Rompetrol Petrochemicals invests over $18 mln for expanding the capacity of the HDPE installation

March 25 (Rompetrol Petrochemicals) -- Rompetrol Petrochemicals, the petrochemical division of the Rompetrol Group, will increase the capacity of the high density polyethylene installation (HDPE) by more than 70% by March 2011, the total value of the investment being estimated to approximately USD 18 million. Stopped in 1996 due to the lack of raw material, the installation was modernized and restarted in 2007, following a total investment of over USD 14.5 million.

⌠Against the background of the reduction or shutting down of production capacities in Central and Eastern Europe, the company maintains its objective set in 2007 of becoming one of the main suppliers and producers of polymers in the region. The modernization program will allow an increase in the installation capacity - from 60,000 to 100,000 tons/year, a reduction of over 10% in the processing cost, a diversification of the range of products provided, as well as an increase in the operating safety stated Cosmin Cocean, Chief Refining and Petrochemicals Officer, The Rompetrol Group.

The project will be carried out in partnership with Mitsui Chemical (the licensor of the HDPE installation) and Rominserv (the general contractor of the Rompetrol Group) and will have two major stages, the rehabilitation and modernization of the granulation tower in the installation by August and the increase in the processing capacity by the first quarter of next year.

Together with the increase in the production capacity, the company will also expand the range of products it provides with two new types designed for the production of gas transportation pipe/very thin foil and large volume containers.

The low- and high-density polyethylene installations currently have a nominal capacity of 60,000 tons/year and entered between 1996 - 2006 in conservation following the lack of raw material - ethylene. In order to modernize and restart them, as well as to build a liquefied gas sea terminal, Rompetrol Petrochemicals allocated over USD 30 million in 2006 (LDPE) and over USD 14.5 million in 2007 (HDPE).

MRC

March 25 (Cet-Austria.com) -- In terms of an international industrial developement Cincinnati Extrusion's KryoSys tipped the scales for the Polish company KNG AWANS Sp. z.o.o., Czarnkow, in favor of placing the order for an HDPE 3-layer pipe extrusion line with the Viennese machine manufacturer.

KNG AWANS Sp. z.o.o. is a producer of water, sewage and pressure pipes made from PE 100, PE 80 and PVC, as well as PVC pipe fittings for the domestic market.

Several plans had already been in existence for expanding the production capacity, but the limited length of KNG's production hall had presented serious problems. With the KryoSys line now ordered from Cincinnati Extrusion, however, KNG AWANS can produce HDPE 3-layer pipes with a thin outer PP-H layer in diameters from 90 to 630 mm and a layer distribution of 25% / 50% / 25% on an extrusion line almost halved in overall length.

The line consists of two monos+ 60 single-screw extruders for the two HDPE layers and a talos 45 as co-extruder for the thin outer PP-H layer. The pipe head, a KryoS 63-1200 3-Coex, ensures excellent distribution accuracy while keeping the length of the entire line short thanks to its integrated melt cooling system.

The line will be installed at KNG AWANS' premises in the second half of this year.

MRC

March 25 (plastemart) -- Saudi Aramco and Total SA expect to raise US$8 bln in debt financing for a joint refinery and petrochemical project for Satorp in the ⌠coming months. The US$8 bln debt package includes the sale of Islamic bonds, or sukuk. The 400,000 bpd refinery in Jubail will cost more than US$12 bln. The cost, including financing expenses, will also be funded by Saudi Arabia, which will contribute over US$1 bln to the project and by the partners' equity. The project Satorp is expected to start operation in mid-2013.

Aramco is investing in refining capacity even though returns are currently poor. Globally, refiners have postponed expansion projects and idled plants as the global recession eroded demand and squeezed profit margins. The company is likely to develop integrated refining and petrochemical plants for all future projects to add value by using products from refining for chemical production. Aramco may sell part of its stake in the project in an initial public offering in 2011 or 2012, so that 25% of Satorp will be publicly traded. Aramco and Total would then hold equal 37.5% stakes.

MRC

March 25 (Borealis) -- Borealis, a leading provider of chemical and innovative plastics solutions, announces the nomination of H.E. Khadem Al Qubaisi, Managing Director of the International Petroleum Investment Company (IPIC) and Chairman of the Board of Aabar Investments, as the new Chairman of the Borealis Supervisory Board, effective March 5, 2010.

