News in brief

26 May 2014 00:00 Source:ICIS Chemical Business

AMERICAS

EXXONMOBIL GETS EPA APPROVAL FOR CRACKER
ExxonMobil has received final approval from the US Environmental Protection Agency (EPA) to construct its planned 1.5m tonne/year ethane cracker in Baytown, Texas, the EPA announced. The greenhouse gas (GHG) permit, which had been contested by environmental groups, was the last of four permits required before ExxonMobil could move forward with the project. Plant operations could start up in late 2016, the US-based chemicals giant has said. The ethylene plant would feed two new 650,000 tonne/year polyethylene (PE) lines to be located next to the cracker.

DOW PDH TO SUPPLY ONE-THIRD OF C3 NEEDS
US-based Dow Chemical will still be a player in the merchant propylene market even after its planned propane dehydrogenation (PDH) plant comes on line in 2015, said Howard Ungerleider, executive vice president of advanced materials. Slightly less than one-third of Dow’s US propylene needs will come from the merchant market even after its Texas PDH plant is running at full run rates. He made his comments during a presentation at the Goldman Sachs Basic Materials Conference 2014. The PDH plant will supply about one-third of Dow’s propylene needs, while its cracker operations will supply the rest, Ungerleider said.

LYONDELLBASELL ON 85% BD ALLOCATION
LyondellBasell has declared 85% allocation on butadiene (BD) for the US beginning in June. In a letter dated 19 May, the producer notified customers that the monthly allocation of BD supply is estimated at 85% of their contract minimum volumes. Lyondell had declared force majeure and 75% allocation in late March, following a mechanical failure at its BD extraction unit in Channelview, Texas. Earlier in May, market sources said the company lifted its force majeure and later raised the allocation to “up to 85%”. LyondellBasell’s BD unit has a capacity of 390,000 tonnes/year, according to ICIS plants and projects.

M&G TO KEEP BRAZIL PET PLANT CLOSED
Italy-based Mossi & Ghisolfi (M&G) will keep one of its two Brazilian polyethylene terephthalate (PET) plants shut down for resin production and without plans for reactivation, as it can sufficiently supply its customers from just one plant, market sources said. The 200,000 tonne/year PET plant at Pocos de Caldas has been shuttered for several years. M&G’s PET inventory is enough to supply customers without any problem, a market source close to the situation said. M&G has 550,000 tonnes/year of PET capacity at its plant in the port of Suape next to the city of Ipojuca in northeastern Brazil, according to market sources.

PENNTEX TO BUILD NGL PLANT IN LOUISIANA
US midstream energy logistics firm PennTex plans to build a natural gas liquids (NGL) recovery facility in northern Louisiana, Honeywell’s UOP petrochemicals technology business UOP said. UOP, which won a contract to build the project, said that the plant will be able to process 200m cubic feet/day of gas after starting up in the first quarter of 2015. UOP will be the project’s engineering, construction and procurement contractor. UOP added that its “modular design and construction approach” will allow for quick construction and start-up of PennTex’s NGL project.

US EPA ISSUES FINAL RULE ON WATER SYSTEMS
The US Environmental Protection Agency (EPA) issued its final rule that will require many chemical plants, refineries and other industrial facilities to reduce the impact of their water cooling systems on public waters. In its announcement of the final rule, the EPA said that existing facilities that take at least 25% of their cooling water from adjacent public waterways must take action to reduce their impact on fish populations and other aquatic life. Larger production facilities, refineries and electric power plants will be required to conduct studies and hold public hearings on what steps might be necessary to reduce the impact of their cooling water intake systems on aquatic life.

INDIA IMPOSES ADDS ON PHENOL FROM US, TAIWAN
India’s Ministry of Finance has imposed provisional antidumping duties (ADDs) on phenol imports from the US and Taiwan, industry sources said. The provisional ADDs will be valid for six months from May, the sources said. US cargoes will be subject to an ADD of $146.09/tonne, the sources said. The same rate applies to all the US exporters. Phenol from Taiwan will be subject to ADDs of between $46.07/tonne and $193.90/tonne, depending on the exporter.

