Global roundup

04 August 2003 00:00  [Source: ACN]

LG Chem and its striking workers struck a deal, Saddam Hussein's two sons were killed by US troops, and Brazil announced plans to create two large petrochemical groups in the week 18-24 July. The World Bank advised India to reduce its fertiliser subsidies, and an Indonesian court threw out a bankruptcy claim against TriPolyta  

From stories supplied by the CNI and ACN  teams. See www.cnionline.com. For exclusive news and analysis, see the rest of ACN

Ibra hopes to resume Tuban project

25 July. The Indonesian Bank Restructuring Agency (Ibra) is hoping to resume construction of the long-delayed Tuban petrochemical project in September this year, despite the fact that a US$400m loan from Japanese creditors has not yet been obtained.

An Ibra official said consultants from Indonesia and Japan were completing legal documents on project financing and hope to conclude the deal by the end of August so that the project, located in East Java, can be resumed by September. The project would take up to 20 months from the restart of construction to come into commercial operation.

Bayer ABS' net profit falls by 34.8%

25 July. Bayer ABS has recorded a 34.8% decline in net profit to Rs46.1m (US$998 800) in the second quarter to 30 June, from Rs70.8m in the corresponding period of the previous year.

The company improved gross sales by 10.3% to Rs925.2m from Rs838.9m a year earlier. Expenditure shot up by 19.2% to Rs822.1m from Rs689.2m, while operating profit declined by 31% to Rs103.1m from Rs149.6m.

Japanese study methanol from PNG gas

25 July. Itochu Corp and Mitsubishi Gas Chemical are studying the feasibility of producing methanol using natural gas from fields in Papua New Guinea (PNG), according to gas exploration company Oil Search.

The Australian listed company said Mitsubishi Gas and Itochu were planning to review the location and infrastructure needs, funding and commercialisation options for a methanol plant.

Natural-gas feedstock for the plant would be sourced from the Kimu field, located onshore in petroleum retention licence area 08, and from the Urama field located offshore in the Gulf of Papua in licence area 10. Oil Search has major stakes in both licensed areas.

Gas-price hike to hit Indian petchems

25 July. The costs of manufacturing petrochemicals and fertilisers and of generating power in India are expected to increase within three months when the government gives its final nod for a 12.28% increase in the price of natural gas. Gas prices have remained unchanged since October 1999.

The imminent increase in prices will apply to gas supplies from the Oil and Natural Gas Corp and Oil India.

The Group of Ministers on gas pricing decided earlier this week to recommend an increase in the basic price of gas of 12.28% to Rs3200 (US$69.35) per 1000 std m3 from the present Rs2850/1000 std m3.

PTT denies TPI merger plans

25 July. The Petroleum Authority of Thailand (PTT) has denied that there are any plans to merge or integrate its operations with those of the heavily indebted Thai Petrochemical Industry (TPI).

In a letter to the Stock Exchange of Thailand, PTT president Viset Choopiban said 'at present, PTT and/or its subsidiaries do not have any policy to integrate TPI as part of PTT's business'. The statement was made to dispel rumours of a possible merger between PTT and TPI.

Bayer Polymers buys out partner in jv

25 July. Bayer announced today that its polymers business had bought out compatriot Rohm from their three-year-old Makroform joint venture. Financial details of the deal were not disclosed. Before the transaction, Bayer held 54.5% of Makroform and Rohm's stake was 45.5%. The deal took effect on 15 July.

ABB wins Secco petchem contracts

25 July. ABB said it has won US$123m of petrochemical contracts from Shanghai Secco Petrochemical Co for its complex in Caojing, China.

The Swiss engineering group said it would provide the technology licence, engineering, and procurement for an ethylbenzene/styrene unit of 500 000 tonne/year capacity, and the engineering and procurement for a 300000 tonne/year PS plant.

The units are part of Secco's new US$2.7bn petrochemical complex in Caojing that is due to start operations in 2005.

