This week's world news

07 December 2012 10:31  [Source: ICB]

AMERICAS

SASOL IN FEED STAGE FOR US GTL PLANT
Sasol is moving forward with the front-end engineering and design (FEED) phase for an integrated gas-to-liquids (GTL) facility and world-scale ethane cracker at its Lake Charles site in southwest Louisiana, US, the South African energy and chemicals company said. The $11bn-14bn (€8bn-11bn) GTL facility will produce 96,000 bbl/day of fuel, with the first phase operating in 2018, and the other phase the following year.

DOW DIVESTS BUSINESSES WITH SALES OF $1BN
US-based Dow Chemical will divest businesses with revenues of around $1bn (€770m) in the next 12 months, CEO Andrew Liveris said. The sales would be part of Dow's plan to deliver $1bn in cost and cash interventions in 2013, of which $500m will affect earnings before interest, tax, depreciation and amortisation (EBITDA).

BRASKEM PVC PLANT RESUMES PRODUCTION
Braskem has resumed normal production at its PVC plant in Camacari, Brazil. The plant underwent repairs for continuing technical issues after a fire caused a power outage at a substation transformer in late October. At the end of November, resin inventories were very low because existing stocks were drawn down during the maintenance. However, inventories are expected to reach normal levels in December as the Camacari plant is now functioning normally, local sources said.

INNOSPEC WITHDRAWS ITS BID FOR TPC GROUP
US specialty chemicals company Innospec withdrew its takeover bid of $47.50/share (€36.58/share) for US butadiene producer TPC Group on 3 December. Innospec said it still feels TPC is a good fit but was unable to conclude a deal structure that satisfied shareholders. The offer made on 15 November trumped the $45/share offer made by equity firms SK Capital and First Reserve on 8 November.

MAIRE TECNIMONT WINS BRASKEM IDESA CONTRACT
Maire Tecnimont has been awarded a $191.4m (€147.4m) engineering and procurement contract for a low-density polyethylene (LDPE) plant being developed by Brazils' Braskem and Mexico's Grupo Idesa, the Italian petrochemicals engineering firm said. The planned 300,000 tonnes/year LDPE plant will be constructed within the Ethylene XXI petrochemical complex being developed near Veracruz, Mexico.

BHS TO CONSTRUCT TACOMA DISTRIBUTION FACILITY
US-based BHS Specialty Chemical Products will expand the scope of its food-safe chemical manufacturing operations by developing a new production and distribution facility in Tacoma, Washington, US. The new site will more than double the company's production capacity, and will expand its reach in the Northwest and worldwide, said CEO Phil Johnson.

KEYBANC NAMES TOUKAN AS CHEMICALS HEAD
US-based investment bank KeyBanc Capital Markets has appointed Mario Toukan as head of the chemicals practice. Before assuming this role, Toukan spent 13 years as a mergers and acquisitions-focused banker, and served as KeyBanc Capital Markets' advisory lead for chemicals for the past several years.

BRAZIL CUTS IMPORT TARIFFS FOR CAPRO, PTA
Brazil's Chamber of Foreign Trade (Camex) said that it has temporarily lowered the nation's import tariffs on caprolactam (capro) and purified terephthalic acid (PTA) to safeguard the products' supply. The tariff on capro was cut from 12% to 2% for a period of 180 days and limited to a maximum quota of 26,000 tonnes. The tariff on PTA was cut from 12% to 0% and for a period of 90 days and is limited to a maximum quota of 42,000 tonnes.

PPG GRANTS TIO2 LICENCE TO HENAN BILLIONS
PPG Industries has agreed a licensing deal that gives China's Henan Billions Chemicals the worldwide right to use PPG's technology for the manufacture of chloride-grade titanium dioxide (TiO2), the US chemicals, coatings and materials firm said. Henan Billions is a supplier of sulphate-grade TiO2 to PPG.


EUROPE

INEOS TO BRING US FEEDSTOCK TO EUROPE
INEOS is to move forward with plans to ship US-derived feedstocks to its European operations with the construction of a new ethane tank in Norway, the company said. The Switzerland-headquartered chemical major has signed a letter of intent with Germany's TGE Gas Engineering to build the tank and expand related infrastructure at the company's Rafnes site in Norway, with the facility expected to be operational from the second quarter of 2015.

CEO TON BUCHNER RETURNS TO AKZONOBEL
AkzoNobel's supervisory board has said CEO Ton Buchner will return to work on Friday, 7 December, following a full recovery from fatigue. On 18 September, the Netherlands-headquartered coatings and specialty chemicals group said Buchner was taking a temporary leave of absence because of the medical condition.

