Borouge awards contracts for expansion of Abu Dhabi complex

Borouge awards contracts for expansion of Abu Dhabi complex

MOSCOW (MRC) -- Borouge has signed a 25-year deal for ADNOC Logistics & Services to manage integrated logistics support at the Khalifa Industrial Zone and a new hub at the port in the area, said the company.

The deal covers the transportation and handling operations for Borouge’s polymer products at Khalifa Port to export to international markets.

ADNOC is the majority shareholder in Borouge, with Austria-based Borealis holding 40% of the business. The company claimed that the deal would reduce unit costs of production by optimising manufacturing and distribution value chains.

Rainer Hoefling, CEO of Borouge, added: "Borouge 4 is fundamental to reinforcing our commitment to our global customers and milestone in our story of growth. Our new facility enables us to actively respond to the growing global demand for energy, infrastructure, advanced packaging and agriculture solutions which have a positive impact on society and the environment."

The scope of the award covers engineering, procurement, construction, and commissioning activities for the polyolefin complex facilities required to facilitate the full production capacity of two new polyethylene plants – each with a capacity of 700,000 tonnes per annum.

These plants will be supplied by a world-scale ethane cracker with capacity of more than 1.5 million tonnes per annum of ethylene.

As per MRC, Abu Dhabi National Oil Company (ADNOC) has signed of a strategic partnership with Borealis AG that confirms a USD6.2 B (AED22 B) investment agreement between the companies to build the fourth Borouge facility - Borouge 4 - at the polyolefin manufacturing complex in Ruwais, United Arab Emirates (UAE), which will produce 1.4 MM tons of polyethylene (PE) per year.

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.

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. In 2020, Borealis generated EUR 6.8 billion in sales revenue and a net profit of EUR 589 million. OMV, the Austria-based international oil and gas company, owns 75% of Borealis, while the remaining 25% is owned by a holding company of the Abu-Dhabi based Mubadala.
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Reduced production and stronger demand lead to lower US jet fuel inventories

Reduced production and stronger demand lead to lower US jet fuel inventories

MOSCOW (MRC) -- On November 26, US jet fuel inventories were at their lowest level since late 2014, according to the EIA's weekly petroleum status report. Refineries produced less jet fuel in October compared with this summer, and since August, jet fuel demand has increased to near pre-pandemic levels. This increased demand, along with reduced production, has caused inventories to decline, according to Hydrocarbonprocessing.

High jet fuel inventories in summer 2021 were the result of increased refinery production during a period of high market demand for gasoline and distillate. This high demand encouraged refiners to process more crude oil, and jet fuel is a byproduct of crude oil refining. Hurricanes along the Gulf Coast in August contributed to temporary refinery outages and reduced production, which brought jet fuel inventories to more normal seasonal levels. For the week ending September 3, total jet fuel inventory fell below its previous five-year average.

Jet fuel demand (measured as product supplied) has been well below its 2019 average of 1.74 MMbpd since the onset of the COVID-19 pandemic. In most weeks since mid-August, jet fuel consumption has been within 20% of 2019 levels, according to the weekly petroleum status report. By comparison, in November 2020, US jet fuel demand averaged 1.13 MMbpd, or about two-thirds of its 2019 average value.

As MRC reported earlier, g;obal jet fuel markets stayed under pressure on Tuesday as more countries expanded border restrictions to keep the new Omicron coronavirus variant at bay, prompting travelers to reconsider their plans. Jet fuel demand - the biggest laggard in the oil complex - had been forecast to post the strongest growth of 550,000 bpd to 5.9 MMbpd in fourth quarter, according to the International Energy Agency in its Nov. 16 report. But now Omicron poses the greatest risk to jet fuel consumption. Hong Kong expanded a ban on entry for non-residents from several countries, the latest to expand travel curbs after Israel and Japan have already announced border closures to all foreign travelers.

We remind that the Omicron coronavirus variant kicked oil prices lower in late November and sapped refining margins, but with crude futures rallying several days later, the impact could be limited. Oil prices plunged more than 10% on Friday - their largest daily drop since April 2020 - but recovered some of those losses on 29 November, standing up nearly 5% on the day. Analysts said the Friday sell-off had been excessive. Refining margins fell further, increasing the impact of new coronavirus curbs that had already been rolled out in Europe.

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 2,047,100 tonnes in the first ten months of 2021, up by 17% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,226,530 tonnes in January-October 2021, up by 26% year on year. Supply of propylene homopolymers (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding stat-copolymers of propylene (PP random copolymers) decreased significantly.
MRC

Malaysia and Shanxi Construction Investment Group sign deal on 2nd-generation biodiesel, biojet fuel

Malaysia and Shanxi Construction Investment Group sign deal on 2nd-generation biodiesel, biojet fuel

MOSCOW (MRC) -- Malaysia and China's state-owned Shanxi Construction Investment Group on Monday signed a MOU to collaborate on the production of second-generation biodiesel and biojet fuel, reported Reuters.

Shanxi Construction plans to invest in a hydrogenated vegetable oil (HVO) plant, also known as second-generation biofuel, in Malaysia's southern state of Johor, Malaysia's commodities ministry said.

"The HVO plant has the potential to produce sustainable aviation fuels which is also known commonly as biojet fuels," the ministry said, adding there was increasing demand for HVO including from Europe.

Each HVO plant is expected to bring foreign investment worth 3 B ringgit (USD712.25 MM) and create nearly 800 jobs, it said.

The MOU is between the Malaysian Palm Oil Board, Pengerang Maritime Industries, Shanxi Construction, and the Institute of Coal Chemistry, Chinese Academy of Sciences.

