SIBUR completes a major investment project at its Voronezh Site

MOSCOW (MRC) -- SIBUR has launched production of styrene-butadiene thermoplastic elastomers (TPE) – cutting-edge polymer materials for the road building industry and roof coatings - at its Voronezh-based facility, according to the company's press release.

The production facility reached its full design capacity of 50,000 tonnes per year.

The process phase of start-up and commissioning operations at the new facility completed with a 72-hour trial run of all the equipment units attended by the licensor's representatives. Each separation line showed the nominal design capacity at the finished products stage.

In its report on the results of the integrated testing, the licensor expressed a high opinion of the quality of construction and installation, general readiness of the TPE-50 facility to commence operations and its full compliance with the technology transferred under the licence. The licensor concludes that "the operating personnel is well-qualified, and the equipment well-prepared ensuring output of high-quality products in the amounts as specified in the framework project."

"The new facility proceeds to operate in the production and maintenance mode," says Viktor Kuklinov, CEO of Voronezhsintezkauchuk. "From now on, the consumers will receive extra volumes of cutting-edge polymer materials for the road building industry and roof coatings."

As MRC informed previously, in late May 2013, SIBUR began integrated equipment testing at the propylene storage facility and trial production of the first polypropylene line at the company’s Tobolsk-Polymer complex. This follows testing of the first production line at the extrusion plant and the polypropylene packaging and dispatch plant. SIBUR expects to begin production at the complex by the end of 2013, once all approvals have been granted.

Thermoplastic elastomers are materials combining the properties of both rubber and plastics. The most important use of TPEs is production of polymer-modified asphalt cements, which contribute to better durability of upper layers of the road surface. Their use extends the time between repairs from 3-4 years up to 7-10 years.

SIBUR is a vertically integrated gas processing and petrochemicals company. SIBUR owns and operates Russia’s largest gas processing business in terms of associated petroleum gas processing volumes, and is a leader in the Russian petrochemicals industry. As of 31 March 2013, SIBUR operated 27 production sites across Russia, had over 1,500 large customers operating in the energy, automotive, construction, fast moving consumer goods (FMCG), chemical and other industries in approximately 60 countries and employed over 30,000 personnel.
MRC

МОSCOW (MRC) -- According to IHS, while the effect of the escalating unrest in Egypt is obvious at the petrol pump, the crisis could potentially have a less obvious impact on the cost of countless everyday consumer products that are derivatives of crude oil, said Energyglobal.

This could then in turn potentially impede the US economic recovery.Petrochemicals derived from oil are used to manufacture a huge array of products taken for granted in the modern world and encompasses many things from pharmaceuticals, to plastic bottles, to bin liners. The unrest in Egypt has already driven up pricing of oil and some associated petrochemicals. And based on the analysis of historical trends, a sustained increase in oil costs could result in a surge in petrochemical expenses, inflating prices for a slew of items.

In July of this year, oil prices again rose above the USD100 /bbl level reaching an average of USD104.70 /bbl, and it won’t stop there. During this month, they are expected to rise to USD106.67 before easing back as the end of summer driving season reduces seasonal demand. Yet, if the civil unrest in Egypt continues or gets worse, oil prices could remain high and drive up the cost of ethylene and other base petrochemicals within 30 – 60 days.

Looking beyond ethylene, pricing for other key petrochemicals are affected by high oil prices, including benzene, styrene, propylene and butadiene. The supply chain for these material spans from crude oil producers, to petrochemical manufacturers, to derivatives manufacturers, to finished goods, to retail outlets, to consumers. These petrochemicals serve as the intermediate building blocks for numerous plastics and other chemical derivatives.

The current events in Egypt are illustrating how global events can have unforeseen impacts on petrochemical supply chains. Although Egypt is not a major oil producer or exporter, the unrest in the nation is indirectly impacting energy and petrochemical prices globally. Instability in a key country or region can have an unforeseen and lasting impact on oil prices and futures trading. The unrest in Egypt has the potential to cause wider scale upheaval in the Middle East, including countries that are major oil producers.

We remind that UK supermajor BP said it will start pulling some staff from Egypt as unrest in the North African nation escalated following the military's ousting of president Mohammed Mursi. Besides, anglo-Dutch supermajor Shell closed its offices in Egypt for the next few days and restricted business travel there after at least 525 people were killed in a security crackdown.

