Indorama strengthens its footprint in Asia-Pacific by expanding packaging business in Vietnam

Indorama strengthens its footprint in Asia-Pacific by expanding packaging business in Vietnam

MOSCOW (MRC) -- Indorama Ventures Public Company Limited (IVL), a global sustainable chemical company, announces that it is in the process of acquiring shares in Ngoc Nghia Industry - Service - Trading Joint Stock Company (NN), as per the company's press release.

NN is a leading polyethylene terephthalate (PET) converter in Vietnam with long-standing relationships with major brands. It has four manufacturing sites in both the North and South of Vietnam. It has a total production capacity of approximately 5.5 billion units of PET preforms, bottles and closures, or equivalent to a PET conversion of 76,000 tons per annum.

Operating with high quality standards, NN is a trusted provider of PET packaging products to major multinational and Vietnamese brands in the beverage and non-beverage industries. Its business operations are run by an experienced management team with strong industry knowledge as well as local market exposure and understanding. These competitive advantages are strategic fits for IVL and would complement the company’s long-term growth after integration. This proposed acquisition will strengthen IVL’s market position in the packaging business in high growth markets of the Asia-Pacific region.

The acquisition process is required to follow the Law on Securities, its guiding decrees and circulars as required by the State Securities Commission of Vietnam and regulations of the Hanoi Stock Exchange. Through its affiliate, Indorama Netherlands B.V., IVL would be required to do the tender offer of all of NN’s shares. The transaction is expected to be completed by the first half of 2022.

As MRC wrote before, in November 2021, the board of directors of IVL, a large producer of recycled PET for beverage bottles, approved the purchase of land, buildings and utility machinery from Aurus Specialty to utilize for a proposed PET recycling facility in Thailand. The assets, valued at a total of 112.90-million baht, will be acquired by Indorama Polyester Industries and Indorama Holdings, direct subsidiaries of IVL. Subject to approval from the board of investment, the transaction is expected to be com-pleted in the first quarter of 2022.

According to MRC's ScanPlast report, Russia's estimated PET consumption grew to 737,590 tonnes in the first eleven months in 2021, up by 14% year on year. PET consumption in Russia grew by 25% in November and reached 75,760 tonnes versus 60,520 tonnes a year earlier.

Indorama Ventures Public Company Limited, listed in Thailand (Bloomberg ticker IVL.TB), is one of the world’s leading petrochemicals producers, with a global manufacturing footprint across Africa, Asia Pacific, Europe and Americas. The company’s portfolio comprises Integrated PET, Olefins, Fibers, Packaging and Specialty Chemicals. Indorama Ventures products serve major FMCG and automotive sectors, i.e. beverages, hygiene, personal care, tire and safety segments. Indorama Ventures has approx. 24,000 employees worldwide and consolidated revenue of US$ 11.4 billion in 2019. The Company is listed in the Dow Jones Emerging Markets and World Sustainability Indices (DJSI).
MRC

Fire broke out at SK Energy refinery in Ulsan

Fire broke out at SK Energy refinery in Ulsan

MOSCOW (MRC) -- A fire broke out at SK Energy’s Ulsan plant on Wednesday morning, 12 January, and a fire brigade was dispatched to extinguish it, according to Archyde.

At 6:22 am that day, the fire broke out in the battery room energy storage system (ESS) of SK Energy’s Ulsan plant in Gosa-dong, Nam-gu, Ulsan. This storage device is a system that supplies power to facilities for emergencies when power supplied from KEPCO to factory facilities is cut off.

Upon receiving the report, the fire brigade issued the first stage of response, mobilizing all fire department personnel and equipment, and dispatched 89 firefighters and 29 firefighting equipment to the scene. The fire brigade is carrying out firefighting activities while blocking the spread of flames from the fire station to other oil refineries.

The fire has not yet spread to other facilities. However, the fire brigade said that it would take some time for the complete extinguishment to take place due to the characteristics of the facilities at the fire site. As of 8:20 a.m. that day, the big fire has been put out, and work is being done to clean up the fire and remove the flame.

It is reported that there were no casualties in the fire that day.

We remind that, as MRC informed earlier, South Korea's SK Global Chemical shut its small No. 1 naphtha-fed steam cracker in Ulsan permanently on Dec. 10, 2020, due to aging-related issues. The No. 1 steam cracker was able to produce 200,000 mt/year of ethylene and 140,000 mt/year of propylene. The company will keep normal operations of its No. 2 steam cracker at the same location. The No. 2 unit is able to produce 660,000 mt/year of ethylene, 350,000 mt/year of propylene and 110,000 mt/year of butadiene.

