This week's world news

04 July 2011 00:00  [Source: ICB]

PETROLOGISTICS, BAYER MULL CRACKER DEAL
German chemical major Bayer would not confirm reports last Tuesday that US-based propylene producer Petrologistics is considering buying land from the company in West Virginia to build an ethane cracker. If Petrologistics pursues the project it would likely cost more than $1bn (€700m), the Houston Business Journal reported. "What I can tell you is that we are engaged in what I would categorize as serious discussions with several interested companies, who are looking at our New Martinsville site in West Virginia as a possible site for an ethane cracker," Bayer spokesman Bryan Iams said. Petrologistics did not respond to a request for comment.

PEMEX, MEXICHEM PROPOSE $556M VCM JV
Mexico-based producers Pemex and Mexichem have proposed creating a vinyl chloride monomer (VCM) joint venture, with the goal of increasing production to 400,000 tonnes/year. Pemex and Mexichem plan to invest $556m (€389m) in the venture. The joint venture will increase VCM production through a three-year stage. VCM is a feedstock for polyvinyl chloride (PVC). Mexichem is Mexico's sole PVC producer.

RFA: US DECISION ON E15 NOT BROAD ENOUGH
The US move to allow ethanol blends of up to 15% (E15) in gasoline was not broad enough because it does not permit the use of E15 in all US vehicles, the Renewable Fuels Association (RFA) trade group said. The RFA's comment came as the Environmental Protection Agency (EPA) unveiled rules for the use of E15 - including a label that will be displayed on pumps dispensing the biofuel. Under the new EPA ruling, E15 can only be used in vehicles manufactured in or after 2001. This is not what the industry wanted, because there is no regulatory reason not to allow E15 for use by older vehicles, said RFA president and CEO Bob Dinneen, during a presentation at the 2011 International Fuel Ethanol Workshop & Expo in Indianapolis, Indiana.

ZEACHEM BIOETHANOL REFINERY PROGRESSES
US-based cellulosic ethanol producer ZeaChem is advancing rapidly with its new refinery, said president and CEO James Imbler on the sidelines of the 2011 BioPlastek conference in New York. The company's 250,000 gal/year (946,000 liter/year) demonstration refinery in Boardman, Oregon, is 65% complete, he said. The refinery, estimated to cost $40m (€28m), is aiming to be up and running before the end of the year - "ahead of schedule and under-budget." ZeaChem plans to produce biomass-based ethanol and ethyl acetate using hybrid poplar as feedstock. The ethanol would be used to make polymers.

BASF'S VOSCHERAU SLAMS GERMANY'S NUCLEAR EXIT
Germany's planned exit from nuclear power is a "high-risk balancing act without a safety net," said BASF supervisory board chairman Eggert Voscherau. The plan to end nuclear power generation by 2022 is evidence that the country's economic success "has gone into the heads" of Germans, he said. "Germans are not acknowledging that industry is the basis of our wealth," Voscherau wrote in an op-ed article for newspaper BILD. "Electricity is a raw material for industry, and it needs to be available each and every second for producers to be competitive."

GUODIAN BEGINS BDO PLANT CONSTRUCTION
China's Guodian Younglight ­Energy and Chemical Group said on Wednesday it has started ­construction of a 200,000 tonne/year 1,4-butanediol (BDO) plant at Ningdong industry park in Ningxia province on June 26. Construction has also begun on its 92,000 tonne/year polytetramethylene glycol unit and a gamma-butyrolactone (GBL) unit at the same site. The yuan (CNY) 3.7bn ($572m) project is expected to be completed by September 2012. The company is also building a 450,000 tonne/year vinyl acetate monomer (VAM) unit, a 300,000 tonne/year acetic acid unit and a 100,000 tonne/year polyvinyl alcohol plant at the same site.

HONEYWELL LIFTS FM ON US CAPROLACTAM
US chemical producer Honeywell has lifted its force majeure on caprolactam (capro) from its Hopewell, Virginia, plant. The force majeure was implemented on March 15, because of difficulties in obtaining feedstock phenol. Honeywell's lifting of its force majeure came after US firm Sunoco lifted its force majeure on phenol, sources said. Honeywell has 375,000 tonnes of capro production at its Hopewell plant, mostly for use in nylon 6 production.

