Petronas Chem sells Vietnam unit to Asahi Glass, Mitsubishi Corp

MOSCOW (MRC) -- The petrochemicals arm of Malaysian state oil firm Petronas will sell its stake in Vietnamese Phu My Plastics and Chemical Company Ltd (PMPC) to Japanese Asahi Glass Co Ltd and Mitsubishi Corporation, as per Plastemart.

Petronas Chemicals Group Bhd said in a stock exchange statement on Wednesday the divestment of 93.1% of PMPC was part of a plan to discontinue its vinyl business and strengthen its asset portfolio.Deutsche Bank acted as financial advisor to Petronas Chemicals for this transaction.

As MRC wrote before, Japan-based Toyo Engineering has been awarded a contract by Malaysian Petronas for the rejuvenation and revamp project of the No. 4 gas processing plant located in Kerteh, Terengganu. The plant will have a capacity of 250 million cubic feet/day, according to project officials. Toyo is slated to provide engineering, procurement, construction and commissioning with a turnkey contract for expanding the plant's life by another 20 years.

Petronas, short for Petroliam Nasional Berhad, is a Malaysian oil and gas company wholly owned by the Government of Malaysia. The Group is engaged in a wide spectrum of petroleum activities, including upstream exploration and production of oil and gas to downstream oil refining; marketing and distribution of petroleum products; trading; gas processing and liquefaction; gas transmission pipeline network operations; marketing of liquefied natural gas; petrochemical manufacturing and marketing; shipping; automotive engineering; and property investment.
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MOSCOW (MRC) -- Formosa Plastics Corp. USA and scores of government entities that allege they were sold defective PVC pipes for sewer systems from 1996-2005 have agreed to a USD22.5 million settlement in a whistle-blower lawsuit, said Plasticsnews.

The Taiwan-based plastics giant was sued along with J-M Manufacturing Co., which is now called JM Eagle, by a whistle blower, three states, and 42 cities and water districts. The lawsuit says the defendants violated the False Claims Act by knowingly selling pipe that would fail earlier than promised.

Details about the proposed settlement between Formosa and the plaintiffs came to light as the first part of a two-phase trial wraps up before U.S. District Court Judge George H. Wu in California. If a jury finds liability, a second phase of the trial will determine damages.

In a joint motion filed on Oct. 28, Formosa and the plaintiffs are asking the judge to approve a proposed settlement that covers all claims against FPC-USA in both federal and state actions. Los Angeles-based JM Eagle is the largest pipe extruder in North America, according to Plastics News' ranking. Formosa is its former parent company.

All parties have reason to settle, according to the motion, which says Formosa faces significant litigation risks considering its PVC resin was a principal ingredient in hundreds of millions of feet of J-M's PVC pipe at issue.

"The risks are great, even if only a small portion of claims against FPLC-USA are ultimately successful," the motion says. "For their part, plaintiffs also face many burdens in their claims…"

The plaintiffs would have to establish the timing, source and scope of Formosa's discovery of alleged false claims to the plaintiffs.

"The settlement provides the plaintiffs with an immediate benefit and eliminates the risk that, given the circumstances of this case, the plaintiffs could recover less than the settlement from FPC-USA or take nothing," the motion says.

The proposed settlement has been signed by attorneys and attorney generals representing Formosa; Hendrix; the states of Nevada, Virginia and New Mexico; and 21 cities and 21 water districts in California.

As MRC wrote before, Formosa Chemicals & Fibres Corp restarted in early October its No.2 styrene monomer (SM) unit. Located in Kaohsiung, Taiwan, the unit has a production capacity of 350,000 mt/year.

ormosa Petrochemical is involved primarily in the business of refining crude oil, selling refined petroleum products and producing and selling olefins (including ethylene, propylene, butadiene and BTX) from its naphtha cracking operations. Formosa Petrochemical is also the largest olefins producer in Taiwan and its olefins products are mostly sold to companies within the Formosa Group. Among the company"s chemical products are paraxylene (PX), phenyl ethylene, acetone and pure terephthalic acid (PTA). The company's plastic products include acrylonitrile butadiene styrene (ABS) resins, polystyrene (PS), polypropylene (PP) and panlite (PC).
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MOSCOW (MRC) -- Braskem has reduced prices of polypropylene and polyethylene in Brazil in H1-November, pressured by international competitive offers, said Plastemart.

Offers on polypropylene grades -- homopolymer and co-polymer, by Braskem, were heard USD200/mt lower, at around USD2133/mt in the domestic market. For polyethylene grades, offers from Braskem were heard at USD2760/mt, or USD160/mt lower than the USD2920/mt in October. These prices include the Brazilian taxes, IPI and ICMS. But despite the prices reduction, the domestic offers in Brazil are still very expensive," a Brazilian distributor said. This is leading to an influx of imported material into Brazil.

