This week's world news

11 January 2013 11:32  [Source: ICB]

AMERICAS

ENTERPRISE MULLS SECOND PDH UNIT
US propylene maker Enterprise Products said it is considering building a second propane dehydrogenation (PDH) facility, citing anticipation of a continuing decrease of propylene supplies in the US. The company plans to launch production at its first PDH facility in the third quarter of 2015, bringing about 1.65bn lb/year (750,000 tonne/year) of new polymer-grade propylene (PGP) capacity to the US market. The company did not provide details on capacity or a timeframe for the construction of a second plant.

PETROLOGISTICS RESTARTS PDH PLANT AFTER OUTAGE
US propylene producer PetroLogistics has restarted its propane dehydrogenation (PDH) plant in Texas after completing unscheduled repairs on the unit, the company said. The 544,000 tonne/year facility was taken down on 17 December.

HUNTSMAN SHUTS DOWN PORT NECHES CRACKER
Huntsman said it has shut down its Port Neches cracker in Texas for planned maintenance. The 193,000 tonne/year plant is expected to be off line for 45 days, according to information in the market. The shutdown, which was originally planned for the fourth quarter of 2012, includes an expansion that will raise capacity at the unit by 230m-240m lb/year (104,000-109,000 tonnes/year).

EXXONMOBIL FLARES TEXAS CRACKER IN BAYTOWN
ExxonMobil reported flaring from its Baytown cracker in Texas, citing a gas-compressor trip. The company reduced rates, restarted the compressor and stabilised the unit to minimise emissions, according to the filing with Texas Commission on Environmental Quality (TCEQ). It has two crackers in Baytown with a combined 2.2m tonnes/year of ethylene capacity.

YPFB TO START UP LIQUID SEPARATION FACILITY IN MAY
Bolivia's Yacimientos Petroliferos Fiscales Bolivianos (YPFB) said its Rio Grande liquids separation plant in the eastern Bolivian department of Santa Cruz will begin operations in May. The plant will process around 5.6m cubic metres (Mm³)/day of natural gas and produce 361 tonnes/day of liquefied petroleum gas (LPG), the state-run oil company said. The plant will also produce 350 bbl/day of gasoline and 195 bbl/day of isopentane.

TRANSCANADA GETS NOD FOR PETRONAS PROJECT
Malaysia's state oil and petrochemicals major PETRONAS has selected energy infrastructure firm TransCanada as partner for a planned $5bn natural gas pipeline transmission project in ­western Canada, officials said. The 750-kilometre pipeline, called "Prince Rupert Gas Transmission Project", will ship gas from the North Montney gas-producing ­region in British Columbia to Progress' planned liquefied ­natural gas (LNG) export facility near Prince Rupert on the British Columbia coast. Initial capacity would be 2.0bn cubic feet of gas/day, with the ability to expand to 3.6bn cubic feet of gas/day. The estimated in-service date is the end of 2018.

GOLDEN GATE CAPITAL BUYS CHEM PRODUCER ARRMAZ
US private equity firm Golden Gate Capital has acquired mining chemicals producer ArrMaz Custom Chemicals from private equity firm Snow Phipps, said The Valence Group, the investment bank that advised Golden Gate Capital on the deal. In addition to mining chemicals, Arrmaz also produces fertilizer chemicals, nitrogen additives and products used in asphalt paving. ArrMaz also has a water-treatment consulting business.

CHEMICAL TANKER TRAFFIC ON TEXAS WATERWAY RISES
December chemical tanker arrivals on the Houston Ship Channel rose 48% year on year, continuing the swell of vessels carrying ­petroleum products and by-­products on the waterway, according to data from the Greater Houston Port Bureau (GHPB). For all of 2012, chemical tanker arrivals rose 75% year on year to 170, marking 15 straight months of big gains that began in late 2011. There were 1,613 chemical tanker arrivals from January through December, compared with 924 in 2011. Crude tanker traffic fell by 19% during the year to 2,855 vessels, compared with 3,539 tankers in 2011.

DOW CORNING TO LAY OFF 500 EMPLOYEES
Dow Corning will lay off about 500 employees to restructure the company with the volatile global economy, the US silicone producer said. The involuntary separation programme over the next weeks will affect mostly those in the professional ranks, the company said. The company is a joint venture between Dow Chemical and Corning. Dow Corning said the announcement does not affect Hemlock Semiconductor, a joint venture with Shin-Etsu and Mitsubishi that produces polycrystalline silicon for semiconductor and solar wafer manufacturing.