UNIPETROL CUTS LITVINOV ETHYLENE OUTPUT
Czech petrochemical firm Unipetrol has reduced the production of ethylene at its Litvinov steam cracker, due to technical problems with cooling compressors. "Today after 11:00 am [local time] the production of the steam cracker was decreased due to technical problems with cooling compressors," Unipetrol said in a statement last Wednesday. Unipetrol could not say by how much the production rate had been lowered at the 545,000 tonne/year cracker.

NOVA CHEMICALS STUDIES PE LINES IN CANADA
Canada-based NOVA Chemicals has started feasibility and engineering work for the construction of additional polyethylene (PE) lines in Alberta and Ontario, in Canada. The projects are for a Advanced SCLAIRTECH technology-based line and a world-scale NOVAPOL technology-based linear low density polyethylene (LLDPE) line. NOVA Chemicals is also studying a further debottlenecking of its low density polyethylene (LDPE) line in Mooretown, Ontario. NOVA expects to complete the engineering and feasibility studies by mid-2012, and the expansions are targeted for start-up between late 2014 and 2017.

LSB TO SELL PORTUGAL PET PLANT TO CONTROL PET
Spain's La Seda de Barcelona (LSB) has agreed to sell its Portugal-based polyethylene terephthalate (PET) production plant to Portugal-based Control PET SGPS for €5.6m ($8.1m). The amount will be paid through 2011 to 2015, and the sales value may increase according to the company's productivity during this period, said LSB. Industrial activity at the 70,000 tonne/year plant was halted in 2010, but the acquisition will result in it being brought back into operation from July. The facility is part of LSB's PET division, Artenius.

SHENHUA BAOTOU TO SHUT MTO PLANT ON JULY 5
China's Shenhua Baotou Coal Chemical plans to shut its 600,000 tonne/year methanol-to-olefins plant and derivative units in Baotou on July 5 for a 35-45 day turnaround, a source close to the company said. The derivative facilities to be shut include a 300,000 tonne/year linear low density polyethylene/high density polyethylene (LLDPE/HDPE) swing unit, and a 300,000 tonne/year polypropylene (PP) facility.

SHANGHAI PETROCHEMICAL TO SHUT HDPE PLANT
Shanghai Petrochemical, a subsidiary of China-based petrochemical firm Sinopec, plans to shut its 250,000 tonne/year high density polyethylene (HDPE) plant in Jinshan, in eastern China, at the end of July for one month of regular maintenance, a company source said. The plant's shutdown is estimated to reduce its output of HDPE pipe grade by more than 15,000 tonnes, which will cause a shortage of HDPE pipe grades in China from the end of July to the end of August, local distributors said.

PETRO RABIGH RESTARTS SAUDI MEG PLANT
Saudi Arabia-based petrochemical firm Petro Rabigh restarted its 600,000 tonne/year monoethylene glycol (MEG) plant at Rabigh in Saudi Arabia on June 23-25 after completing a two-month turnaround, a company source said. The restart was initially scheduled for June 14, but was delayed because of some technical issues at Petro Rabigh's upstream cracker, the source said. Petro Rabigh is a joint venture ­between Japan's Sumitomo Chemical and Saudi oil company Saudi Aramco.

TOTAL PETROCHEMICALS GPPS PLANT IN RESTART
Belgium-based Total Petrochemicals' general purpose polystyrene (GPPS) plant in Carville, Louisiana, is in the process of restarting after a lengthy disruption, according to sources - but a company spokesperson said last Tuesday the plant was operational. The ­restart followed a three-to-four week disruption caused by a power outage, sources said. The plant has a capacity of 748,000 tonnes/year, according to ICIS plants and projects.

