News in brief

06 December 2013 09:46  [Source: ICB]

EUROPE

INEOS CONFIRMS GRANGEMOUTH CLOSURES
Switzerland-headquartered producer INEOS has confirmed that it is to close its 320,000 tonnes/year G4 naphtha cracker at its Grangemouth, UK facility by the second quarter of 2015. Several downstream units at the site are also slated for closure, according to INEOS Petrochemicals UK chairman, Calum MacLean. A benzene unit is to close by the end of this year, while a butadiene unit is to close by the first quarter of 2015. Meanwhile, the company is planning to bring its 700,000 tonnes/year natural gas liquids KG cracker at the site back up to full capacity.

INEOS TO COMPLETE TANK DESIGN BY Q1 2014
The design work for a terminal to receive imports of shale-derived ethane from the US at the Grangemouth, UK petrochemicals complex operated by Swiss chemical producer INEOS could be completed by the first quarter of 2014, the company said. Negotiations are currently taking place for long-term gas import contracts, and the facility could be on line and receiving imports by 2016, the company added. The capacity of the ethane tank is expected to be 33,000 tonnes, according to INEOS.

INEOS TO EXPAND RAFNES CRACKER CAPACITY
Switzerland-headquartered chemicals producer INEOS said that it is to expand the cracker capacity at its Rafnes, Norway complex by 50,000 tonnes/year. The expansion is to be achieved through the development of a twelfth furnace at the unit, and will bring the unit’s capacity to 620,000 tonnes/year, the company added. The expansion is due to be completed by the end of 2015 following the installation of additional tank storage and related infrastructure to allow the import of shale-derived ethane from the US, expected to be up and running by the first quarter of that year.

LOTTE’S NEW UK PET PLANT UNAFFECTED BY CLOSURE
Lotte Chemical UK (LCUK) is still on course to start up its 200,000 tonne/year polyethylene terephthalate (PET) plant in Teeside, UK, in the first quarter of 2014, despite its proposal to close the upstream purified terephthalic acid (PTA) plant in Wilton. A company source said pending the consultation process with employees affected by the decision to shut the PTA plant, LCUK could bring feedstock into Europe from Asia, “instead of making it in situ and transferring it by pipe”.

GERMANY’S ALLESSA TO CUT 300 JOBS, APPOINTS CEO
German fine chemicals firm Allessa plans to cut about 300 jobs in an effort to streamline operations and remain internationally competitive, it said. The measure, affecting one third of Allessa’s 900-strong workforce, is part of the company’s “Allessa 2017” strategy. Its announcement comes two months after Allessa’s acquisition by International Chemical Investors Group (ICIG). Allessa added Rafael Reiser has been appointed CEO. Reiser is taking on the role in addition to his position as managing director of ICIG portfolio company WeylChem.

KUWAIT PETROLEUM SUFFERS TURNAROUND DELAY
Kuwait Petroleum suffered a delay during the maintenance turnaround at its Rotterdam refinery complex, including its base oil and wax units, a company source said. The turnaround began on 1 October and was due to finish at the end of November. The company now expects to have on-spec SN100 base oil available by the last week of December, and the remaining base oil grades by early January.

GERMANY NEW-CAR SALES SET TO REACH 3M – GROUP
Germany’s new-car sales registrations should reach 3m units in 2014, slightly above 2013 levels, German car manufacturers association VDA said in an outlook. For 2013, VDA expects Germany’s new-car sales at 2.93m, down 5% from 2012. VDA said that it expects global new-car sales to rise 3% in 2014 to 74.7m, following a 5% increase in 2013 from 2012. All “relevant markets”, with the exception of Japan, should show growth in 2014, the group added.

POLAND’S LOTOS, AZOTY FORM SPV FOR COMPLEX
Polish refiner Grupa Lotos and chemical group Grupa Azoty have signed an agreement to form a special purpose vehicle (SPV) for the creation of their planned petrochemical complex in Gdansk, the two companies said. The agreement commits Lotos and Azoty to complete feasibility studies for the investment and outlines how as much as zloty (Zl) 12bn ($3.9bn, €2.9bn) of capital expenditure could be raised for it, they added.

EU, EUROZONE CHEMS PRODUCER PRICES FALL
Chemicals producer prices both in the EU and the eurozone fell by 0.6% month on month in October, European statistics provider Eurostat said. Europe’s total industrial producer prices also fell in October, declining by 0.6% in the EU and by 0.5% in the eurozone compared with the previous month. “Decreases were recorded in almost all member states for which data are available, the largest being registered in Croatia, Italy and Hungary (all -1.3%) and Denmark (-1.1%),” the agency said.

