US advantage not arbitraged for a decade
The US energy price advantage derived by North America is unlikely to balance out against other regions for at least a decade, and probably longer, an executive for Netherlands-headquartered LyondellBasell said. Executive vice president Bob Patel said North America could have ethane supplies of up to 2.5m bbl/day by 2020. “Our view is that [the price advantage will not balance out] in the foreseeable future,” he said at a London conference.
Polyolefins boost Borealis Q1 results
Borealis’ first-quarter net profit rose 67% year on year to €102m as sales increased 14% to €2.26bn on the back of a good performance at its polyolefins business and the start-up of its Borouge 3 cracker in Abu Dhabi, the Austrian polyolefins producer said. Margins in polyolefins during the first quarter of 2014 proved more satisfactory than forecast and the economic situation in Europe improved.
Czech Unipetrol says ‘PE3 is on track’
Czech petrochemical producer Unipetrol clarified the status of its polyethylene 3 (PE3) investment project amid comments from the company CEO that the firm’s five-year investment plan might not be adhered to. Following up on comments made by CEO Marek Switajewski to Czech daily Hospodarske Noviny, Unipetrol spokesman Mikulas Duda did not give a cast-iron guarantee that PE3 would be completed, but noted very significant progress had been made in realising the investment.
Germany chems warn of ‘damage’ from wage law
Germany’s chemical employers are skeptical about Berlin’s move to legislate a minimum wage, fearing “collateral damage” to the country’s apprenticeship system, Wiesbaden-based chemical employers trade group BAVC said. Germany’s coalition government is introducing a €8.50/hour minimum wage, effective from 1 January 2015 – the first time the country is legislating a minimum wage. However, BAVC said that according to some estimates, the legally prescribed minimum wage could lead to 350,000 job losses by 2018.
Moerdijk EO force majeure declared: Shell
A force majeure (FM) declared by Shell on pure ethylene oxide (EO) on Friday 9 May at its Moerdijk plant in the Netherlands was due to a technical issue. “The FM was declared due to a technical problem at the Moerdijk ethylene oxide plant which caused the unit to trip,” , a company spokesperson said. “Supplies of ethylene glycol [EG] are still under review, [there is] no update [at this time].” The source declined to comment on when normal EO deliveries would resume.
Ukrainian acetic acid plant ceases production
Ukrainian producer Azot Severodonetsk stopped production at its acetic acid unit in Luhansk province owing to political unrest, a source close to the company confirmed. The acetic acid plant has a nameplate capacity of 150,000 tonnes/year, according to ICIS data. The producer’s 35,000 tonne/year vinyl acetate monomer (VAM) unit at the same site is still operating, the source said.
Germany’s chemicals trade reports 5% growth
Germany’s chemical industry trade group VCI said sales in the sector grew 5% year on year during the first quarter to €46.8bn, with production output rising 4.2% over the same period, on the back of stronger industrial production in Europe. However, VCI said selling prices had registered in the first quarter a 2.4% decline year on year. Quarter on quarter, revenues within Germany rose 3% but sales abroad fell 1.5% in the first quarter of 2014, while chemical production fell 0.8%.
BMS lifts FM on pure MDI and derivatives
Bayer MaterialScience (BMS) has lifted a force majeure on pure methyl di-p-phenylene isocyanate (MDI) and derivatives in Europe, the Middle East and Africa with immediate effect, following the completion of repairs at its MDI plant in Uerdingen, Germany, a source said. The force majeure came into effect on 24 April, following technical problems at its thermal emission control system at its Uerdingen site, which resulted in a complete shutdown of the plant.
Austria’s OMV posts higher Q1 petchem profit
OMV’s first-quarter clean petrochemical operating profit edged up to €42m from €41m a year ago on the back of improved margins, the Austrian group said, describing the result as “strong and stable”. “The petrochemicals result was at €42m, significantly above the €25m in Q4 2013, driven by increased margins, especially for propylene and benzene,” the company said. Petrochemical sales volumes for the January-March period, however, fell by 4% year on year to 550,000 tonnes from 570,000 tonnes a year ago.
