This week in brief

23 September 2013 00:00  [Source: ICB]

AMERICAS

ROCKWOOD TIO2, OTHER ASSETS SOLD TO HUNTSMAN
Huntsman is to acquire fellow US producer Rockwood’s performance additives and titanium dioxide (TiO2) business for $1.1bn (€825m) in cash, and assume unfunded pension liabilities of around $225m. The deal will make Huntsman the second-largest global producer of TiO2 and inorganic colour pigments, said CEO Peter Huntsman. The combined Huntsman and Rockwood pigments businesses would be subject to a public offering within two years of the transaction closing, he said.

FORMOSA DECLARES FORCE MAJEURE ON HDPE IN TEXAS
Formosa Plastics declared force majeure on its high density polyethylene (HDPE) products on 17 September, due to “unexpected operational difficulties” at its plant in Point Comfort, Texas, US following an incident that sent five to the hospital. Formosa did not elaborate on the accident, but the local newspaper, the Victoria Advocate, said it was a flash fire. The company has capacity to produce 650,000 tonnes/year of PE in Point Comfort, according to ICIS plants and projects.

VENEZUELA TO INVEST $4BN INTO PLASTIC PRODUCTION
Venezuelan petrochemicals producer Pequiven plans to invest some $4bn (€3bn) in a string of construction projects aimed at increasing production of plastic resins and guaranteeing supply to domestic producers. Projects include the construction of the 800,000 tonne/year Olefins III plant, a 300,000 tonne/year high-density polyethylene (HDPE) plant and a 300,000 tonne/year low-density polyethylene (LDPE) plant. Other proposals include a 37,000 tonne/year biaxially oriented polypropylene (BOPP) plant, a 240,000 tonne/year polyethylene terephthalate (PET) plant and a 460,000 tonne/year homopolymer and copolymer plant.

NOVA CHEMICALS TO SHUT EPS PLANT IN SEP
NOVA Chemicals will shut down in late September its expandable polystyrene (EPS) plant in Painesville, Ohio, US to perform maintenance, a market source familiar with the situation said. The plant, which has 45,000 tonnes/year of capacity, will only be shut for a week, and the maintenance had been scheduled ahead for months, the source added. NOVA has another EPS plant in Beaver Valley, Pennsylvania, US with 81,500 tonnes/year capacity which will continue operations.

AIRGAS SECURES LIQUID CO2 FROM ETHANOL PLANT
An Airgas subsidiary has signed a long-term supply agreement for liquid carbon dioxide (CO2) from Fox River Valley Ethanol’s plant in Oshkosh, Wisconsin, the US-based industrial gas supplier announced. Airgas Carbonic will market food and beverage-grade liquid CO2 co-products from the plant, which will start up in October and produce 250 tons/day of liquid CO2.

ELEVANCE SUPPLIES C18 DIACID FOR NEW NYLONS, PU
US-based Elevance Renewable Sciences has started selling octadecanedioic acid (ODDA), a C18 diacid that could allow a new family of nylon resins to reach the market as well as new types of polyurethanes. Elevance started making ODDA from starting materials made at its new biorefinery in Gresik, Indonesia. Elevance built the biorefinery using its technology in a joint venture with Wilmar International. Diacids are one of the two building blocks for nylons, the other being diamines.

FLUOR GETS CONTRACT FOR METHANOL PROJECT
Fluor has received the engineering and design contract for a 5,000 tonne/day methanol plant in St. James Parish, Louisiana, the US-based engineering firm said. South Louisiana Methanol (SLM) announced earlier this year it would build the largest methanol plant in North America in partnership with Todd Corp of New Zealand. The plant will produce 1.8m tonnes/year of methanol, with a design similar to that of the M5000 plant in Trinidad, according to SLM’s website.

SHERWIN-WILLIAMS COMPLETES COMEX BUY
US-based Sherwin-Williams has completed its acquisition of Mexican coatings and painting firm Consorcio Comex for $90m (€68m) in cash and the assumption of about $75m in liabilities. The purchase still must be approved by Mexico’s Federal Competition Commission, which in July rejected the deal after it had been agreed to in November 2012. Sherwin-Williams and Comex remain committed to securing regulatory approval and have extended the exclusivity period to 31 March 2014.