BASF LIFTS FORCE MAJEURE ON NORTH AMERICAN TDI
Germany-based BASF's declaration of force majeure on toluene di-isocyanate (TDI) supply in North America was lifted in early June, industry sources confirmed. BASF declared force majeure on TDI supply when severe flooding in the lower Mississippi river disrupted delivery of raw materials to its 160,000 tonne/year plant in Geismar, Louisiana, according to a company letter to customers dated May 17, 2011.

BASF RUNS BDO, BUT FORCE MAJEURE STILL IN PLACE
BASF has restarted butanediol (BDO) production at its site in Ludwigshafen, Germany, but the force majeure may continue into September, Europe's largest BDO producer said last week. "We have increased our allocation to 45% from the initial level of 33%," a company source said. BASF declared force majeure on BDO from the 190,000 tonne/year plant after a fire at an acetylene precursor plant on May 30. The force majeure may not be lifted until the end of August.

KEYUAN AND ZC RUBBER TO COOPERATE ON S-SBR APPS
Keyuan Petrochemicals and tiremaker Hangzhou Zhongce Rubber (ZC Rubber) are codeveloping commercial applications for solution polymerization styrene-butadiene rubber (S-SBR). The two Chinese chemical firms will share the rights to products and technologies from the cooperation. Keyuan expects to produce S-SBR in a styrene-butadiene-styrene block copolymer (SBS) facility it is building in Ningbo, Zhejiang province.

STYRON FILES FOR TRINSEO IPO TO RAISE $400M
US-based petrochemical firm Styron has filed a registration statement with US regulators to raise $400m (€280m) in an initial public offering (IPO) under the name Trinseo. Proceeds from the IPO will be used to repay debt and for "general corporate purpose," the company said. Styron, which used to be part of Dow Chemical, was acquired by private equity firm Bain last year.

OILTANKING ODFJELL TO EXPAND OMAN CAPACITY
Oiltanking Odfjell Terminals plans to commission a storage capacity of 450,000 cubic metres (m3) for clean petroleum products at its terminal at Sohar, Oman. Construction has begun on the expansion, which will increase the total capacity of the terminal to more than 1.3m3 when it is brought on stream by mid-2012. "Twelve tanks with a total capacity of 27,300m3 are being built to accommodate base oils and a wide range of chemicals such as solvents, glycols, isocyanates and acrylic esters," said the company in a statement. Oiltanking Odfjell Terminals is a joint venture between Oiltanking Odfjell Oman with 70%, Oman Oil with 25% and a private investment company with 5%.

BOSCH SOLAR TO INVEST IN MALAYSIA PV SITE
Bosch Solar Energy will invest €520m ($742m) to build a new photovoltaics (PV) manufacturing site at Penang in Malaysia. Construction will begin before the end of this year, and production is expected to begin by the fourth quarter of 2013. The completion of the entire site is expected in 2014. "The planned facility will cover the entire value-added chain, from silicon crystals and solar cells, to the modules which can be installed on roofs or in solar power plants," said Holger von Hebel, chairman of Bosch Solar Energy, in an earlier statement. Once fully functional, the manufacturing site will supply enough solar panels to power 300,000 Malaysian homes.

REGISTRATIONS RISE FOR NEW VEHICLES IN EU
May registrations within the EU of new commercial vehicles increased by 25.1% compared with the same month last year, said the European Automobile Manufacturers' Association. Spain was the only major market to record a downturn, at 13.3%. The UK, France and Germany all expanded at respective levels of 17.2%, 32.3% and 38.4%. During the period January-May, a total of 835,539 new vehicles were recorded within the EU, a 15.8% ­increase over the same period last year.

UZ-KOR TO BORROW $3BN FOR USTYURT COMPLEX
Uzbekistan reiterated plans to pursue a major gas chemical project that has fallen behind its original schedule. Uz-Kor Gas Chemical aims to conclude a $3bn (€2.1bn) loan agreement in the third ­quarter of the year in order to finance construction of the Ustyurt gas chemical complex, the company said last week. The actual disbursement is due to start from the beginning of 2012. Uz-Kor Gas Chemical, a joint venture ­between the state-owned Uzbekneftegaz and a consortium of South Korean companies, expects the $3.5bn complex to be completed by 2014.

