Unipetrol extends the contract for REBCO oil supplies

MOSCOW (MRC) -- Unipetrol RPA has signed an amendment to the contract with PKN ORLEN the subject of which is the supply of Russian Export Blend (REBCO) to the Czech Republic from Tatneft. Unipetrol RPA has now secured REBCO crude oil supplies from Rosneft and Tatneft until 2019, said the producer on its site.

"By signing the contract amendment with PKN ORLEN we extended the validity of the existing contract until the end of 2019. Together with the contract for the REBCO crude oil supply from Rosneft, we have now secured up to 100 % of the required volume of REBCO oil," says Andrzej Modrzejewski, Unipetrol CEO and Chairman of the Board.

On the basis of the signed amendment, the Tatneft Oil Company will deliver a total of min. 1.620 to max. 3.960 million tons of crude oil to Unipetrol RPA in the period from January 1, 2017 to December 31, 2019, depending on Unipetrol RPA’s offtake possibilities. Agreed REBCO crude oil volumes will be supplied to the Czech Republic through the Druzhba pipeline.

Unipetrol has now signed two long-term contracts for REBCO crude oil supply. Beyond the scope of the contract signed today, Unipetrol RPA signed another contract with PKN ORLEN regarding REBCO crude oil supplies from Rosneft in June this year. Unipetrol is using the advantages of joint crude oil purchase within the ORLEN Group. PKN ORLEN purchases roughly 30 million tons of crude oil per year, exercising therefore a significant purchasing power.

Russian Export Blend (REBCO) crude oil is processed in the Litvinov refinery. The capacity of the refinery is 5.4 million tons of crude oil per year.

As MRC informed before, in late August 2016, repair works on Unipetrol's steam cracker in Chempark Zaluzi, which was out of the operation since last year’s extraordinary event on August 13, were completed. Finals tests before gradual start of production were undetarken afterwards. Standard production of the steam cracker began in mid-October.

Unipetrol , a.s. is a group of companies operating in the petrochemical industry in the Czech Republic. In 2005 Unipetrol became a part of the PKN ORLEN Group, the largest oil processor in Central Europe. The UNIPETROL Group is oriented mostly towards oil processing, fuel distribution and petrochemical production. In all of these business areas the Unipetrol Group is among the key players both in the Czech Republic and on the Central European market. In the Czech Republic, the group is one of the most important companies with regards to turnover and employs almost 4,500 people.
MRC

MOSCOW (MRC) -- Rosneft and the China National Petrochemical Company (ChemChina) signed a Heads of Agreement on establishing a Joint Venture, said the company on its site.

The document was signed by Rosneft Chief Executive Officer Igor Sechin, and General Manager of ChemChina Yang Xingqiang.

According to the terms of the document, the parties will establish a joint venture in the Bolshoy Kamen priority development territory in Primorsky Krai, Russia, to build a plant and a polymer coatings and paints facility with an annual capacity of 50 thousand tons, as well as implement R&D activities. In that regard, Rosneft and ChemChina will conduct a feasibility study of the project and carry out the necessary preparations to set up a joint venture. As a result of the project implementation, the largest facility to produce special marine and arctic vessel coatings, a leader in this segment, will be established in Russia.

The plant’s production will find its application at the Zvezda shipbuilding complex in the Russian Far East, being constructed under the order of the President of Russia Vladimir Putin. In particular, Rosneft and ChemChina will establish a working group to develop new polymer coatings for ships of various classes, including Arctic class vessels.

As it was informed earlier, in September 2016, Rosneft and ChemChina signed a Heads of Agreement on cooperation in equity investment in ChemChina Petrochemical Corporation (CCPC) and a Memorandum of Understanding for cooperation on the project of the Far-East Petrochemical Company (FEPCO).

ChemChina is one of the largest chemical companies in the world. The company's business is focused on the production of new and special chemical materials, basic chemicals, oil refining, agricultural chemistry, rubber products, and chemical equipment.

ChemChina Petrochemical Co. Ltd is a subsidiary of ChemChina, and engaged in the production of petrochemical products; the installed capacity of hydroskimming is 25 million tons of crude oil per year.

Rosneft became Russia's largest publicly traded oil company in March 2013 after the USD55 billion takeover of TNK-BP, which was Russia’s third-largest oil producer at the time.
MRC

November production of unmixed PVC in Russia rose to 74,200 tonnes from 62,000 tonnes a month earlier, with RusVinyl and Bashkir Soda Company, which shut down their production capacities for a scheduled turnaround in October, accounting for a major increase in production. Overall PVC production exceeded 701,200 tonnes in January-November 2016, compared to 711,600 tonnes a year earlier. RusVinyl raised its output by 30%, Bashkir Soda Company - by 3%, whereas SayanskKhimplast and Kaustik Volgograd reduced their production of resin.

The structure of PVC production by plants looked the following way over the stated period.

RusVinyl (joint venture of SIBUR and SolVin) produced about 29,500 tonnes of PVC in November, 2,200 tonnes of which accounted for emulsion polyvinyl chloride (EPVC), compared to 20,900 tonnes a month earlier. As reported previously, RusVinyl shut down its production capacities for a scheduled maintenance in the second half of September - early October. RusVinyl's total PVC production exceeded 275,000 tonnes in the first eleven months of 2016, whereas this figure was 210,9000 tonnes a year earlier.

