Sasol mulls USD 4.5 bln ethane cracker

(Plastemart) -- Sasol Ltd plans to invest US$4.5 bln to build a plant usin low-cost natural gas to make ethylene and related chemicals in Louisiana. The board of directors has approved a feasibility study on a possible ethane cracker and ethylene derivatives complex in Lake Charles.

The feasibility study is estimated to be completed by June 2013. The investment outlay is estimated at US$3.5-4.5 bln for ethylene capacity estimated between 1-1.4 mln tpa. ⌠The rapid development of the shale gas industry in North America and the resulting decoupling of the crude oil and natural gas prices have created several opportunities for growth for Sasol in both fuels and chemicals, the company said in a statement.

In particular, the availability of significant volumes of natural gas liquids, and specifically ethane, has opened up opportunities in the ethane feedstock area for cracker-based chemicals.

Sasol joins Dow Chemical Co, Chevron Phillips Chemical Co. and Royal Dutch Shell Plc, among others, who are studying whether to build ethane crackers in the US.


IRPC earmarked Bt70 billion to invest in its Phoenix

(THE NATION) -- IRPC has earmarked Bt70 billion to invest in its Phoenix as well as non-Phoenix and maintenance projects from 2012 to 2016, with revenue contribution from the Phoenix projects targeted to double to 60 per cent from about 30 per cent currently.

The Phoenix Project is the name of IRPC's investment plan aimed at making the integrated oil and petrochemical manufacturer the petrochemical leader in Asia by 2014.

President Atikom Terbsiri said yesterday that about Bt60 billion of the Bt70-billion budget was for Phoenix and non-Phoenix projects and the remaining Bt10 billion for maintenance.

The biggest Phoenix project for IRPC is the expansion of propylene capacity by 420,000 tonnes to 740,000 tonnes per year from the current 320,000 tonnes, which needs a budget of US$990 million (Bt30.8 billion).

The first propylene expansion phase, on which IRPC has already spent about $90 million to increase output by 100,000 tonnes, started this year. The new capacity will come on stream in the second quarter of next year, taking IRPC's propylene production capacity to 420,000 tonnes per year.

The company will next invest $900 million to expand propylene capacity by 320,000 tonnes by 2016.

IRPC will also benefit from the new capacity for propylene and treated distillate aromatic extract, which will be increased to 50,000 tonnes per year from 20,000 currently, she said.

The company will also recognise a full year of revenue from the combined heat and power plant project. The power plant is expected to generate revenue of Bt80 million to Bt100 million per month or as much as Bt1.2 billion per year.


Iranian government shrugged off the latest round of oil sanctions

(Arabian oil and gas) -- The Iranian government has shrugged off the latest round of oil sanctions, saying they will cause greater problems outside the country than within. Iranian oil minister Rostam Qasemi told Iran's Tehran Times that sanctioning Iranian crude will cause problem in oil markets. His remarks were echoed by NOC head Ahmad Qalebai, who told the Mehr news agency ⌠⌠Iran possesses massive oil and gas reserves... Thus ignoring Iran in oil and gas exchange will not be acceptable (by the international community).

Qasemi also told state media that the role of foreign companies in the country's oil sector will be further restricted for at least five years. News of the sanctions has kept Brent prices around $110 a barrel.

The US, UK and Canadian governments agreed a tough sanctions regime against Tehran on 22 November, including an oil import ban and severe restrictions of the Iranian central bank's activities. The UK's sanctions included a ban in any financial dealings between British and Iranian banks.

The sanctions were prompted by a report by the United Nations nuclear watchdog that gave increased credence to claims Ira's nuclear program includes the manufacture of atomic weapons.

However, officials in the US are confident that the current roster of sanctions is hitting the Ahmadinejad regime hard. ⌠Iran has been increasingly unable to attract foreign investment, especially in its oil fields, leading to a projected loss of $14 billion a year in oil revenues through 2016, David Cohen, the US Treasury's undersecretary for terrorism and financial intelligence, told the U.S. Senate Banking Committee in early October, before the latest round of financial sanctions were initiated.


Asia exports low December benzene volumes to US on weak prices

(ICIS) -- Asia's benzene exports to the US will likely be low in December, as in the previous two months, given a lack of price incentive to ship out products that far, industry sources said on Friday.
Benzene shipments from South Korea to the US in December are estimated to remain below 20,000 tonnes, a Korean producer said. South Korea is the largest exporter of benzene from Asia to the US, which is the world's largest benzene importing nation.

US benzene prices were at $3.10-3.20/gal or $927-957/tonne (┬686-708/tonne) FOB (free on board) Barges late on Thursday, while European values were at $890-910/tonne CIF (cost, insurance and freight) ARA (Antwerp, Rotterdam and Amsterdam). On Friday morning, Asian spot prices were hovering at about $970-980/tonne FOB (free on board) Korea, according to ICIS.

South Korea traditionally ships out 40,000-50,000 tonnes of benzene to the US. But in November, the Asian country only exported about a third of the usual volume to the US, said a Singapore-based trader.

Demand from western industrialized economies has been falling as the US' economic state remains fragile, while the eurozone is steeped in its sovereign debt crisis.

A pick-up in US' benzene demand depends largely on China's appetite for styrene monomer (SM) imports from the US, the same Korean producer said. SM is the major downstream of benzene.
Asia is a net exporter of benzene to the US and Europe, while Asia imports SM from the US and Middle East.


US butadiene market split again in December

(ICIS) -- The US butadiene (BD) market split again in December, market sources said on Thursday, adding that one producer refused to fully match the reduction of its three rival suppliers. The split settlement, which put December contracts at 98 cents/lb ($2,161/tonne, ┬1,599/tonne) and $1/lb, followed proposed reductions of 10, 15 and 17 cents/lb by the four main US producers. The three producers settling at 98 cents/lb account for around 85% of the US BD capacity, which translates into a weighted average price of 98.3 cents/lb for the month.

BD contracts in November settled at $1.15/lb, down by 25 cents/lb from October. The reduction in December - the fourth in as many months - extends a downtrend that began in September, when prices began to soften on the back of weaker demand and ample supply. US BD prices have dropped by 44% during the last four months, mirroring sharp losses seen in other regions.

BD spot prices in Asia have regained some strength, but demand in the US is expected to remain soft in December, pressured by de-stocking ahead of the end of the year. However, the outlook for 2012 points to a possible rebound, a US producer said recently, citing capacity expansions in the tyre sector and a series of cracker turnarounds scheduled for the first half of the year.