Louisiana refineries begin coming back to life after Ida

MOSCOW (MRC) -- At least three refineries in Louisiana were starting on Friday to get some power supplies that would enable them to consider restarting operations five days after Hurricane Ida made landfall on the US Gulf Coast, reported Reuters.

Nine refineries were knocked offline by Ida's winds and power losses. The state's largest utility, Entergy Corp, has restored power to about a quarter of affected customers, it said.

Three crude oil refineries near Baton Rouge, Louisiana, have begun restarts since being idled by Hurricane Ida, the US Department of Energy said Friday.

The largest, Exxon Mobil Corp’s 520,000 barrel-per-day (bpd) Baton Rouge complex, began preparations earlier and on Thursday said it was restarting oil processing. The DOE directed 1.5 million barrels of oil from the Strategic Petroleum Reserve be provided to Exxon to help alleviate regional fuel shortages caused by Hurricane Ida.

Two other refineries, Placid Refining's 75,000-bpd Port Allen refinery and Delek US Holdings' 80,000-bpd plant in Krotz Springs, could also see power restored soon under Entergy's plan.

Neither Placid nor Delek replied to requests for comment on Friday.

As MC reported earlier, PBF Energy said it was receiving limited power at its 190,000-bpd Chalmette refinery but could not predict when operations could fully resume. A restart could begin over the weekend, people familiar with the matter said.

Besies, power was returning to Marathon Petroleum's 578,000-bpd Garyville refinery and Valero Energy Corp’s 215,000 bpd St. Charles refinery in Norco, GasBuddy.com analyst Patrick De Haan said. A Marathon spokesman said he did not have information immediately available about the refinery.

Valero did not reply to a request for comment.

Phillips 66's Alliance refinery on the Louisiana coast was still being evaluated for damages. Any restart would depend on those assessments and the availability of electricity, it said.

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) -- Electrical power was being restored on Thursday night to PBF Energy's 190,000-bpd Chalmette, Louisiana refinery for the first time, reported Reuters with reference to sources familiar with plant operations.

PBF may begin restarting refinery units over the weekend, the sources said, but the process is expected to be slow as the electrical power supply will be reduced due to damage to the power grid from Hurricane Ida.

A PBF spokesman was not immediately available to comment.

The Chalmette refinery was knocked out by a power outage on Sunday as Hurricane Ida crossed the New Orleans area. PBF had reduced production.

PBF is the second refinery to begin restarting after being knocked out by the hurricane, which was one of the most powerful to strike Louisiana.

As MRC wrote before, ExxonMobil began restarting its Baton Rouge, Louisiana refinery on Tuesday. The US Energy Department authorized the release on Thursday of 1.5 million barrels of crude oil from the national Strategic Petroleum Reserve (SPR) to the Baton Rouge refinery. Exxon spokesperson Julie King said on Thursday because of transportation interruptions, Exxon requested the crude from the SPR for the refinery, which is restarting as utilities are restored.

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) -- Oil prices rose as a rebound in global demand was widely expected and a slow recovery for the US Gulf Coast export and refining hub from the hurricane earlier this week looked set to deplete stocks further, reported Reuters.

Brent crude futures were up 39 cents, or 0.5%, to USD73.42 a barrel at 1231 GMT, while US West Texas Intermediate (WTI) crude futures were up 21 cents or 0.3% at USD70.20 a barrel. Both benchmark oil contracts were largely steady for the week.

About 1.7 million barrels per day of oil production remains shut in the US Gulf of Mexico, with damage to heliports and fuel depots slowing the return of crews to offshore platforms, sources told Reuters.

"The prolonged US Gulf production and Louisiana refining capacity outages, which are bound to carve a bigger hole in the already diminished US oil stockpiles, as well as data showing continued strong domestic fuel demand recovery are supportive factors," said Vandana Hari, energy analyst at Vanda Insights.

Some analysts see room for further price gains amid tightening crude supplies and signs of recovering demand after the Organization of the Petroleum Exporting Countries and allies, known as OPEC+, stuck to a plan to add 400,00 barrels per day (bpd) to the market over the next few months.

The United States welcomed the move and pledged to press the exporter club to do more to support economic recovery by unleashing production.