Ultrapar eyes EO acquisitions

25 July. Ultrapar intends to focus its search for chemicals acquisitions on ethylene oxide (EO) derivatives producers in Mexico and Venezuela, Fabio Schvartsman, chief financial officer, said. The Brazilian group will seek acquisitions to complement the activities of its chemicals subsidiary, Oxiteno, which is Brazil's sole producer of EO and derivatives, he said.

Foreign terrorists in Iraq: US general

27 July. The commander of US ground forces in Iraq says the country is becoming a magnet for foreign terrorists targeting Americans.

Lieutenant-General Ricardo Sanchez, whose troops usually blame the attacks on die-hard Saddam loyalists, said the sophistication of the raids had increased over the last 30 days.

'This is what I would call a terrorist magnet where America, being present here in Iraq, creates a target of opportunity,' Sanchez said.

Mutiny in Manila ends

28 July. Renegade Philippine troops have agreed to end their mutiny in Manila and return to barracks, the government said.

President Gloria Macapagal Arroyo went on television to announce that 'the crisis in Makati is over - 296 soldiers, including 70 officers, are standing down and returning to barracks'.

The rebel soldiers had stormed a prestigious shopping complex in Manila early yesterday, demanding the resignation of Arroyo, whom they accused of corruption.

The breakthrough came after several hours of negotiations between the rebels and senior government officials. Not a shot was fired.

Indo Rama Synthetics' net profit slumps

28 July. Indo Rama Synthetics recorded a net profit slump of 92.3% to Rs35.8m (US$775 600) in the first quarter of its financial year to 30 June, from Rs467.67m in the same period of the previous year.

The main reason for the poor result was the company's decision to suspend production for more than a month due to a truckers' strike and a slowdown in the textiles markets during March and April.

The decline in net profit would have been greater had investment-related other income not shot up to Rs178.1m from Rs21.6m.

Singpu aims to raise $7.8m from IPO

28 July. Singpu Chemicals is hoping to raise S$13.7m ($7.8m) through an initial public offering (IPO) on the Singapore Stock Exchange to expand its aniline and chlor-alkali operations in China, the company said in a statement today.

The Singapore-based company plans to offer 63m shares at S$0.42/share, 56.7m of which will go to institutional investors and the balance to retail investors, management and employees.

Eterindo posts fall in Q1 net profit

28 July. Eterindo Wahanatama has reported a big fall in net profit to Rp18.4bn (US$2.1m) for the first quarter of its financial year to 31 March 2003 from Rp110.1bn in Q1 2002, even though its sales grew by 9.7%.

Eterindo booked consolidated sales of Rp372.1bn in the quarter - up from Rp339.4bn in the previous year. However, the company's cost of goods sold increased by 14.3% in the period resulting in a gross profit of Rp43.1bn - down by 15.6% from Rp51.6bn in Q1 2002.

Eterindo managed to cut its operating costs by 12% in the period, but its operating profit fell by 25.8% to Rp13.7bn from Rp18.5bn a year earlier.

Supreme Petchem turns loss to profit

28 July. Supreme Petrochem has turned the corner by posting a net profit of Rs126.4m (US$2.7m) in its financial year to 30 June 2003 from a net loss of Rs203.9m in the previous year.

The results are not strictly comparable, as the previous financial year to 30 June 2002 comprised 15 months as against the 2002-03 results, which covered 12 months.

The company increased gross sales by 2.6% to Rs8.48bn from Rs8.26bn while expenditure declined by 0.81% to Rs7.81bn from Rs7.87bn. Operating profit shot up by 59.4% to Rs622.99m from Rs390.65m.

Other income rose by 217.7% to Rs32.5m from Rs10.2m.

DuPont Canada shareholders OK sale

28 July. DuPont Canada shareholders have overwhelmingly approved DuPont's plan to take the company private in a US$1.4bn deal.

DuPont announced a bid to buy the 66m DuPont Canada shares it did not already own in March as part of a plan to set up DuPont Textiles & Interiors (DTI) as a separate entity, and to integrate DuPont Canada's business with that of DTI.

Air Products to cut jobs, shut gas plants

28 July. Air Products said it is reducing its 17200-worker labour force by 3% or 461 positions, will close several gas facilities and exit 'certain intermediate chemicals operations'.