BRAZIL PUTS ANTI-DUMPING TARIFFS ON ASIA NYLON
Brazil’s chamber of foreign trade (Camex) has applied provisional anti-dumping measures to nylon imports from China, South Korea, Thailand and Taiwan. The anti-dumping measures apply for up to four months. Import tariffs range from $220.70/tonne (€165.53/tonne) on several producers in Taiwan to $2,409.11/tonne for several Chinese producers. As a rule, Camex imposes provisional tariffs when it begins an investigation into possible dumping of product into the Brazilian market.

US BUILDER CONFIDENCE FLAT IN SEPTEMBER
Market confidence among US housing contractors held steady in September following four straight months of gains, indicating a pause in builder outlook as home prices and interest rates increase. In its monthly survey of business prospects among its members, the National Association of Home Builders (NAHB) said that its housing market index (HMI) held steady at 58 last month, the same as the downwardly revised August reading of 58. The August HMI had originally been estimated at 59.

EUROPE

EU CLEARANCE SOUGHT FOR INEOS/SOLVAY PVC JV
INEOS and Solvay have submitted their PVC (polyvinyl chloride) joint venture for competition clearance by the European Commission. The companies signed a letter of intent in May to combine their chlor-vinyls businesses in a 50:50 joint venture. The merged business would have combined net sales of €4.3bn and recurring earnings before interest, taxes, depreciation and amortisation of €257m, and more than 5,600 employees, based on figures in 2012. It would be active in the vinyls chain from chlor-alkali to PVC.

GERMANY INVESTOR CONFIDENCE RISES
Germany’s investor confidence continued to rise in September, reaching its highest level in more than three years, a research group said, citing a survey. Mannheim-based ZEW Centre for European Economic Research said that its monthly investor confidence index for Germany rose to 49.6 points in September, up 7.6 points from August. The index is based on responses from 260 financial market analysts who were asked about their expectations for Europe’s largest economy in the next six months.

UNIPETROL’S CRACKER HAS ANOTHER SHUTDOWN
Unipetrol’s 545,000 tonne/year ethylene steam cracker has gone into an unplanned shutdown that is expected to last two weeks, the Czech refiner and petrochemical company said. The shutdown, caused by unexpected technical difficulties, would also limit polymer production at the site of the cracker, Chempark Zaluzi in Litvinov in the northern Czech Republic. It could also affect refinery units that provide feedstock to the unit, it added.

CIECH ARM RESTARTS EPOXY RESINS PLANT
Poland-based epoxy resins producer Zaklady Chemiczne Organika-Sarzyna has restarted its liquid epoxy resins (LER) plant in Nowa Sarzyna after annual planned maintenance. Organika-Sarzyna is the epoxy producing arm of Polish chemical group Ciech. The shutdown started on 12 August and ended last week. The plant’s capacity was not disclosed. Meanwhile, Czech epoxy resins producer Spolchemie restarted its epoxy resins plant after a brief shutdown in August. According to ICIS, the epoxy resins plant has a nameplate capacity of 60,000 tonnes/year.

EU JAN-JUNE CHEMICALS TRADE SURPLUS UP 5.2%
The EU chemical products trade surplus for January to June increased by 5.2% from the same period last year, official data showed. The chemicals trade surplus rose to €58.6bn ($78.1bn) from €55.7bn in the same period of 2012, according to official EU statistics agency Eurostat. Non-seasonally adjusted data showed that chemical exports from the EU27 increased by 1% year on year during the period to €138.7bn, while imports declined by 2% to €80.1bn.

SOLVAY TO SHUT DOWN ECH UNIT IN GERMANY
Belgium-based producer Solvay will shut down its epichlorohydrin (ECH) plant in Rheinberg, Germany, for planned maintenance from 7-16 October, a company source said. The company will supply its customers from inventories and also by ramping up production at its other plant in Tavaux, France. According to ICIS, the Rheinberg plant has a nameplate capacity of 60,000 tonnes/year. In related news, Czech-based Spolchemie has restarted its 26,000 tonne/year ECH plant in Usti nad Labem after a brief shutdown in August.

STRONGER GDP GROWTH BOOSTS INDUSTRIAL CHEMS
Stronger global economic growth is expected to favour the stock performance of industrial chemical companies over agrochemical producers, Bernstein Research said. In a note to clients the research firm said that it was expecting European companies such as Air Liquide, Linde, AkzoNobel and BASF to outperform in the chemicals market for the rest of 2013 while it moved K&S, Yara and Syngenta into its underperform category.