He assumed the role from Gerhard Roiss, OMV Deputy Chairman, who will become Vice Chairman of the Supervisory Board. In accordance with the rotation principle agreed to by the shareholders in the shareholders agreement, IPIC has the right to nominate the Chairman of the Supervisory Board until 31 December 2011.

Additional Board members are David Davies, OMV Chief Financial Officer; Mohamed Al Mehairi, Investment Department Director of IPIC and Mohamed Al Khaja, Deputy Director of Research & Business Development of IPIC.

MRC

MRC Reference

Borealis. The share in the Russian market in 2008:

polyethylene - 4.1% (including HDPE - 4.7%, LLDPE в─⌠ 8.7%);
polypropylene в─⌠ 3.2% (PP-impact - 7.5%).

Annual sales growth in Russia over the last 5 years:
polyethylene - 11%;
polypropylene в─⌠ 6%.

Leader in polymers processing technologies:
extrusion coating;
cable extrusion;
injection molding.

March 25 (ICIS news)--A deluge of new ethylene capacities, led by Shell's massive 800,000 tonnes/year mixed feed cracker in Singapore, could ease the cost pressure on ethylene-based polyvinyl chloride (PVC) producers in Asia and give them an edge over their carbide-based competitors, industry sources said on Thursday.

Crackers with capacities totalling more than 10m tonnes/year were expected to come on stream in the Middle East and Asia this year, adding to the 6m tonnes/year capacity in operation since 2009.

Although most of the new capacity would go into the polyethylene (PE) and monoethylene glycol (MEG) markets, industry sources said its impact on the PVC market would still be significant.

⌠The PE and MEG markets will probably need to buy less ethylene (as a result of the new capacities) at a time when some of the new crackers have spare material to sell. Ethylene prices will come under downward pressure, said a Chinese ethylene-based PVC supplier.

About three-quarters of global ethylene output goes to PE and MEG production, while 12% was being consumed for manufacturing PVC, market players said. PVC is a key product used on construction materials like pipes.

Prices of carbide-based PVC grade had softened in recent weeks, dampening buying interest for ethylene-based PVC, traders and producers said.

Offers for April-arrival ethylene-based PVC in the key China market had been met with stiff resistance so far, even though seasonal demand for the product was supposed to have kicked in, they noted.

Carbide-based PVC in east China was at yuan (CNY) 7,250-7,300/tonne ($1,062-1,069/tonne) ex-warehouse (EXWH) on 19 March, lower than ethylene-based PVC prices of CNY7,400-7,600/tonne EXWH, according to global chemical market intelligence service ICIS pricing.

⌠The question producers are asking is how much ethylene prices can come down by. Hopefully it will be enough for us to compete more effectively with carbide-based PVC producers, said a PVC producer.

Ethylene was at $1,170-1,230/tonne (┬865.8-910.2/tonne) CFR (cost and freight) northeast Asia last week, with the spread between naphtha and ethylene prices was at $459/tonne (┬344/tonne), ICIS pricing data showed.

Given that cracker operators could break even on a spread of $250-300/tonne, the new ethylene capacities should narrow the current spread considerably, producers said.

With naphtha prices at $740/tonne (cost and freight) CFR (cost and freight) Japan, a spread of $250-300/tonne would equate to an ethylene price of just over $1,000/tonne CFR NE (northeast) Asia.

The last time this happened, China had welcomed ethylene-based PVC imports as the country's carbide-based PVC producers lost their competitiveness, market players said.

⌠If oil reached $150/bbl and naphtha was over $1,000/tonne CFR Japan, it would still be difficult for ethylene-PVC producers to compete [with] their carbide-based counterparts, said a northeast Asian PVC producer.

But the newly started crackers may not run at high operating rates immediately, industry sources said.

⌠It will be a while before we actually see the impact on PVC prices, a trader said.

China's calcium carbide capacity also remained a factor. Despite the Chinese government's efforts to curb the industry's growth on environmental grounds, the country still has an annual production capacity of 22m tonnes/year with an operating rate of just below 70%, market players said.

Considering current plans to add another 7m tonnes/year of calcium carbide capacity, carbide-based PVC producers in China might still be able to compete effectively on costs, industry sources added.

MRC