Gazprom and CNPC sign agreement to supply Russian pipeline gas to China via Far Eastern route

MOSCOW (MRC) -- Russia and China have agreed a second long-term gas supply deal, this time for 10 billion cubic metres (bcm)/year which will take total contractual supply between the two countries to 48bcm/year, said the company.

Gazprom and China National Petroleum Corporation (CNPC) signed a long-term Sales and Purchase Agreement for natural gas to be supplied via the Far Eastern route.

The signing of this document is an important step towards further strengthening the mutually beneficial cooperation between Russia and China in the gas sector. As soon as the project reaches its full capacity, the amount of Russian pipeline gas supplies to China is going to grow by 10 billion cubic meters, totaling 48 billion cubic meters per year (including deliveries via the Power of Siberia gas trunkline).

“This is already a second contract to be signed for Russian gas supplies to China, and it is indicative of the exceptionally strong mutual trust and partnership between our countries and companies. Our Chinese partners from CNPC have already seen for themselves that Gazprom is a reliable gas supplier,” said Alexey Miller.

Gazprom on reported the agreement with China’s CNPC for delivery through what is called the Far Eastern Route. The news comes as Russian President Putin visited China for the start of the Beijing Winter Olympics, where the two countries issued a statement on their cooperation on a range of issues, including energy.

In January, Gazprom completed a feasibility study for the Soyuz Vostok pipeline that would become an extension of the Power of Siberia 2 pipeline through Mongolia and which would have a capacity of 50bcm/year. In addition to the latest supply contract and the existing Power of Siberia contract, this would take potential nameplate supply from Russia to China close to 100bcm/year.

We remind, that in December 2020, SIBUR Holding, Russia’s leading petrochemicals company and one of the most rapidly growing petrochemicals businesses globally, and China Petroleum & Chemical Corporation (Sinopec), China’s leading energy and chemical company, have closed the deal to set up a joint venture (JV) at the Amur Gas Chemical Complex after obtaining all the necessary approvals from the regulators of both countries. SIBUR and Sinopec will hold interest in the JV in the amount of 60% and 40%, respectively.

PJSC Gazprom is a Russian energy company engaged in exploration, production, transportation, storage, processing and sale of gas, gas condensate and oil, as well as production and sale of heat and electricity. The largest company in Russia, the largest gas company in the world, owns the longest gas transmission system (over 160,000 km). It is the world leader in the industry.
MRC

1. Eastman expands global tertiary amines capacity

MOSCOW (MRC) -- Eastman's care additives business has announced the completion of a significant expansion of its tertiary amine capacity, primarily DIMLA 1214, at both its Ghent, Belgium, and Pace, Florida, manufacturing sites, said the company. The Ghent expansion has led to an increase in capacity, while the Pace expansion has improved production flow, making it the world's largest tertiary amine unit. Demand for tertiary amines had increased because of rising consumer demand that was caused by the coronavirus pandemic, Eastman said.

MRC

MOSCOW (MRC) -- Russian producers began negotiations over February shipments of Russian PVC at the end of last week. Pressured by a major slump in demand and a noticeable increase in imports in January, Russian producers cut their prices for February deliveries after several months of steadiness, according to ICIS-MRC Price report.

Since November, the availability of PVC in the global markets has been gradually increasing, and along with it, a steady price reduction was registered in a number of regions. But difficulties with logistics for shipments of resin from a number of regions of the world did not allow Russian companies to significantly increase imports. And the lack of stable and sufficient imports allowed Russian producers to maintain PVC prices in the domestic market at a record high level. The situation changed drastically in January, Russian producers cut their prices by Rb2,000-14,000/tonne.

Since November, PVC has been steadily getting cheaper in the Asian region, and local producers' export prices have been also going down. February was no exception, the key producers' prices of resin fell in the region by USD70-100/tonne.

US producers reduced their export prices more dynamically, while export quotas grew in parallel. By late January, prices of North American resin for Russian buyers dropped to USD1,600/tonne CFR St. Petersburg and lower. Even several deals were reported after a rather long pause.

But very weak demand amid unusually high imports in the winter period was the main reason for the price adjustment for the domestic market by Russian producers. Thus, according to preliminary data, almost 13,000 tonnes of PVC were imported to Russia in January, whereas imports exceeded this figure only once last year.

Negotiations over February deliveries of Russian PVC began at the end of last week, but, like a month earlier, many converters were in no hurry to discuss deals. In fact, some converters have been still negotiating this week. But in general, all market participants reported lower prices of Russian PVC for February shipments, with resin with K=70 accounting for the greatest price decrease.