POLAND’S ORLEN SEES PETCHEM MARGIN DECLINE
PKN Orlen’s model petrochemical margin for November declined to €706/tonne from €769/tonne in October, the Polish oil, gas and petrochemicals group said. The month-on-month fall was the first decrease recorded in the model margin since July, it added. The November 2013 figure compared to the €719/tonne ($972/tonne) recorded in November 2012, Orlen said. Despite the deterioration, the model margin was “still at a fairly decent level”, investment bank WOOD & Company said.


AMERICAS

DOW TO SHUT DOWN 1.8BN LB/YEAR OF CAPACITY
Dow Chemical will shut down 1.8bn lb/year (816,000 tonne/year) of chlorine capacity at its Freeport site in Texas, starting in early 2014. The shutdown will be coordinated with the start-up of the Dow Mitsui chlorine joint venture in early 2014, said Andrew Liveris, chairman, president and CEO of Dow. The company is carving out its US chlor-alkali, global chlorinated organics and global epoxy resins, along with associated brine and energy assets. Total sales of the businesses are around $5bn (€3.7bn) (see pages 9 and 10).

US DOW TO PRESERVE PU, AGCHEM CHLORINE SUPPLIES
Dow Chemical will maintain the integration benefits it enjoys as a chlorine producer for its downstream polyurethane (PU) and agricultural-chemical businesses after it carves out its chlor-alkali segments. The epoxy resins and chlorinated organics businesses had received the bulk of Dow’s chlorine production, said spokeswoman Rebecca Bentley. Nonetheless, Dow will still need chlorine for its polyurethanes and agricultural-chemical businesses. Dow will establish chlorine supply and purchase agreements similar to those it made with the 2010 sale of Styron, its styrenics business.

NACD NAMES ERIC BYER AS PRESIDENT
The National Association of Chemical Distributors (NACD) has named Eric Byer as president and chief operating officer (COO), effective January 1, 2014. Byer comes to NACD from law firm Obadal, Filler, MacLeod & Klein where he served as senior vice president. Prior to that Byer was COO and vice president, government & industry affairs at the National Air Transportation Association (NATA). “His experience in elevating the association’s presence and influence with Congress, regulatory agencies, and among industry leaders will further NACD’s strategic initiatives,” said Roger Harris, chairman of NACD and president and CEO of Producers Chemical Company.

US A SCHULMAN COMPLETES $49.5M ACQUISITION
A Schulman has completed its $49.5m (€36.6m) acquisition of Network Polymers, the US-based compounder said. Network is a niche engineered-plastics compounder and distributor, Schulman said. It had 2012 revenues of $65.2m. A Schulman announced the deal in May. Network expands A Schulman’s products to include Centrex acrylic styrene acrylonitrile (ASA);Diamond Polymer acrylonitrile butadiene styrene (ABS); as well as ABS/polycarbonate (PC), ASA and ASA/PC thermoplastic products.

US WR GRACE COMPLETES DEAL FOR DOW PP LICENSING
WR Grace said it has completed the acquisition of fellow US-based producer Dow Chemical’s polypropylene (PP) licensing and catalyst business for a cash purchase price of $500m (€370m). The acquisition includes UNIPOL PP process technology. Dow said in October 2013 that the transaction also includes Dow’s PP catalysts manufacturing facility at Norco, Louisiana, along with customer contracts, intellectual property and inventory.

CB&I AWARDED $1BN CONTRACT FOR CRACKER
CB&I has been awarded a $1bn (€740m) contract for work on OxyChem and Mexichem’s joint venture, a 544,000 tonne/year ethane cracker in Texas, the US-based engineering and construction firm said. CB&I will undertake engineering, procurement and construction at the facility in Ingleside, with work expected to start in the middle of next year. The contract, awarded by the joint-venture firm Ingleside Ethylene, includes work on associated utilities and offsites, the Texas-based company said.

KEMIRA SELLS COAGULANT BUSINESSES IN BRAZIL
Kemira has agreed to sell its Brazilian iron and aluminium coagulant businesses to Brazil’s Bauminas Quimica for an undisclosed sum, the Finland-based chemicals firm said. Bauminas will acquire the coagulant business-related assets, liabilities and personnel of Kemira WaterSolutions Brazil, shares of Nheel Quimica, along with three coagulants manufacturing sites. Kemira added that 193 employees would be transferred to Bauminas.

