Foster Wheeler to study Kuwait aromatics plan

MOSCOW (MRC) -- Foster Wheeler was awarded a contract by Kuwait's Petrochemical Industries Company (PIC) for a pre-feasibility study and a market report for a proposed aromatics plant in Kuwait, reported Hydrocarbonprocessing.

The study is scheduled to be completed in the fourth quarter of 2013.

"Our wide chemicals experience and in-depth technical expertise, combined with the specialist study execution capability in our Business Solutions Group, were key factors in winning this contract," said Umberto della Sala, chief operating officer of Foster Wheeler.

The Foster Wheeler contract value was not disclosed. The order will be included in the company’s third-quarter 2013 bookings.

We remind that, as MRC informed previously, Foster Wheeler has been awarded a contract by Shell Global Solutions to develop the basic engineering package for a world-scale mono-ethylene glycol (MEG) facility at the Gulf region (Qatar).

Also, Foster Wheeler has recently announced that a subsidiary of its global engineering and construction (E&C) group was awarded a contract by Dow Chemical to provide services for the LA-3 crack more ethane (CME) project at Dow’s Plaquemine petrochemical complex in Louisiana. The objective of the project is to improve the plant's ethane flexibility to take advantage of low-cost feedstock. The scope will include brownfield additions and retrofit modifications to the plant.
MRC

MOSCOW (MRC) -- Oman Oil Co. agreed to buy Oxea from Advent International to expand beyond refining into chemicals and ingredients for manufacturing and consumer goods, said Bloomberg.

The state-owned oil producer will use the purchase of Oxea as a springboard for tapping demand for oxo-based chemicals, the companies said today. Oxea, formed from units of Celanese Corp. and the predecessor of Evonik Industries AG , generated about EUR1.5 billion (USD2.03 billion) in sales in 2012. Oman Oil paid almost EUR1.8 billion , according to three people familiar with the matter who asked not to be named because the negotiations were private.

The deal with Oman Oil "will provide additional access to growth markets in Asia and the Middle East," Martina Floel, managing director of Oxea, said in the statement.

Under Advent’s leadership, Oberhausen, Germany-based Oxea diversified its products to add higher-margin derivatives, and capacity is now 1.3 million tons a year. After a push into Asian markets, Oxea’s polyols are used in cosmetics and lubricants, and its amines are used in rubber chemicals and dyes.

The company is building a new derivatives plant in Nanjing to serve fast-growing markets for films and safety glass laminates in Asia, including China.

As MRC wrote before, Oman Oil Company, the energy investment arm of the Oman government, announced plans to build an USD800m (OMR 308m) petrochemicals plant in Sohar and one of the largest crude storage facilities in the world at Ras Markaz in Duqm. The petrochemicals plant will produce purified terephthalic acid (PTA) and polyethylene terephtalate (PET).

Oman Oil will give Oxea the option to draw on the country’s petrochemical base and source cheaper supplies of its main raw material polyproplene from its parent. It will also provide the technology and management experience to further expand operations, which compete with companies such as BASF SE.

Oxea is the largest supplier in the merchant oxo chemicals market, and No. 2 in capacity after Ludwigshafen, Germany-based BASF.

MRC

MOSCOW (MRC) -- INEOS Enterprises announces the closure of its Vinyl Acetate Monomer Unit at Saltend, Hull. 04 Oktober 2013, said the producer in its press release.

Low cost imports and a hostile trading Environment made closure inevitable. He says, "This is a very sad day for Saltend. Everyone has worked hard to resolve this issue without success. We will do all we can to help those affected by this."

Today INEOS Enterprises is announcing the closure of its Vinyl Acetate Monomer (VAM) facility at Saltend in Hull with a loss of 18 jobs. This announcement does not affect the INEOS Ethyl Acetate plant at the same site which will remain in production.

INEOS acquired the VAM facility in 2008 and has committed over GBP40 million trying to make it competitive in world markets. Both management and employees have done everything they can to make the business sustainable but without success.

The VAM market has become increasingly targeted by cheap imports mainly from Saudi Arabia and the USA, both of whom benefit from low cost raw materials. The VAM plant in Hull gets one of its main raw materials, ethylene, down a pipeline from Grangemouth in Scotland. Despite this integration, Grangemouth site has not been able to provide products at a low enough cost to enable the Saltend site to match its competitors prices.

