New plant start up props Korean Q1 paraxylene exports by 61% on year

MOSCOW (MRC) -- South Korea's paraxylene exports for January-March totaled 806,657 mt, surging 60.5% from a year earlier and up 41.4% from the previous quarter, as reported by the Korea Customs Service by Plastemart.

The sharp increase was due to the startup of a new PX plant there. South Korea's HC Petrochem, a 50:50 joint venture between Hyundai Oilbank and Japan's Cosmo Oil, started commercial operations at its new 800,000 tpa PX plant in Daesan on January 8. Most of the new output from the plant is shipped to China.

As a result, South Korea's PX exports to China jumped 49.2% quarter on quarter to 762,382 mt over January-March. Tracking this, the CFR Taiwan/China PX price benchmark rose 3% from the previous October-December 2012 quarter to average at USD1635.04/mt in January-March.

But demand from China is likely to slow from April, as Chinese purified terephthalic acid producers have started reducing their operating rates amid bearish demand for polyester production, market sources said Monday. In addition, the turnaround season for aromatics plant in South Korea would likely reduce PX exports, they added. In the middle of March, GS Caltex shut its No. 2 aromatics plant in Yeosu for one month of annual maintenance.

The plant is able to produce 400,000 tpa of PX. In April, HC Petrochem shut its No. 1 aromatics plant in Daesan for 30 days of annual maintenance, while S-Oil will shut its No. 2 aromatics unit from the middle of April for around 36 days.
MRC

MOSCOW (MRC) -- Idemitsu Kosan, one of Japan’s largest refining and petrochemical companies, has selected Honeywell’s Experion process knowledge system (PKS) to modernize the integrated control room at its Tokuyama refining and petrochemical complex to promote operational efficiency, safety and reliability, according to Hydrocarbonprocessing.

"This modernization project will give us greater effectiveness and efficiency as we work to meet Japan’s need for energy diversification," said Takashi Matsushita, general manager of the manufacturing and technology department for Idemitsu Kosan.

As a part of this modernization effort, the company will deploy abnormal situations management, alarm management, and cyber-security solutions.

The implementation of Experion PKS began in late 2012 and is expected to be completed by the end of 2014.

We remind that, as MRC wrote previously, Dow Chemical has recently signed a long-term ethylene off-take agreement with a new Japanese joint venture that will allow the chemical producer to enhance its performance plastics franchise. The joint venture is being formed between Japanese companies Idemitsu Kosan and Mitsui & Co. to construct and operate a Linear Alpha Olefins unit on the U.S. Gulf Coast.

Idemitsu Kosan is a Japanese petroleum company. It owns and operates oil platforms, refineries and produces and sells petroleum, oils and petrochemical products. The company runs two petrochemical plants in Chiba and Tokuyama. The two naphtha crackers can produce up to 997,000 tonnes of ethylene per year.
MRC

MOSCOW (MRC) -- PPG Industries Inc.'s first-quarter earnings surged after the paint-and-coatings supplier recorded a roughly USD2.2 billion sale of its chemicals business, according to The Wall Street Journal.

In July, PPG agreed to form a new company by separating its chemicals business and then merging the unit with Georgia Gulf Corp. in a cash-and-stock deal. The deal was completed in late January, with the new company called Axiall Corp.

PPG, which also makes coatings for the auto, aircraft and other markets, in recent years has been shifting its emphasis to paint and other coatings from glass and chemicals. In December, PPG agreed to buy the North American architectural coatings business of Amsterdam's Akzo Nobel NV for USD875 million in a bid to increase its exposure in the region ahead of a recovering U.S. construction market.

For the quarter, PPG reported a profit of USD2.41 billion, or USD16.31 a share, versus a year-earlier profit of USD13 million, or eight cents a share. The chemicals-business sale added USD14.83 per share to the bottom line. Stripping out the sale and other items, PPG's earnings were USD1.58 a share for the quarter, up from USD1.41.

Net sales edged down 0.1% to USD3.33 billion.

