MOSOW (MRC) -- Chemical producer LyondellBasell Industries NV aims to sell its Houston crude oil refinery as quickly as possible, reported Reuters with reference to people familiar with the matter.
The company on Wednesday said it is considering strategic options for the refinery, including a potential sale. US refiners last year suffered deep losses as the coronavirus pandemic slashed demand for motor fuels.
LyondellBasell joins a number of other operators that have put plants up for sale. Royal Dutch Shell Plc last year offered its Convent, Louisiana, refinery and Phillips 66 recently put a Belle Chasse, Louisiana, plant on the market.
"They hope to sell as soon as possible," one of the people familiar with the matter said of LyondellBasell.
The refinery along the Houston Ship Channel has been under Lyondell's sole ownership since 2006, when the company bought out minority partner Citgo Petroleum to end a troubled relationship.
This is Lyondell's second attempt to sell the Houston refinery, which the US Energy Information Administration says can process 263,776 barrels per day of crude oil.
The first attempt, in 2016, was hampered by repeated fires and breakdowns at the Houston refinery that cut production to a third of capacity in the spring of that year. But by the fall, the plant had recovered sufficiently to draw offers over USD1 billion from Saudi Aramco and Suncor. Saudi Aramco denied bidding on the plant, but sources familiar with company's negotiations said a deal fell apart when Lyondell raised the asking price before formal bids.
Refinery values have fallen in the past five years as capacity, especially in the United States, is seen too great for an economy preparing to move away from fossil fuels for transportation.
The Houston refinery was once considered an essential source of feedstock for the company's chemical plants, but that changed following Basell's purchase of Lyondell in 2007 and the company's emergence from bankruptcy in 2010. Since then, Lyondell has expanded, acquiring and building chemical plants around the world, especially in Asia as well as adding capacity along the US Gulf Coast.
As MRC informed previously, in early March 2021, LyondellBasell Industries began restarting the gasoline-producing fluidic catalytic cracker (FCC) after completing the restart of the large crude distillation unit (CDU) at its 263,776 barrel-per-day (bpd) Houston refinery. The 147,000-bpd Unit 537 CDU is the first to restart since the refinery was shut on Feb. 15 by severe cold weather. The 90,000-bpd FCC was back in production in H1 March, 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 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.
LyondellBasell is one of the largest plastics, chemicals and refining companies in the world. Driven by its employees around the globe, LyondellBasell produces materials and products that are key to advancing solutions to modern challenges, like enhancing food safety through lightweight and flexible packaging, protecting the purity of water supplies through stronger and more versatile pipes, improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road, and ensuring the safe and effective functionality in electronics and appliances. LyondellBasell sells products into more than 100 countries and is the world"s largest producer of polymer compounds and the largest licensor of polyolefin technologies. In 2020, LyondellBasell was named to Fortune Magazine"s list of the "World"s Most Admired Companies" for the third consecutive year.
MRC