PTT and Pertamina Petrochemical Expansion

MOSCOW (MRC) -- Indonesia’s Pertamina has chosen Thailand’s PTT Global Chemical as a partner in the development of a USD5 billion petrochemical facility in Indonesia, said Livetradingnews.

The decision was made after months of deliberations with 11 companies being considered, including South Korea’s SK Global Chemical and Japan’s Mitsubishi (see MRC news).

"PTT Global Chemical is a company with a global reputation in petrochemical sector," Karen Agustiawan, Pertamina’s president director, said in a statement.

"The partnership between both companies is expected to not only build petrochemical plants" but also to involve marketing and research and development to gain market share across Asia, Karen said.

She added that Pertamina planned to make petrochemicals a key part of its business as it strived to become a regional leader by 2025.

The partnership with PTT will center on the construction of a petrochemical plant with an annual production capacity of 250,000 tons of ethylene and 350,000 tons of polypropylene — materials key for producing plastic.

It will also produce each year 400,000 tons of polyethylene (plastic) and polyvinyl chloride, which is widely used as a construction material.

The companies will commence a feasibility study for the construction of the plant soon, with an agreement due to be signed early next month. A joint venture will be established in December, ahead of the plant’s construction next year.

The petrochemical plant is expected to go on stream in 2017, with Pertamina aiming for a 30% market share at that time.

PTT owns the largest petrochemical facilities in Thailand, with an annual capacity of 8.2 million tons, using advanced technology and high energy efficiency. Pertamina has the largest oil refinery assets in Southeast Asia.

The facility will be built near one of Pertamina’s existing oil refineries in Balongan, West Java; Plaju, South Sumatra; and Tuban, East Java. The company has not yet decided which location to use.

Hanung noted that Pertamina accounts for 10 % of the petrochemical market in Indonesia. Due to low domestic refinery capacity, it imports around USD5 billion worth of petrochemicals a year.

Pertamina’s net income climbed 26% to Rp. 25.9 trillion (USD2.7 billion) last year.
MRC

MOSCOW (MRC) -- Mangalore Refinery and Petrochemicals Ltd (MRPL) says it is no longer interested in buying out the West Bengal government's share in Haldia Petrochemicals Ltd (HPL), said Business-standard.

P P Upadhyay, managing director of MRPL, told Business Standard it made no sense to buy the shares of a loss-making company at this stage.

"There was an interest in HPL but that has died down. The key promoters are fighting a legal battle which is getting more complex every day and a solution doesn't seem to get any nearer. In such conditions, I would rather stay away from a company like this," he said.

In June last year, key officials of MRPL, citing forward integration interests, had come here to meet Partha Chaterjee, chairman of HPL.

West Bengal Industrial Development Corporation (WBIDC), through which the government holds close to 40 per cent stake in HPL, has been in a hurry to get out of the troubled joint venture, set up in 1984. The Purnendu Chaterjee-led TCG is another key promoter but TCG has been demanding management control and that has taken both the promoters to the courts.

Indian Oil Corporation has an 8.89% stake in HPL by virtue of a Rs 150-crore investment made in 2004.

HPL has faced a couple of downgrades by rating agencies over its long-term debt and the earnings per share is negative, according to officials close to the development. The West Bengal government is keen on completing transfer of its shares in Haldia Petrochemicals Ltd (HPL), which is facing funds crunch (see MRC news).

HPL's monthly cash loss is Rs 50-60 crore and operational capacity around 50%. Experts say if a petrochemical company runs below 70% of its capacity, it will have a negative impact on the plant in the long run.
MRC

MOSCOW (MRC) -- France-based engineering group Technip has announced the acquisition of Ingenium AS, a highly-experienced off-shore engineering and services contractor located in Oslo, Norway, according to the company's press-release.

Ingenium AS designs and develops mechanical and electro-hydraulic tools and equipment, for the off-shore oil and gas industry, and provides engineering services for marine operations, such as the installation of pipes and cables.

Comprising over 20 highly-skilled engineers in the subsea business, the umbilical lay spread on the North Sea Giant, for the Goliat project, in 2012 is one of their recent achievements, according to Technip officials.

Financial terms of the acquisition were not disclosed.

We remind that, as MRC reported earlier, Technip had recently signed two agreements with State Corporation Russian Technologies (Rostec). The agreements aim at manufacturing flexible pipes and umbilicals in Russia, for the Arctic region and the Black Sea oil fields, as well as at the construction and renovation of refining and petrochemical units in Russia.

