Nova Chemicals Ends Force Majeure on HDPE Supplies in Canada

Nova Chemicals recently announced the termination of force majeure on the supply of high-density polyethylene (HDPE) to Moore in Sarnia, Ontario, said Chemanalyst.

This decision comes after the force majeure was initially declared on September 14, citing an unplanned power outage at the Corunne ethylene plant in the Sarnia region of Ontario. The Corunne facility serves as a crucial supplier of ethylene to Nova Chemicals' polyethylene production facilities in the same region.

The Corunne ethylene plant's unforeseen power outage prompted the force majeure declaration, impacting the production and supply chain of HDPE. Nova Chemicals, a major player in the industry, took this step to address the challenges posed by the disruption in ethylene supply, which is a key component in the HDPE manufacturing process.

The Sarnia site, where Nova Chemicals produces HDPE, has a substantial annual production capacity, capable of manufacturing 457,000 tonnes of HDPE and 220,000 tonnes of LDPE. The lifting of force majeure is anticipated to bring relief to the HDPE supply chain and alleviate the strain caused by the earlier disruptions.

This force majeure event wasn't the only challenge Nova Chemicals faced in recent times. Earlier reports indicated that the company had also declared force majeure concerning the supply of ethylene, attributing it to an unplanned shutdown of the cracking plant in Joffre, located in Alberta, Canada. The Joffre cracking plant plays a pivotal role in Nova Chemicals' overall ethylene production, with an annual capacity of 745,000 tonnes of ethylene and 50,000 tonnes of propylene.

The termination of force majeure for HDPE in Moore signifies a positive development for Nova Chemicals and the broader industry. HDPE is a widely used polymer with applications across various sectors, and any disruption in its supply chain can have cascading effects on downstream industries.

In the context of the global polyethylene landscape, the United States stands as a major hub for production. Key players in the U.S. polyethylene market include Chevron Phillips Chemical (CP Chem), Dow, LyondellBasell, ExxonMobil, Formosa, INEOS, Total Petrochemicals, and Westlake. These industry giants play a pivotal role in meeting the escalating demand for polyethylene and its derivatives.

Nova Chemicals' decision to lift force majeure on HDPE supplies in Moore, Sarnia, is a significant development with wide-reaching implications for the industry. As a critical player in the production of polyethylene, Nova Chemicals' ability to resume normal operations will contribute to stabilizing the HDPE supply chain. The broader trends in increased polyethylene consumption underscore the importance of a steady and reliable supply chain in meeting the growing demand for these essential materials. The dynamics of force majeure events and their resolution highlight the intricate interdependencies within the polymer industry, where disruptions necessitate prompt and strategic responses to maintain the integrity of the supply chain.

We remind, Greiner Packaging has successfully manufactured trays using 70% recycled polyethylene terephthalate (r-PET) for the renowned Austrian beverage company, Rauch Fruchtsafte. This environmentally conscious initiative by Greiner involves the utilization of material sourced from 'yellow bags' to create these innovative and sustainable beverage trays. Throughout the project, the viability of generating r-PET flakes from post-consumer material was demonstrated through a meticulous process involving pre- and post-sorting, followed by shredding and washing.

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Asahimas Chemical, a prominent subsidiary of the renowned Japanese petrochemical giant Asahi Glass, has successfully concluded comprehensive repair operations on Vinyl Chloride Line 3 at its facility in Cilegon, Indonesia, said Chemanalyst.

The facility, boasting an impressive annual capacity of 400 thousand tons of Vinyl Chloride Monomer (VCM), underwent meticulous repair activities aimed at addressing operational challenges. Despite the successful removal of coke and the subsequent restart of VCM Line 3, technical complexities have limited its current operational capacity to 90%. The precise timeline for achieving full operational restoration remains uncertain.

In a preceding instance, Asahimas Chemical, a pivotal subsidiary under the Asahi Glass umbrella, finalized repair work on Line No. 2, dedicated to the production of vinyl chloride (VCM) in Cilegon, Indonesia. This particular facility, equipped with a production capacity of 300 thousand tons of VCM annually, underwent extensive repair activities spanning from late July to September 10.