The company said about half the job cuts will be in the US and the remainder mostly in Europe. Its financial communications manager, Katie McDonald, said the company is already pursuing the sale of its European methylamines and derivatives business.

She added: 'We are in active negotiations with several potential buyers. We also will shut down our Pensacola, Florida, methanol and ammonia facilities, which are used to make raw materials for our US methylamines business.'

On the gases side, she said, Air Products has closed several facilities - mainly merchant facilities. She did not provide the locations of the facilities.

LG-Caltex union to vote on strike

29 July. The union at LG-Caltex Oil plans to vote on whether or not to go on strike, as it and the company's management have failed to reach an agreement on wage hikes.

The union wants an 11.2% wage hike, while management is offering a 5.4% rise in basic wages and a 100% increase in bonuses.

LG-Caltex said wage negotiations between the firm and its union had collapsed after 12 rounds of talks. They also failed to narrow differences on whether to withdraw disciplinary action the company has taken against union leaders.

The union yesterday filed with South Korea's National Labour Relations Commission for mediation, which is a necessary step before a walkout.

US warns of possible al-Qaeda attacks

29 July. The US Department of Homeland Security has warned the airline industry that Osama bin Laden's al-Qaeda network is planning new suicide hijackings and bombings in the US or abroad, saying the danger would last until at least the end of the summer.

'At least one of these attacks could be executed by the end of the summer 2003,' the department said in an advisory sent out on 26 July. 'Al-Qaeda planners have primarily considered suicide hijackings and bombings as the most promising method to destroy aircraft in flight as well as to strike ground targets.'

It added: 'Attack venues may include the UK, Italy, Australia or the east coast of the US due to the relatively high concentration of government, military and economic targets.'

Century Enka net profit plunges 89%

29 July. Century Enka posted an 89% fall in net profit to Rs14.1m (US$305 590) in the first quarter of its financial year to 30 June 2003 from Rs128.8m in the same period of the previous year.

Century Enka's net sales declined by 7.1% to Rs1.6bn from Rs1.72bn a year earlier. Expenditure increased by 1.3% to Rs1.48bn from Rs1.46bn while operating profit plummeted by 55.2% to Rs114.1m from Rs255m.

Conditional nod for Methanex project

29 July. The board of directors of Methanex has given a conditional go-ahead for its 1.3m tonne/year methanol project on the Burrup Peninsula in Western Australia, a company spokesman said.

The spokesman said the condition was that one or two environmental and technical issues be ironed out in the next couple of months. This would allow site works on the US$500m project to start by the end of this year, with construction to follow early in 2004. The plant is scheduled to come onstream in 2006.

Lautan starts up China sodium sulphate

29 July. Lautan Hongze Chemical Industry, a subsidiary of Indonesia's Lautan Luas, started commercial operations this month at its new sodium sulphate plant in Jiangsu, China.

The plant, with an installed capacity of 200 000 tonne/year, has been built with a Rmb60m (US$7.2m) investment. Lautan Luas owns a 60% stake in the venture, while the rest is owned by a local company.

Vinachem starts work on DAP plant

29 July. Vietnam National Chemical Corp (Vinachem) has started construction of the country's first diamonnium phosphate (DAP) fertiliser plant in the northern port city of Haiphong.

Planned for commissioning next year, the US$172m plant in Dinh Vu Industrial Park will have a DAP capacity of 330 000 tonne/year, according to a Vinachem source, who added that work on the site started on 27 July.

The source said phosphate feedstock for the DAP project will come from Lao Cai in Vietnam's far northwest, while sulphur and ammonia will be imported. The plant will also produce sulphuric acid and phosphoric acid.

Gail's Q1 net profit up 17.5%

29 July. Gail (India) has hiked its net profit by 17.5% to Rs3.65bn (US$79.1m) in Q1 of its financial year to 30 June 2003, from Rs3.10bn in the same period the previous year on increased sales of natural gas and liquefied petroleum gas (LPG), as well as its LPG pipeline business.

The company has not released details of how its petrochemical business performed, as it did in previous years, combining the business this year under the broader category of gas processing and sales.