RUSSIA’S PETROCHEMICAL OUTPUT MIXED IN 2013
Russia’s overall production of chemical and petrochemical products was mixed in January-August, statistical agency Rosstat said. In January-August 2013, the country’s total output of mineral fertilizers was down by 1.4% year on year at 12.2m tonnes, said the agency. Ammonia output was 4% up year on year at 9.5m tonnes. Plastics production was 13.8% up year on year at 4m tonnes, the agency said. Synthetic rubber production was 6% higher year on year at 990,000 tonnes.

BORSODCHEM TDI T2 UNIT REMAINS OFF LINE
BorsodChem’s toluene di-isocyanate (TDI) T2 facility in Kazincbarcika, Hungary, remains down because of ongoing repair work, and the existing force majeure on TDI at the site remains in place, a company source said. The TDI T2 unit is expected to resume output by the end of the week ending 20 September. At the end of August, BorsodChem experienced a failed restart at its TDI T2 plant because of a serious technical issue and the unit has been off line since then.

ARKEMA TO DISCUSS CLOSURE OF PA, DOP PLANT
Arkema’s management is to convene this week to discuss the closure of its dioctyl phthalate (DOP) and phthalic anhydride (PA) production facility in Chauny, France, a spokesperson for the company said. An extraordinary meeting of the Arkema Central Works Council is to take place on 19 September. According to the spokesperson, the negotiations regarding the closure of the site have arisen because of a slumping market for the products in Europe.

BASF MDI ANTWERP FACILITY TEMPORARILY OUT
BASF’s methyl di-p-phenylene isocyanate (MDI) facility in Antwerp, Belgium, has temporarily shut down and this is likely to last until the middle of the week ending 20 September, a company source said. The shutdown has been caused by recent ongoing production problems. Output has been reduced at the Antwerp facility since early August for technical reasons. The Antwerp plant has a nameplate capacity of 560,000 tonnes/year and is the largest MDI unit in Europe.

ORLEN TARGETS FRACKING TECH WITH TRIOIL DEAL
Poland’s PKN Orlen hopes that the acquisition of Canada’s TriOil Resources for Canadian dollar (C$) 183.7m in cash will give it access to shale gas fracking know-how and technology, the refining and petrochemical company said. Orlen’s offer for 100% of TriOil, made through wholly-owned subsidiary Orlen Upstream at C$2.85 per common share, has been accepted by the acquisition target’s board of directors, and will be put to a shareholders’ vote at a general meeting scheduled for November, it added.

BASF BUILDING PLANT FOR INSULATING MATERIALS
BASF is building a pilot plant at its Lemforde site in Germany that will produce sample quantities of a new aerogel-based insulating material from the middle of next year, the chemicals major said. BASF’s SLENTITE material will be used by the construction and refrigeration sectors. “The company now intends to realise pilot projects with selected partners in architecture and industry,” BASF said.

ASIA

FORCE MAJEURE AT SINGAPORE SM/PO PLANT
Ellba Eastern has declared a force majeure on supply from its Singapore plant, a spokesperson from its parent firm Shell said. “We can confirm that Ellba Eastern has declared force majeure on Shell with effect from 16 September. We continue to closely monitor the situation,” the spokesperson said in an e-mailed statement. Ellba Eastern’s Singapore plant has a nameplate styrene monomer (SM) capacity of 550,000 tonnes/year and a propylene oxide (PO) capacity of 250,000 tonnes/year.

FCFC TO RESTART TWO KAOHSIUNG SM UNITS
Taiwan’s Formosa Chemicals & Fibres Corp (FCFC) plans to restart its two styrene monomer (SM) units in Kaohsiung earlier than expected in end-September. Its 250,000 tonne/year No 1 and 350,000 tonne/year No 2 SM units at the site were shut since late August for maintenance and were supposed to resume production in mid-October, the source said. FCFC also operates a 600,000 tonnes/year No 3 SM plant in Kaohsiung that is currently running at full capacity, the company source said.

DAIREN CHEMICAL TO SHUT MAILIAO VAM PLANT
Taiwan’s Dairen Chemical Corp plans to shut its 300,000 tonne/year No 2 vinyl acetate monomer (VAM) plant at Mailiao in end-September for three weeks of maintenance, a company official said. Its other 350,000 tonne/year No 3 VAM plant at the site will continue to operate normally during the shutdown of the No 2 plant, the official said.

HPCL SEEKS TOTAL, BP FOR PETROCHEMICAL PROJECT
Hindustan Petroleum Corporation Limited (HPCL) will approach Total and BP offering partnership for its $6bn (€4.5bn) 9m tonne/year refinery cum petrochemical complex in Rajasthan, an official in India’s Ministry of Petroleum and Natural Gas said.


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