Vinyl chloride, a fundamental raw material in the chemical industry, plays a pivotal role as the primary precursor for the production of polyvinyl chloride (PVC). PVC, a versatile plastic material widely employed in various applications, relies on the stable and efficient production of vinyl chloride for its manufacturing processes.

The petrochemical landscape's intricacies extend beyond Asahimas Chemical's repair endeavors, with market dynamics influencing the global consumption of polyvinyl chloride. Russia witnessed an estimated consumption of 635.71 thousand tons of unmixed PVC (excluding exports to Belarus) during the initial eight months of the year. This figure reflects a 2% decrease compared to the corresponding period in 2022. Notably, within this market panorama, the emulsion PVC sector reported a 4% increase in shipments, while the slurry PVC market experienced a 2% decrease.

Asahi Glass maintains a commanding interest in Asahimas Chemical, ensuring a strategic alignment with its broader corporate goals. Additionally, the ownership structure includes significant stakes held by key entities such as Rodamas (18%), Ableman Finance (18%), and Mitsubishi Corp. (11.5%). This diversified ownership framework underscores collaborative partnerships within the petrochemical industry, emphasizing a collective and cooperative approach to industry endeavors.

The successful completion of repairs at Asahimas Chemical's facilities not only showcases technical proficiency but also underscores the resilience and adaptability required in the petrochemical sector. As the industry grapples with operational challenges, strategic repairs become imperative to ensure the sustained and efficient production of critical chemical components such as vinyl chloride. The collaborative ownership structure further positions Asahimas Chemical as an integral player in the intricate web of partnerships that drive innovation, efficiency, and sustainability within the petrochemical landscape.

We remind, Asahi Kasei announced Tongsuh Petrochemical Corp., Ltd. (TSPC) acquired the international certification ISCC PLUS for its acrylonitrile (AN) as a sustainable product, and production of AN using biomass propylene is scheduled to begin in February 2022.

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The premium product range of TotalEnergies Lubrifiants in Europe is now packaged in platinum-colored bottles containing 50% post-consumer recycled (PCR) polyethylene, said Hydrocarbonprocessing.

Following a pilot started in 2021 on the Quartz Xtra product bottles, TotalEnergies Lubrifiants is now applying the process of incorporating 50% PCR high-density polyethylene (HDPE) to a larger scale. From September 2023 onwards, all premium range bottles produced in France and Belgium, recognizable by their platinum color, are being made notably from TotalEnergies rPE6314, a ready-to-use polyethylene compound.

Produced at TotalEnergies’ plant in Antwerp and part of the circular polymer range RE:clic, this high-performing rHDPE grade designed for blow moulding applications combines carefully selected recycled polyethylene from post-consumer waste with a high-performing virgin booster. Its high quality and consistency allow for trouble-free processing on existing industrial equipment. The resulting bottle features the same design, shape, and weight as the 100% fossil-based alternatives, with a significantly reduced carbon footprint.

This innovation is aligned with TotalEnergies’ ambition to contribute to a circular economy and reduce its own use of virgin plastic.

Jean Parizot, General Manager Inland markets at TotalEnergies Lubrifiants, said: "We’re moving towards 50% recycled packs by 2030 for all small packaging produced in France and Belgium, thereby reducing the carbon footprint of our production and contributing to a more circular economy".

Olivier Greiner, Vice President, Polymers Europe & Orient at TotalEnergies, said: "This packaging development brought to the EU market is the result of an internal effort to address the challenge of end-of-life plastics. It demonstrates our shared commitment as a Company to promote the circular economy, and fully supports our ambition of reaching 1 million tons of circular polymers by 2030".

We remind, TotalEnergies has reported net income of $6.67bn (€6.33bn) in the third quarter of 2023, a marginal 1% increase compared with $6.62bn in the same period a year ago, said the company. In the July–September quarter of 2023, the French oil and gas company reported $54.41bn in revenue from sales, a 16% decline from $64.92bn in Q3 2022.

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Exxon Mobil moved up the start date for a CDU overhaul at its 619,024-bpd Beaumont, Texas, refinery from August 2024 to June 2024, said people familiar with the company’s plans, said Hydrocarbonprocessing.

Exxon continues to plan to shut the 65,000-bpd diesel-producing hydrocracker in January for an overhaul, during which the 80,000-bpd reformer will also be shut for work, according to the sources. Exxon spokesperson Lauren Kight declined to comment on Tuesday.

