COVID-19 - News digest as of 31.05.2021

1.Shell selling its Mobile, Alabama refinery to Vertex Energy

MOSCOW (MRC) -- Royal Dutch Shell is selling its 90,000 barrel-per-day (bpd) Mobile, Alabama refinery to specialty refiner Vertex Energy for USD75 million plus the cost of hydrocarbon inventory, reported Reuters with reference to the company's statement. Vertex plans to produce petroleum fuel and renewable diesel at the refinery following the close of the transaction in the fourth quarter of 2021, pending approvals. Vertex will also buy co-related logistics infrastructure and hydrocarbon inventory, including more than 3 million barrels of crude oil and product storage. The inventory is currently valued between USD65 and USD85 million, Shell said.

MRC

MOSCOW (MRC) -- Sinopec Shanghai Petrochemical, a subsidiary of one of the world's largest energy and chemical companies - Sinopec, said on Saturday an explosion had occurred on a pipeline carrying raw materials for making ethylene, injuring eight employees, reported Reuters.

A fire at the site of the explosion has been extinguished and the cause of the blast is under investigation, the company said in a notice posted on its official Weibo social media account.

Shanghai Petrochemical said in late March that it planned to shut around 50% of the capacity of its refinery and petrochemical facilities for planned maintenance. The refinery, which has an annual crude oil processing capacity of 16 million tonnes, was scheduled to carry out the overhaul in April and May.

As MRC wrote before, Sinopec Shanghai Petrochemical halted production at its cracker in Shanghai, China for a scheduled turnaround on April 18, 2021. It is expected that the maintenance works at this cracker with a total capacity of two lines of 800,000 mt/year of ethylene and 455,000 mt/year of propylene will continue for 45 days.

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.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group"s key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.
MRC

MOSCOW (MRC) -- Japan's largest refiner ENEOS (formerly known as JXTG Nippon Oil & Energy), Japan's biggest oil refiner, has restarted its Sendai refinery in northeast Japan, according to MarketScreener with reference to Eneos' statement on an update of its refinery operations.

This 145,000 b/d refinery was hit by an earthquake on 1 May, 2021, and resumed production on 18 May.

Besides, on 18 May, the company shut down its Sakai refinery in western Japan for maintenance, with a restart scheduled for June.

As MRC informed previously, ENEOS also took off-stream its Sendai refinery after the strong earthquake offshore Fukushima late Feb. 13, 2021. This refinery was brought back on-line in the first half of April, 2021.

We remind that ENEOS Corporation restarted its naphtha cracker in Kawasaki on 1 February 2021. The company shut this cracker with an annual capacity of 515,000 tons/year of ethylene, 300,000 tons/year of propylene, and 105,000 tons/year of butadiene on 4 December, 2020, for repairment after a technical issue reported at the butadiene separation unit and initially planned to resume operations on 28 December, 2020.

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.

Japan's largest refiner JXTG Nippon Oil & Energy was renamed ENEOS Corporation on 25 June, 2020, as part of a wider re-organization of the parent company JXTG Holdings. The move, which also involved renaming the parent company to ENEOS Holdings upon approval at its annual shareholders meeting in June 2020, comes as it strives to be a more comprehensive energy and materials company under its 2040 vision announced in May, 2019. JXTG Holdings was formed as a result of a merger between JX Holdings and TonenGeneral in April 2017. This followed the establishment of JX Holdings as a result of the merger between Nippon Oil and Nippon Mining Holdings in April 2010.
MRC

MOSCOW (MRC) -- Trinseo, a global materials company and manufacturer of plastics, latex, and rubber, has announced that effective June 1, 2021, the company is increasing the prices of all vinyl pyridine latex sold into the tire cord market in Europe, Middle East, and Africa (EMEA), as per the company's press release.

The increase will be will be EUR500/wet mt as contractual agreements allow.

According to the statement, the present increase is necessary to offset rising raw material costs.

