosed. DMP will, along with Element’s existing metals recycling business, form MacDermic Envio Solutions, a new business unit within the company’s industrial solutions segment.

We remind that Russia's output of chemical products rose in October 2020 by 7.2% year on year. At the same time, production of basic chemicals grew in the first ten months of 2020 by 6.3% 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-October output. October production of polymers in primary form grew to 857,000 tonnes from 852,000 tonnes in September. Overall output of polymers in primary form totalled 8,340,000 tonnes over the stated period, up by 17% year on year.
MRC

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 MOL’s newly updated ‘2030+’ long-term goal to become a key player in central and eastern Europe’s 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 company’s 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 company’s 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.

MOL’s 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 project’s 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.
MRC