PVC IMPORTERS SEE ACTIVITY FROM US, MEXICO
Polyvinyl chloride (PVC) from the US and Mexico is being offered aggressively, sources in importing countries along the Pacific coast of South America said. Market participants along the coast recently noted a strong presence of not-so-traditional suppliers and traders pushing resin from Mexico and the US. Sources suggested that the initiatives could be a result of global trade patterns shifting after India announced its antidumping duties (ADDs), which favoured imports from certain countries. Countries that lost a previous competitive position into India’s markets have had to seek out new destinations for their PVC exports.

EUROPE

EVONIK WORKING TO START UP POLYBUTADIENES PLANT
Evonik is currently working to bring online a new plant for functionalised polybutadienes at its production hub in Marl, north of Essen in Germany’s North-Rhine Westphalia state, the CEO of the German specialty chemicals major said. Evonik started construction at the project in August 2012. Functionalised polybutadiene sealing compounds are used for triple-glazing and as structural adhesives in autobody work.

CUADRILLA TO SUBMIT PLANS TO FRACK FOR SHALE
Cuadrilla is to submit a planning application to hydraulically fracture for shale gas with up to four exploration wells in Lancashire, UK, the energy company said. Described by CEO Francis Egan as a “milestone” in the development of the UK’s shale gas industry, Cuadrilla is to apply to Lancashire County Council to drill, hydraulically fracture and test the flow of gas at its exploration site at Preston New Road, in The Fylde region of the county.

IPA MAINTENANCE ENDS AT SHELL’S NETHERLANDS PLANT
A planned maintenance shutdown at Shell’s Pernis plant in the Netherlands has now come to an end, market sources said. The turnaround at the 150,000 tonne/year facility temporarily reduced the company’s availability of spot material. One producer said: “Shell is out of maintenance but the IPA market remains firm. Pricing is at €1,110-1,140 as far as we see.” One distributor said: “Availability has probably improved because we are not seeing quite the same demand... that we were seeing before.”

OLTCHIM PRIVATISATION BIDS DEADLINE NOW 6 JUNE
The Romanian government has again extended the deadline for bidders in the delayed privatisation process for insolvent chemical producer Oltchim. The new confirmed deadline for offers is 6 June, with the 12 May deadline having proved too early for the conclusion of pre-bid talks between officials and potential bidders. A previous 28 March deadline passed with no binding offers submitted, but ministers agreed to the 12 May deadline after bidders expressed willingness to make an offer once further talks were conducted.

GERMANY’S MERCK TO INVEST €50M ON BIOPHARMA
Merck is to invest €50m in developing its biopharmaceuticals operations at its site in Bari, Italy, the Germany-based chemicals producer said. The investment at the site, which is a production centre for biopharma subsidiary Merck Serono, is to be made in response for growing demand for pharmaceuticals, particularly regarding products used to treat infertility. The new facility, to be completed by 2017, is being set up for the sterile filling and packaging of liquid drugs into syringes and vials.

GERMANY APRIL CHEMICAL PRICES FALL - STATS AGENCY
Germany’s chemical producer prices fell 0.2% in April from March, and they were down 2.8% year over year from April 2013, the country’s federal statistics office said in a producer price report. Most basic chemicals recorded both sequential and year-over-year price decreases in April. However, prices for polymers from ethylene rose 0.5% sequentially in April from March, and prices for synthetic rubbers rose 0.9% from March, Wiesbaden-based Statistisches Bundesamt said.

POLAND’S PLASTIC DEMAND UP 3% IN 2013

Plastics demand in Poland rose 3% year on year in 2013 to 2.9m tonnes, the PlasticsEurope Poland trade association of plastics manufacturers said. The figure means that in Poland 75 kg of plastics per year per head are consumed compared to the EU average of 94-95 kg, it added. “The country is systematically approaching the EU average,” PlasticsEurope Poland said in releasing the figures, while cautioning that Polish plastics production capacity was trailing demand.

DOW PLANS METHYLENE CHLORIDE MAINTENANCE

Dow Chemical has scheduled a maintenance shutdown of its 90,000 tonne/year methylene chloride facility in Stade, Germany. A company source said: “It [the maintenance] will start from the middle of June for three weeks.” The source went on to say inventories at the site are 
relatively low for the remainder of May due to healthy demand, and it expects the upcoming maintenance to tighten the market in June.

BASF launches LFP cathode materials output

Germany-based chemicals major BASF said it has launched the commercial production of lithium iron phosphate (LFP) cathode materials in Weimar. BASF is operating a 3,000 tonne/year plant in Weimar, leveraging LFP precursors produced at the BASF headquarters site in Ludwigshafen, it added. The company said IBU-Tec, a specialist in rotary kiln technology and systems, is carrying out operations at the Weimar manufacturing plant under the supervision and full operational control of BASF.