Technip is a world leader in project management, engineering and construction for the energy industry. Present in 48 countries, Technip has state-of-the-art industrial assets on all continents and operates a fleet of specialized vessels for pipeline installation and subsea construction.
MRC

MOSCOW (MRC) -- Linpac Packaging plans to open a production site in Belarus by the end of the year, according to FoodProductionDaily.

The Belarus facility will initially be 100% focussed on expandable polystyrene (EPS) because Russia mainly is an EPS market, said Linpac, who first considered building a factory in Belarus in 2009.

Speaking exclusively to FoodProductionDaily.com, Rene Christiansen, managing director and general manager for northwest Europe, said the the company had a contract for a new product relating to the bakery sector of "significant volume" and said it may be a "step change" fronted by the innovations teams in the UK and Germany but said he could not reveal more for the moment.

Speaking about the Belarus site, he said: "The cost to serve the Russian market out of the Poland is just too high, both from a transport but also from an import duty point of view.

"I don't think we’ll see EPS coming back from Belarus to, for instance Poland again, because of those import duties but it will cover Belarus itself and mainly Russia but also shipping into Ukraine and maybe even some of the Baltic countries."

We remind that, as MRC wrote previously, in line with its new ‘Fresh Thinking’ innovation strategy Linpac Packaging launched two new PP films for fresh meat, poultry and fish in 2012. Both films - LINtop PP HB Lock Seal and LINtop PP HB Peelable - are to be manufactured at the company’s Pontivy flexible films factory in France.

LINPAC Group Limited was founded in 1959 in Lincolnshire, England. It is now an international, GBP1.1 billion, mainly plastic packaging and supply chain manufacturing and services business, based in Birmingham, United Kingdom, and has 7,000 employees in 29 countries. The company manufactures food packaging, returnable transit packaging (RTP), rigid plastic containers, cartridges, bulk storage tanks, bulk containers, medical containers, spill control products, and GRP gratings and structures.
MRC

MOSCOW (MRC) -- LyondellBasell, one of the major petrochemical global producers and the world's largest maker of polypropylene, will raise its ethylene capacity in North America by 18% in coming years through several debottlenecking projects, reported Hydrocarbonprocessing with reference to LyondellBasell's CEO.

Locations where ethylene capacity will be expanded include crackers in Corpus Christi, La Porte and Channelview, Texas, according to the company. The projects are scheduled to be finished in 2014 and 2015.

Jim Gallogly, CEO of LyondellBasell, said the company aims to finish its projects two-to-three years earlier than industry competitors building new plants, all at a lower cost.

Gallogly said he expects ethane to stay price-advantaged in the US for at least the next five years. He noted that natural gas producers are still incentivized to produce wet gas and, as a result, LyondellBasell plans to raise its ability to crack natural gas liquids (NGLs) from 85% to 90%.

LyondellBasell also said it was "in the early stages" of evaluating a 1 million lb/year polyethylene (PE) plant in North America by 2016.

Overall, the company plans to invest USD1.6 billion in growth capital expenditures (CAPX) over the next four years, adding over USD1.5 billion/year in new earnings by 2017.

Aside from the North American ethylene debottlenecks, proposed projects also include a methanol restart in the US and a butadiene expansion in Germany.

LyondellBasell Industries NV is a manufacturing company. The Company produces chemicals, fuels, and polymers used for packaging, clean fuels, durable textiles, medical applications, construction materials, and automotive parts. LyondellBasell Industries operates globally and is headquartered in the Netherlands. LyondellBasell is also a leading licensor of polypropylene and polyethylene technologies. The more than 250 polyolefin process licenses granted by LyondellBasell are twice that of any other polyolefin technology licensor.

A number of large chemical companies have chosen LyondellBasell's technology for their production processes. Thus, the largest coal company in the world, China Shenhua Coal to Liquid and Chemical Co. selected the LyondellBasell Lupotech T process technology for a 270 KT per year low density polyethylene (LDPE) plant to be built in Xinjiang, China. Then, PETRONAS chose the Spheripol technology from LyondellBasell for two 300 KTA polypropylene (PP) units to be located in Pengerang, Malaysia. Besides, ZapSibNeftekhim L.L.C, a fully owned subsidiary of SIBUR, decided to select the Spheripol process technology from LyondellBasell for a new 500 KT per year single-line polypropylene (PP) plant to be built in Tobolsk, Russia Federation.
MRC