Shell decreased refining capacity in Singapore to change chemical feedstock

Shell decreased refining capacity in Singapore to change chemical feedstock

MOSCOW (MRC) -- Royal Dutch Shell has halved its crude processing capacity at its Singapore hub and reduced fuel exports, executives said on Tuesday, as the major transits from fossil fuels to cut emissions and meet global low-carbon energy needs, said Hydrocarbonprocessing.

The refinery on Pulau Bukom will continue to produce naphtha for its ethylene unit, Shirley Yap, senior vice president of chemicals and products at Shell Singapore, told reporters. Shell has also started testing new chemical feedstocks - pyrolysis oil and bionaphtha - at the cracker, she said, as the major aims to supply olefins with lower carbon footprint to customers like Japanese chemical maker Asahi Kasei Corp.

Shell is a key fuel supplier in Asia and the drop in exports has tightened supplies and propelled margins for refiners in the region back to pre-pandemic levels in recent months. "The reality is that we've cut a substantial part of our capacity and there's demand for fuels today so we have to ensure that we are doing it at a pace that is in step with our customers and in step with the society," Shell Singapore Chairman Aw Kah Peng said.

"But at the same time ... it can't be turned on with just a flick of the switch as infrastructure needs to be build but we want to be there as quickly as we can," she said. Shell will build its first pyrolysis oil upgrader to produce 50,000 tpy of treated pyrolysis oil for its 800,000 tpy cracker on Bukom in 2023.

Pyrolysis melts plastic waste into products such as pyrolysis oil, which can be upgraded as raw material for plastics and chemicals, although the process isn't commercially proven and consumes a lot of energy. Other projects in Shell Singapore's pipeline include a CCS hub and a 550,000 tpy biofuels plant to process waste and vegetable oils into sustainable aviation fuel (SAF). Shell aims to make about 2 MMtpy of SAF by 2025 globally although SAF accounts for less than 0.1% of today's global jet fuel demand.

The projects form part of Shell Singapore's plans to cut emissions from its operations by half by 2030, from 2016 levels on a net basis, Shell Downstream Director Huibert Vigeveno said. Shell did not provide investment figures for the projects. Energy companies are face increasing pressure from investors, activists and governments to steer away from fossil fuels and rapidly ramp up investment in renewables. Globally, Shell has pledged to halve emissions from its operations by 2030, as well as reduce its net carbon footprint by 45% by 2035.

Bukom, together with other Shell chemical plants on Jurong Island, forms one of five Energy and Chemical Parks owned by the major globally and is the only one in Asia. Shell plans to build two chemical conversion units in Asia to convert waste plastics into pyrolysis oil for Singapore, similar to units in the Netherlands with JV partner BlueAlp which will be operational in 2023.

Shell previously announced it would trial the use of hydrogen fuel cells for ships in Singapore and is exploring developing a solar farm in a landfill near Bukom.

As MRC reported earlier, Royal Dutch Shell plans to reduce its refining and chemicals portfolio by more than half, it said in July 2020 without giving a precise timeframe. The move is part of the Anglo-Dutch company's plan to shrink its oil and gas business and expand its renewables and power division to reduce greenhouse gas emissions sharply by 2050.

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 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.
MRC

Clariant launches free N2O-removal catalyst for nitric acid producers

Clariant launches free N2O-removal catalyst for nitric acid producers

MOSCOW (MRC) -- Clariant, a focused, sustainable and innovative specialty chemical company, has launched a major global campaign to reduce the climate change impact of nitrous oxide (N2O), according to Hydrocarbonprocessing.

Drawing on decades of catalyst research expertise, the company has developed the EnviCat N2O-S catalyst, which is proven to remove up to 95% of N2O generated as a by-product of nitric acid production.

Clariant is now offering a free fill of EnviCat N2O-S to 10 nitric acid producers who do not have N2O off-gas treatment in place. Through the campaign, the company intends to help avoid greenhouse gas emissions equivalent to several MM tons of CO2 per year.

