Borealis to invest heavily into European plants

MOSCOW (MRC) -- A leading European polyethylene and polypropylene producer Borealis has announced two major investment projects in its European manufacturing plants in Stenungsund, Sweden and Porvoo, Finland, according to the company's press relese.

The investments, with a combined expenditure in excess of EUR 45 million, will strengthen Borealis’ regional supply and support capabilities, in line with its Value Creation through Innovation strategy.

The first investment concerns a C4 project in Stenungsund which will upgrade the facility’s existing raffinate-1 and raffinate-2 streams to meet required product specifications for the delivery of n-butenes. The EUR 21 million investment is scheduled for completion by March 1, 2015, and is part of a broader commitment to support customers’ raw material demand for expanding production of olefin-based products. The project contracting process commenced in December 2012.

In Porvoo, plans have been approved for the replacement of a 30 year old hot oil heater unit at the Phenol complex. The installation of the new heater, scheduled for 2015 at a cost of EUR 25 million, is a key element in improving efficiency and site integration. The new unit will reduce maintenance requirements and CO2 emissions whilst securing safe, continuous, reliable and cost-competitive operations.

"These investments indicate our on-going commitment to support our customers despite the present difficult market environment in Europe," comments Mark Garrett, Borealis Chief Executive.

We remind that, as MRC informed earlier, Borealis is increasing the capacity of its cracker in Stenungsund, Sweden, after shutting production during the Christmas holidays. The production of low-density polyethylene (LDPE) with the capacity of 350,000 tpa had to be resumed in mid-January.

Borealis is an international company in producing polyethylene (PE) and polypropylene (PP) solutions for the infrastructure, automotive and advanced packaging market sectors. Its plastics are converted by customers into products such as food packaging, medical devices, diapers, energy and communication cables, water and sanitation distribution pipes and automotive parts.a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. Borealis provides services and products to customers around the world in collaboration with Borouge, a joint venture with the Abu Dhabi National Oil Company (ADNOC).

Building on the unique Borstar and Borlink technologies and 50 years of experience in polyolefins, Borealis and Borouge support key industries including infrastructure, automotive and advanced packaging. The Borouge plant expansion in Abu Dhabi will be fully operational by mid-2014 with a total annual capacity of 4.5 million tonnes. After this Borealis and Borouge will have approximately 8 million tonnes of polyolefin capacity.
MRC

MOSCOW (MRC) -- The second half of 2012 saw significant deterioration in the markets, particularly in China, which made Dow took aggressive action to mitigate the effects of a slow-to-no-growth global environment - by deploying cost and cash flow levers and by continuing to prudently manage the company's portfolio and prioritize growth investments, stated Andrew N. Liveris, Dow’s chairman and chief executive officer in the company's press release.

Sales for the forth quarter made USD13.9 billion, down 1% versus the year-ago period.

Equity earnings were USD44 million, or USD206 million excluding the impact of certain items. This compares with USD259 million in the year-ago period. Dow Corning represented the largest driver of the decline.

The company's EBITDA made UDS125 million, or USD1.6 billion on an adjusted basis. Agricultural Sciences achieved a new fourth quarter EBITDA record.

The Company leveraged the benefit of positive U.S. shale gas dynamics, driving a 430 basis point increase in Performance Plastics adjusted EBITDA margin year over year. To further leverage this advantage, Dow also achieved the first major milestone in its U.S. Gulf Coast integration investments, as its previously idled St. Charles Operations ethylene cracker restarted in December, in line with Dow’s year-end target.

Cash flow from operations was USD1.6 billion for the quarter, bringing full-year cash flow from operations to USD4.1 billion.

Dow reported full-year 2012 sales to amount to USD56.8 billion, down 5%, or 3% on an adjusted basis. The company's sales decreased in all operating segments excluding Agricultural Sciences (up 13%) and in all geographic areas year over year, led by Western Europe.

Equity earnings were USD536 million, or USD698 million excluding certain items.

For the full year, Dow reported EBITDA of USD5.6 billion, or USD7.5 billion on an adjusted basis.

Dow maintained its focus on lowering debt, reporting a USD613 million reduction in gross debt in 2012. In addition, year-over-year interest expense declined USD72 million.

The Dow Chemical Company is an American multinational chemical corporation. Dow Chemical is a provider of plastics, chemicals, and agricultural products. It is a large producer of plastics, including polystyrene (PS), polyurethane, polyethylene (PE), polypropylene (PP), and synthetic rubber.
MRC

MOSCOW (MRC) -- The Kingdom holds approximately one-fifth of the world’s proven oil reserves, which is considered to be the world’s largest reserve base, said Albawaba.

Saudi Arabia is producing more than two-third of the total GCC petrochemical capacity, the Gulf Petrochemicals and Chemicals Association (GPCA) reported recently.

Strong infrastructure, substantial reserves of cheaply extractable feedstock and supportive government policies help domestic producers to enjoy competitive advantage globally.

Despite challenging market conditions, the Saudi petrochemicals sector is continuing to show strong growth.

At the end of 2012, the sector accounted for more than 31.4% of the total market capitalization on the Saudi Stock Exchange, reaching at the level of SR 440 billion roughly.

SABIC (Saudi Basic Industries Corp.) is the flagship company among 14 listed companies, representing 61.2 of the total value of petrochemical sector.

SABIC is also the biggest petrochemicals company in the GCC region, reflecting 19.2 % of the total market capitalization on the Saudi stock exchange.

