Shandong Qingyuan looks for funds to boost output

MOSCOW (MRC) -- China's private refiner Shandong Qingyuan Group is working with local authorities to overcome "liquidity pressure" and expects to boost output at a key refinery to as much as 85% of capacity soon, the general manager said, as per Hydrocarbonprocessing.

Qingyuan has been operating its 100,000 barrel-per-day refinery in Linzi, a district under Zibo city, at half of its capacity on average so far this year due to a funding squeeze, Jiao Chong, the general manager told Reuters.

He said Jiuhe Financial Holdings Co Ltd, a government-backed investment firm, which took a stake in Qingyuan in 2015, is helping the group to secure funds that would allow it to operate its refinery at 80% to 85% capacity within 10 days. A syndicate of international banks is also ready to grant Qingyuan a three-year extension on a $955 million loan, a source with direct knowledge of the loan said.

Qingyuan had sought an extension to the loan earlier this year, said four trading and banking sources familiar with the situation. They declined to be identified because the matter was not public. Qingyuan signed the structured three-year loan with commodities trader Trafigura and global banks in September 2019, with lead creditors including the Netherlands' ABN Amro ABNd.ASand ING Group INGA.AS, Australia's Westpac WBC.AX and Japan's Sumitomo Mitsui Banking Corp, according to Refinitiv's Loan Connector.

"Following prolonged negotiations with (a) syndicate of banks, the documentation is ready to be signed, whereby the maturity of the transaction has been extended to 6 years," said one of the sources who has direct knowledge of the loan. "This will allow Qingyuan to continue to operate smoothly in the years to come," the source added.

ABN Amro, ING, Westpac, Sumitomo Mitsui declined to comment. Jiao said he was not in a position to comment on the syndicated loan or the group's broader debt positions. He added that Qingyuan was facing tight liquidity because of investments in upgrading the plant.

As per MRC, Qingyuan, which is based at Linzi in the province of Shandong and operates a 5.2 million-tonne-per-year (104,000-barrel-per-day) refiner, is a regular customer of BP which has expanded its crude oil marketing to Chinese independent refiners over the last three years. Qingyuan has received an annual crude import quota of 4.04 million tonnes and is one of the largest independently-run lubricant producers.

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 1,176,860 tonnes in the first half of 2021, up by 5% year on year. Shipments of exclusively low density polyethylene (LDPE) decreased. At the same time, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.
MRC

MOSCOW (MRC) -- Braskem is distributing its polypropylene (PP) filament and pellets for additive manufacturing (3D printing) through Nexeo Plastics' online marketplace, said the company.

Braskem, which manufactures thermoplastic resins, claims that its PP filaments and pellets are suitable for additive manufacturing depending on its recyclability, impact strength, chemical resistance and dimensional stability.

The company said that the properties make its polypropylene an ideal material for several 3D printing applications. The distribution agreement will enable Braskem to extend its global distribution of PP filament and pellets for additive manufacturing to North America and Europe.

Nexeo Plastics president and CEO Paul Tayler said: “We are focused on providing our customers with the most comprehensive portfolio of 3D materials and solutions. “Our expanded partnership with Braskem will provide 3D printers with the innovative, quality materials they need."

Last year, Braskem invested in a dedicated additive manufacturing lab as part of its ongoing commitment to innovation and to bringing new solutions to the additive manufacturing sector. The manufacturing lab forms part of an expansion of the company’s Innovation & Technology (I&T) Centre located in Pittsburgh, Pennsylvania.

Braskem additive manufacturing commercial director Jason Vagnozzi said: “Our new partnership with Nexeo Plastics marks an important moment for our Additive Manufacturing business as we extend the international reach of our products across the European market through Nexeo Plastics’ comprehensive online marketplace.

Braskem stated that its filaments will facilitate quick prototyping, custom product design, light-weighting, optimising geometries and designing spare parts. They are available in 1.75mm and 2.85mm diameters to fit a broad range of printing applications.

We remind that Brazilian petrochemical producer Braskem's 450,000 mt/year PP plant in LaPorte, Texas, along the Houston Ship Channel completed its initial commercial production, as per the company's statement as of Sept. 10. "The launch of commercial production at our new world-class PP production line in La Porte clearly affirms Braskem's position as the North American polypropylene market leader," Braskem America CEO Mark Nikolich said in a statement. With a USD750 million investment, the new PP plant's construction started in October 2017 and was completed in June, 2020.

Braskem operates five other US PP plants in Texas, Pennsylvania, and West Virginia, with a cumulative capacity of 1.57 million mt/year that the company acquired. The new plant in La Porte, Texas, is Braskem America's first PP new build.

According to MRC's ScanPlast report, Russia's PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.

Braskem S.A. produces petrochemicals and generates electricity. The Company produces ethylene, propylene, benzene, toluene, xylenes, butadiene, butene, isoprene, dicyclopentediene, MTBE, caprolactam, ammonium sulfate, cyclohexene, polyethylene theraphtalat, polyethylene, and polyvinyl chloride (PVC).
MRC

MOSCOW (MRC) -- Crude oil loading at Equinor's Sture export terminal on Norway's west coast was interrupted after activists from the Extinction Rebellion group breached the facility's safety zone, the company said.

Equinor halted the loading of the TS Bergen aframax vessel, but other operations were not affected, a company spokesperson said.