Analysts surveyed by Thomson Reuters expected per-share earnings of USD1.54 on revenue of USD3.44 billion.

PPG's performance-coatings segment posted a decline of about 2% in sales on weaker volume.

Meanwhile, sales in the industrial-coatings unit, which produces colors and finishes for manufacturers and packaging coatings for food companies, were up 10% on higher volume and acquisitions.

PPG Industries Inc. is an Americain international company that produces paints, chemicals, optical components, specialty materials, glass and fiber glass. The company consists of more than 150 production units and offices in more than 60 countries. PPG industries is in the list of the top 500 U.S. corporations in terms of sales of. As MRC reported previously, PPG Industries plans to open its first factory in Russia near Tver. As of today, PPG Industries has no production facilities in Russia.
MRC

MOSCOW (MRC) -- Petro Rabigh (Rabigh Refining and Petrochemical Company) has announced that it will be performing maintenance work on its ethan cracker unit which will lead to the shutdown of the said unit as well as the units that are integrated to it, according to the company's statement.

The maintenance started on April 22, 2013 and will last until May 3, 2013 when gradual start up for these units will take place. The company's downstream units include LLDPE plant, HDPE unit, PP unit and MEG plant.

This shutdown is expected to have an impact on the financial results for the second quarter of 2013. Further developments will be announced as they occur.

As MRC reported previously, Petro Rabigh had signed an agreement with Tasnee and Saudi Advanced Industries (SAIC) for the supply of propylene oxide to the joint venture for the production of polyether polyol. The plant is located in Rabiga, in the west of Saudi Arabia on the Red Sea. The production launch is scheduled for the fourth quarter of 2013.

PetroRabigh, a joint venture between Saudi Aramco and Japan's Sumitomo Chemical, has an annual output capacity of 18 million tonsne of refined products and 2.4 million tonnes of petrochemicals.
MRC

MOSCOW (MRC) --Anglo-Dutch oil major Royal Dutch Shell is interested in Brazil's upcoming oil and natural gas concession auctions but has not yet decided whether to participate, reported The Wall Street Journal with reference to Chief Executive Peter Voser.

"Shell will study the bid areas and make a technical evaluation before deciding how to participate" in the auctions, Mr. Voser told reporters. The first of three auctions scheduled for this year will be held May 14-15, the first such bid round since 2008.

"Our assumption is that Brazil has significant resources being developed and to be developed," Mr. Voser said, noting that Latin America's largest country will play an important role in the global oil and natural gas map in the future.

In addition to the concession auction, Mr. Voser said that Shell was evaluating assets state-run energy giant Petrobras, has put up for sale in Brazil and the Gulf of Mexico. Petrobras plans to sell USD9.9 billion in assets to fund its USD237 billion investment plan through 2017.

"We have a very successful partnership with Petrobras and are interested in further collaboration," Mr. Voser said.

Shell is also carefully watching developments in Venezuela, where the company has a small operation in the Lake Maracaibo region, Mr. Voser said. Venezuela has suffered with political unrest following President Hugo Chavez's death and last weekend's election of his handpicked successor, Nicolas Maduro.

"We take a long-term view on investments in Venezuela," Mr. Voser said, adding that Shell was on the lookout for growth opportunities in the country that is home to the world's largest crude-oil reserves.

Elsewhere, Mr. Voser said, the shale gas revolution in the U.S. could fundamentally change industry in the world's largest economy. "Cheap natural gas feedstock could drive a reindustrialization in the U.S.," Mr. Voser said, bringing previously outsourced manufacturing heavy industry and petrochemicals output back to the U.S.

Shell also expects the U.S. to approve exports of between 50 million and 60 million tons of liquefied natural gas derived from shale gas, Mr. Voser said.

Royal Dutch Shell, commonly known as Shell, is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is also one of the world's most valuable companies. As of January, 2013 the largest shareholder is Capital Research Global Investors with 9.85% ahead of BlackRock in second with 6.89%. Shell topped the list of largest companies in the world.
MRC