SABIC INVESTS TO UPGRADE MOUNT VERNON, INDIANA SITE
SABIC’s Innovative Plastics business unit announced two investments to improve the competitiveness of its largest US manufacturing site at Mount Vernon, Indiana. The first investment is for the construction of a cogeneration (cogen) plant that will use natural gas to create most of the steam for the site. The cogen plant is expected to reduce the site’s greenhouse gas intensity while improving energy efficiency. In the second investment at Mount Vernon, SABIC will install new technology that will streamline the efficiency of the chemical production process.

SWITZERLAND’S CLARIANT TO EXPAND US CAPACITY
Clariant will further expand the capacity of its ethoxylation production site at Clear Lake in Texas, the Swiss specialty chemicals firm said. This second-phase expansion will include new reactors and additional storage facilities, bringing the overall ethoxylation capacity to more than 125,000 tonnes/year from the current 95,000 tonnes/year. The new project is scheduled to go on line in mid-2015. Products manufactured at the US site includes high molecular weight polyethylene glycols (PEGs), alcohol ethoxylates, sodium isethionates and ethoxylated specialties.


ASIA

PETROCHINA TO START UP SICHUAN REFINERY, CRACKER
PetroChina is planning to start up its complex containing a refinery and a cracker among at Pengzhou in Sichuan province in mid-December, after overcoming several delays, a company source said. The complex was scheduled to come on line over the August-September period. The company has been delivering crude oil through the pipelines to the refinery since the second half of November, according to the source. The yuan (CNY) 38bn ($6bn) complex includes a 200,000 bbl/day refinery, a cracker that can produce 800,000 tonnes/year of ethylene as well as various derivatives units.

CHINA’S SHANDONG SANYUE TO START TRIAL RUNS
China’s Shandong Sanyue Chemical plans to commission its new 80,000 tonne/year propylene oxide (PO) plant in Shandong province in December, a company source said. The company shut its other older 80,000 tonne/year plant at the same site from 22 November, to dock pipelines with two PO plants. They will restart the older PO plant on 1 December, the sources added. The company is a wholly owned subsidiary of the Sanmu Group.

FIRST THAI S-SBR PLANT TO START PRODUCTION
JSR BST Elastomer Co Ltd (JBE) expects to start commercial production at Thailand’s first solution styrene butadiene rubber (S-SBR) plant by early next year, a company source said. The 50,000 tonne/year plants is located in Map Ta Phut. “We are now under test trial and expect to start commercial production by the end of this month or early next year,” the source said. The S-SBR plant is a joint venture between JSR Corp of Japan and Bangkok Synthetics Co Ltd of Thailand (BST). S-SBR is a high-performance synthetic rubber used in fuel-efficient tyres.

INDIA LIFTS OMAN ANTI-DUMPING DUTY FOR PP
India has lifted an anti-dumping duty for polypropylene (PP) from Oman, industry sources said. New Delhi had imposed a 6.5% anti-dumping duty in November 2010 on PP from Oman. The move is expected to benefit Indian end-users, who can now purchase Omani PP at a cheaper rate, a Mumbai-based trader said.

TAIWAN’S FPC SHUTS NBA PLANT FOR TURNAROUND
Taiwan’s Formosa Plastics Corp (FPC) has shut its 250,000 tonne/year n-butanol (NBA) plant at Mailiao on 2 December, a source close to the company said. The NBA plant is expected to be shut for around three weeks for its annual maintenance, the source said. The company was recently operating the 250,000 tonne/year NBA unit at close to full capacity to build up inventory ahead of the shutdown, the source added.

CHINA’S CHONGQING JIANFENG TO DELAY START-UP
China’s Chongqing Jianfeng Chemical plans to delay the start-up of its 46,000 tonne/year polytetramethylene ether glycol (PTMEG) plant at Fuling in Chongqing to 2014 because of feedstock issues, a source close to the company said. The company has failed to purchase feedstock 1,4-butanediol (BDO) from the spot market so far, the source said, without disclosing further details. While the producer has a 60,000 tonne/year BDO plant at the same site, it is scheduled to start up only after the PTMEG plant comes on stream, according to the source.

TAIWAN’S CPC KAOHSIUNG TDP UNIT NO 1 ON LINE
CPC Corp’s No 1 toluene disproportionation (TDP) unit in Kaohsiung, Taiwan has restarted following a turnaround, while its No 2 unit at the site has no firm restart date, a company source said. The No 1 and No 2 TDP plants have a combined benzene capacity of 170,000 tonnes/year, the source said. The TDP unit No 1 resumed production in the week ending 1 December.


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