Sture is a major export facility for crude, which arrives by pipeline from several offshore fields including Equinor's Oseberg, Lundin Energy's Edvard Grieg and Aker BP's Ivar Aasen, according to Equinor's website.

Activists entered the terminal's safety zone with a boat, and also blocked a road leading to the terminal. "We decided to interrupt the loading, but the terminal operates as normal," Equinor spokesperson Eskil Eriksen said.

"We have notified the police and they are handling the situation," he added. The TS Bergen's destination was Rotterdam, according to Eikon data.

As per MRC, Equinor agreed to sell its Danish Kalundborg refinery as well as an oil terminal to Geneva-based Klesch Group for an undisclosed sum. The companies declined to reveal the value of the deal, which will require approval by Danish authorities. Built in 1961 and acquired by Equinor in 1986, the facility can process 107,000 barrels a day of crude oil and condensate for gasoline, diesel, propane and heating oil, with an annual capacity of 5.5 million tonnes of oil products.

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 1,176,860 tonnes in the first half of 2021, up by 5% year on year. Shipments of exclusively low density polyethylene (LDPE) decreased. At the same time, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.
MRC

MOSCOW (MRC) - China Petroleum and Chemical Corp, also known as Sinopec, the world's petrochemical major, has launched the first phase of the Gulei refining complex in Zhangzhou city in China’s southeastern Fujian province, reported Reuters with reference to the company's statement on Thursday.

The refining complex, a 50:50 joint venture between Sinopec’s Fujian Petrochemical Company Ltd and Taiwan Xuteng Investment Company Ltd, invested 27.8 billion yuan (USD4.28 billion) in the first phase.

That will result in an 800,000 tonnes per annum ethylene plant, a 600,000 tonnes per annum styrene unit and seven other downstream petrochemical units, Sinopec said.

The complex targets to churn out 18 chemical products, including polypropylene (PP), ethylene glycol and styrene, with total output reaching 3 million tonnes per year.

“The launch of the project will provide high-quality raw materials for industries such as plastics, rubber, textiles, clothing, electronics and instrument manufacturing in Zhangzhou and the surrounding areas,” said Sinopec.

Sinopec said it is accelerating development of the second phase of the project, which will boost annual ethylene capacity at the complex to 1.4 million tonnes and drive total chemical output to 4.2 million tonnes.

As MRC informed earlier, BASF and Sinopec will further expand their Verbund site operated by BASF-YPC Co., Ltd. (BASF-YPC), a 50-50 joint venture of both companies in Nanjing, China. It includes the capacity expansion of several downstream chemical plants.

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 1,176,860 tonnes in the first half of 2021, up by 5% year on year. Shipments of exclusively low density polyethylene (LDPE) decreased. At the same time, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.

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) -- US crude oil stockpiles dropped last week to their lowest levels since January 2020, reported Reuters with reference to the Energy Information Administration's statement.

Inventories have been declining for several months as US fuel demand has rebounded with Americans getting vaccinated against coronavirus. Infections, however, are surging again and analysts are watching to see if fuel demand slackens, particularly across southern states where the number of people infected has surged.

Crude inventories fell by 3.2 million barrels in the week to Aug. 13 to 435.5 million barrels, exceeding estimates for a 1.1 million-barrel drop. Crude exports rose in the most recent week to 3.4 million barrels per day (bpd).

"The crude draw will be very supportive for the market. There's a good demand from exports, probably to do with the recent price decline," said John Kilduff, partner at Again Capital LLC in New York. "This report should push back against worries about the (coronavirus) Delta variant that have crept into the market."

At the Cushing, Oklahoma, delivery hub, crude stocks fell by 980,000 barrels in the last week, the EIA said. Inventories at the nation's largest oil storage hub and delivery point for US crude futures have dropped for 10 straight weeks and are now at their lowest levels since October of 2018, at 33.6 million barrels.

US gasoline stocks rose by 696,000 barrels in the week to 228.2 million barrels, the EIA said, compared with analysts' expectations for a 1.7 million-barrel drop.

Distillate stockpiles, which include diesel and heating oil, fell by 2.7 million barrels in the week to 137.8 million barrels, versus expectations for a 276,000-barrel rise.

Refinery crude runs fell by 191,000 barrels per day in the last week, EIA said. Refinery utilization rates rose by 0.4 percentage point, in the week.

The four-week average of overall product supplied to the market - a measure of demand - was 20.8 million barrels per day, in line with pre-coronavirus levels from 2019.

US crude production rose to 11.4 million bpd, though weekly figures are volatile. Shale oil production, which accounts for most of US output, is expected to rise to 8.1 million bpd in September, its highest since April 2020, according to the EIA's monthly drilling output report.

As MRC informed earlier, US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, the US Energy Information Administration (EIA) said in a monthly report, a smaller decline than its previous forecast for a drop of 210,000 bpd.

We remind that US ethylene exports have declined and shifted from Asia to Europe as US producers focus on restocking inventories in the aftermath of a deep freeze that hit the US Gulf Coast in mid-February and subsequent operational issues that squeezed output. At the same time, US ethylene inventories remain at five-year lows amid hurricane season, and producers remain focused on building inventory. August and September tend to be the months during the June-November US Atlantic hurricane season when major storms are most likely to develop and hit the US Gulf Coast.

Ethylene is the main feedstock for the production of polyethylene (PE).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,176,860 tonnes in the first half of 2021, up by 5% year on year. Shipments of exclusively low density polyethylene (LDPE) decreased.
MRC