Royal converting siding plant to PVC pipe production

MOSCOW (MRC) -- Royal Building Products will invest USD24 million to expand PVC pipe production in Newbern, Tenn, said Plasticsnews.

Royal and Tennessee officials announced the project May 22. Royal recently converted the Newbern operation to PVC pipe from vinyl siding production. The boost in pipe production will create 85 new jobs in Dyer County.

"The Newbern location provided our PVC pipe business with an opportunity to establish a manufacturing presence near growth markets in the southern United States and take advantage of western Tennessee’s strength as a transportation and distribution center," noted Paul Czachor, Royal’s vice president and general manager of pipe and fittings, in a news release.

Czachor said Newbern employees have experience with building products and vinyl extrusion which will help smooth the way for transition to extruding PVC pipe.

Royal’s other PVC pipe plants are in Woodbridge, Ontario, where it is headquartered, and in Abbottsford, British Columbia. The Abbotsford location’s involvement with pipe dates back to 1913, when it began making clay pipe.
Royal did not disclose where it relocated vinyl profile production from Newbern. In 2011 it expanded its profile product offerings and production capacity by acquiring the Columbus, Ohio, siding business of Crane Group.
Tennessee Economic and Community Development, the Tennessee Valley Authority, the city of Newbern and Dyer County are assisting Royal’s pipe project. Royal is a division of Axiall Corp. of Atlanta.

As MRC wrote before, Axiall Corp. is considering building a USD3 billion ethane cracker and chemical plant somewhere in Louisiana. The Atlanta-based chemical manufacturer says it could make a decision sometime early next year. Axiall would invest USD1 billion of its own money, while an unnamed partner would put in USD2 billion.

Axiall Corporation is a leading integrated chemicals and building products company. It is an international manufacturer of chlor-alkali and derivatives, chlorovinyls and aromatics products including chlorine, caustic soda, vinyl chloride monomer, chlorinated solvents, calcium hypochlorite, ethylene dichloride, muriatic acid, phosgene derivatives, polyvinyl chloride, vinyl compounds, acetone, cumene and phenol. It also manufactures vinyl-based building and home improvement products, including window and door profiles, mouldings, siding, pipe and pipe fittings, and decking. Axiall, headquartered in Atlanta, Georgia, has manufacturing facilities located throughout North America and in Asia to provide industry-leading materials and services to customers.
MRC

MOSCOW (MRC) -- Evonik Industries has inaugurated a new building to house precipitated silica applied technology for tire and rubber at its Wesseling site near Cologne, reported the company on its site.

In so doing, the leading specialty chemicals company has added applied technology to the world’s largest facility for precipitated silica production and research. Evonik invested an amount in the low tens of millions of euros in the new building.

A combination of precipitated silica and sulfur-functional silanes produced for the tire and rubber industry enables tire manufactures to reduce their products’ rolling resistance and improve their wet-grip. This can reduce fuel consumption by up to 8% in comparison to conventional tires.

Evonik supplies precipitated silica to the tire industry globally from Wesseling where silica production and research were previously located. Thus it made sense to re-locate application engineering to the Wesseling site.

Innovative products for the rubber industry are being developed and tested in the new 2,500 square meter building. Strict quality control, which is standardized worldwide, is applied to several thousand mixtures annually.

To be closer to its worldwide customers and provide them with first-class products, Evonik has undertaken a robust worldwide capacity expansion. In March 2014, it opened an expanded precipitated silica facility in Thailand; in May 2013, it initiated planning for a new facility in Brazil; and it will begin operations later this year in an expanded facility in Chester, Pennsylvania, USA.

As MRC wrote previously, Evonik’s global silica production capacity will increase by approximately 30% over its 2010 capacity by the end of 2014.

Moreover, as part of the company's strategic portfolio expansion, Evonik has recently announced its plans to launch a new generation of PVC plasticizers. Apart from its product lines expansion, the company will also develop a new brand of products. Thus, Evonik is broadening its range of sustainable plasticizers.

Evonik, the creative industrial group from Germany, is one of the world leaders in specialty chemicals. Its activities focus on the key megatrends health, nutrition, resource efficiency and globalization. Evonik benefits specifically from its innovative prowess and integrated technology platforms. Evonik is active in over 100 countries around the world. In fiscal 2013 more than 33,500 employees generated sales of around EUR12.7 billion and an operating profit (adjusted EBITDA) of about EUR2.0 billion.
MRC

MOSCOW (MRC) -- KBR was awarded a contract for project management consultancy (PMC) services for the construction of the advanced oil processing complex, as part of the major renovation program of the largest operating refinery in Russia owned by JSC Gazprom, reported Hydrocarbonprocessing.

The refinery is located in Omsk, Western Siberia, Russia.

KBR will provide PMC services for three new process units and offsites and utilities construction beginning with the front end engineering and design phase and continuing through EPC, commissioning and start-up.

The PMC will be executed by KBR’s London and Russian offices.