As MRC wrote earlier, Saudi Basic Industries Corp. (SABIC) may report a 14 % decline in annual profit, highlighting the petrochemical maker’s struggle with slowing economies in Europe and a resurgent U.S. chemical industry.

During 2012, Saudi Kayan commenced and expanded operational capacity of many commercial operations including olefins, ethylene glycol, polypropylene, high density polyethylene and Amines etc.

The company remained at top in terms of percentage growth. It’s revenue increased by 295 % to record SR9.5 billion.

Core operating profitability of petrochemical sector declined significantly, mainly due to decrease in overall product prices.

Total operating income for FY 2012 reported SR 53 billion compared with SR 64.25 billion for FY 2011, a decrease of 17.52 %.

Three out of 14 companies including , National Petrochemical (Petrochem), Sahara Petrochemical Company and Saudi Kayan showed operating losses during 2012.

On the positive side, Petrorabigh operating income increased exceptionally by 536 %, it achieved SR 654 million during FY2012 compared with SR103 million of FY2011.

Alujain Corporation’s operating income also increased by 127 % during 2012.

The petrochemical sector managed to earn an adequate margin of 10.9 %, generating SR 33.85 billion as net Income during fiscal year 2012. SABIC dominated the profitability, contributing SR24.7 or 73 percent of the consolidated value.
MRC

MOSCOW (MRC) -- The Gulf Petrochemicals and Chemicals Association (GPCA) is launching a regional initiative to promote a better understanding of the value of plastics, and encourage more responsible attitudes toward litter disposal, said Ameinfo.

Employees of the association's member companies and the public will be rolling up their sleeves on February 27 in Dubai at DP World's Al-Hamriya Port, for 'Clean Up The Gulf', a new annual campaign which the GPCA hopes will soon become the largest environmental awareness initiative of its type in the Gulf.

"Plastics are part of everyday life and its role will only increase as more and more products we take for granted incorporate plastic materials," said Dr. Abdulwahab Al-Sadoun, Secretary General of the GPCA. "But irresponsible littering behaviour combined with limited infrastructure for recycling in the region and complacency about proper waste disposal are tarnishing the image of a product, which is both economically valuable and eminently sustainable."

Employees from SABIC, Borouge, PetroRabigh, EQUATE, Sahara, Tagleef and other GPCA member companies have already pledged their support.

The GPCA estimates that less than 10% of plastic is recycled in the Gulf. Out of the 80 million tonnes of waste generated in the GCC each year, 33% constitutes the municipal solid waste. The percentage of plastic waste is noted to be 26 million tonnes per year, that is the result of high consumption of consumer products.

Meanwhile, the credentials of plastic as a sustainable product are widely misunderstood. Plastic bags, for example, require less energy and water to make than paper bags, create less solid waste, and generate fewer carbon emissions.

"Plastic is derived from oil and gas, the lifeblood of the Gulf economy, so it is imperative that Gulf countries lead by example on the recycling and safe disposal of plastic goods," said Dr. Al-Sadoun.

"Local communities also need to do more to prevent such a valuable product blighting the natural environment. The Clean Up The Gulf campaign is the investment of the regional petrochemicals industries, in the responsible management of a vital industry for the world and Gulf economy."

As MRC wrote earlier, per capita consumption of plastics in the Gulf has crossed 39 kilogrammes, 33 % higher than the world average and almost 8 times more than India. GCC accounts for 34 % of global demand for pipes as new GCC pipeline networks will need over 5.3 million tonnes of steel pipes in five years, it says, which is equivalent to USD7.2 billion (Dh26.48 billion) in spending.


MRC

VOSCOW (MRC) -- Mitsui Chemicals had decided to withdraw from the business operations of Keiyo Ethylene Co. (KEC), a joint venture with Maruzen Petrochemical Co. and Sumitomo Chemical Co, said Apic-online.

KEC, in which Mitsui holds a 22.5% interest, began operations in 1995 as part of an effort to reinforce domestic olefin supply infrastructures. However, Mitsui explained, recent changes in the global ethylene market have resulted in "an urgent need to fundamentally restructure and reform domestic petrochemical business" for sustainability.

Mitsui said it has been conducting studies of its operations, including continued participation in KEC with Maruzen and Sumitomo, and their possible participation in the Ichihara, Japan, ethylene complex of Chiba Chemicals Manufacturing LLP, a venture of Mitsui and Idemitsu Kosan Co. Based on these studies, Mitsui, Maruzen and Sumitomo agreed that Mitsui will withdraw from KEC by the end of fiscal 2014.

As MRC wrote earlier, Mitsui Chemicals is going restructure its ethylene and polyolefins operations in Chiba in response to weak domestic demand and increased competition from the Middle East and China. The restructuring, which is expected to take place next year, includes reducing ethylene output from the two crackers at the site and closing of an HDPE plant.

Mitsui said it will further strengthen participation in Chiba Chemicals Manufacturing as one of many efforts to restructure its petrochemical business.

Mitsui Chemicals is a leading manufacturer and supplier of value added specialty chemicals, plastics and materials for the automotive, healthcare, packaging, agricultural, building, and semiconductor and electronics markets. Mitsui Chemicals is a Japanese Chemicals company, a part of the Mitsui conglomerate. The company has a turnover of around 15 billion USD and has business interests in Japan, Europe, China, Southeast Asia and the USA. The company mainly deals in performance materials, petro and basic chemicals and functional polymeric materials.

MRC