GS Caltex shut its new cracker in Yeosu

MOSCOW (MRC) -- South Korea's GS Caltex shut its new mixed-feed cracker at Yeosu on June 27 owing to a technical issue, reported S&P Global.

A company source on June 28 could not provide a restart date, but said it likely take several days to resume operations.

The new steam cracker, which came online around June 18, has the capacity to produce 750,000 mt/year of ethylene and 430,000 mt of propylene. This schedule is earlier than the initial plan of 2022.

As MRC informed before, this June, the company also started up its new high density polyethylene (HDPE) in Yeosu with an annual capacity of 500,000 tons/year that would concentrate on producing the film (TR-144, TRB-115), blow molding (5520BN or BM593), and injection (6060 or 6060UV) grades.

The company also operates 180,000 tons/year polypropylene (PP) plant at the same complex.

The project is a 50-50 joint venture between GS Energy Corp. and Chevron Corp., costing 2 trillion won (USD1.84 billion) that started construction work in 2019.

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 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.
MRC

1. OPEC discussing deal to increase crude oil production by 2 mln b/d by December

MOSCOW (MRC) -- OPEC and its allies appear in striking distance of a deal on production quotas, discussing proposals that call for an output increase of about 2 million b/d from August to December to meet recovering global oil demand, three sources told S&P Global. If agreed, the OPEC+ alliance's collective production cuts would shrink by about one-third by the end of the year to about 3.76 million b/d, from July's 5.76 million b/d. The sources, who spoke on condition of anonymity, said the deal was not yet finalized and that Saudi Arabia was seeking some flexibility to rescind all, or part of the output increases, if Washington and Tehran revive the nuclear deal that relieves sanctions on Iran's oil exports.


MRC

MOSCOW (MRC) -- Crude oil futures were steady during mid-morning trade in Asia July 2 as the market awaited clarity on OPEC+'s production plans for August onwards, after the producer group failed to reach consensus at a fractious July 1 Joint Ministerial Monitoring Committee meeting, reported S&P Global.

At 10:26 am Singapore time (0226 GMT), the ICE September Brent futures contract was up 10 cents/b (0.13%) from the previous close at USD75.94/b, while the NYMEX August light sweet crude contract was up 8 cents/b (0.11%) at USD75.31/b.

The market remains in limbo after objections from the UAE soured proceedings at the JMMC meeting, forcing the committee to adjourn without reaching a consensus on a production recommendation for August onwards.

During the course of the JMMC, members had reached a tentative agreement to boost production by 400,000 b/d a month from August to December, shrinking the OPEC+'s collective output cut to about 3.76 million b/d from the 5.76 million b/d cut expected in July.

However, according to sources, tensions escalated after the UAE requested that its baseline production level, from which its quota is determined, be hiked significantly due to the capacity additions it has made over the last three years.

The UAE's baseline under the current pact, determined by its October 2018 production level, is 3.168 million b/d, but the UAE claims it is now closer to 4 million b/d. Increasing the UAE's baseline would allow it to pump more crude into the market.

The UAE's request was dismissed by the other members and the monitoring committee failed to reach a compromise, deciding to continue discussion on July 2. The full OPEC+ ministerial meeting that was scheduled to have started after the JMMC was also postponed to July 2.

"Talks are set to resume today in order to try to reach a deal. Failure to come to an agreement could mean that the group continues with current levels of production, which would mean that the market tightens even quicker," ING's head of commodities strategy Warren Patterson and senior commodities analyst Wenyu Yao said in a July 2 note.

We remind that as MRC informed earlier, Indian refiners, anticipating a lifting of US sanctions, plan to make space for the resumption of Iranian imports by reducing spot crude oil purchases in the second half of the year. The world"s third-largest oil consumer and importer halted imports from Tehran in 2019 after former US President Donald Trump withdrew from a 2015 accord and re-imposed sanctions on the OPEC producer over its disputed nuclear programme.

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 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.
MRC

MOSCOW (MRC) -- Oversupply continued to put pressure on prices of film grade high density polyethylene (HDPE) in Russia. Prices peaked in the first half of May, and a smooth roll-back has already begun since the middle of the month, which continued throughout June, according to ICIS-MRC Price report.