US wholesale prices advance 0.6% in April
US wholesale prices rose 0.6% in April from March, the Labor Department said, with prices at the producer level advancing equally among both goods and services. In its monthly report, the department noted that April’s 0.6% gain in its producer price index (PPI) followed an advance of 0.5% in March, with both months showing a sharp upturn from the 0.1% decline seen in the PPI for February.
FMC breaks ground on US natural-colours plant
FMC has broken ground on a natural-colours blending plant in Newark, Delaware, the US-based specialty chemicals company said. The company did not disclose the cost of the project or its capacity. The plant will help FMC meet growing demand from the baking and beverages markets in North America, the company said. The company should complete the plant in December, it said.
US EPA seeks information on fracking chemicals
The Environmental Protection Agency (EPA) is seeking public input on how it should obtain and disclose information on chemicals used in hydraulic fracturing, the agency announced. That production technique, commonly called fracking, along with horizontal drilling is the energy development combination that triggered a dramatic increase in domestic US production of natural gas and crude oil from deep shale formations. The fracking process has come under criticism from environmental groups.
INVISTA gets permanent injunction in patent case
INVISTA has obtained a permanent injunction from a US court in a case of alleged infringement of one of its polyethylene terephthalate (PET) resin patents, the US-based fibre and polymer major said. INVISTA said that the US Court of Appeals for the Federal Circuit last week denied a motion by Mossi & Ghisolfi (M&G) to stay a permanent injunction the US District Court for the District of Delaware ordered earlier.
OCI Texas methanol unit going down for 40 days
OCI Partners’s Texas methanol plant will go down for 40 days in Q4 2014 to complete a debottlenecking project, a top executive at the company said. The $178m project will increase the size of the Beaumont methanol unit by 25% to 912,500 tonnes/year of capacity from the current 730,000 tonnes/year, said Frank Bakker, chief executive officer of OCI Partners. The expansion will also increase the ammonia unit’s capacity by 15% to 305,000 tonnes.
LyondellBasell rules out refinery arm divestment
LyondellBasell has no plans to divest its refining operations at present despite a difficult 2013 for the division, although the company may evaluate whether those operations remain a strategic asset in the longer-term, an executive for the US-based chemicals producer said. Refining division earnings before interest, taxes, depreciation and amortisation (EBITDA) fell 93% year on year in 2013 to $22m on the back of lower margins, and a 23,000 bbl/day decline in output.
US INVISTA, LanzaTech to work on gas-fermentation
US polymer and fibre major INVISTA has agreed to work with New Zealand’s industrial biotechnology firm LanzaTech on developing a gas-fermentation process technology for the production of industrial chemicals from carbon dioxide and hydrogen gas feedstocks, it said. If successful, the first commercialisation of this technology is expected as early as 2018, it said without disclosing financial terms. The agreement will provide INVISTA increased access to LanzaTech’s gas-fermentation process technology.
LyondellBasell PE plant to showcase technology
LyondellBasell’s proposed polyethylene (PE) plant that would showcase new low-pressure technology would be built at its La Porte, Texas, complex, according to an air permit. Construction would begin on 1 January 2015, according to the permit filed with the Texas Department of Environmental Quality (TCEQ) on 31 October 2013. Start-up of the $400m plant would be in mid-2017, LyondellBasell in its Q1 2014 earnings presentation.
Canada Chemtrade to sell business to Suncor
Chemtrade Logistics is selling its Montreal East sulphur removal and compliance services business to Suncor for $120m, the Canadian sulphur and sulphuric acid producer and marketer announced. Chemtrade expects the deal to close in June, subject to normal closing conditions. The Montreal East business only currently services Suncor’s Montreal refinery after providing services to several refineries in the area for several years.
Shenhua, Dow Chemical scrap Yulin project
China’s Shenhua Group (Shenhua) and US-based Dow Chemical (Dow) have abandoned their proposed joint venture coal-to-chemical project at Yulin in Shaanxi province, sources from the two companies said. The yuan (CNY) 104bn project was planned to produce around 22m tonnes/year of chemicals and plastic products, according to its Environment Impact Assessment published by China’s Ministry of Environment Protection. Dow withdrew from the project in 2013, a source from Dow Chemical (China) told ICIS, but declined to comment further.