Deals for February shipments of PVC with K64/67 were negotiated in the range of Rb172,000-177,000/tonne CPT Moscow, including VAT, for quantities less than 500 tonnes. Prices of resin with K=70 were discussed at an average of Rb195,000-198,000/tonne CPT Moscow, including VAT.
MRC

MOSCOW (MRC) -- Eastman's care additives business has announced the completion of a significant expansion of its tertiary amine capacity, primarily DIMLA 1214, at both its Ghent, Belgium, and Pace, Florida, manufacturing sites, said the company.

The Ghent expansion has led to an increase in capacity, while the Pace expansion has improved production flow, making it the world's largest tertiary amine unit. Demand for tertiary amines had increased because of rising consumer demand that was caused by the coronavirus pandemic, Eastman said.

"We've seen a significant increase in tertiary amine demand, partially due to structural changes in consumer habits related to the global pandemic, and are committed to serving our customers and meeting global consumer needs," said Robert Ash, product director for Eastman care additives. "I want to thank our customers for their patience and partnership over the past year as we executed these expansions."

Ash also thanked the Eastman engineering staff and manufacturing teams that completed the projects safely in an accelerated timeline during a global pandemic.

Eastman did not disclose the size of the expansions or their costs.

The projects increased capacity at Ghent and improved production flow at Pace, making it the world's largest tertiary amine unit, Eastman said. The projects expanded output of mostly dimethyldodecylamine 1214 (DIMLA 1214).

Tertiary amines are used to make surfactants in liquid dish soap, hard-surface cleaners and antibacterial wipes and sprays.

As per MRC, Eastman is targeting for a 2023 groundbreaking on its proposed plastics recycling project in France. The company has yet to decide where in France the project will be built. The methanolysis-based project, first announced on 17 January, will process up to 160,000 tonnes/year of hard-to-recycle polyethylene terephthalate (PET) waste. Startup of production is expected in 2025.

According to MRC's ScanPlast report, Russia's estimated PET consumption remained steady in December 2021 year on year. December estimated PET consumption totalled 67,880 tonnes (67,710 tonnes in December 2020).

Eastman is a multinational chemical company serving customers in approximately 100 countries. Sales in 2015 amounted to around USD9.6 Billion. The company is headquartered in Kingsport, Tennessee, USA. The company employs approximately 15 thousand people around the world.
MRC

MOSCOW (MRC) -- Honeywell announced its intent to form a joint venture with Avangard Innovative to build an advanced recycling plant in Texas, according to Hydrocarbonprocessing.

The facility will use Honeywell’s recently announced UpCycle Process Technology to transform end-of-life plastic waste into recycled polymer feedstock that can be used to create new plastics.

Honeywell’s new UpCycle Process Technology reduces the need for fossil feeds in the creation of virgin plastics, with the goal of enabling a circular economy for plastics.

Avangard Innovative is the largest plastics recycler in the Americas and will be the first to deploy the UpCycle Process Technology in the United States. Honeywell and Avangard intend to form a joint venture to co-own and operate a facility within Avangard’s NaturaPCR complex in Waller, Texas. The planned advanced recycling plant is expected to have the capacity to transform 30,000 metric tons of mixed waste plastics into Honeywell Recycled Polymer Feedstock per year. Production is anticipated to begin in 2023.

When used in conjunction with other chemical and mechanical recycling processes, along with improvements to collection and sorting, Honeywell’s UpCycle Process Technology has the potential to increase the amount of plastic waste that can be recycled to 90% from only 15% today.

This announcement expands the UpCycle Process Technology footprint, building on Honeywell’s recent announcement in Spain of its intent to form a joint venture with Sacyr. That joint venture would build an advanced recycling plant in Andalucia, in Southern Spain. That facility is expected to have the capacity to transform 30,000 metric tons per year of mixed waste plastics into Honeywell Recycled Polymer Feedstock.

Honeywell’s UpCycle Process Technology was created within Honeywell’s Sustainable Technology Solutions (STS) business, which is part of Honeywell UOP. This latest breakthrough technology builds upon Honeywell’s focus to deliver high impact, environmentally sustainable solutions for customers and society.

As MRC wrote previously, in January, 2022, Honeywell announced that it has been selected by Spanish oil and gas company Repsol to supply an integrated control and safety system (ICSS) for the first advanced biofuels production plant to be built in Spain.

We remind that Repsol said in October, 2021, it will invest EUR2.549 billion (USD2.958 billion) in the entire hydrogen value chain by 2030. Renewable hydrogen is one of Repsol’s strategic pillars to achieve zero emissions by 2050. Thus, the company presented its hydrogen strategy for up to 2030.

We also remind that the “Cracker of the Future” consortium has recently announced two new member companies: Repsol and Versalis (Eni) have joined the consortium.

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.
MRC