NEW SHAWNEE CEO TAKES OVER AS FOUNDER RETIRES
Terrence Hurley, founder of US-based polyvinyl chloride (PVC) resins and additives distributor Shawnee Chemical, retired as CEO of the company as of 31 December 2012 with president David Peters assuming the CEO role. Hurley started his career in PVC in the 1950s in sales with Union Carbide and also worked at Stauffer Chemical in the 1960s and Whitaker in the early 1970s. He founded Shawnee in 1976.


EUROPE

LANXESS AGREES NEW €1.25BN CREDIT DEAL
Germany's specialty chemicals maker LANXESS has signed a new €1.25bn ($1.64bn) syndicated credit agreement with an international banking consortium, the company said. The agreement has a five-year maturity and contains two separate one-year extension options. This agreement replaces the company's existing €1.4bn credit line due to mature in November 2014.

CZECH CHEMICALS OUTPUT EDGES UP 0.2% IN NOV 2012
Production of chemicals and chemical products in the Czech Republic edged up 0.2% year on year in November 2012, the Czech Statistical Office (CZSO) said. Overall industrial production fell 3.9%, with the biggest decline in industrial segments seen in the manufacture of rubber and plastic products, which sank 15.6%, it added. The production of motor vehicles, trailers and semi-trailers grew 0.3%, the CZSO added.

UNIPETROL'S POLYOLEFIN MODEL MARGIN FALLS
Unipetrol's model polyolefin margin edged down to €228/tonne ($300/tonne) in December 2012 from €234/tonne in the previous month, the Czech petrochemical producer said. The company's model olefin margin rose to €377/tonne in December from €362/tonne in November, it added. In December 2011, the model polyolefin and model olefin margins stood at €205/tonne and €236/tonne, respectively.

CHEMS PRODUCER PRICES FALL BY 0.6% IN NOVEMBER
The EU chemicals producer price index fell by 0.6% in November from the previous month, statistics agency Eurostat said. The index for the 17-member eurozone fell by 0.8% month on month in November, with the producer price drops following three months of consecutive growth for both regions.

FITCH CANCELS RATINGS AS PETKIM ENDS PARTICIPATION
Fitch Ratings has withdrawn all its ratings on major Turkish petrochemical producer Petkim, the agency said. In a statement, Fitch said: "Fitch has withdrawn the ratings as Petkim has chosen to stop participating in the rating process. Therefore, Fitch will no longer have sufficient information to maintain the ratings. Accordingly, Fitch will no longer provide ratings or analytical coverage for Petkim." The controlling shareholder in Petkim is the State Oil Company of the Azerbaijan Republic (SOCAR).

BAYER CROPSCIENCE BUYS GERMANY'S PROPHYTA
Bayer CropScience, a subgroup of Germany-based chemicals major Bayer, has signed an agreement to acquire microbial crop protection products supplier Prophyta, the company said. Financial details of the deal, expected to close within a few weeks, were not ­disclosed. Prophyta, which employs a total staff of approximately 30 full-time employees, is headquartered in Malchow on the island of Poel in Mecklenburg-­Vorpommern, Germany.

GERMANY INDUSTRIAL ORDERS FALL 1.8% IN NOV
Germany's industrial orders fell 1.8% in November from October, mainly because of lower orders from abroad, the country's economics ministry said. November's decline came after a revised 3.8% increase in industrial orders in October from September, the ministry said. On a two-month sequential comparison (October-November against August-September) orders rose 1.6%. Compared with October-November 2011, orders fell 1.7%.

BASF SELLS SCHAFFHAUSEN, ASSETS IN SWITZERLAND
BASF has agreed to sell its CONICA Sports Surfaces business in Schaffhausen, Switzerland, as well as a site it operates in the area, the Germany-based chemicals giant said. The assets are to be acquired by Serafin Group, a Munich-based, family-owned industrial conglomerate. Both parties declined to disclose financial details.


ASIA

CHINA'S ZHONGYAN DEBANG RUNS SODA ASH AT 80-90%
China's Zhongyan Debang Chemical is running its 300,000 tonne/year soda ash plant at Lianyungang city in Jiangsu province at 80-90% capacity, following its restart on 10 January, a company source says. The plant was shut on 5 January for scheduled maintenance, according to the source.

The loss of soda ash output during the shutdown was 4,000 tonnes. The producer's light-grade soda ash offer on 10 January was at yuan (CNY) 1,230/tonne ($197/tonne) EXW (ex-works), unchanged from 4 January, the source added.

SINOPEC CHANGLING STARTS BUILDING NEW PO PLANT
Sinopec Changling Co has started construction of its new 100,000 tonne/year propylene oxide (PO) plant at Hunan province in central China, a source close to the company said. The yuan (CNY) 1.28bn ($205m) plant is the world's first facility that will use propylene and hydrogen peroxide as feedstock for PO production, according to the source. No timeline was provided on the plant's start-up. PO is a major feedstock in the production of propylene glycol (PG).