Wang Chongjun, general manager of Shanxi's overseas department, said the firm is exploring development of a green diesel refinery and related storage facilities in Johor's Pengerang Maritime Industrial Park using China's technology and Malaysia's palm oil products.

The biodiesel and bio-jet fuel products will be used to meet the needs of the Chinese market but will also be exported to Europe and the United States, he said.

As MRC wrote before, a new biojet fuel developed by energy group Eni was used for the first time in mid-October, 2021, to power Alitalia successor ITA as part of plans to cut carbon footprints. The sustainable aviation fuel (SAF), made from waste products and residues, will be produced at Eni refineries in Taranto and, early next year, in Livorno, Eni said in a statement.

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 2,047,100 tonnes in the first ten months of 2021, up by 17% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,226,530 tonnes in January-October 2021, up by 26% year on year. Supply of propylene homopolymers (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding stat-copolymers of propylene (PP random copolymers) decreased significantly.
MRC

Sika opened adhesives, sealants tech centre and plant in India

Sika opened adhesives, sealants tech centre and plant in India

MOSCOW (MRC) -- Sika is opening a new technology centre and manufacturing plant for high-quality adhesives and sealants at Pune in Maharashtra, India, said the company.

"Developments at the new R&D laboratories and the production in the new plant are aimed at meeting the rapidly growing demand in the Indian market," the company said in a statement. On its three new production lines, Sika said that it will mainly manufacture products for the transportation, construction, and renewable energy sectors.

Capacity details for the production lines were not disclosed. "Both the building industry and the automotive sector in India are benefitting from dynamic economic growth and ongoing urbanisation as well as from favorable government investment policies," the company said.

India is now the world’s fifth biggest market for cars, according to Sika. The construction industry is expected to grow by an average of 6.5% per annum from now until 2030, it said. Annual growth in the automotive sector in the same period should exceed 10%, the company added.

As per MRC, Sika has acquired Shenzhen Landun Holding, a manufacturer of waterproofing systems in China, for an undisclosed sum. Shenzhen Landun has a range of waterproofing products and technologies that "perfectly" complement Sika’s portfolio.

As MRC informed earlier, Sika commissioned a manufacturing facility in Dubai, United Arab Emirates (UAE), which produces epoxy resins aimed at flooring solutions. Sika has decided to invest in the expansion of its manufacturing facilities at the Dubai site in order to increase flexibility in production, shorten delivery times, optimize cost structures, and reduce inventories.

Sika is a specialty chemicals company with a leading position in the development and production of systems and products for bonding, sealing, damping, reinforcing, and protecting in the building sector and motor vehicle industry. Sika has subsidiaries in 101 countries around the world and manufactures in over 200 factories. Its more than 20,000 employees generated annual sales of CHF 7.09 billion in 2018.
MRC

Eni and Sonatrach expand their strategic partnership

Eni and Sonatrach expand their strategic partnership

MOSCOW (MRC) -- The Chief Executive Officer of Sonatrach, Toufik Hakkar, and the Chief Executive Officer of Eni, Claudio Descalzi, in the presence of the Minister of Energy and Mines Mohamed Arkab and the Ambassador of Italy to Algiers Giovanni Pugliese, have signed a new oil contract related to the onshore Berkine basin area, where Eni has been a leader since 1981. On the same occasion, Eni and Sonatrach also signed a MOU for cooperation on initiatives in the energy transition, according to Hydrocarbonprocessing.

Eni's CEO Claudio Descalzi commented: "Today’s agreements are testimony to the commitment of Sonatrach and Eni to continue the shared strategy of accelerated project development, and to pursue the decarbonization objectives within our common commitment to achieve carbon neutrality."

The contract, which is the first ever signed under the aegis of the new Algerian oil law, covers an area of 7,880 km2 in the southern part of the Berkine basin, in close proximity to the company's current production assets, Menzel Ledjemet Est (MLE) and Central. Area Field Complex (CAFC), already operated by the JV Eni-Sonatrach.

Descalzi and Hakkar shared the commitment to create an ambitious exploration and development program in the area. In the first phase, the project envisages the fast-tracked development of reserves estimated at 135 MM bbl of oil equivalent, with a start-up of production expected by the end of 2022. This project will enhance synergies with existing plants. The entry into force of the new contract is subject to approval by the competent Algerian authorities.

With a view to building on the cooperation already in place in the technological field and to continue the decarbonization process undertaken in support of the initiatives towards carbon neutrality, Eni and Sonatrach have also signed a MOU with a strategic value for cooperation in the energy transition sector.

The agreement provides for the assessment of joint opportunities in the fields of renewables, hydrogen, CCUS, bio-refining, and many other initiatives in line with the companies’ respective decarbonization objectives. This agreement is in line with Eni's commitment to achieving carbon neutrality by 2050, consolidating the partnership with Sonatrach for a sustainable development and to jointly tackle the energy transition challenges.

As MRC wrote earlier, Eni is evaluating conversion of its Livorno refinery in northwest Italy into a biorefinery, as part of the Italian company's wider strategy to make its activities more environmentally sustainable. Eni has already converted two of its Italian refineries and is looking to almost double its biorefining capacity to around 2 million mt/year by 2024, and expand this to at least five times by 2050, as part of its pledge to achieve complete carbon neutrality 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 2,047,100 tonnes in the first ten months of 2021, up by 17% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,226,530 tonnes in January-October 2021, up by 26% year on year. Supply of propylene homopolymers (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding stat-copolymers of propylene (PP random copolymers) decreased significantly.

Eni, abbreviation of Ente Nazionale Idrocarburi, in full Eni SpA, Italian energy company operating primarily in petroleum, natural gas, and petrochemicals. Established in 1953, it is one of Europe's largest oil companies in terms of sales.
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