HDPE prices in Russia were dynamically rising in the first four months of 2021, following a similar price increase in the markets of Europe and Turkey. In April, the European and Turkish markets stopped putting pressure on polyethylene (PE) prices in the Russian market, and prices of film grade PE in Russia reached their peak in May. Since the second half of May, weak demand and oversupply have become the main reasons for the downward price trend.

Limited shipments of film grade HDPE from Kazanorgsintez did not affect the balance of the domestic market. Supply of PE from ZapSibNeftekhim and Stavrolen was more than enough to meet the market needs. In addition, PE imports from neighboring countries have begun to grow for the past two months.

A week earlier, some sellers reduced their film grade HDPE prices to Rb120,000/tonne, including VAT and delivery. At the beginning of this week, some market players, particularly, small-sized sellers for shipments of ZapSibNeftekhim's PE, already negotiated deals in the range of Rb118,000-118,500/tonne, including VAT and delivery.
MRC

MOSCOW (MRC) -- Borealis, owned by Austrian energy major OMV, announces that it has entered into a multi-dimensional partnership with Renasci N.V., a provider of innovative recycling solutions and creator of the novel Smart Chain Processing (SCP) concept, as per the company's press release.

The partnership is another key enabler for Borealis to realise its ambitions to bring circular base chemicals and polyolefins to market, and to deliver on its promise to bring 350 kilotons of recycled polyolefins into circulation by 2025.

The SCP concept developed by Renasci is a proprietary method of maximising material recovery in order to achieve zero waste. It is unique because it enables the processing of multiple waste streams using different recycling technologies - all under one roof. At the newly-built Renasci SCP facility in Oostende, Belgium, mixed waste – plastics, metals, and biomass - is automatically selected and sorted multiple times.

After sorting, plastic waste is first mechanically recycled, and then in a second step any remaining material is chemically recycled into circular pyrolysis oil and lighter product fractions, which are used to fuel the process.

Other types of sorted waste such as metals and organic refuse are further processed using other technologies. In the end, only 5% of the original waste remains, and even this residual material is not landfilled, but used as filler in construction materials. Because of this extremely efficient way of processing, the overall CO2 footprint of these waste streams is greatly reduced – yet another advantage of the circular SCP concept.

Borealis circular cascade model sits at the heart of its ambition to achieve a truly circular economy, by combining carefully chosen technologies in a complementary and cascading way to achieve full circularity. In this way, Borealis aims to give plastic products multiple lifetimes in the most sustainable way possible. Starting with optimising product design, first for eco-efficiency, then for re-use and finally for recycling. Once a product has reached its end of life, we must close the plastics loop: first with mechanical recycling to make products with the highest possible value, quality and lowest carbon footprint; then utilising chemical recycling, as a complement to mechanical recycling, to further valorise residual streams which would otherwise go to incineration, or even worse to landfills. The valorised material from mechanical and chemical recycling is then processed with Borealis consisting of Borcycle M for mechanical recycling and Borcycle C for chemical recycling, providing high quality solutions for more sophisticated applications, such as food packaging and healthcare.

The SCP concept is aligned to Borealis’ ambition to close the loop on plastic waste as encapsulated in its circular cascade model.

Having acquired a 10% minority stake in the company, Borealis will collaborate closely with Renasci to evolve and scale up the unique SCP technology. This includes the development of future facilities which would source their feedstock entirely from household waste. The two companies also plan to identify and act on other promising investment opportunities in the circular economy sphere. In addition to the agreement to source the projected 20 kt circular pyrolysis oil annually, Borealis is also planning to purchase mechanically recycled material from Renasci’s Oostende facility.

As MRC reported earlier, in April 2021, Borealis commenced a new project to secure an increased supply of chemically recycled feedstock for the production of more circular base chemicals and polyolefin-based products. A feasibility study for a chemical recycling unit to be established at the Borealis production location in Stenungsund, Sweden, is now underway.

We remind that Borealis began to restart of its 625,000-metric tons/year steam cracker at Stenungsund, Sweden, in early January, 2021, but the declaration of force majeure remained in place then. The process of restarted lasted for several weeks. Force majeure at Stenungsund was declared after a fire started at the cracker on 10 May last year. A restart of the cracker was initially planned for the fourth quarter of 2020. The force majeure was lifted on 29 January, 2021.

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 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. With headquarters in Vienna, Austria, Borealis currently employs around 6,500 and operates in over 120 countries.
MRC