ASIA

JAPAN’S JX NIPPON TO RUN TOTAL PX CAPACITY AT 40%
Japanese refiner JX Nippon Oil & Energy plans to cut its production of paraxylene (PX) by more than half during the July-September period because of weak market conditions. The company plans to operate its total PX capacity, including its new 1m tonne/year project in South Korea, at 40% in those three months. It currently produces a total of 2.62m tonnes of PX at its manufacturing facilities in Kashima, Kawasaki, Mizushima and Oita.

YISHENG PETCHEM SHUTS 2M TONNE/YR PTA UNIT
China’s Yisheng Petrochemical shut its 2m tonne/year purified terephthalic acid (PTA) unit in Hainan on 20 May due to an unexpected plant failure. The maintenance will take about 8-10 days. The company has four other PTA units in Ningbo. No 1 and No 2 PTA units, each with a capacity of 650,000 tonnes/year, are currently off line, with no fixed restart date. The remaining two units, with capacities of 2.2m tonnes/year and 2.25m tonnes/year, are running at full rates.

VIETNAM’S BSR PP UNIT SHUT UNTIL EARLY JULY
Vietnam’s Binh Son Refining and Petrochemical has shut its polypropylene (PP) plant in Quang Ngai province for scheduled maintenance. The company, which is a subsidiary of state-owned oil firm PetroVietnam, is undergoing a turnaround as of 19 May, and will likely restart in early July. “Although there is usually a decline in downstream demand because of the seasonal rains in May, the Binh Son turnaround has tightened supply,” said a trader.

RIL SHUTS ITS MEG NO 3 PLANT FOR MAINTENANCE
India’s Reliance Industry Limited (RIL) has shut its 150,000 tonnes/year No 3 monoethylene glycol (MEG) unit in Hazira, Gujarat, from 19 May for a routine turnaround. The turnaround will last for 10 days. The company is also building a new 750,000 tonnes/year MEG plant in Jamnagar, Gujarat, which is expected to be completed by late 2015 or early 2016.

HENGLI PETROCHEMICAL TO SHUT NO 1 PTA UNIT IN JUNE
China’s Hengli Petrochemical plans to shut its 2.2m tonne/year purified terephthalic acid (PTA) No 1 unit located at Dalian for maintenance in June. The shutdown is expected to last for around two weeks. The company will continue to operate its 2.2m tonne/year PTA No 2 unit located at the same site during the shutdown period. Several PTA facilities have been either shut for maintenance or have reduced run rates because of squeezed margins.

PHILIPPINES’ FIRST CRACKER IN COMMISSIONING PROCESS
JG Summit Petrochemical is in the process of commissioning the Philippines’ first cracker in Batangas. “The cracker is in the process of being commissioned and on-spec ethylene is expected early next week,” a source said. The cracker will be using 100% on naphtha feedstock initially, and it could use 10-20% of its total feed on liquefied petroleum gas (LPG), depending on the economics of the feedstock. The naphtha cracker is expected to produce 320,000 tonnes/year of ethylene and 190,000 tonnes/year of propylene.

JX SHUTS AROMATICS UNITS FOR TURNAROUND
Japan’s JX Nippon Oil and Energy has shut both its Kashima and Oita-based aromatics units from mid-May for scheduled maintenance. Both the reformer and toluene disproportionation (TDP) unit at Kashima will be shut for 45 days, while the 130,000 tonne/year benzene unit in Oita will be shut for a month. The Kashima-based TDP plant can produce 70,000 tonnes/year of benzene, while the reformer has a nameplate capacity of 190,000 tonnes/year of benzene and 185,000 tonnes/year toluene.

CHINESE BUYERS PREFER LOWER-QUALITY RPET
Some Chinese buyers of recycled polyethylene terephthalate (R-PET) have turned to lower-quality R-PET material amid lacklustre downstream market conditions. The import demand from Chinese buyers has been thin since the start of the year as the downstream recycled polyester staple fibre (PSF) market condition remains relatively weak. A Chinese buyer said it has increased its purchasing share of lower-quality, mixed-colour R-PET with 30-40% contamination, which was at lower-than-market prices, given the lacklustre downstream sales condition.

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