Of the approximately 500 nitric acid plants operating globally, more than half run without N2O abatement, mostly in regions without applicable emission control regulations. Clariant now aims to tip the balance towards more sustainable production processes. The company is offering a free first fill of EnviCat N2O-S catalyst to up to 10 nitric acid producers who currently do not use an N2O abatement catalyst.

Hans Bohnen, Chief Operating Officer at Clariant, commented, “Sustainability is no longer an afterthought of business; it is central to what we do and requires action now. That’s why we announced new ambitious science-based climate targets for Clariant. But as a specialty chemicals company we can do more: I am therefore particularly proud to announce that we have committed a substantial investment to help nitric acid producers worldwide virtually eliminate their N2O off-gas emissions. This benefits the climate, while also helping the nitric acid manufacturers to minimize their carbon footprint and progress on their sustainability journey.”

Clariant’s EnviCat N2O-S catalyst converts up to 95% of the N2O formed during nitric acid production into the harmless substances oxygen and nitrogen. Besides climate benefits, the catalyst can also slightly increase nitric acid yield by improving the efficiency of the ammonia oxidation process. Designed as a convenient “drop-in” solution, the catalyst is easy to install with almost no engineering modifications.

As MRC reported earlier, in October 2020, Clariant announced the construction of a new state-of-the-art catalyst production site in China. This project represents a significant investment which further strengthens Clariant’s position in China and enhances its ability to support its customers in the country’s thriving petrochemicals industry.

The new facility will be primarily responsible for producing the Catofin catalyst for propane dehydrogenation, which is used in the production of olefins such as propylene. Thanks to its excellent reliability and productivity, Catofin delivers superior annual production output compared to alternative technologies, resulting in increased overall profitability for propylene producers, says the company. Construction at the Dushan Port Economic Development Zone in Jiaxing, Zhejiang Province was scheduled to commence in Q3 2020, and Clariant expects to be at full production capacity by 2022.

Propylene is the main feedstock for the production of polypropylene (PP).

According to MRC's ScanPlast report, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.

Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints.
MRC

Lukoil discovered an oil field in Mexico

Lukoil discovered an oil field in Mexico

MOSCOW (MRC) -- Lukoil announces discovery of an oil field within the Yoti West structure at Block 12 offshore Mexico, said the company.

The field was discovered after drilling the first exploration well. According to preliminary estimates, the initial oil in place reaches 250 million barrels.

The Yoti West-1 EXP well was drilled 60 km offshore from the Valaris 8505 semi-submersible platform. The well penetrated a sand reservoir in Upper Miocene sediments with high permeability and effective oil-saturated thickness of about 25 meters. An assessment plan for the Yoti West field is planned to be developed based on drilling results.

In 2017, Lukoil Upstream Mexico (part of LUKOIL Group) obtained the right for exploration and production of hydrocarbons at Block 12 in the Gulf of Mexico. The Block has an area of 521 square kilometers. The stakeholders are LUKOIL Upstream Mexico – 60% (project operator), and Eni – 40%. Two successful exploration wells were previously drilled at Block 10 offshore Mexico where Lukoil owns 20% and Eni is the operator. The resource base of the Block is currently being assessed based on drilling results.

As per MRC, Lukoil has submitted to Iraq's oil ministry a preliminary development proposal for Eridu field, which may yield an estimated 250,000 b/d at peak, helping OPEC's second biggest producer in its efforts to boost crude production capacity. The proposal's submission will allow the ministry to study and approve the field's development, the ministry said in a Nov. 12 statement. Initial indications point to Eridu holding potential resources ranging between 7 billion and 12 billion barrels, the ministry added.

As per ICIS-MRC Price Report, Stavrolen, subsidiary of Lukoil, resumed its polypropylene (PP) production capacities after an scheduled turnaround. According to the company's clients, by 11 November, Stavrolen completely resumed PP production after a planned shutdown for scheduled maintenance works, which started on 16 October. The plant"s annual production capacity is 120,000 tonnes.

