China to build crude MDI plant for polyurethanes with BASF, Huntsman

MOSCOW (MRC) -- BASF, Huntsman, Shanghai Hua Yi (Group) Co., Shanghai Chlor-Alkali Chemical Co. and Sinopec held a ceremony Tuesday kicking off the construction of a new 240,000 tpy plant for crude MDI (diphenylmethane diisocyanate) at the Shanghai Chemical Industry Park (SCIP) in Caojing, China, said Hydrocarbonprocessing.

With the new plant, the MDI capacity at this site will be doubled to 480,000 tpy. In addition, the partners plan to build a HCl (hydrogen chloride) recycling plant for the production of chlorine, a precursor for MDI.

The facility is expected to start up 2017. The project is subject to further approval of the Chinese Ministry of Commerce.

MDI is an important precursor in the manufacture of polyurethanes – versatile polymers that are used in industries like construction, automotive, appliance, and footwear. "Asia Pacific remains an important growth and investment region for BASF, with the fast growing Chinese market being a major focus," said Martin Brudermuller vice chairman of BASF's executive board.

"Polyurethanes are among the most versatile materials existing to address sustainability issues across numerous applications such as the automotive or construction industries,' he added. "With the new plant, BASF can participate in this dynamic market."

The new MDI plant is planned to be adjacent to the existing integrated isocyanates complex at the Shanghai park. This will enable the utilization and full access to raw materials and energy.

Shanghai Lianheng Isocyanate Co. has a production capacity of 240,000 tpy of crude MDI and includes manufacturing facilities for the precursors aniline and nitrobenzene built by BASF, Huntsman, Shanghai Hua Yi (Group) Co., Shanghai Chlor-Alkali Chemical Co. and Sinopec. Commercial production started in 2006.

As MRC wrote previously, in early June 2014, BASF successfully closed the previously announced transaction to divest its PolyAd Services business unit to Edgewater Capital Partners, L.P., a private equity firm based in Cleveland, Ohio. PolyAd Services is a stand-alone global business that offers innovative specialty blends and services to solve additive incorporation problems for the plastics compounding and converting industry globally. The business serves a wide spectrum of plastic applications in industries, such as automotive, building and construction, packaging and electronics.
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MOSCOW (MRC) -- Specialty chemical companies Clariant and Ashland have formally sold their joint venture ASK Chemicals, headquartered in Hilden, Germany, to investment funds affiliated with Rhone, a London and New York-based private equity investment firm, said Hydrocarbonprocessing.

The enterprise value of the transaction before debt and assumed liabilities amounts to CHF 310 million (EUR 257 million). After adjustments for debt and assumed liabilities, total pre-tax proceeds to the sellers will be approximately CHF 180 million (EUR 149 million), which includes CHF 155 million (EUR 128 million) in cash and a CHF 25 million (EUR 21 million) buyer note.

Proceeds will be split evenly between Ashland and Clariant under terms of the 50/50 joint venture. "The divestment of our stake in ASK Chemicals is part of our continuous active portfolio management to reallocate capital towards our more profitable growth areas," said Hariolf Kottmann, CEO of Clariant.

With 1,800 employees in 25 countries ASK Chemicals is a leading foundry chemicals manufacturer. Its portfolio encompasses an exceptionally broad and innovative range of foundry resources such as binders, coatings, feeders, filters and release agents, as well as metallurgical products including inoculants, inoculation wires and master alloys for iron casting.

In full-year 2013 ASK Chemicals generated revenues of EUR 513 million.

As MRC reported earlier, this summer, Clariant and Tasnee, one of the largest industrial conglomerates in Saudi Arabia, signed an agreement to establish a masterbatches joint venture in Saudi Arabia. Clariant's Masterbatches business unit is a recognized global leader in color and additive concentrates and performance solutions for plastics.

Clariant Chemicals (India) Limited and custom color and additive products with production of more than 10,000 color matches which are completed each year. With more than 50 manufacturing plants around the world, Clariant
Masterbatches products, technology and service deliver competitive advantages that foster long-term customer relationships.

MRC

MOSCOW (MRC) -- The specialty chemicals company has taken its new plant for polyamide plastics in Antwerp, Belgium, into operation as planned. The world-scale facility for polyamide plastics is designed for an annual capacity of around 90,000 metric tons, said Jeccomposites.

It represents an investment volume of EUR 75 million. The main customer of lightweight plastics is the automotive industry. Following the current starting-up phase, the capacity utilization rate of the plant will be gradually increased in the coming months.

