Texas lawmakers investigate deadly power blackout

MOSCOW (MRC) -- Texas state legislators started digging into the causes of deadly power blackouts that left millions shivering in the dark as frigid temperatures caught its grid operator and utilities ill-prepared for skyrocketing power demand, said Hydrocarbonprocessing.

Hearings are highlighting shortcomings by grid planners, electric utility and natural gas transmission operators that led to billions of dollars in damages and dozens of deaths. Consumer advocates have called for more stringent regulation of utilities and a review of retail marketing plans. "The entire energy sector failed Texas," said NRG Energy Inc Chief Executive Mauricio Gutierrez, who testified at the hearing.

The biggest failure was the state's natural gas system, said Curtis Morgan, CEO of Vistra Corp, adding that without better ties between gas producers, pipelines and power plants, the state could face future cold weather outages. "We just couldn't get the gas at the pressures we needed," said Morgan, who instructed employees to buy gas at any price but could not acquire enough to run plants.

Up to 48% of the state's power generation was offline at times last week and at least 32 people died, including an 11-year-old boy of hypothermia in an unheated mobile home. "We owe it to them and every Texan to make sure this never happens again," said State Representative Ana Hernandez, noting that hospitals still have supply chain problems and burst pipes, and some people cannot access food and water. "The impact of this disaster was not only financial."

Utilities were ordered to cut power to prevent a larger catastrophe, Bill Magness, CEO of the Electric Reliability Council of Texas (ERCOT), the state's grid operator, said on Wednesday. ERCOT, whose board is appointed by the state Public Utility Commission, faces lawsuits by customers and a generator claiming damages from misrepresentation and lack of planning. Six of ERCOT's 15 directors resigned this week and a nominee withdrew before taking a seat.

ERCOT did not warn residents that the state's power generation would not keep up with demand, even under perfect conditions, despite warnings the week prior from utilities, Morgan said. "We did not give people a fighting chance," Morgan said.

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.

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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.
MRC

COVID-19 - News digest as of 26.02.2021

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.

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Australian Ampol sees slow recovery in jet fuel demand

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

Element Solutions beats estimates on strong electronics demand

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