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 2,265,290 tonnes in the first eleven months of 2021, up by 14% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,363,850 tonnes in January-November, 2021, up by 25% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

SK energy began in 1962 as Korea Oil Corporation, the first oil refinery in the country. The company has since contributed to national economic development by producing, exporting, and distributing petroleum products. SK energy's Ulsan Complex can process up to 840,000 barrels of crude oil per day, supplying petroleum products to both domestic and international markets.
MRC

COVID-19 - News digest as of 13.01.2022

1. Crude oil prices hit two-month high on tight supply and easing concerns about Omicron impact on demand

MOSCOW (MRC) -- Oil prices hit two-month highs on Wednesday on tight supply and easing concerns about the potential hit to demand from the Omicron coronavirus variant, reported Reuters. US Federal Reserve Chairman Jerome Powell on Tuesday said that the economy of the United States, the world's biggest oil consumer, should weather the current COVID-19 surge with only "short-lived" impact and is ready for the start of tighter monetary policy. Brent crude futures were up 47 cents, or 0.6%, at USD84.19 a barrel by 1430 GMT. US West Texas Intermediate (WTI) crude futures were up 66 cents, or 0.8%, at USD81.88.

MRC

ExxonMobil continues running its Baytown refinery at reduced rates in January

ExxonMobil continues running its Baytown refinery at reduced rates in January

MOSCOW (MRC) -- Exxon Mobil Corporation’s Baytown refinery in Texas continues to produce at reduced rates after a fire broke out at a reformer feed hydrotreater on Dec 23,2021, reported Reuters.

The Baytown refinery is one of the largest refining and petrochemical facilities in the United States, with a crude processing capacity of 560,500 barrels per day.

The fire took place at the refinery’s hydrotreater unit, which had been closed due to a leakage in the bypass line. Reformer feed hydrotreater eliminates sulfur and other contaminants from partially refined oil to produce refined products.

The fire affected a gasoline-producing unit, which could affect premium gasoline prices. The fire could hinder the Baytown refinery’s production for months, in turn, affecting the gasoline supply when the US refining capacity has already been reduced. Beside this, it affected a toluene benzene unit and a nearby cooling tower.

Although there were no fatalities, a few workers were hospitalized with injuries. While workers were relocated from that refinery section, the rest of the facility continued its operations.

This is the second fire incident at the Baytown refinery in two years. In 2019, a fire broke out at a polypropylene (PP) recovery unit, in which plastic is purified for production.

The cause of the fire has not yet been determined.

Exxon's Baytown facility is home to a chemical plant, an olefins plant and the country's fourth-biggest oil refinery, with capacity to process 560,500 bpd of crude.

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 2,265,290 tonnes in the first eleven months of 2021, up by 14% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,363,850 tonnes in January-November, 2021, up by 25% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.
MRC

Polish refiner PKN Orlen to sel 30% ofl Lotos assets to Saudi Aramco

Polish refiner PKN Orlen to sel 30% ofl Lotos assets to Saudi Aramco

MOSCOW (MRC) - Poland's largest refiner PKN Orlen said it will sell some Lotos assets to companies including Saudi Aramco, reported Reuters.

Saudi Aramco will buy a 30% stake in Lotos Asfalt, one of the largest manufacturers of bitumen in Europe which also owns the Lotos oil refinery in Gdansk, in a deal including a fixed payment of 1.15 billion zlotys and variable elements. It will also acquire 100% stakes in two other units.

Orlen has also signed a deal with Aramco for oil supplies of 200,000-337,000 barrels per day, adding more purchases to those agreed earlier. Deliveries under the new contract will start this year, PKN's chief executive told journalists.

Poland's Unimot and Hungary's Rossi Biofuel will also purchase some Lotos assets, PKN Orlen added.

Critics say selling Lotos's assets would result in letting more international competitors into Poland, but Orlen and the government argue that taking over the smaller rival will improve company's market position, its bargaining power and investment capacities.

"This new company...is a great opportunity for Poland...to successfully face the challenges we are facing today. The challenges related to the energy transformation, to global changes when it comes to new sources of energy and fuels," Poland's state assets minister told journalists.

"I am convinced that Orlen will be strengthened by these Lotos assets, but also strengthened by cooperation with Saudi Aramco," Jacek Sasin added.

PKN Orlen announced plans to buy Lotos in 2018, but had to meet conditions set by the European Commission. It agreed to sell some Lotos assets to address competition concerns.

As MRC informed earlier, in May 2016, PKN ORLEN signed a contract with Saudi Aramco for the supply of ca. 200 thousand tonnes of crude oil monthly to its refineries. The contract was effective since May 1st to December 31st 2016, with an option of automatic renewal for successive years. The oil is processed by all PKN ORLEN's refineries in Poland, the Czech Republic and Lithuania. This was the first direct long-term contract with a supplier from the Gulf region in the history of the Polish company.

We remind that Orlen Unipetrol (part of PKN Orlen), a major Czech producer of petrochemical products, will expand the capacity of its steam cracker in Litvinov (Czech Republic) by installing a new furnace. The new cracker will be built by Technip Energies in Zaluzi, the largest chemical plant in the Czech Republic, and is due to be commissioned in 2022. Orlen is investing over 700 mln Czech crown (CZK) in the project.

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 2,265,290 tonnes in the first eleven months of 2021, up by 14% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,363,850 tonnes in January-November, 2021, up by 25% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

PKN Orlen is a leading player on the fuels and energy markets, and the largest company in Central and Eastern Europe, listed in prestigious global rankings such as Fortune Global 500, Platts TOP250 and Thompson Reuters TOP100. The ORLEN Group operates in 6 home markets – Poland, the Czech Republic, Germany, Lithuania, Slovakia and Canada.
MRC