Gail said gross sales increased by 11.5% to Rs29.23bn from Rs26.21bn, while expenditure grew by 11.3% to Rs21.86bn from Rs19.64bn. Operating profit improved by 12.2% to Rs7.36bn from Rs6.56bn.

China extends phenol antidumping duty

30 July. China's Ministry of Commerce has extended antidumping measures against imports of phenol from Japan, South Korea, the US and Taiwan for at least another six months until 1 February 2004.

The ministry introduced a cash deposit for imports of phenol from the four countries in early June this year after launching an antidumping investigation on 1August 2002.

IPL records 50% fall in Q1 net profit

30 July. India Polyfibres Ltd (IPL) posted a 50% fall in net profit to Rs9.9m (US$214 630) in the first quarter of its financial year to 30 June 2003, from Rs19.8m in the same period of the previous year due a rise in intermediates prices and a slowdown in sales.

Net sales grew by 4.2% to Rs414.3m from Rs397.4m, while expenditure increased by 7.3% to Rs402.4m from Rs374.9m. Operating profit fell by 47.1% to Rs11.9m from Rs22.5m.

ATC's Q2 net profit up four-fold

30 July. Aromatics Thailand PCL (ATC) saw its net profit quadruple to Baht352.4m (US$8.4m) in the second quarter of its financial year to 30 June 2003 from Baht81m in the same quarter last year on a massive increase in net sales.

Net sales increased to Baht 8.17bn from Baht3.41bn a year earlier.

Siam Cement's net profit up 1.8% in Q2

30 July. Siam Cement's Q2 consolidated sales rose by 6.2% in the second quarter to 30 June 2003 over the same period in 2002 to Baht36.04bn (US$859m). Its net profit rose by 1.8% to Baht3.57bn, while operating profit increased by 0.4% to Baht3.51bn year-on-year. Its petrochemicals sector posted a Q2 increase in sales of 18% year-on-year to Baht11.95bn.

Mitsub Chem eyes Apr 2004 for PTA nod

30 July. Mitsubishi Chemical expects to obtain final approval from the Chinese government in April 2004 for its 600 000 tonne/year purified terephthalic acid (PTA) plant in Ningbo, Zhejiang, China, a company spokesman said. The government granted preliminary approval, which was sought more than two years ago, earlier this month.

The Japanese major is now putting together a feasibility study, which it will submit to the government.

IPCL turns net loss to net profit

30 July. Indian Petrochemicals Corp Ltd (IPCL) earned a net profit of Rs390m (US$8.4m) in the first quarter of its financial year to 30 June 2003, compared with a net loss of Rs60m in the same period of the previous year.

IPCL boosted net sales by 58.3% to Rs13.55bn from Rs8.56bn in Q1 2002-03. Exports rose to Rs1.23bn from Rs220m. Expenditure shot up by 72.9% to Rs11.31bn from Rs6.54bn, while operating profit grew by 10.9% to Rs2.24bn from Rs2.02bn.

TCL posts 42.7% rise in Q1 net profit

31 July. Tata Chemicals Ltd's (TCL) net profit jumped by 42.7% to Rs485.3m (US$10.5m) in the first quarter of its financial year to 30 June 2003 from Rs340.1m in Q1 2002-03.

Net sales fell by 5.7% to Rs3.078bn from Rs3.26bn. Expenditure declined by 14.9% to Rs1.96bn from Rs2.31m, while operating profit improved by 16.4% to Rs1.11bn from Rs959.1m in H1 last year.

TPI Polene's Q2 net profit quadruples 

31 July. TPI Polene's net profit in the second quarter of its financial year to 30 June 2003 more than quadrupled to Baht1.14bn (US$23.1m) from Baht258.6m for the same period last year on the back of expansions in most of its businesses.

Consolidated sales rose by 52% to Baht4.63bn from Baht3.05bn. TPI Polene did not give its operating profit or other financial details.

MGC posts Q1 op profit of $14m

31 July. Mitsubishi Gas Chemicals (MGC) has reported an operating profit of Yen1.71bn (US$14m) for the first quarter of April-June 2003, on the back of strong methanol prices, a company spokesman said. MGC said it posted Q1 group sales of Yen79.11bn.