As MRC wrote previously, in late August, 2021, US crude stocks dropped sharply while petroleum products supplied by refiners hit an all-time record despite the rise in coronavirus cases nationwide, the Energy Information Administration said. Crude inventories fell by 7.2 million barrels in the week to Aug. 27 to 425.4 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop. Product supplied by refineries, a measure of demand, rose to 22.8 million barrels per day in the most recent week. That's a one-week record, and signals strength in consumption for diesel, gasoline and other fuels by consumers and exporters.

We remind that 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.
MRC

MOSCOW (MRC) -- US specialty chemicals company Element Solutions has completed its previously announced $500m acquisition of France-based Coventya Holding SAS, said the company.

Element Solutions Inc, a global and diversified specialty chemicals company, announced today that it has closed its previously announced acquisition of Coventya Holding SAS, a global provider of specialty chemicals for the surface finishing industry. Coventya joins MacDermid Enthone Industrial Solutions and will be reported within the Company’s Industrial & Specialty segment.

Coventya is expected to generate annual sales of approximately USD190 million and adjusted EBITDA of greater than USD35 million for its fiscal year 2021 ending in September. Including annualized synergies of at least USD15 million expected to be achieved within two years, the purchase price represents less than 10x Coventya’s projected fiscal year 2021 adjusted EBITDA. The total consideration of approximately $500 million was funded with USD400 million of additional Term Loan B debt and cash on hand. The add-on tranche of Term Loan B matures in January 2026 and has an effective interest rate of less than 2% after giving effect to cross-currency swaps into fixed-rate euro-denominated debt.

President and Chief Executive Officer Benjamin Gliklich said, “We are excited to welcome Coventya and its talented people to the Element Solutions family. The more time we spend with the Coventya team, the more enthusiastic we have become about the potential from this combination. We believe our MacDermid Enthone Industrial Solutions business will benefit significantly from Coventya’s added scale and complementary product offerings, and so will our customers from a larger, more comprehensive set of solutions and deeper technical know-how. On an annualized basis, we expect the acquisition to be approximately 5% accretive to our adjusted EPS, based on our previously announced guidance of USD1.35 or greater for 2021 before the impact of the acquisition. This accretion does not include run rate cost synergies of at least USD15 million that we expect to realize within the next two years."

As per MRC, Element Solutions says it has acquired DMP Corporation (Rock Hill, South Carolina), a provider of turnkey wastewater treatment and recycling products and services for the manufacturing sector. Terms of the transaction, including purchase price, were not disclosed. DMP will, along with Element’s existing metals recycling business, form MacDermic Envio Solutions, a new business unit within the company’s industrial solutions segment.

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) -- BASF has been granted regulatory approval to form a joint venture (JV) with battery materials supplier Hunan Shanshan Energy to cater for the electric vehicle (EV) market in China, said the company.

German chemicals giant BASF and major Chinese producer of lithium battery materials Ningbo Shanshan on 31 August established joint venture BASF Shanshan Battery Materials to focus on the fast-growing electric vehicle industry.

Ningbo Shanshan in May unveiled an agreement with BASF to transfer a 19.6438pc stake of its subsidiary Shanshan Energy to BASF, and also to purchase 31.3562pc of Shanshan Energy from other shareholders. BASF will hold 51pc of Shanshan Energy, while Ningbo Shanshan will reduce its share to 49pc from 68.6438pc after the deal. The deal was completed yesterday, with Shanshan Energy renamed BASF Shanshan Battery Materials.

Shanshan Energy operated Ningbo Shanshan's battery cathode material business. Established in 2003, Shanshan Energy focuses on production of lithium-ion cathode materials including lithium nickel cobalt manganese oxide (NCM), lithium cobalt oxide (LCO) and lithium manganate. Shanshan Energy shipped 16,722t of LCO, NCM and lithium manganate in January-June, up by 85pc on the year.

As per MRC, BASF reported a better-than-expected second-quarter net profit as it managed to increase volumes and prices thanks to strong demand. Low commodity prices during the coronavirus pandemic weighed on BASF’s earnings last year, but the German group recorded a rapid recovery so far in 2021 as the global economy picked up faster than expected.

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.

BASF SE (headquartered in Ludwigshafen) - the world's largest manufacturer of chemical products for the industry, including the extraction and processing of oil and gas; has more than 150 production sites in the world, including a number of production lines in the Russian Federation.
MRC