Lotte Chemical declares FM on MEG shipments from its plant in Louisiana after storm

MOSCOW (MRC) -- Lotte Chemical USA, a joint venture (40:60) of the Malaysian company Lotte Chemical Titan and its parent company Lotte Chemical Corporation, has declared force majeure (FM) on monoethylene glycol (MEG) and other products produced at its Louisiana complex after an electrical equipment failure, according to a customer letter seen by S&P Global Platts on May 27.

The letter said the company prepared for heavy storms that hit Lake Charles and other areas along the Texas and Louisiana coasts the week of May 17, but on May 21, "critical electrical equipment" failed and prompted an unexpected plant shutdown. Thus, the FM was declared on May 22.

The letter said further that initial assessments showed that torrential rain caused the failure, which severed electricity supply to critical process equipment.

Lotte operates a 700,000 mt/year MEG plant in Lake Charles that started up in January 2019. The force majeure declaration affects MEG, diethylene glycol (DEG) and triethylene glycol (TEG) production at the Lake Charles site, the letter said.

Market sources said Lotte was expected to restart its operations by May 31. The swift force majeure declaration indicated the company had limited MEG/DEG/TEG stocks when the shutdown occurred.

MEG is one of the main feedstocks for the production of polyethylene terephthalate (PET).

According to MRC's ScanPlast report, the estimated PET consumption in Russia reached 64,750 tonnes in March 2021, which corresponds to the previous year's figure (64,520 tonnes). Russia's estimated PET consumption decreased in January-March 2021 by 5% year on year to 182,300 tonnes.
MRC

MOSCOW (MRC) -- Ufaorgsintez (UOS, Bashneft’s petrochemical asset) has shut down operations at some of its low density polyethylene (LDPE) production capacities for a scheduled turnaround, according to ICIS-MRC Price report.

The plant's customers said UOS shut its second LDPE line (158 grade and 153 grade polyethylene - PE) for a scheduled maintenance on 1 June. The outage of the second PE line will be short and will take only a week. The first LDPE line (108 grae PE) will be shut for scheduled maintenance works in September.

Ufaorgsintez's overall LDPE and polypropylene (PP) production capacities are 90,000 and 120,000 tonnes per year, respectively.

It is also worth noting that Angarsk Polymers Plant and Tomskneftekhim will shut down their LDPE production capacities for turnarounds in June.

PJSC Ufaorgsintez produces phenol, acetone, synthetic ethylene-propylene rubber, high and low pressure polyethylene, polypropylene, more than 30 types of petrochemical products and over 25 consumer products.
MRC

MOSCOW (MRC) -- POET announced it has purchased Flint Hills Resources ethanol assets in its entirety, expanding POET's ethanol production capabilities to 3bn gallons/year, said the company, said the company.

POET said on Tuesday it has acquired Flint Hills Resources' entire ethanol business, highlighting the largest U.S. biofuels producer's bet that conventional renewable fuels like corn-based ethanol will play a role in reducing carbon emissions.

The deal will boost POET's ethanol production capacity by 40% to 3 billion gallons per year, the company said.

The United States is the world's largest producer of ethanol. Before the coronavirus pandemic, U.S producers made 15.8 billion gallons of ethanol in 2019, according to the U.S. Energy Information Administration.

Ethanol and ethanol-gasoline mixtures burn cleaner than pure gasoline. Producing and burning ethanol still results in carbon emissions, though its effect on net emissions depends on how it is made, according to the EIA.

Financial details of the purchase have yet to be disclosed.

Ethanol is used as a gasoline blendstock, in pharmaceuticals, and in food and beverage applications, such as hand sanitizers and vodka.

The deal was announced in May this year.

Ethylene and propylene are the main feedstocks for the production of PE and PP, respectively.

According to MR''s ScanPlast report, Russia's estimated PE consumption totalled 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.