CHINA'S SHANGHAI CHLOR-ALKALI TO EXPAND UNITS
China's Shanghai Chlor-Alkali Chemical has started expanding its chlor-alkali complex in Caojing, with completion expected in the fourth quarter. The company will increase the capacity of its 540,000 dry metric tonne/year (dmt/year) caustic soda plant by 180,000dmt. It also plans to double the capacity of its 360,000 tonne/year ethylene dichloride unit.

DSM AGREES TO ACQUIRE C5 YEAST COMPANY
Netherlands-based DSM has reached an agreement to acquire C5 Yeast Company from compatriot natural agricultural producer Royal Cosun, for an undisclosed sum. The acquisition will allow DSM to combine C5 Yeast Company's capabilities with its own yeast and enzyme technologies for the production of second generation biofuels, the life sciences and materials sciences firm said.

ENTERPRISE PLANS SIXTH NGL FRACTIONATOR
US-based midstream energy firm Enterprise Products Partners plans to build a sixth natural gas liquids (NGL) fractionator at its Mont ­Belvieu facility in Texas in response to growing shale gas production. The fractionator will add 75,000 bbl/day in capacity at Mont Belvieu, which is projected to begin service in early 2013, Enterprise officials said. The unit will boost Enterprise's fractionation capacity at Mont Belvieu to over 450,000 bbl/day. System-wide, the partnership's net fractionation capacity will increase to more than 780,000 bbl/day.

ETHANOL 'FLAWLESS' FUEL, SAYS NASCAR CEO FRANCE
Ethanol is proving to be a "flawless" fuel on the racetrack, delivering higher combustion than gasoline despite a small decrease in mileage, according to Brian France, chief executive of the US-based National Association for Stock Car Auto Racing (NASCAR). NASCAR began using a blend of 15% ethanol in gasoline (E15) this year under an agreement with ­several US ethanol makers and trade group Growth Energy. France said that he hoped the partnership with the US ethanol industry would help to debunk myths about the biofuel, including what he said was misinformation about the performance of the product. "I am tired of hearing lawnmower stories," he said to delegates, dismissing allegations by some consumer advocates that ethanol can damage certain types of engines, particularly those used in outdoor equipment.

LI HENG EYES MARCH 2012 FOR NYLON 6 START-UP
Chinese nylon manufacturer Li Heng Chemical Fibre Technologies plans to start up its 100,000 tonne/year nylon (or polyamide) chips plant in Fujian in March 2012, a company source said. Construction of the plant, which the company says will be the world's largest, is expected to be completed at the end of this year.

OLIN MOVES ON CHLOR-ALKALI CONVERSION
US-based chlor-alkali producer Olin has awarded an $80m (€57m) contract to convert its plant in Charleston, Tennessee, to membrane technology from mercury technology. Robins & Morton, the contractor, said that the project was to begin immediately. The plant has a capacity of 260,000 tonnes/year.

YIDU XINGFA TO START UP MAP, DAP PLANT IN 2012
China's Yidu Xingfa Chemical plans to start up its new 600,000 tonne/year ammonium phosphate plant at Yidu in Hubei in January 2012. The plant can produce 300,000 tonnes/year of monoammonium phosphate (MAP), consisting of 55% powdered MAP and 60% granular MAP, and 300,000 tonnes/year of 64% diammonium phosphate (DAP). Yidu Xingfa will then begin construction of a nitrogen phosphorus potassium (NPK) plant.

CHINA TO BEGIN ONE-YEAR REVIEW OF ECH DUTIES
China has decided to review its antidumping duties (ADD) on the import of epichlorohydrin (ECH) from Russia, South Korea, Japan and the US, the Ministry of Commerce said. China imposed the ADD on ECH imports on June 28, 2006. The review is expected to take one year and will help the government decide if removing the ADD will harm the domestic ECH industry, the Ministry of Commerce said. The ADD measure will ­continue throughout the period of the review.


By: Joseph Chang
+1 713 525 2653



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