"KBR appreciates Gazprom Neft’s confidence in our ability to deliver PMC services for this very important refinery renovation program in Omsk," said Roy Oelking, president of KBR's hydrocarbons business. "This project reinforces KBR’s position in Russia and as a leading contractor for complex project execution in remote locations."

Expected revenue from the contract will be included in the second quarter 2014 backlog of unfilled orders for the Hydrocarbons segment. The contract value was not disclosed.

As MRC informed before, in early 2014, Shell and Gazprom Neft kicked off pilot shale oil exploration under their joint venture partnership in Siberia.

We also remind that in July 2013, Gazprom Neft signed an agreement with France-based Total to form a joint venture to produce and sell modified bitumen and bitumen emulsions on the Russian market.

Gazprom Neft, is the fourth largest oil producer in Russia and ranked third according to refining throughput. It is a subsidiary of Gazprom, which owns about 96% of its shares. The company is registered and headquartered in St. Petersburg after central offices were relocated from Moscow in 2011.
MRC

MOSCOW (MRC) -- BASF, the world’s biggest chemical maker, plans to increase spending on research and development this year and is adding six laboratories in Asia and the US, said Hydrocarbonprocessing.

Half of the research activities at Ludwigshafen, Germany-based BASF will take place outside Europe by 2020, up from 28% now, board member Andreas Kreimeyer said at a press conference at the company’s headquarters. It spent EUR1.8 billion (USD2.5 billion) on research last year, he said.

The R&D drive will help BASF reach a goal of generating a quarter of its sales from products that are less than 10 years old by the end of the decade. The chemical company posted 8 billion euros in revenue, equivalent to 11% of total sales, from products that were less than five years old in 2013, it said at Tuesday's conference.

"In absolute terms we lead the field in the chemical industry with our research and development expenditures," Kreimeyer said. The company aims to spend about 3% of its sales, excluding an oil and gas unit, on research every year, he said.

BASF has established research cooperation in California with the universities of California in Berkeley and Los Angeles as well as Stanford University that focuses on biosciences and new inorganic materials for the energy, electronics and renewable resources industries, Kreimeyer said.

Seven universities in China, Japan and South Korea are involved in a research initiative with BASF to explore products for the automotive, construction, water and wind-energy industries, the executive said.

As MRC wrote before, BASF has launched two new MasterTop topcoats for decorative and industrial applications which can be used in public rooms such as education, office and healthcare facilities as well as in industrial environments.

BASF is the largest diversified chemical company in the world and is headquartered in Ludwigshafen, Germany. BASF produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries. BASF had sales of about EUR74 billion in 2013 and over 112,000 employees as of the end of the year.
MRC

MOSCOW (MRC) -- Import duties on high density polyethylene (HDPE), used for anticorrosion protection of large diameter pipes, will be cancelled for 9 months, reported the Ministry of Industry and Trade (Minpromtorg).

This decision was made by a subcommittee on customs tariff and non-tariff regulation, protective measures in foreign trade of the governmental commission on economic development and integration.

As reported earlier, the Fund of Pipe Industry Development introduced the initiative on cancellation of import duties on HDPE because of a sharp increase in consumption of pipes with anticorrosion coating for the construction of oil and gas pipelines, the main component of which - HDPE - is purchased abroad.

At the same time, Rosnano and the company "Metakley", which have implemented a project for the production of a nanocomposite three-layer polyethylene (PE) coating for insulation of large diameter pipes, confronted the cancellation of the duties.

To find a compromise solution, meetings were held at Minpromtorg during 2013 and 2014 with the participation of the Fund that support the pipe industry, pipe industry companies and businesses that implement investment projects for the production of HDPE and its components (Rosnano, "Metakley", Nizhnekamskneftekhim, "Gazprom neftekhim Salavat").

As a result, contracts for HDPE shipments for anticorrosion protection of large diameter pipes were signed, which will allow Russian pipes companies to receive innovative products produced in Russia at competitive prices.

Furthermore, in line with the agreements, the quantities that are not covered by Russian producers will be replenished by imports at a zero customs duty until Russian producers reach their full capacity utilisation.

MRC analyst Sergei Karaichentsev said: "This initiative is quite effective. Imports of this HDPE grade to Russia totalled about 73,800 tonnes in 2013. The key supplier of this PE grade for Russian pipe companies is Borealis. At the same time, the price difference between this PE grade and standard grade HDPE, prices of which are at an average of EUR1,120-1,180/tonne FCA at present, is around EUR300/tonne (because of this grade complex production). Import duty on HDPE (HS Code 39012 09000) currently is 9.1% (it will be reduced to 6.5% from 1 September 2014), and it is easy to calculate the economic effect of the present measure."

"But, on the other hand, an issue of administration of this PE grade imports arises - how other HDPE grades will be separated. It is because there is a temptation to declare, for instance, film grade or pipe grade PE. Moreover, it is because there is a shortage of this material in Russia at the moment due to an outage at Stavrolen, the second largest producer, and subsequent skyrocketing prices," - he added.

The main HDPE suppliers to Russia are Borealis, Total Petrochemicals, LyondellBasell and Korea Petrochemical.
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