ARAMCO ASIA MARKETS FREP POLYOLEFINS IN CHINA
Aramco Asia has officially tapped into China's petrochemical market with the start of marketing polyolefins in China on 1 January 2013, a statement from the company said. Aramco Asia will annually sell 200,000 tonnes of polyethylene (PE) and 130,000 tonnes of polypropylene (PP), produced by Fujian Refining & Petrochemical (FREP), through Aramco Asia's branch office in Xiamen, Fujian province located in south China. In addition to polyolefins, Aramco Asia also plans to market a variety of other petrochemicals such as aromatics in the Asia area.

HC PETROCHEM ACHIEVES ON-SPEC AT NEW PX UNIT
South Korea's HC Petrochem achieved on-spec production at its new 800,000 tonne/year paraxylene (PX) unit at Daesan in South Korea on 8 January, market sources said. The unit was restarted on 7 January, and has achieved on-spec production, according to several market players. The company initially started the new plant during the week ended 4 January, but it was then shut due to a technical glitch, they added.

JSR RAMPS UP EPDM PLANT OP RATE TO 100% IN JAN
Japan's JSR Corp increased the operating rate of its 36,000 tonne/year ethylene propylene diene monomer (EPDM) plant in Kashima, Japan, by 10-20 percentage points to 100% of capacity in January, a company source said. The Kashima plant was running at a reduced rate of 80-90% of capacity in December because of poor market conditions. "We are increasing our operating rates because we are building up inventories to prepare for our annual turnaorund in May," the source added. The Kashima plant will be shut for one month for annual maintenance until the end of June, the source said.

JAPAN VAM PRODUCTION GROWS 9% YEAR ON YEAR
Japan's production of vinyl acetate monomer (VAM) in November 2012 increased by 9% year on year to 51,398 tonnes, official industry data showed. Domestic shipments of VAM for the production of polyvinyl alcohol (PVOH) rose by 6% to 36,780 tonnes, according to the Sakubi poval kogyokai (VAM PVOH industry association). However, domestic shipments for adhesives fell by 24% year on year to 2,407 tonnes, while exports were up by 12% to 1,000 tonnes, the data showed.

MOC SCHEDULES CRACKER TURNAROUND FOR NOV-DEC
Map Ta Phut Olefins Co (MOC) plans to shut its 900,000 tonne/year naphtha cracker in Thailand for a 45-day turnaround in ­November-December, a source close to the company said. The cracker shutdown is in line with a turnaround at the company's aromatics unit. Map Ta Phut Olefins is a joint venture between Thailand's largest conglomerate Siam Cement Group (SCG) and US major Dow Chemical. SCG and Dow also jointly operate Rayong Olefins' (ROC) 800,000 tonne/year naphtha cracker. The facility is not scheduled for maintenance this year, the source added.

SIAM CEMENT PLANS AROMATICS TURNAROUND
Thailand-based Siam Cement Group (SCG) plans to shut its joint venture's Map Ta Phut Olefins Co (MOC)'s aromatics unit in November or December for a 45-day scheduled maintenance, a company source said. MOC's aromatics plant is able to produce 160,000 tonnes/year of benzene, 80,000 tonnes/year of toluene and about 60,000 tonnes/year of solvent grade xylene, the source said. MOC is a joint venture between SCG and Rayong Olefins Co (ROC).

LG CHEM ACHIEVES ON-SPEC CUMENE OUTPUT IN DAESAN
South Korea's LG Chem has achieved on-spec cumene output at its new phenol/acetone plant in Daesan, a company source said. The on-spec cumene output was achieved over the weekend of 5-6 January, the company source added. Cumene, a feedstock for phenol/acetone, is an intermediate produced from benzene and propylene. Trial runs at LG Chem's new phenol/acetone plant, which has a phenol nameplate capacity of 300,000 tonnes/year and an acetone nameplate capacity of 180,000 tonnes/year, began in early January. The producer's downstream bisphenol-A (BPA) plant in Daesan has a nameplate capacity of 150,000 tonnes/year.

TAIWAN'S CMMFC EYES NEW EG PLANT START-UP IN Q4
Taiwan's China Man-Made Fiber Corp (CMMFC) has targeted to start-up its new 200,000 tonne/year ethylene glycol (EG) plant in Kaohsiung in the fourth quarter of 2013, a company source said. The new EG plant in Dashe district produces both monoethylene glycol (MEG) and diethylene glycol (DEG), the source said. It will receive raw material ethylene from Taiwan-based CPC Corp's new cracker at Linyuan.


By: Will Beacham
+44 20 8652 3214



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