Flint Hills, a refining, biofuels and petrochemical company, is based in Wichita, Kansas, and is currently the fifth-largest ethanol producer in the United States. Its biofuels division includes six ethanol plants with a combined capacity of about 800 million gallons per year, 1.5 million tons of distillers grains and about 200 million pounds of corn oil.
MRC

MOSCOW (MRC) -- ExxonMobil Corp. activist investor Engine No. 1 expanded its presence on the oil giant’s board to three seats, reported Bloomberg with reference to preliminary vote tallies.

The initial counts show the newest nominee from Engine No. 1’s slate elected to Exxon’s 12-member board is private-equity investor Alexander Karsner, Exxon said Wednesday in a statement. The results, which still need to be certified, confirmed an earlier report by Bloomberg News.

Karsner joins Gregory Goff, former chief executive officer of refiner Andeavor, and environmental scientist Kaisa Hietala, whose victories were announced last week shortly after Exxon’s May 26 annual general meeting. The Western world’s biggest oil company managed to place nine of its nominees onto the board.

Exxon investors also for the first time approved proposals requiring the company to disclose political- and climate-lobbying activities, according to a filing, despite staunch opposition from incumbent directors.

Chairman and Chief Executive Officer Darren Woods captured about 2.67 million votes, placing him in the bottom half of the field. Lead Director Ken Frazier fared only marginally better with a seventh-place showing.

A third seat for Engine No. 1 caps a months-long proxy fight and provides a coda to last week’s dramatic meeting, which at one point was halted so that the company could have more time to count the votes.

The shift in Exxon’s boardroom may present a crippling blow to the future leadership of Woods, according to Ceres, a coalition of environmentally active investors managing USD37 trillion. Woods told shareholders earlier last month that voting for the dissident directors would “derail our progress and jeopardize your dividend.”

The three Engine No. 1’s nominees join nine members from the company’s slate, including Jeff Ubben and Michael Angelakis, who were the top vote getters last week and were originally added to the board as part of a pact with another investor, D.E. Shaw & Co.

As MRC informed previously, Sinopec Engineering (Group) and ExxonMobil (Huizhou) Chemical (EMHCC) have recently entered into a BEPC (basic design, engineering, procurement and construction) contract for the proposed Huizhou Chemical Complex Project (Phase I). The main units of the project include a 1.6 million tonnes/year ethylene flexible feed steam cracker, downstream polymer and derivative units and utilities. The main product units include two performance polyethylene (PE) lines and two differentiated performance polypropylene (PP) lines.

Ethylene and propylene are the main feedstocks for the production of PE and PP, respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world"s energy.
MRC

MOSCOW (MRC) -- Before Petroleos Mexicanos (Pemex) surprised the oil industry last week with plans to take full control of a refinery in Texas, an internal assessment by the Mexican state oil company had concluded it lacked expertise in the refining business, reported Reuters.

Pemex's domestic refining operations have long racked up losses, and the 2019 internal assessment seen by Reuters found the state oil group had failed to take advantage of its nearly three-decade partnership with Royal Dutch Shell in the profitable Deer Park refinery in Texas.

Knowledge that could have been useful to Mexico's six domestic refineries had not been effectively transferred from Deer Park, the report found.

Absorbing that technology and expertise now, analysts say, holds the key to the success of Pemex's USD596 million deal last week to acquire Shell's Deer Park stake. "Owning the steel does not give the advantage, it's the skill that comes with it," said George Baker, a Houston-based consultant and publisher of Mexico Energy Intelligence.

Pemex did not reply to requests for comment and the company has not detailed what new expertise it will receive from the deal, nor how it would be used. Still, a Pemex source said Deer Park would be a benchmark of efficiency and good practices for its Mexican refineries.

As MRC informed before, Pemex will invest USD2.64 billion to complete a coking plant at its Tula refinery as the country seeks to reduce its dependence on imported fuels, said earlier the state company's CEO. The project, which Pemex expects to finish by 2023, will allow Pemex to process 90% of the fuel oil produced at Tula and at neighboring Salamanca, Octavio Romero Oropeza said during the daily press conference held by Mexican President Manuel Andres Lopez Obrador.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers 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