This is the first time MGC has reported its results on a quarterly basis and therefore comparative figures are not available. No other financial data were provided.

Reliance posts 10% rise in Q1 op profit

31 July. Reliance Industries Ltd (RIL) has reported a 10% rise in operating profit to Rs24.75bn (US$536m) for the first quarter of its financial year to 30 June 2003, from Rs22.53bn in Q1 2002-03.

RIL said its sales grew by 16% to Rs135bn from Rs116bn and net profit (after extraordinary items) increased by 20% to Rs11.04bn from Rs9.18bn. Its exports grew by 37% to Rs34.66bn from Rs25.35bn.

Results of US and European chemical companies

Eastman Chemical reported a 20% decline in Q2 2003 net income to US$35m on sales of US$1.5bn. Those figures compare with a net income of US$44m on sales of US$1.4bn for the same period last year.

Dow Chemical said Q2 2003 net income surged by 65% to US$393m on a 14% increase in sales to US$8.2bn. Earnings before interest, income taxes and minority interests were US$799m versus US$539m in Q2 2002.

Rhodia posted Q2 2003 earnings before interest, taxes, depreciation and amortisation of Euro123m (US$138m), down by 26% against restated earnings in Q2 2002 of Euro166m. The restated figures accounted for divestments last year and reflect current foreign exchange rates, the group said. Group operating earnings in Q2 dived by 83% to Euro13m against a restated performance in Q2 of last year of Euro78m. Sales revenues were almost flat, however, at Euro1.4bn.

Rohm and Haas (R&H) posted a Q2 2003 net loss of US$3m from continuing operations on restructuring and asset-impairment charges. R&H recorded a US$92m net profit in Q2 2002. Its Q2 sales rose by 8% over the same period of 2002 to US$1.6bn.

Air Products reported Q3 2003 net income of US$27m, down from Q3 2002 net income of US$141.3m on a US$153m restructuring charge. Before special charges, Air Products said, net income declined by 13% to US$123m. Q3 revenues rose by 19% to US$1.6m, with acquisitions and divestitures accounting for much of that increase.

ABB has reported a Euro43.0m (US$49.6m) net loss in its oil, gas and petrochemicals division for the second quarter to 30 June 2003. The division - which is due to be divested - turned in a profit of Euro30m in the same period last year.

The firm attributed the loss to higher project costs and interest expenses. Orders were down by 43% at Euro845m, compared with a strong Q2 last year when a US$980m order in Russia was secured.

Celanese unveiled a five-fold rise in Q2 operating profit to Euro110m (US$127m), from Euro22m in Q2 last year, thanks to higher selling prices, cost savings, and a substantial recovery from an insurance claim. The company's net earnings leapt to Euro97m from Euro22m, but sales were down by 4% at Euro1.08bn.

BP posted pro forma operating profits, adjusted for special items, for the renamed petrochemicals division 25% higher at US$308m, due to lower feedstock costs and improved margins. Sales improved by 11.6% to US$4bn from the same period last year. Petrochemicals production in Q2, at 6.7m tonne, was nearly 2% below the same period last year.

The combined Huntsman companies posted Q2 2003 pro forma earnings before interest, taxes, depreciation and amortisation of US$135.1m, 41% lower than the same period of 2002. The combined Huntsman companies include HMP Equity Holdings, Huntsman LLC and Huntsman International Holdings LLC.

Huntsman said the combined results for Q2 2003 included US$31.4m in restructuring charges and an US$8.5m loss on receivables.

Solutia posted a US$21m Q2 2003 loss compared with a US$23m profit in Q2 2002, citing increased raw-material costs, rising interest expenses and severance costs. For the period April-June, the company said sales rose to US$611m from US$585m.

Shell posted a 16% fall in Q2 2003 chemicals earnings to US$111m, citing as the main reason volatile feedstock prices. Losses in the US operations increased to Euro55m (US$63.8m) from Euro13m, but profits from the rest of the world increased by 14% Euro166m. Sales, excluding trading activities, rose by 32% to US$3.78bn in Q2.

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