Reacting to the increased risk in the region, energy traders are already driving up their prices. The potential upwelling comes at the time when petrochemicals are in high demand for use in consumer electronics products, such as plastic enclosures for televisions, smart phones and media tablets as well as automotive parts, packaging and a host of other goods.


MRC

MOSCOW (MRC) - Chinese producers of polyethylene terephthalate (PET) have increased their export shipments to foreign markets. Exports of Chinese PET have increased by 62% to 538,000 tonnes in the second quarter 2013 compared to the same period a year earlier (332 ,000 tonnes), according to MRC analysts.

Chinese producers have increased their sales in all markets. The largest increase in Chinese PET exports in the second quarter was recorded in the market of Africa and the Middle East (up by 118% to 156,000 tonnes).
However, the largest consumer of Chinese PET continue to be southern regions of Asia (exports in the second quarter totalled more than 162,000 tonnes).

In general, exports of Chinese PET in the first half of the year increased by 32% to about 930,000 tonnes.
Substantial increase in PET granulate exports from China was seen in CIS countries.

The advantage of Chinese brands is supported by attractive prices and the quality of some brands from large producers, such as Jiangsu Sanfangxiang, Shanghai Hengyi Polyester, Zhejiang Wankai, China Resources Chemicals, etc.

Exports of Chinese PET to Ukraine grew by more than 64% relative to the period of 2012 and totalled 68,000 tonnes in the first half of 2013.

Russian converters have also increased their purchases in China. In the first six months of 2013 imports of PET from China totalled 51,500 tonnes, up by 19% year on year (despite the overall decline in imports in January-June from 106,000 tonnes 91,000 tonnes).
MRC

MOSCOW (MRC) -- Formosa Chemicals &Fiber Corp (FCFC) is in plans to shut its No.1 styrene monomer (SM) plant for maintenance turnaround, reported Apic-Online.

A Polymerupdate source in Taiwan informed that the plant will be shut next week. It is likely to remain off-stream for around 40 days.

Located in Mailiao, Taiwan, the plant has a production capacity of 250,000 mt/year.

We remind that, as MRC wrote previously, Formosa Petrochemical is in plans to shut two crude units for maintenance at its Mailiao refinery. An 80,000 bpd vacuum distillation unit (VDU) and 84,000 bpd residual fluid catalytic cracking unit (RFCC) are planned to be taken off-stream. The units are likely to be shut in October 2013. They are expected to remain off-stream for around three weeks.

Besides, Formosa Plastics Corp (FPC) is in plans to shut a polyvinyl chloride (PVC) plant for maintenance turnaround. The plant is likely to be shut in September 2013 and expected to remain off-stream for around two weeks. Located in Mailiao, Taiwan, the plant has a production capacity of around 500,000 mt/year.

Formosa Chemicals & Fibre Corporation (FCFC) is a subsidiary of Formosa Plastics Group, the largest private owned enterprise in Taiwan, with annual revenue of USD13.5 billion.

Formosa Plastics Corporation is a Taiwanese company based in Taiwan that primarily produces polyvinyl chloride (PVC) resins and other intermediate plastic products.
MRC

MOVSCOW (MRC) - At least three people were killed by an ammonia gas leak from a pipeline owned by state oil monopoly Pemex in southern Mexico on Tuesday and 1,500 people were evacuated from the area and taken to shelters, said Reuters.

Mexican media put the death toll at four and said some 40 others were poisoned by the leak in the southern state of Oaxaca.

Pemex said the leak was caused when the pipeline was damaged by heavy machinery operated by a private company doing road work. Pemex has had a poor safety record in recent years.

Nearly 40 people were killed in January in a massive explosion at Pemex's Mexico City headquarters. Investigators said the blast was caused by a buildup of methane and other gases that had collected for years in the basement of the building with no ventilation.

Mexican President Enrique Pena Nieto has proposed an overhaul of the energy sector to attract private investment to help stem a slide in oil output over nearly a decade and drag the giant Pemex into the modern era.

Petroleos Mexicanos is the Mexican state-owned petroleum company, created in 1938 by nationalized petroleum and expunging all private foreign and domestic companies at that time.

MRC