As MRC reported earlier, Trinseo and its affiliate companies in Europe have announced a price increase for all polystyrene (PS), acrylonitrile-butadiene-styrene (ABS) and acrylonitrile-styrene copolymer (SAN) in Europe. Effective May 1, 2021, or as existing contract terms allow, the contract and spot prices for the products listed below rose as follows:

- STYRON general purpose polystyrene grades (GPPS) -- by EUR105 per metric ton;
- STYRON and STYRON A-Tech and STYRON X- Tech and STYRON C- Tech high impact polystyrene grades (HIPS) - by EUR105 per metric ton;
- MAGNUM ABS resins - by EUR160 per metric ton;
- TYRIL SAN resins - by EUR170 per metric ton.

According to ICIS-MRC Price report, in Russia, Nizhnekamskneftekhim's PS prices remained unchanged in May. Prices of Nizhnekamskneftekhim's GPPS were in the range of Rb 192,000-203,000/tonne, CPT Moscow, including VAT, whereas HIPS prices were at Rb196,000-207,000/tonne CPT Moscow, including VAT. At the same time, May prices of Penoplex's material fell by Rb15,000/tonne to Rb204,000-206,000/tonne CPT Moscow, including VAT. And prices of Gazprom neftekhim Salavat's GPPS were not adjusted in early May.

Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo's technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015. Trinseo had approximately USD3.0 billion in net sales in 2020, with 17 manufacturing sites around the world, and approximately 2,600 employees.
MRC

MOSCOW (MRC) -- Saint-Gobain has invested in a new plant to produce advanced solution for construction applications, including a large variety of mortars, waterproofing and construction chemicals solutions, said Businesstoday.

Located on a 50,000m? land in Johor, the southern state of Malaysia, the factory, will be devoted to serve the Company’s growing Malaysian and Singaporean markets. Saint-Gobain has been present in Malaysia for over 20 years. and this new factory is the fifth industrial establishment of the Group in the country and the 28th in Southeast Asia.

Arham Abdul Rahman, Chief Executive Officer of the Malaysian Investment Development Authority (MIDA), commended Saint-Gobain’s continual confidence in Malaysia. Commenting on the Company’s latest expansion in Malaysia, he said, “The Covid-19 pandemic has highlighted the need to accelerate the adoption of digital technologies to be applied in the manufacturing of products. Given that research and innovation are at the heart of Saint-Gobain’s strategy, we are excited to witness this latest undertaking here. We are confident that Saint-Gobain will further benefit from Malaysia’s strategic location, comprehensive global trade agreements, competitive cost of doing business, multi-facetted talent pool as well business friendly policies."

This latest addition to Saint-Gobain’s footprints in Malaysia gathers the best of the Company’s technologies and manufacturing processes. This new plant is also designed to produce 3D printing solutions to support their pioneer positioning in this new market segment. The capacity of the plant is scalable for future demands.

Moreover, to reduce its carbon dioxide emissions and achieve carbon neutrality by 2050, the new plant will utilise natural gas with lower carbon dioxide emission. The Company is committed to continually seek out and invest in Industry 4.0, recycling, raw material and energy reduction to reach its desired goal.

Javier Gimeno, Senior Vice-President, CEO Saint-Gobain Asia-Pacific said, “This investment in Johor is a tangible proof of the long term commitment of Saint-Gobain with Malaysia and Southeast Asia. Indeed, we are convinced of the huge potential of development in these geographies whose markets are increasingly driven by innovation, technology, products’ performance and genuine respect of the environment. At Saint-Gobain we strive every day to excel in all these fields so that we can bring to our clients and the final users the best value proposition.”

Details about the plant’s costs or capacities in tonnes or pounds per year were not disclosed.

As per MRC, Saint-Gobain, the world's largest manufacturer of building materials, in 2015 opened the third plant in Russia for the production of dry building mixtures in the city of Yegoryevsk, Moscow Region. The total investment in the construction of the plant amounted to more than 500 million rubles. The construction of the facility started in October 2013; in September 2014, the first line for the production of dry mixes was put into operation at the enterprise. It is expected that the plant will produce 120 thousand tons of dry building mixtures annually.

As MRC informed before, Russia's output of chemical products rose in March 2021 by 5.4% year on year. Thus, production of basic chemicals increased year on year by 6.7% in the first moths months of 2021. March production of polymers in primary form was 958,000 tonnes versus 861,000 tonnes in February. Overall output of polymers in primary form totalled 2,740,000 tonnes over the stated period, up by 8.5% year on year.

MRC