As MRC wrote before, Ineos Grangemouth plant is likely to be shut down in the next three years if it continues losing over GBP100 million every year, as per Ineos chairman of Olefins and Polymers Europe. The main reasons for the massive losses are the decline in North Sea petrochemical feedstocks and the site’s pension scheme deficit of GBP200 million, two issues Ineos is now working to address.

INEOS Enterprises is a portfolio of ten businesses manufacturing chemical products in Northern Europe, with sales of these products to customers around the world. The Company is focused on the developing needs of customers and rapid growth through investment in new products and manufacturing facilities or by acquisition. INEOS Enterprises now employs some 800 people across sites in the UK, France, Germany.
MRC

MOSCOW (MRC) -- A dispute between workers and management at the UK Grangemouth refinery and chemical plant worsened on Thursday as owner Ineos rejected union counter-proposals to a cost-cutting plan, a source close to the negotiations said Reuters.

Ineos says the petrochemical plant has been losing money for four years and will have to close unless it can lower costs by cutting jobs and renegotiating pensions.

Unite, Britain's largest union, this week presented its own alternative proposals. In a dispute that is notionally separate but has contributed to a climate of mistrust, Unite is also locked in an industrial dispute with Ineos over claims of unfair treatment of an organiser and the use of casual workers.

He said the union's offer had included renegotiating pay and pensions for an interim period. "We need a period of reflection to decide what our next move is," he said.

A spokesman for the Swiss-based oil refiner and chemicals company said: "We are focusing on trying to save the plant."

On Monday, staff across the complex began working to rule and refusing overtime in a dispute over Ineos's treatment of union organiser Stephen Deans.

On Thursday Ineos restated its position on the case. "There is an investigation into Stephen Deans following standard process and, until that concludes, going to ACAS is a pointless exercise," a company spokesman said.

The union has said it could still escalate the dispute to a full strike, which would be likely to shut the Forties Pipeline System as the Kinneil oil processing terminal, where Forties oil comes ashore, relies on Grangemouth for its steam and power.

Ineos says cutting costs is crucial to securing a loan guarantee from the British Treasury of 125 million pounds, and a grant of 9 million pounds from the Scottish government. It says it is investigating whether Deans's political activities with the Labour Party contravened company policies, and that it will announce its findings on Oct. 25.

The union says both the Labour Party and the police have found no evidence of wrongdoing. The refinery that the chemical plant is attached to processes 210,000 barrels of oil per day and provides most of Scotland's fuel. It is owned jointly by Ineos and PetroChina .

MRC

MOSCOW (MRC) -- Saudi International Petrochemical Company (Sipchem) has announced the commencement of operations of utility and offsite units, and initial operation of some process units of ethylene vinyl acetates (EVA) and low density poly ethylene (LDPE) plant owned by its affiliate International Polymers Company at its complex in Jubail Industrial City, according to Arab News.

By this accomplishment, the company, which issued a statement in this connection earlier on June 11, has said that it has completed the first phase.

The phase includes installation and testing of major equipment and pre-manufactured modules, whose installation and testing required longer time, prior to completion of basic preparations for initial startup expected during fourth quarter of this year.

The plant capacity is 200,000 tpa of ethylene vinyl acetates (EVA) and low density poly ethylene (LDPE).

Raw material required for EVA and LDPE production is ethylene, which will be supplied by Jubail United Petrochemical Company, an affiliate of Saudi Basic Industries Corporation (SABIC) and vinyl acetate monomers (VAM) which will be supplied by International Vinyl Acetate Company, a Sipchem affiliate.

The company will announce initial operation and financial impact or any other developments in due course. The total cost of construction of this project is SR3 billion.

As MRC wrote previously, IPC signed on 10 June 2013 a financing agreement of SR 704 million (USD 188 million) with Public Investment Fund (PIF). The loan is repayable over 14 years in 26 semiannual and equal installments commencing December 2014. The loan is payable until 30 June 2027 and secured until project completion by order notes. The purpose of this agreement is to support the project financing of a greenfield EVA/LDPE plant.

International Polymers Company (IPC) is jointly owned by Sipchem (75%) and Hanwha Chemical Corporation (25%).

Established in 1999, Saudi International Petrochemical Company (Sipchem) manufactures and markets methanol, butanediol, tetrahydrofuran, acetic acid, acetic anhydride, vinyl acetate monomer. Besides, it has launched several down-stream projects to manufacture ethylene vinyl acetate, low density polyethylene, ethyl acetate, butyl acetate, cross linkable polyethylene, and semi conductive compound that are scheduled to start in 2013.
MRC