BANK QUESTIONS POLAND'S ORLEN PETCHEM FORECAST
Polish oil and petrochemical group PKN Orlen has overestimated its likely petrochemical profitability for the next five years in its 2013-2017 strategy, an investment bank said. "Orlen assumes an [average] €812/tonne [$1,055/tonne] petchems [model] margin, whereas this margin has never averaged above €800/tonne since Orlen began publishing [its strategy] (2008-2012), not even on a quarterly basis," Wood & Company said in a note to investors.

UK GOVERNMENT TO SIMPLIFY REGULATION
The UK government is to establish a dedicated government office for shale gas to simplify regulations for the sector, and is to consult on tax breaks for the industry, UK Chancellor of the Exchequer George Osborne said. The new office is to provide a single point of contact for investors in shale gas extraction, which is currently banned in the country, and to ensure a "simplified and streamlined" regulatory process.

FIRST WAVE OF PROPOSALS EXAMINED BY ECHA
The European Chemicals Agency (ECHA) has examined all proposals to test substances submitted by the first Reach (Registration, Evaluation, Authorisation and Restriction of Chemicals) deadline, it said. Draft or final decisions have been issued to each Reach registered company that had submitted a proposal based on the identification of a data gap regarding information requirements, it added.

POLAND'S ZCHP CLAIMS 'MOST DIVERSIFIED' GAS
Zaklady Chemiczne Police (ZChP) is set to have the most diversified gas supplies among Poland's chemical companies following the signing of two contracts worth a combined zloty (Zl) 207.6m ($65.7m, €50.6m), the nitrogen phosphorus potassium (NPK) fertilizer and titanium dioxide producer said. The contracts, a two-year agreement for German gas with E.ON Ruhrgas worth Zl 107.7m and a one-year deal with Poland's Egesa Energy Group valued at Zl 99.9m, will take effect in 2013 in line with the liberalisation of Poland's gas supply market.

EU CHEMICALS OCTOBER PRODUCER PRICES RISE
The EU chemicals producer price index rose by 0.4% in October from the previous month, official statistics agency Eurostat said. This was the third consecutive monthly increase, following two months of decline in June and July. The index for the 17-member eurozone also rose in October by 0.5%, following the same monthly pattern of increase and decline. On a year-on-year basis, the EU's chemical producer price index was 2.9% higher, while the eurozone's index was up by 3.5%.

PKN ORLEN NOVEMBER PETCHEM MARGIN FALLS
PKN Orlen's model petrochemical margin fell 4.3% to €719/tonne ($934/tonne) in November from €751/tonne in October, the Polish group said. However, the figure remained 17% ahead of the €614/tonne model margin recorded in November 2011. An assessment of the figures should take into account the fact that one year ago the petrochemical market was going through "a very depressed period", investment bank Wood & Company said.

UK'S ECO PLASTICS RAISES CAPITAL FOR EXPANSION
UK plastic-bottle recycling company ECO Plastics has raised £6m ($9.6m, €7.9m) from existing investors to finance its expansion plans over the next year, shareholder the Ludgate Environmental Fund (LEF) said. LEF and SAM Private Equity are among the backers contributing to the capital-raise, which will be used to fund "short-term added-value expansion opportunities", according to European cleantech sector-focused investor LEF.

BRENNTAG AGREES TO POLYMER DEAL WITH DOW
Brenntag has agreed a deal with Dow Consumer & Industrial Solutions to distribute the US company's range of scale inhibition polymers in central Europe, eastern Europe and Turkey, the Germany-based chemical distributor said. The agreement is effective as of 1 January 2013, and builds on an existing contract between the two companies for Brenntag to distribute Dow's scale inhibition polymers in western Europe. Financial details of the deal were not disclosed.


MIDDLE EAST & AFRICA

SAMAPCO CAUSTIC SODA PLANT TO START UP IN 2013
Saudi Arabia's Sahara & Ma'aden Petrochemicals Co (SAMAPCO) will start up its 250,000 tonne/year caustic soda and 300,000 tonne/year ethylene dichloride (EDC) plant in the first quarter of 2013, a company source said. The plant will be located in Jubail Industrial City, Saudi Arabia, to allow ethylene to be delivered by pipeline, the source added. The project will be completed by the end of 2012 and start up is expected in the first quarter of next year.

