Chandra Asri and Ferrostaal ink deal for polypropylene and ethylene plant

MOSCOW (MRC) -- German petrochemical company Ferrostaal Industrial Projects GmbH and Jakarta-listed PT Chandra Asri Petrochemical, the country’s largest petrochemical producer, have agreed to work on studies for the development of a petrochemical plant, according to Plastemart.

Under an agreement, Ferrostaal and Chandra Asri will develop a methanol-based olefin production complex in Teluk Bintuni in West Papua, with a total investment amounting to USD1.89 billion.

The complex is expected to produce up to 400,000 tonnes of polypropylene and 175,000 tonnes of ethylene annually.

However, the project is dependent on feasibility studies as well as gas allocation and prices from the Energy and Mineral Resources Ministry. Ferrostaal and Chandra Asri will cooperate with the Industry Ministry on the feasibility studies.

Gas supply for the complex is expected to be provided by the Tangguh liquefied natural gas (LNG) plant also in West Papua.

Both Ferrostaal and Chandra Asri have not determined the allocation of their relative share-holdings in the putative joint venture that would work on the planned project. The production complex is expected to be ready for operation by 2019.

We remind that, as MRC wrote previously, state energy firm Pertamina is abandoning a deal with Chandra Asri Petrochemical to establish a joint venture to build a petrochemical plant. In December 2012, Pertamina and Chandra Asri signed a memorandum of understanding to perform a feasibility study for building a petrochemical facility. The agreement was predicated on the establishment of a joint venture.
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MOSCOW (MRC) - British police are investigating a money-laundering allegation related to a big oil field bought by Shell and ENI from Nigeria for USD1.3 billion (846.46 million pounds), after most of the cash they paid ended up in a company linked to a former Nigerian oil minister, said Reuters.

The probe concerns offshore block OPL 245, which industry sources say contains up to 9.23 billion barrels of crude – more than enough to keep China running for two and a half years – the ownership of which had been in dispute for more than a decade.

"The proceeds of crime unit is investigating a money-laundering allegation in the UK in connection with OPL 245. The investigation is at an early stage," a UK spokesman said.

Transparency campaigners, who asked the UK to look into the matter, assert that Shell and ENI used the Nigerian government as a go-between to obscure the fact that they were dealing with former oil minister Dan Etete, who also has a 2007 money-laundering conviction in France related to bribes he was alleged to have taken when in government.

In his capacity as oil minister, Etete awarded block OPL 245 in 1998 for a payment of just $2 million to Malabu Oil and Gas, a company in which he played a prominent role.

The critics claim that Shell and ENI, which haven't been accused of any legal wrongdoing, wanted to distance themselves from Etete given his reputation and his involvement in the original award of the oil block to Malabu.

A Shell spokesman told Reuters it had purchased the block from the government, making no payment to Malabu, and that it acted transparently and in accordance with Nigerian law.

As MRC wrote before, Shell Oil has agreed to spend at least USD115 million to cut harmful pollution at a Houston-area refinery. The oil giant will also pay a USD2.6 million civil penalty under the settlement announced Wednesday. Shell settled with the US Environmental Protection Agency and the Department of Justice after it was accused of violating the federal Clean Air Act.

Eni S.p.A. is an Italian multinational oil and gas company, present in 79 countries, and currently Italy's largest industrial company with a market capitalization of 87,7 billion euros (USD138 billion), as of July 24, 2008.The Italian government owns a 30.3% golden share in the company, 3.93% held through the state Treasury and 26.37% held through the Cassa depositi e prestiti. Another 2.29% of the shares are held by BNP Paribas group.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.
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MOSCOW (MRC) -- Several companies have been researching ways to reduce the chemical industry’s dependence on fossil raw materials. The main goal is to find renewable-based or "green" chemicals products equivalents. A patent recently issued by BP Chemicals discloses a process to produce green ethylene from biomass ethanol dehydration, said Plastemart.

The patent proposes a process in which ethanol is dehydrated in a fixed bed reactor under mild conditions. According to BP Chemicals, milder reaction conditions lead to improved ethylene selectivity and yield, since moderate reaction temperatures reduce the formation of undesirable by-products, such as alkanes.