Protesters set PE, PP units in Vietnam on fire
A number of polyethylene (PE) and polypropylene (PP) factories owned by Chinese plastics converters in southeastern Vietnam were set on fire and vandalised by anti-China protesters on 14 May, an import trader said.“My Chinese customers who own factories in Vietnam said their plants have been torched and vandalised this morning,” the trader said.Around 100 protesters stormed into two factories that produce 500-600 tonnes/month of PE and PP resins on Wednesday morning, and damaged manufacturing equipment, the source said.
Kolon Plastics to KEEP POM RUN rate at 70%
South Korea’s Kolon Plastics will maintain the run rate of its polyacetal (POM) unit at Gyeongbuk in Gumi, South Korea, at 70% for the next few months because of poor demand from the China market, a company source said.The unit, which can produce around 65,000 tonnes/year of POM, has been running at 70% since the first quarter of this year because of lacklustre demand, the source said, adding that it has no plans to increase the operating rate until the market “becomes better”.
Jiangsu Yangnong Kumho Chem runs unit at 70-80%
China’s Jiangsu Yangnong Kumho Chemical is running its 120,000 tonne/year epoxy resins plant in Yangzhou at 70-80% of capacity after completing a brief turnaround at the unit on 1 May, a company source said.The plant in Jiangsu province was shut on 26 April because of disruption to its power supply due to annual maintenance at the power source by the authorities, the source said.
Japan’s Nissan Chemical to shut melamine plant
Japan’s Nissan Chemical Industries plans to shut its 50,000 tonne/year melamine plant in Toyama prefecture for annual maintenance at the end of June, a company source said. The turnaround will last around one and a half months, the company source said. The plant is currently running at around 80% capacity, the source said
South Korea’s Tongsuh shuts down No 3 ACN line
South Korea’s Tongsuh Petrochemical has shut down its 245,000 tonne/year No 3 acrylonitrile (ACN) line in Ulsan on 13 May for a scheduled turnaround, a company source said.“The shutdown will last around three weeks,” the source said. The company’s 70,000 tonne/year No 2 ACN line is also down, but the source declined to disclose the shutdown date and when this plant will be restarted.
Petro Oxo Nusantara to shut Gresik 2-EH unit
Indonesia’s PT Petro Oxo Nusantara (PON) plans to shut its 140,000 tonne/year 2-ethylhexanol (2-EH) plant at Gresik in the first half of June 2014, a company source said. The plant will be shut for a catalyst change and is expected to be off line for 7-10 days, the source said. The shutdown may result in a loss of 3,000-4,000 tonnes of 2-EH supply, the source added.
Tongbai Anpeng eyes soda ash plant overhaul
China’s Tongbai Anpeng Soda Mine Co plans to shut its 1.2m tonne/year soda ash plant in Henan province on 20 May for an overhaul, following previous delays, sources close to the company said. The plant in Tongbai County was initially scheduled to be taken off line in the second half of April, but the delivery of parts needed for the maintenance was delayed, they said.The overhaul period is expected to last 10 days, the sources said.
China’s CSPC shuts LDPE unit on technical issue
Shell Petrochemicals Co’s (CSPC) 250,000 tonne/year low density polyethylene (LDPE) unit at Huizhou in Guangdong province was shut on 13 May on the back of technical issues, distributors said.The LDPE unit is expected to restart within five days, they added. Local distributors said the supply of LDPE is expected to decrease as CSPC is one of the major producers of LDPE in southern China.
Middle East & Africa
Arkema launches Saudi Arabia oilfield plant JV
Arkema subsidiary CECA has entered into a joint venture with Saudi Arabia’s Watan Industrial Investment to operate an oilfield production chemicals blending plant and storage facility in the country. The joint venture, to be majority-owned by Arkema, will help CECA to meet demand for oilfield production chemicals in the OPEC nation, the company said. The partnership intends to acquire a storage and blending facility in Dammam industrial city, scheduled to come onstream in the second half of 2014.