The 180,000-bpd Crude B CDU is scheduled to shut down for the overhaul in June, two months earlier than previously planned, the five sources said. Crude B is one of three CDUs breaking down crude oil at the start of the refining process to produce feedstocks for all other units at the refinery, which is the nation's second largest by capacity.

Crude B processes sour crude oil, a cheaper grade that requires processing for the higher levels of residual crude it produces compared with sweet crude. While the CDU is shut, the 100,000-bpd Vacuum B vacuum distillation unit (VDU) will also be shut for work, the sources said. Production on the refinery’s 60,000-bpd coker will be cut back while Crude B shut.

Unlike CDUs, which operate at atmospheric pressure, VDUs operate at vacuum pressure to break down residual crude oil into feedstocks for other production units. Cokers take residual crude from distillation units and break it down into motor fuel feedstocks or petroleum coke, which can be used as a coal substitute.

Hydrocrackers use a catalyst under high heat and pressure in the presence of hydrogen to convert gas oil into diesel and other motor fuels. Reformers convert refining byproducts into octane-boosting components added to unfinished gasoline to make premium grades.

We remind, ExxonMobil is planning to invest up to $15bn in a greenfield petrochemical project as well as new carbon capture and storage (CCS) facilities in Indonesia. The Indonesian government earlier this week signed an agreement with ExxonMobil to study the possibility of the petrochemical project which would include polymer production units.

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In the third quarter, Japan witnessed a substantial surge in the export of liquid caustic, with volumes reaching 248.85 thousand tonnes, marking an impressive 90.1 percent increase compared to the preceding quarter, said Chemanalyst.

This uptick in export figures, despite favorable conditions in caustic soda supply during most of the third quarter, can be attributed to robust chlor-alkali production. The profitability of electrochemical units (ECUs) within Japanese polyvinyl chloride (PVC) producers likely played a crucial role in driving this growth.

Analyzing the key export destinations, Australia, Indonesia, and the United States emerged as the top three, collectively constituting 83.1% of Japan's total liquid caustic exports for the quarter. This strategic distribution points to the significance of these markets in absorbing Japan's increased export volumes.

On a year-on-year basis, the export volumes witnessed a notable 6.8% rise, indicating sustained growth and positive trends in Japan's liquid caustic sector.

Comparatively, South Korea's export volumes of liquid caustic soda in the third quarter amounted to 83.34 thousand tons, reflecting a 17.2% decline from the previous quarter. This decrease was influenced by limited workload indicators among manufacturers, driven by a reduction in profitability. Despite favorable supply conditions in Asia during most of the third quarter, South Korea experienced a decrease in export volumes. However, on a year-on-year basis, South Korea's export volumes demonstrated a significant 12.2% increase.

The estimated consumption amounted to 635.71 thousand tons, reflecting a marginal 2% decline compared to the same period in 2022. Within this market landscape, the emulsion PVC sector witnessed a commendable 4% increase in shipments, while the slurry market experienced a modest 2% decrease.

Japan's notable surge in liquid caustic exports in the third quarter reflects a dynamic market influenced by both domestic and international factors. The profitability of ECUs within Japanese PVC production has evidently played a pivotal role in driving this growth. The strategic distribution of exports to key destinations further underscores the resilience and adaptability of Japan's liquid caustic sector.

Meanwhile, South Korea's experience of a decline in export volumes emphasizes the delicate balance between profitability and market dynamics. The year-on-year increase in South Korea's export volumes showcases the potential for recovery and growth in the liquid caustic sector.

As the global landscape continues to evolve, these trends provide valuable insights into the nuanced dynamics of the liquid caustic market in the broader context of the chemical industry. The year-on-year growth in both Japan and South Korea's export volumes signals resilience and adaptability, crucial attributes in navigating the complexities of the international chemical market.

We remind, Japan and South Korea will establish a joint supply network for carbon-neutral fuels such as hydrogen and ammonia. Japanese Prime Minister Fumio Kishida and South Korean President Yoon Suk Yeol will announce the framework on Nov. 17 in the United States, where they are expected to join the Asia-Pacific Economic Cooperation meeting, the paper said.

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