Total taps Chinese banks to fund Russian project

MOSCOW (MRC) -- Total, Europe’s third-largest oil company, is pushing ahead with a USD27 billion natural-gas project in the Russian Arctic, but it will seek a big chunk of the financing - as much as USD15 billion worth - through Chinese banks in local currency and euros, reported MarketWatch.

The decision comes amid worry that Western sanctions against Russia could complicate the sort of dollar-based fundraising that is more typical for big energy projects.

Total’s Arctic project - years in the planning - doesn’t run afoul of sanctions itself. But one of Total’s partners in the Yamal liquid natural gas venture is Russian energy firm OAO Novatek, in which Total has a minority stake. Another big Novatek shareholder is Gennady Timchenko, who has been specifically targeted by U.S. sanctions.

The U.S. and Europe have slapped a series of economic sanctions on Moscow in recent months amid a standoff over Ukraine and Crimea. Under the sanctions regime, rules limit the transfer to Russian firms of technology related to some unconventional drilling techniques, including shale-oil recovery methods and some Arctic and offshore oil projects. But Yamal, a natural-gas project, isn’t specifically affected.

Total has previously signaled its plans to meet some of the big costs of the project through fundraising from Chinese banks. But the size of the funding goal disclosed by Chief Executive Patrick Pouyanne in an interview could make the Yamal project the largest reported private corporate deal involving Chinese banks. The biggest deal of that nature so far is a $12 billion syndicated loan to Daimler AG DAI, -2.86% DDAIY, +0.01% in 2013, in which two of the 34 banks were Chinese.

As MRC informed before, Total is in plans to permanently shut its high density polyethylene (HDPE) line. A Polymerupdate source in Belgium informed that the line is planned to be shut by this year-end. The plant will be shut permanently owing to weak margins which have arisen on account of cheap imports in the region. Located at Antwerp in Belgium, the line has a production capacity of 70,000 mt/year.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
MRC

MOSCOW (MRC) -- The overall imports of high density polyethylene (HDPE) to Ukraine fell over the first two months of 2015 by 38% year on year and totalled 12,100 tonnes, according to DataScope report.

February HDPE imports into Ukraine increased after the January fall and totalled 6,700 tonnes (5,300 tonnes in January). The overall HDPE imports decreased to 12,100 tonnes in January and February 2015 versus 19,300 tonnes a year earlier. Pipe grade polyethylene (PE) accounted for the greatest drop in demand.

The supply structure by HDPE processing technologies looks the following way over the stated period.

February imports of film grade HDPE to the Ukrainian market grew to 4,100 tonnes from 2,700 tonnes a month earlier because of the increased supplies from Russia. The overall imports of film grade PE decreased over the first two months of 2015 to 6,700 tonnes, down by 31% year on year.

February imports of pipe grade HDPE were about 600 tonnes, whereas in January this figure barely exceeded 500 tonnes. Imports of this PE grade to the Ukrainian market slumped by 71% over the said period to 1,100 tonnes.

Last month's imports of blow moulding HDPE to Ukraine rose up to 1,300 tonnes from 908 tonnes in January 2014 because of the resumption of shipments from Russia. Demand for this PE grade from local converters declined by a quarter in January and February 2015 and totalled 2,200 tonnes.

February imports of injection moulding HDPE fell to 510 tonnes versus 1,300 tonnes a month earlier, due to the suspension of purchasing from local producers of caps for PET packaging. Imports of injection moulding HDPE to Ukraine totalled around 1,800 tonnes over the stated period, down by 33% year on year.

MRC

MOSCOW (MRC) -- For automotive exterior applications with wide flow paths and exceptionally challenging weathering requirements, thermoplastics elastomer manufacturer Kraiburg TPE (Waldkraiburg/Germany) has developed a new class of compounds within the Thermolast K family: High-flow compounds, as per GV.

Kraiburg TPE carried out flow length tests using a spiral flow test and obtained a flow path up to 30 % longer in comparison to standard materials. For window overmoulding in particular, the internal mould pressure is almost halved.

This allows, together with the lower melt temperature, a 20 % shorter cycle time. The level of force applied in the filling process has been reduced, which allows even thinner panes of glass or laminated panes to be overmoulded. This also significantly reduces the risk of the glass breaking. Even applications with extremely long flow paths such as the encapsulation of a rear window or a roof module can now be realised with a TPS.

As other Thermolast K materials the high flow grades withstand Florida and Kalahari tests, which simulate two- to three-year cycles, without any problems.

As MRC reported earlier, in 2012, Kraiburg TPE launched two new TPE product ranges in Europe. The "Copec" and "For-Tec E" ranges had already been successfully launched in the USA, and the company hoped to replicate that success in Europe. The products, which were designed for use in consumer sectors, have superior haptic and adhesion properties and are resistant to influences such as sweat, alcohol and weather.
MRC

MOSCOW (MRC) -- SKC Corp is in plans to shut a propylene glycol (PG) plant for maintenance turnaround, according to Apic-online.

A Polymerupdate source in South Korea informed that the plant is planned to be shut on April 1, 2015. It is likely to remain off-stream till the last week of April.

Located in Ulsan, South Korea, the plant has a production capacity of 110,000 mt/year.

As MRC informed earlier, Honeywell's UOP announced in late December 2014 that China had commissioned the first of 14 planned propylene production units, using technology from UOP to help close the global propylene supply and demand gap.

China’s Zhejiang Satellite Petrochemical Co. became the first Chinese producer to start production of propylene using UOP C3 Oleflex process technology, which efficiently produces propylene from propane.

Zhejiang Satellite Petrochemical is currently producing high-quality, on-spec product for acrylic acid and derivative production, according to UOP officials.

Traditionally, propylene is a byproduct of making ethylene. However, a shift in how ethylene is produced globally has meant less propylene byproduct is being produced, sparking investment in technology to create propylene from propane.

Since 2011, UOP has licensed the C3 Oleflex process to more than a dozen producers to meet rising demand, with a majority of licensed capacity in China.
MRC

MOSCOW (MRC) -- Saudi Arabia’s Advanced Petrochemical said on Monday it had restarted production at its propylene and polypropylene (PP) plants after scheduled maintenance, reported GulfBusiness.

Full operational capacity at the two plants would be achieved in 8-10 days, it said in a bourse filing.

No details of the financial impact of the maintenance was given.

The plants, in Jubail on the Gulf coast of Saudi Arabia, went off line on March 1, according to an earlier statement from the company.

As MRC wrote before, Advanced Petrochemical Co. plans to invest in a project worth around USD1 billion to produce propylene in South Korea. The propane dehydrogenation (PDH) project, a joint venture with South Korea’s SK Gas, is due to start up in H1-2016. The project, with annual production capacity of 600,000 tons, will be financed 40% equity and 60% debt. Advanced will hold a 35% stake in the project.

Advanced Petrochemical Company (before Advanced Polypropylene) is a Saudi Joint Stock Company, established in October 2005. The company was initially launched by National Polypropylene Limited, jointly owned by Mr. Khalifa Al Mulhim, the chief executive officer of Advanced, and Mr. Monther Laheeq, who negotiated all the main deals related to the project, either before or after the establishment of Advanced Petrochemical. Currently, National Polypropylene Limited controls 7.9% of Advanced Petrochemical. Advanced Petrochemical started the construction of its plants in May 2005. The company produces 455,000 tons per year of propylene and 450,000 tons per year of polypropylene from its production facility located in Jubail Industrial City, in the Eastern coast of the Kingdom of Saudi Arabia.
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