As MRC wrote before, Braskem is participating in the bidding to acquire the polyvinyl chloride (PVC) assets of Belgium's Solvay in South America. Braskem said the negotiations had not yet concluded and it could not say when they would be completed.Solvay Indupa operates two industrial sites, one in Bahia Blanca, Argentina, and the other in Santo Andre, in Brazil's Sao Paulo state, that produce PVC plastic and caustic soda.

Braskem is the leading producer of thermoplastic resins in Latin America and the US, following its purchase of polypropylene assets of Dow Chemical. The company serves 70% of Brazilian demand in PP, PE and PVC resins, but foreign resin imports have gained Brazilian market share in recent years. Brazil's annual consumption of PP is estimated at 1.4 million tons this year. Braskem has been a target of criticism by plastics processors over its perceived dominance of the resins market. Brazil's import tariff on foreign PP is 14%, but could increase. Brazil's federal government raised the import tariff on PE in late 2012 from 14-20%.
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MOSCOW (MRC) -- Russian petrochemical company SamaraNefteOrgSintez (Sanors) has shown interest in Thai PTT's mega refining and petrochemical project in Vietnam's Binh Dinh province, reported Apic-online with reference to the Binh Dinh provincial government's statement.

Sanors chief, Igor Soglayev, and his delegation met Binh Dinh government officials at the proposed 660,000 b/d project site. "Igor Soglayev said this project is very attractive to investors, but it needs clear commitments of the involved governments," it said.

The mega refining and petrochemical project in Vietnam's Binh Dinh province was proposed by Thailand's top energy company PTT in November last year. It expects to complete the feasibility study for the proposed complex in the Vietnamese central province of Binh Dinh in April 2014, which will then be submitted for Vietnamese government's approval.

Soglayev has asked Binh Dinh officials to meet Igor Sechin when the Rosneft president accompanies Russian President Vladimir Putin on his visit to Vietnam starting November 12.

The provincial government will also meet PTT officials on Tuesday, according to the provincial government officials.

Total investment for the project is expected to range from USD25 billion to USD30 billion. PTT would finance part of it with the remainder sourcing from other potential investors and financiers, Sukrit Surabotsopon, Senior Executive Vice President of Petrochemicals & Refining Business Unit at PTT, said in a press briefing in Binh Dinh on August 15.

As MRC wrote previously, Sanors and Russia's state-owned giant Rosneft in June signed a heads of agreement, under which the companies intend to create a joint venture that will incorporate Rosneft's gas-processing assets and Sanors' petrochemical assets in Russia's Samara and Orenburg regions. One of the joint venture's main objectives will be to build a world-scale petrochemical complex in the Samara region.

Russian Sanors produces a wide variety of petrochemical products like phenol, acetone, alpha-methyl-styrene, ethylene, synthetic ethanol.

PTT Asahi Chemical Company Limited (PTTAC), a company of the PTT Group, is a joint venture of PTT Public Company Limited (PTT), Thailand chemicals producer , and Marubeni Corporation (Marubeni) of Japan, one of the world's leading petrochemicals traders with the shareholding ratio of 48.5%, 48.5% and 3% respectively. PTTAC receives joint support from the shareholders with strengths in technology, feedstock, operations and marketing.
MRC

MOSCOW (MRC) -- Showa Denko and KH Neochem Co., Ltd. have agreed to dissolve their joint venture, Japan Ethyl Acetate Co., Ltd. (JEA), said Plastemart.

JEA was established in August 2003 for the purpose of strengthening the foundations of the two parent companies' ethyl acetate businesses. JEA began commercial production in April 2004.

While demand for ethyl acetate has grown inside and outside Japan since then, the business environment has changed dramatically, reflecting the rise in raw material costs and capacity expansions in neighboring countries.

Under the circumstances, SDK and KHNC have concluded, after mutual consultation, that it is difficult to continue JEA's operations. Thus, the two companies have agreed to stop ethyl acetate production at JEA, and dissolve the company.

As MRC wrote before, Mitsubishi Corporation (MC), a major petrochemical producer, and Showa Denko K.K. (SDK) have entered into a strategic partnership in the Fullerene business. As part of the arrangement, SDK acquired from Mitsubishi Corp a 50% stake in Frontier Carbon Corporation (FCC), a producer and marketer of Fullerene products, thereby making FCC a 50-50 joint venture between MC and SDK.

Showa Denko K.K. is a major manufacturer and marketer of chemical products serving a wide range of fields ranging from heavy industries, to the electronic and computer industries. The company has overseas operations and a joint venture with Netherlands-based Montell and Nippon Petrochemicals to manufacture and market polypropylenes (PP).
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