MOSCOW (MRC) -- Repsol says that its petrochemical sales volumes declined to 1.3 million metric tons (MMt) in the first half of 2020 from 1.5 MMt in the corresponding period of last year, reported Chemweek.
The company says its chemical business “adjusted its operations in accordance with the falling demand of sectors such as the automotive sector and the increase of others associated with health and food, vital to the fight against COVID-19, and those for which its raw materials are essential.”
Income at Repsol’s chemical business was down largely due to lower margins and sales, and a rise in operating incidents and maintenance stoppages at the company’s Sines, Portugal, and Tarragona, Spain, petchem complexes, the company says.
Repsol does not break out earnings and sales figures for its chemical business. The company’s industrial business, which includes refining and chemicals, saw a big drop in second-quarter adjusted net income to EUR8.0 million (USD9.3 million) from EUR177 million in the year-earlier period. First-half adjusted net income for the industrial business dropped to EUR296 million from EUR448 million a year before, on sales of EUR8.2 billion, down from EUR12.2 billion.
Repsol says that higher international margins in the petchem industry, caused by the collapse in crude oil prices, were offset by lower selling prices for petrochemicals and a narrow naphtha-propane differential. Nevertheless, “margins have been solid and demand has remained at reasonable levels,” Repsol says. Falling prices also reduced the value of Repsol’s chemical inventories, the company says.
The company says that the gradual recovery of the Chinese economy has been countered by the effective closure of other major markets. Meanwhile, “the increased reliance on propylene oxide and styrene units was somewhat successful in compensating for the lack of any real market for polyols and polyurethanes destined for the automotive sector,” the company says.
Separately, Repsol says that the Quimicas del Oxido de Etileno (Iqoxe) ethylene oxide and derivatives complex at Tarragona came back onstream in May after a big explosion and fire in January.
As MRC reported earlier, Repsol's refinery at Puertollano in central Spain will carry out an upgrade of its olefins unit. The modernization will be a part of planned maintenance of the cracker and chemical derivative plants at the end of 2020.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
Repsol S.A is an integrated Spanish oil and gas company with operations in 28 countries. The bulk of its assets are located in Spain.
MRC