Therefore, the use of some expensive cryogenic separation equipment could be limited, reducing associated capital requirements and operating costs. In its most recent publication, Intratec Solutions LLC evaluates the technical aspects and economic performance of this process based on capital and operating expenses estimates for a 190 kta plant utilizing the process patented by BP. The study, "Green Ethylene from Ethanol," notes that the construction of such a plant demands investments of about USD230 million. In one of the process scenarios evaluated by Intratec, it was confirmed that the formation of by-products would require additional purification equipment, increasing the necessary investment by approximately USD20 million. A sensitivity analysis also evaluated the impact of the reaction conversion on both capital and operating costs.

In addition, an analysis of the plant operating costs showed that, at the current process development stage and under the pricing conditions of Q3 2012, green ethylene does not compete with petrochemical ethylene on pricing; however, there are niche consumer markets eager for the benefits of an environmentally friendly product and willing to pay more for them.

As MRC wrote before, BP along with its joint venture (JV) partners AB Sugar and DuPont, has officially opened the GBR350m Vivergo bio-ethanol plant in Hull City, UK. The Vivergo plant is a brownfield re-development project, which has been developed on a 25 acre site within the Saltend Chemicals Park near Hull.

BP is one of the world's leading international oil and gas companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemicals products for everyday items.
MRC

MOSCOW (MRC) -- Zhejiang Hengyi will be building an aromatics plant in the southeast Asian nation of Brunei. This will be the country's first aromatics plant, reported Apic-online.

A Polymerupdate source in China informed that the plant is scheduled for completion in 2016.

To be located in Pukau Muara Besar, Brunei, the aromatics plant will have a paraxylene (PX) production capacity of 1.5 million mt/year and benzene production capacity of 500,000 mt/year.

As MRC informed earlier, in April 2012, Zhejiang Hengyi signed a land lease agreement with the Brunei Economic Development Board (BEDB) for its Integrated Refinery and Aromatics Cracker Project in Brunei Darussalam. The China Zhejiang Hengyi (Brunei) PMB Petrochemical Project at Pulau Muara Besar (PMB), Indonesia, is the largest investment project for a privately-owned Chinese company overseas.

Zhejiang Hengyi Group Co., Ltd. is a large private corporate group that has a highly integrated industry chain, with the production of purified terephthalic acid (PTA, a commodity chemical used to make polyester), polyester spinning and chemical fiber as its main businesses.
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MOSCOW (MRC) -- Dow Chemical Co. said its second-quarter net income more than tripled, boosted by a USD2.16 billion payment related to a scrapped joint venture, and its adjusted results beat Wall Street predictions, said Cityherald.

The Midland, Mich.-based chemical company earned USD2.34 billion, or USD1.87 per share, for the three months ended June 30. That was up from USD649 million, or 55 cents per share, in the same quarter of 2012. Excluding the payment from Petrochemical Industries Company of Kuwait and other one-time items, Dow posted an adjusted profit of 64 cents per share.

Revenue was essentially flat at USD14.58 billion, compared with USD14.51 billion a year ago.

Analysts, on average, expected adjusted profit of 62 cents per share, on USD14.46 billion in revenue, according to FactSet.

Sales at the company's agricultural sciences business increased 10%, but were offset by declines at the company's feedstocks and energy and performance plastics businesses.

Overall sales volume increased 2%, with Latin American sales volume jumping 12 percent and Asia Pacific volume rising 7%. Overall pricing fell 2%.

As MRC wrote before, Dow Chemical signed a long-term ethylene off-take agreement with a new Japanese joint venture that will allow the chemical producer to enhance its performance plastics franchise. The joint venture is being formed between Japanese companies Idemitsu Kosan and Mitsui & Co. to construct and operate a Linear Alpha Olefins unit on the U.S. Gulf Coast.

The Dow Chemical Company is an American multinational chemical corporation headquartered in Midland, Michigan, United States. Dow is a large producer of plastics, including polystyrene (PS), polyurethane, polyethylene (PE), polypropylene (PP), and synthetic rubber. In 2012, Dow had annual sales of approximately USD57 billion. The Company's more than 5,000 products are manufactured at 188 sites in 36 countries across the globe.
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