COVID-19 - News digest as of 09.04.2021

1. Russia sees pandemic impact on crude oil demand to last until 2023-2024

MOSCOW (MRC) -- Russia expects the fallout from the COVID-19 pandemic on the global consumption of oil and oil products may last until 2023-2024, a draft government document, seen by Reuters, showed. The global oil and liquid fuels production dropped in 2020 to 94.25 million barrels per day (bpd) from 100.61 million bpd in 2019, amid the pandemic, which led to lockdowns, halting 80% of air traffic and a quarter of road traffic at its peak and denting fuel consumption. The Organization of the Petroleum Exporting Countries expects oil demand to grow by 5.6 million barrels per day this year under its base case scenario. Russian Deputy Energy Minister Alexander Novak has also projected similar growth.


MRC

MOSCOW (MRC) -- A major fire has broken out at an oil refinery run by Petroleos Mexicanos (Pemex) in the eastern city of Minatitlan in the southern state of Veracruz, reporte Reuters with reference to Mexican media and authorities' statements.

According to media reports and Mexico's safety, the blaze started at this refinery, one of six operated by Pemex, which has a capacity of up to 285,000 barrels per day, on Wednesday afternoon.

Energy and environment regulator ASEA said it was monitoring the situation.

ASEA's executive director Angel Carrizales said on Twitter the fire started in a gasoline transfer pump.

Police from the state of Veracruz said emergency services were arriving at the scene. It was not immediately clear what, if any, human cost the blaze had caused.

Pemex did not immediately reply to questions about the fire.

As MRC informed before, there was a fire at Pemex's Minatitlan refinery in mid-June 2018. There were no injuries. The fire was put out soon.

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.

Pemex, Mexican Petroleum, is a Mexican state-owned petroleum company. Pemex has a total asset worth of USD415.75 billion, and is the world's second largest non-publicly listed company by total market value, and Latin America's second largest enterprise by annual revenue as of 2009. Company produces such polymers, as polyethylene (PE), polypropylene (PP), polystyrene (PS).
MRC

MOSCOW (MRC) -- Sinopec Shanghai Petrochemical plans to shut its low density polyethylene (LDPE) unit in Shanghai for a scheduled turnaround, according to CommoPlast.

Thus, the company will take this plant off-stream on April 18, 2021. The LDPE plant is expected to resume operations after a 29-day maintenance on May 17, 2021.

Located at Shanghai in China, the unit has a production capacity of 210,000 mt/year.

Sinopec Shanghai Petrochemical also operates its high density polyethylene (HDPE) unit in Shanghai with a production capacity of 260,000 mt/year.

As MRC reported earlier, Sinopec Shanghai Petrochemical took off-stream its HDPE plant for maintenance on June 30, 2020. The plant resumed operations on July 8, 2020.

According to MRC's ScanPlast report,January estimated LDPE consumption in Russia grew to 61,210 tonnes from 43,090 tonnes a year earlier. Russian producers increased their capacity utilisation, and export LDPE shipments decreased. Russia's estimated LDPE consumption was about 563,730 tonnes in 2020, up by 1% year on year.

China Petroleum & Chemical Corporation, or Sinopec Limited is a Chinese oil and gas company based in Beijing, China. It is listed in Hong Kong and also trades in Shanghai and New York . Sinopec is the worlds fifth biggest company by revenue.
MRC

MOSCOW (MRC) -- Operations at Indonesia’s state oil company PT Pertamina’s 125,000 barrel-per-day refinery in Balongan has returned to normal this week, following a fire in some parts of the refinery in late March, said the company in its statement as of 9 April.

Thus, the fire broke out just after midnight last Monday, 29 March, forcing Pertamina to shut the plant and evacuate around 950 nearby residents.

As MRC informed before, only four storage tanks were affected, out of the total 72 tanks in Balongan with total capacity of 1.35 million kilo litres.

The company had began the restart process at the refinery on March 31, two days after the fire broke out, by restarting the primary processing CDU (Crude Destilation Unit). Next, the secondary processing unit starts up in stages, beginning from the RCC (Residual Catalytic Cracker) unit, which processes the residue into high-value products, and it was operating normally on April 7.

We remind that PT Pertamina shut its cracker in Indonesia for maintenance works from 18 March, 2020. This cracker with a production capacity of 578,000 tons remained off-stream until 18 April 2020.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 241,030 tonnes in January 2021 versus 217,890 tonnes a year earlier. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, PP shipments to the Russian market reached 141,870 tonnes in January 2021 versus 123,520 tonnes a year earlier. Supply of homopolymer PP and PP block copolymers increased.

Pertamina is an Indonesian state-owned oil and natural gas corporation based in Jakarta. It was created in August 1968 by the merger of Pertamin (established 1961) and Permina (established 1957). Pertamina is the world's largest producer and exporter of liquefied natural gas (LNG).
MRC

MOSCOW (MRC) -- Reliance Industries (RIL) and US-based Chart Industries are leading a new coalition focussed on commercialising hydrogen technologies and systems to build net-zero carbon pathways in India, according to Kemicalinfo with reference to a statement from the alliance.

The alliance will work together to build the hydrogen economy and supply-chain here and also help develop blue and green hydrogen production and storage apart from building hydrogen-use industrial clusters and transport use-cases with hydrogen-powered fuel cells.

The alliance will focus on industrial clusters, specifically steel, refineries, fertilisers, cement, ports and logistics as well as heavy-duty transport use-cases and help establish standards for storing and transporting hydrogen in pressurized and liquefied form, the statement added.

“India needs to identify and execute large-scale hydrogen demonstration projects if it wants to be part of the global supply chain for hydrogen. Beyond R&D pilots, India needs ‘hydrogen-valley’ style national initiatives across a region like a high-traffic industrial freight corridor, with multiple use-cases,” said Anurag Pandey, R&D team lead at Reliance Industries.

“Such hydrogen-related systems projects are strategic for India’s energy transition plans, linking closely with renewables and battery-technology. These require multiple industry players to come together and form consortia to implement such projects. The India H2 Alliance will take the lead on such initiatives.”

We remind that, as MRC reported earlier, RIL shut its polyvinyl chloride (PVC) plant in India for maintenance in April 2021. The unit in Dahej with an annual capacity of 315,000 tons/year was taken offline by 5 April 2021 and will resume operations on 20 April.

According to MRC's ScanPlast report, Russia's overall PVC production reached 259,400 tonnes in the first three months of 2021, down 3% year on year. All producers decreased their output over the stated period.

Reliance Industries is one of the world's largest producers of polymers. The company produces polypropylene, polyethylene and polyvinyl chloride and other petrochemical products.
MRC