All plastics manufactured by the company at Antwerp will be processed within its global network of compounding facilities into the final Durethan-brand products. In addition, the new plant for the polymerization of high-tech plastics has been built in the direct vicinity of the caprolactam facility operated by the group in Antwerp. Caprolactam is the key intermediate for plastics manufacturing. With the inauguration of the polyamide plant, the company will be able to increase its captive use of caprolactam.

After the polymerization the plastics are reinforced among others with glass fibers to further improve their properties and adapt them to customer needs. The glass fibers required for this purpose are also produced at a Lanxess facility in Antwerp.

The automotive industry is a key customer of Lanxess’ High Performance Materials (HPM) business unit. Innovative materials help to build much lighter plastic parts that can replace metal ones in motor vehicles and thus contribute to reducing fuel consumption and emissions. A lightweight design can reduce weight by 10 to 50 percent, depending on the component. Those plastics are used, for instance, in engine applications, door structures, pedals, front ends and cockpit crossmembers. Furthermore, the materials enable automobile manufacturers and suppliers to achieve considerable savings in production and facilitate the assembly. Another field of application for high-tech plastics is the electrical and electronics industry.

As MRC said before, Lanxess has successfully concluded the pilot phase for a highly efficient production process for butyl rubber. In the past seven years, Lanxess worked on a fundamentally new technology for a more sustainable production. An important step in this process was the testing of the new technology in two pilot plants at its production site in Zwijndrecht/Belgium since spring 2012.

Lanxess is a leading specialty chemicals company with sales of EUR 8.3 billion in 2013 and roughly 17,300 employees in 31 countries. The company is currently represented at 52 production sites worldwide. The core business of Lanxess is the development, manufacturing and marketing of plastics, rubber, intermediates and specialty chemicals.

MRC

MOSCOW (MRC) -- сis to invest more than USD1bn in its refinery in Antwerp, Belgium, in a rare vote of confidence in a beleaguered European industry hit by weak demand and competition from lower-cost US fuels, said the Financial Times.

The US oil major plans to build a new coker to convert heavy oil into diesel and marine fuel, a market it believes will grow in Europe over the coming decades even as demand for petrol declines. Exxon also urged EU governments not to block imports of heavy crude from Canada’s oil sands, which have been a target of environmental campaigners.

Steve Hart, Exxon refining director for Europe, Africa and Asia, said the market was "very challenging" but the group had some of the lowest-cost refineries in Europe and was taking a long-term view of demand. The facilities could still be in use in 30 or 50 years’ time, he said.

Other groups have generally been selling off or shutting their European refineries. The industry has lost 8 per cent of its capacity and 10,000 jobs in the past six years. Murphy Oil of the US stopped taking in any more crude at its refinery at Milford Haven in Wales in April. It has been in talks about a possible sale to the Klesch Group, the industrial commodities business led by Gary Klesch.

US refineries have been given two advantages by the shale boom: they use domestic crude, which is priced at a discount to Brent because US production is rising fast and exports are generally prohibited; and they have access to cheaper natural gas.

Energy accounts for about 60% of the costs of a refinery in Europe, but only 30 per cent in the US, Exxon estimates. US exports of distillate fuel oil have risen from about 3m barrels per month in 2004 to 35m barrels in April of this year. The Netherlands and France are two of the largest markets.

European refineries have come under pressure from capacity coming on stream in the Middle East. Mr Hart said the facility at Antwerp would strengthen the competitive position of Exxon’s other refineries in the UK, France and the Netherlands. It will take heavy residue from other refining processes and convert it into usable fuel.
Mr Hart said it was important that the EU did not close off sources of energy, including Canadian heavy oil.

As MRC wrote before, ExxonMobil is in talks with state-run Turkish Petroleum Corporation over a venture to explore for shale gas in the country's southeast and northwest regions. Exxon held talks with TPAO in 2012 to over a partnership in shale, but the negotiations were inconclusive. Turkish officials say talks have since advanced and are likely to result in an agreement.
MRC

Moscow (MRC) - Imports of polyvinyl chloride (PVC) in Belarus decreased by 27% in the first four months of this year. The main reason for the decline in demand was weak demand for finished products, according to MRC DataScope.

April PVC imports in the country seasonally increased to 4,000 tonnes. Total imports of virgin PVC in Belarus decreased to 10,200 tonnes in January - April of this year, compared with 14,000 tonnes year on year.

The main reason for the decline in demand for PVC was the reduction in demand for finished products, in particular window profiles both in the domestic and export markets.

German producers took the biggest share in the PVC imports to the country over the reported period. Imports of German PVC in Belarus were about 5,200 tonnes in the first five months of the year. The second largest supplier was the Polish producer Anwil, with 3,600 tonnes imported over the reported period. The share of Russian resin imports to the Belarusian market did not exceed 10% from the total shipments over the reported period.
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