Lukoil is one of the leading vertically integrated oil companies in Russia. The main activities of the company include operations for the exploration and production of oil and gas, production and sale of petroleum products. Lukoil is the second largest privately-owned oil company in the world in terms of proven hydrocarbon reserves. The structure of Lukoil includes one of the largest petrochemical enterprises in Russia - Stavrolen.
MRC

COVID-19 - News digest as of 24.11.2021

1. Global petrochemical market suffers from price volatility - SIBUR CEO D. Konov

MOSCOW (MRC) - Record gas prices have a significant impact on the petrochemical market, said RBK with reference to the words of SIBUR head D. Konov. Dmitry Konov, Chairman of the Board of SIBUR Holding, said that the "main evil" for the petrochemical market this year is not the rise in prices, but the speed and frequency of their change. "The main evil - and this is true for both us and the consumer - is not some absolute level of prices, but the speed and frequency of their changes. When prices rise and fall by 30% month by month, this is bad," Konov said. He noted that this year there were many such phenomena that led to record gas prices. This includes interruptions in American production, an accident at the Urengoy plant for preparing condensate for transport, and force majeure events in Europe. Konov stressed that as a result of this, "the long-standing established system is failing," which manifests itself in the hypervolatility of product prices and leads to anomalous delivery costs from one geography to another.

MRC

Crude oil futures up in Asia after 3% surge overnight on smaller-than-expected release from strategic petroleum reserves

Crude oil futures up in Asia after 3% surge overnight on smaller-than-expected release from strategic petroleum reserves

MOSCOW (MRC) -- Crude oil futures were higher in mid-morning trade in Asia Nov. 24, extending gains of more than 3% overnight, after major oil-consuming economies announced a smaller-than-expected release from their strategic petroleum reserves, reported S&P Global.

Some bearish pressures also came from an unexpected build in US crude oil and gasoline inventories last week.

At 10:23 am Singapore time (0223 GMT), the ICE January Brent futures contract was up 14 cents/b (0.17%) from the previous close at USD82.45/b, while the NYMEX January light sweet crude contract was 25 cents/b (0.32%) higher at USD78.75/b.

Oil prices continued to climb after settling 2.3%-3.3% higher overnight as investors deemed the scale of the SPR releases by several major oil-consuming economies insufficient to offset the current shortage of oil the world faces.

"Markets deemed the overall release of the strategic oil reserves to be too small to ease the demand-supply imbalance," IG market strategist Yeap Jun Rong said.

The US will release 50 million barrels from its SPR by early next year, though a portion of that has to be returned by 2025, while India will release 5 million barrels and the UK will allow companies to voluntarily release 1.5 million barrels.

South Korea also said Nov. 24 that it will release crude oil from its SPR, though it did not specify the timing and volume to be released.

A source at South Korea's energy ministry said the country could possibly release about 4% of the country's SPR, equivalent to around 3.8 million barrels, as it did in 2011 during the Libyan crisis.

The announced figures will do little to calm nerves about soaring energy costs and the associated rise in inflation. Despite declines in the last four weeks, crude prices remain not far from the seven-year highs touched in late October.

In the US, drivers are now facing the highest Thanksgiving gasoline prices in nine years as of Nov. 23.

Media reports indicate the American Petroleum Institute has reported a build in US crude oil and gasoline inventories for the week ended Nov. 19, with crude stocks rising 2.3 million barrels in the week and gasoline inventories up 600,000 barrels.

As MRC informed before, US commercial crude stocks fell 3.48 million barrels to 413.96 million barrels in the week ended Sept. 17, to more than 8% below the five-year average, Energy Information Administration data showed. Stocks were last lower Oct. 5, 2018.

We remind that 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 also remind that US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, EIA said in a monthly report earlier this year, a smaller decline than its previous forecast for a drop of 210,000 bpd.
MRC