IRAQ TO PLAY CRUCIAL ROLE IN GLOBAL OIL MARKET - IEA
Iraq is set to play a pivotal role in the global oil market over the next few decades, accounting for 45% of the growth in crude production through to 2035, the International Energy Agency's (IEA) chief economist Fatih Birol says. Iraq's oil output in 2012 is 3m bbl/day, and the country is expected to double its output to 6m bbl/day by 2020, Birol said. By 2035, Iraq is expected to produce more than 8m bbl/day of oil, he added.


ASIA

INDIA PU DEMAND SET TO SOAR
India's polyurethane (PU) demand is expected to continue double-digit growth over the next two years, despite challenges, Rahul Gautam, chairman of the Indian Polyurethane Association said.

AKZONOBEL TO RESTART ETHANOLAMINES PLANT
AkzoNobel is in the process of restarting its ethanolamines plant China's Zhejiang province after a brief shutdown, a source close to the company said. The 80,000 tonne/year unit at Ningbo was taken off line on 1 December for mechanical works, the source said. Sales will resume after a short suspension when the plant was shut, the source said. The Ningbo plant produces monoethanolamine (MEA) and diethanolamine (DEA).

HONAM TO RESTART CHINA ETHANOLAMINES UNIT
South Korea's Honam Petrochemical planned to restart its 50,000 tonne/year ethanolamines plant in China's Zhejiang province on 8-9 December after a 10-day maintenance, a company source said. The plant at Jiaxing was shut at the end of November for minor repairs of its utility facilities, said the source, adding that unfavourable market conditions were taken into consideration in the plant's shutdown.

CHINA'S ZRCC TO RESTART ZHEJIANG LLDPE PLANT
China's Zhenhai Refining & Chemical Company (ZRCC) plans to restart its 450,000 tonne/year linear low-density polyethylene (LLDPE) plant at Zhejiang province on 7 December, a company source said. The turnaround started on 3 December, the source added. Local distributors said the restart would significantly increase the supply to the local market as Zhenhai Refining & Chemical is one of the major PE producers in east China.

TAIWAN'S TSRC TO KEEP 80% DECEMBER RUN RATE
Taiwan's TSRC will continue running its 100,000 tonne/year styrene butadiene rubber (SBR) plant in Kaohsiung at 80% of capacity throughout December because of prevailing weak market conditions. The plant operated at the same reduced rate last month. Abundant supply and weak demand have been depressing SBR prices in recent months.

GLOBAL PROPYLENE ANNUAL DEMAND GROWTH
Global propylene (C3) demand is expected to grow at an annual rate of 4% in 2011-2015, in line with economic expansion, an industry consultant said. While polypropylene (PP) is the main downstream for C3 consumption, Wonsoo Byun of energy consulting firm NEXANT ­commented that another downstream sector - the acrylic acid market - is ­expected to show the strongest increase in demand for the ­monomer.

SAMSUNG FINE CHEMICALS RUNS ECH PLANT AT 100%
South Korea's Samsung Fine Chemicals is operating its 60,000 tonne/year epichlorohydrin (ECH) plant in Daesan at 100% of capacity amid stable demand for the product. The company is operating the unit at full rates on stable-to-firm demand in the domestic South Korean market despite prevailing weak demand in the other Asian regions.

MITSUI CAPS PHENOL/ACETONE OUTPUT AT 70%
Japan's Mitsui Chemicals plans to continue running its Osaka phenol/acetone plant at a reduced rate of 70% in December because of an ongoing margin squeeze, a company official said. Output at the Osaka plant, which can produce 200,000 tonnes/year of phenol and 120,000 tonnes/year of acetone, will be capped at 70% of capacity for the entire month, unchanged from November, the official said.

GLOBAL SALES FROM PU PRODUCT MARKET TO GROW
Global sales from the polyurethane (PU) product market are expected to grow to $43.5bn (€33.5bn) this year, up from $40.6bn last year, buoyed by demand from the key Asia Pacific market, a senior industry executive said. "[The] Asia Pacific region represents the fastest growing PU market in the world, forecasted to expand at a pace of about 6% through to 2017," said Erman Tan, CEO of Asia Polyurethane Manufacturing.

BASF-YPC ACRYLATES UNITS UNDERGO MAINTENANCE
China's BASF-YPC Company plans to shut down its acrylic acid (AA) and acrylate esters units in Nanjing for three weeks of maintenance in January 2013, a company source said. The company has a 160,000 tonne/year crude AA unit; a 60,000 tonne/year glacial AA unit; a 55,000 tonne/year methyl acrylate/ethyl acrylate swing unit; and a 100,000 tonne/year butyl acrylate unit at the site. BASF-YPC is a major supplier of AA and acrylate esters in China.


By: Will Beacham
+44 20 8652 3214



AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly