The output of large polymers in Russia amounted to 3,480,000 tonnes in 2012

MOSCOW (MRC) - In 2012, Russian producers reduced their production volumes of large polymers by 1% to 3,480,000 tonnes. Last year, the output of polyolefins dropped, while the production volumes of PVC, polystyrene (PS) and PET increased, according to MRC ScanPlast.

2012 proved to be quite a successful year for Russian makers of large polymers. The growth of domestic demand allowed producers to increase their output. The only exception made producers of polyolefins (polyethylene and polypropylene) that reduced their capacity utilization last year. The implementation of several projects for the start-up of new polymer plants with the total capacity of 1,720,000 tonnes per year were announced for the next five years.

In 2012, the total output of polyethylene by Russian producers made 1,389,000 tonnes, down 10% year-on-year. At the same time, the production volumes of high density polyethylene (HDPE) made 733,000 tonnes, down 13% year-on-year. The output of LDPE and LLDPE fell to the level of 626,000 tonness and 31,000 tonnes, respectively.

The main reason for such a serious decline in the HDPE production was due to a lengthy outage at Stavrolen (Lukoil group). Also, because of the extended turnaround, Gazprom neftekhim Salavat reduced its HDPE production. Last year, Tomskneftekhim, Ufaorgsintez and Angarsk polymer plant reduced their capacity utilization for the production of LDPE, while NefteKhimSevilen completely shut production of polyethylene in February. Only Nizhnekamskneftekhim announced a launch of new facilities in the next five years, said while, the company plans to build another production site with the capacity of 600,000 tonnes per year.

The volume of polypropylene production did not fall that significantly last year. The fairly rapid resumption of production at Stavrolen and growth of capacity utilization at the other sites (Nizhnekamsknftehim, Tomskneftekhim, Ufaorgsintez and Neftekhimia) allowed to reach the total production rate of more than 660,000 tonnes.

The launch the production of polypropylene is expected to take place at two new sites in the second quarter of this year: in Omsk (Polyom) with the capacity of 180,000 tonnes per year, and in Tobolsk (Tobolsk-Polymer) with the capacity of 500,000 tonnes per year. Sibur (the managing company of Tobolsk-Polymer) has already officially announced its intention to start up the new plant in April.

In 2012, the output of unblended PVC (suspension and emulsion PVC) rose by 7% to 616,000 tonnes. The main increase in production was due to Sayanskkhimplast and Kaustik (Sterlitamk). Both plants announced the further expansion of the existing sites. In 2014, a new plant for suspension PVC production with the capacity of 330,000 tonnes per year is expected to be launched in the Nizhny Novgorod region on the basis of the joint venture of Solvin and Sibur's RusVinyl.

Last year, the production volume of polystyrene in Russia amounted to about 362,000 tonnes, up 12% year-on-year. The main increase in output secured Sibur-Khimprom (Sibur) due to the launch of the second production line of expandable polystyrene with the capacity of 50,000 tonnes per year. This year, Nizhnekamskneftekhim plans to launch a new production of ABS plastics with the annual capacity of 60,000 tonnes.

The output of polyethylene terephthalate (PET) by Russian producers increased by 14% to 397,000 tonnes. Such a significant surge in production was due to an increase of capacity utilization at Alco-Naphtha and Senezh plants. This year, the Bashkir plant Polief (Sibur) is going to expand its capacity to 80,000 tonnes. Given the increased capacities in Bashkiria, the total production capacities of Russian PET producers will make 600,000 tonnes per year.


Russian market EPS grew by 13% in 2012

MOSCOW (MRC) - Last year, the consumption of expandable polystyrene (EPS) in Russia increased to 158,600 tonnes, up 13% year-on-year, according to MRC ScanPlast.

The past year was a turning point not only for the Russian EPS market, but also for that of the CIS countries. With the achievement of 100% capacity utilization at Sibur-Khimprom (Perm) (100,000 tonnes per year), the market balance changed significantly.

In 2012, the share of imports in the estimated consumption decreased to 54% compared to 65% in 2011 and 80% in 2010. Imports dropped by 8% to 85,520 tonnes of EPS.

Meantime, the domestic production of the material increased by 80% and reached the level of 89,790 tonnes. SIBUR-Khimprom accounted for 75% of the produced material, which is equal to 67,570 tonnes of the material. Angarsk polymer plant produced 13,500 tonnes of EPS in 2012 (15%) and Plastik Uzlovaya's EPS output made 8,720 tonnes (10%).

Exports of EPS also increased significantly due to Perm production volumes. In 2012, they amounted to 16,720 tonnes of the material compared to 1,930 tonnes in 2011. The main export destination of the Perm material is the Ukrainian market, which accounted for about 15,000 tonnes of material in 2012.


Shell enters a project for LNG export from the USA

MOSCOW (MRC) -- Shell US Gas & Power LLC (Shell), a subsidiary of Royal Dutch Shell plc, and Southern Liquefaction Company, LLC, a Kinder Morgan company and unit of El Paso Pipeline Partners,has announced their intent to form a limited liability company to develop a natural gas liquefaction (LNG) plant at Southern LNG Company’s existing Elba Island LNG Terminal, according to Shell's press release.

The project is going to be implemented in two phases. Subject to various corporate and regulatory approvals, Shell and Kinder Morgan affiliates have agreed to modify EPB’s Elba Express Pipeline and Elba Island LNG Terminal to physically transport natural gas to the terminal and to load the liquefied natural gas onto ships for export.

Once finalized, Kinder Morgan will own 51% of the entity and operate the facility. Shell will own the remaining 49% and subscribe to 100% of the liquefaction capacity. The project will use Shell’s innovative small-scale liquefaction unit, which will be integrated with the existing Elba Island facility and enable rapid construction compared to traditional large-scale plants.

The total project is expected to have liquefaction capacity of approximately 2.5 million tonnes per year (mtpa) of LNG. LNG portfolio and unrivaled access to strategic markets around the world - with Kinder Morgan’s unparalleled portfolio of U.S. natural gas assets and industry expertise.

Already one of the largest petrochemical producer INEOS plans to build an ethane storage in Norway as part of the company's strategy for LNG shipment from the U.S. as a feedstock to operate its steam crackers in Europe. The storage is expected to be operational in the second quarter of 2015.

As MRC reported earlier, Shell and Ukrainian Company "Nadra Yuzovsky" on Thursday, 24 January, in Davos, signed a production sharing agreement (PSA) for the developments of shale gas at Yuzovsky area, Ukraine. Each partner has a 50% interest in the project. Shell will be the operator of the project, responsible for all activities under the agreement. The agreement was signed for a period of 50 years.

South Korea SK Gas finalizes USD890 mln propylene plant

MOSCOW (MRC) -- SK Gas, South Korea's top LPG importer, has finalized a USD890 million plan to build a 600,000 tpa propylene plant in the industrial city of Ulsan on the country's southeast coast by 2016, said Plastemart.

SK Gas runs an LPG storage facility in Ulsan with a capacity of 290,000 mt. The South Korean major is considering importing US shale gas-based LPG as feedstock for its petrochemical business.

As MRC wrote earlier, South Korean refining margins are expected to recover in January-March on increase in global oil prices amid expanding demand for heating oil and an upswing in the chemical business.

SK Gas Ltd is a Korea-based company engaged in the import, storage and marketing of liquid petroleum gas (LPG). The Company imports LPG from the Middle East countries, such as Saudi Arabia, Kuwait and the United Arab Emirates, and provides LGP to domestic oil refineries, petrochemical companies, gas stations and other industries. The Company operates storage terminals in Ulsan and Pyeongtaek, Korea. It also exports LPG to Japan, China, Netherlands, Singapore, Malaysia, Taiwan and others.

BASF plastic is used for Volkswagen Golf front end carrier

MOSCOW (MRC) -- BASF' plastic, a highly reinforced polyamide is used in the production of a front end carrier in the new Golf 7. This is one of the world's first front end carriers without metal reinforcement, accoridng to BASF's press release.

Replacing the previous polypropylene (PP) hybrid part with an all-plastic part required use of not only Ultramid B3WG8, a highly reinforced polyamide during development, but particularly Ultrasim, the simulation tool from BASF. The sheet steel parts that had been attached previously are now eliminated. This reduces the weight of the front end module significantly compared to that of the predecessor model, saving assembly time and thus costs. Volkswagen produces the part in-house.

BASF is the largest diversified chemical company in the world and the world's leading supplier of high quality polyamide and polyamide intermediates for the film and monofilament industry. The line of products include Ultramid B (polyamide 6), Ultramid C (polyamide 6/6.6 copolymer) and Ultramid A (polyamide 6.6).

The Ultramid film and monofilament products are optimized for high performance in a wide variety of applications through polymer modifications and additivation and is used for the production of flexible food packaging and technical films. BASF operates Ultramid B (polyamide 6) polymerization plants in Ludwigshafen (Germany), Antwerp (Belgium), Freeport (USA) and Sao Paulo (Brazil). As MRC informed previously, BASF had increased its capacity for Ultramid B film product materials at its Ludwigshafen Verbund site by 21,000 tonnes per year in early 2013.