Bashkir Soda Company produced over 21,600 tonnes of suspension polyvinyl chloride (SPVC) last month, whereas this figure was slightly more than 13,700 tonnes in October (the plant was shut for a short turnaround in October). The Bashkir plant's overall output of resin exceeded 226,000 tonnes in January-November 2016, up by 3% year on year.

Kaustik (Volgograd) showed a slight decrease in its output in November, last month's total SPVC production was 7,600 tonnes, compared to 8,000 tonnes a month earlier. The plant's overall production of resin reached 80,400 tonnes in the first eleven months of 2016, down by 8% year on year. Lower output was largely caused by a long turnaround in May-June.

SayanskKhimPlast reduced its capacity utilisation last month, the plant's SPVC production reached 15,600 tonnes, whereas this figure was 19,400 tonnes in October. The Sayansk plant managed to produce only 119,800 tonnes of resin in the fist eleven months of 2016, compared to 193,2000 tonnes a year earlier. The major reduction in production was due to a forced long shutdown in February-July because of an emergency outage at the ethylene unit of Angarsk Polymer Plant, the only ethylene supplier.

MRC

MOSCOW (MRC) - Total imports of high density polyethylene (HDPE) into Russia decreased to about 137,500 tonnes in the first eleven months of 2016, down 22% compared to the same period of 2015. Reduction of imports was seen in all segments of consumption, the exception was the film and blow moulding polyethylene, according to MRC DataScope.

November imports of HDPE into Russia reduced to 11,700 tonnes, compared with 12,800 tonnes a month earlier, the main decline in purchases accounted for extrusion blow moulding PE, production of films and injection moulding sector. Total HDPE imports into Russia decreased to 137,500 tonnes in the first eleven months of the year, compared with 177,000 tonnes in the same time a year earlier. The greatest reduction in external supplies recorded in the segment of pipe extrusion, and extrusion coating of steel pipes of large diameter, while import of film and blow moulding HDPE, on the contrary, has grown.

Structure of HDPE supply over the reported period looked as follows.

November imports of injection moulding PE fell to 2,600 tonnes from 3,500 tonnes a month earlier, the main decrease in imports accounted for South Korean and Uzbek PE. Total imports of injection moulding HDPE in to the country were about 33,800 tonnes in the first eleven months of the year, compared with 42,700 tonnes a year on year.

November imports of HDPE for extrusion blowmoulding into the country reduced practically three times against October to about 900 tonnes.
Total imports of HDPE for extrusion blow moulding into the country increased to 26,500 tonnes in January - November 2016, compared to 23,700 tonnes year on year, with main increase accounted for Uzbek PE.

November imports of film HDPE dropped to 1,900 tonnes from 2,900 tonnes in the previous month. Total imports of film HDPE into the country increased to 24,000 tonnes in January-November 2016, compared to 17,000 tonnes a year earlier.

The last month's production of pipe HDPE remained practically at the level of October and was about 1,600 tonnes. Russia's pipe HDPE imports in the first eleven months of the year decreased to 20,500 tonnes, down 47% year on year. The main reasons for the fall in import volumes were increased domestic production and reduced the demand for pipes.

November imports of HDPE for extrusion coating of steel pipes of large diameter increased to 3,900 tonnes, whereas the previous month this figure has not exceeded 1,600 tonnes. Imports of this type of polyethylene fell by 49% to 21,900 tonnes in the first eleven months of this year, partly because of the growth of local production.

Russia's imports of HDPE in other consumption sectors decreased to 10,700 tonnes in the first eleven months of the year compared with 10,700 tonnes year on year.


MRC

MOSCOW (MRC) -- BASF has completed its acquisition of Albemarle’s global surface treatment business, Chemetall. Through this acquisition, BASF’s Coatings division expands its portfolio to become a more complete solutions provider, as per the company's press release.

BASF combines its knowledge in chemistry and coatings applications with Chemetall’s expertise in surface treatment. The combined businesses will benefit from each other’s global infrastructure, scale and market access, driving new growth opportunities by offering an unmatched solutions competence to customers.

"We are extending a warm welcome to our new colleagues. The acquisition of Chemetall allows us to significantly expand our market. By combining the expertise and innovation power of two global market leaders, we will accelerate innovation and make our customers even more successful," said Markus Kamieth, President of BASF’s Coatings division.

Chemetall develops and manufactures customized technology and system solutions for surface treatment. Their products protect metals from corrosion, facilitate forming and machining, allow parts to be optimally prepared for the painting process and ensure proper coating adhesion. These chemicals are used in a wide range of industries and end-markets, such as automotive, aerospace, aluminum finishing, and metal forming. Chemetall’s sales for the full calendar year of 2015 were USD845 million.

As MRC wrote previously, BASF will strengthen its local production capability for waterborne and solventborne coatings in Thailand by building a new manufacturing facility at its Bangpoo site. The new production facility complements the facilities at the new Coatings Technical Competence Center ASEAN, which was opened in September 2015 and includes a laboratory for product development, performance testing, color design, as well as a small batch production unit. The expansion will better serve the strong demand from the expanding automotive industry in ASEAN.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries. BASF generated sales of more than EUR70 billion in 2015.
MRC