Arkema strengthens its position in specialty chemicals by offering USD2.2 bln for Bostik

MOSCOW (MRC) -- French chemicals group Arkema has offered to buy oil major Total's adhesives business Bostik, which makes Blu-Tack, for EUR1.74 billion (USD2.24 billion), as per the company's press release.

Total, under pressure from shareholders to improve its cash flow and raise dividends, has embarked on a major divestment program. A sale of Bostik at that price would increase its announced disposals this year to near USD20 billion - at the top of its target range of USD15-USD20 billion.

For Arkema, which said it hoped to finalize the deal in the coming months, buying Bostik would expand its position in a fragmented global adhesive and sealants market.

Bostik, which makes adhesives and sealants used in products ranging from aircraft components and building materials to diapers, had 2013 sales of EUR1.5 billion and has 4,900 staff worldwide. The company, whose main rivals are Henkel and H.B. Fuller has been a Total unit since 1990.

As MRC reported previously, in July 2014, Arkema and Omya, a Switzerland-based global provider and distributor of specialty chemicals, entered into an exclusive pan-European distribution agreement. Under this distribution agreement, Omya will market Arkema's plastic additives range for various polymer markets (impact modifier and processing aid solutions).

Arkema is a leading European supplier of chlorochemicals and PVC. Kynar and Kynar Flex are registered trademarks of Arkema Inc.
MRC

Russian sanctions force Exxon to pull out of Arctic project

MOSCOW (MRC) -- Exxon Mobil Corp. issued a terse statement that the company has received a license from the U.S. government that allows the company to continue working in Russia while it shuts down its first project under a deal signed more than three years ago, said The Wall Street Journal.

Russia’s energy industry had avoided sanctions placed on the country by the U.S. and Europe as a result of the Russian incursion into Ukraine.

Under the latest round of sanctions, foreign oil companies are barred from providing equipment, technology, or assistance to Russian firms to support deepwater, offshore, or shale projects. Because Russia has not developed significant expertise in these areas yet, the ban effectively brings such projects to a grinding halt.

Another new sanction against the Russian oil companies - Gazpromneft, Transneft, and Rosneft - forbids European banks from lending to the companies on maturities of more than 30 days. Russia’s five state-controlled banks, which have been allowed to raise funds on maturities up to 90 days, will also see their maximum maturities cut to 30 days.

Exxon Mobil Corp. formed an alliance with Russia’s state-controlled oil giant OAO Rosneft in 2011 to develop the potentially huge and so-far untapped reserves on Russia’s Arctic Shelf and in Western Siberia’s shale oil deposits. The deal could eventually be worth as much as USD500 billion. Part of the deal included exploration work in the Black Sea, but the big prize is the Arctic. Exxon was able to persuade Russian President Vladimir Putin to cancel taxes on oil exports from the Arctic for up to 15 years in exchange for its investments in the country.

MRC

SIBUR and Government of the Amur Region sign cooperation agreement

MOSCOW (MRC) -- Oleg Kozhemyako, Governor of the Amur Region, and Pavel Lyakhovich, Member of the SIBUR Management Board and Managing Director, have signed a cooperation agreement between the Government of the Amur Region and the petrochemical holding, said SIBUR in its press-release.

According to the agreement, both parties share a common interest in SIBUR's investment and its other programmes in the Amur Region, most notably the prospective construction of a gas chemical complex. The agreement provides that when investing in the Amur Region SIBUR will build on the local potential of the region, particularly with regards to its technical infrastructure, labour sourcing and liaison with educational institutions.

The Amur Government, in turn, undertakes to offer full support to ensure development of the gas chemical industry within the Region in compliance with applicable law. In particular the local authorities will look into the possibility assisting in the construction of infrastructure facilities required to build and operate the gas chemical complex, and including these facilities in the state programme for the Socioeconomic Development of the Russian Far East and the Baikal Region through 2025.

In late 2013, SIBUR and Gazprom signed a memorandum of cooperation to build a gas processing plant (GPP) and a gas chemical complex (PCC) in the Amur Region. The agreement outlines cooperation by the parties on the prospective construction of a large-scale multicomponent gas processing complex in the Yakutsk and Irkutsk gas production centres, which Gazprom is developing under the Eastern Gas Programme. Initial estimates suggest that the prospective gas chemical complex will produce 2.4 mtpa of ethylene and its derivatives.

MRC

Consumption of extrusion grade PC in Russia rose by 7% from January to August 2014

MOSCOW (MRC) -- The capacity of the Russian extrusion grade polycarbonate (PC) market was 55,100 tonnes from January to August 2014, up by 7% year on year, according to MRC ScanPlast report.
The extrusion segment accounts for 85% of the PC granules consumption in Russia. Extrusion grade PC is used for the production of honeycomb PC sheets. Its main application areas are agriculture (construction of greenhouses) and civil engineering (awnings, roofs, decoration). Accordingly, there is seasonal demand for PC granules, and May and September account for its peaks.


Extrusion grade PS is the most popular in the Russian market, this segment is constantly expanding, and new players emerge. Consequently, demand for material has been increasing.

Kazanorgsintex, Russia's only PC producer, manufactures PC grades for sheet extrusion. Kazanorgsintez accounted for 64% of the total segment from January to August 2013. This year's share of the plant increased to 67%.

MRC

Output of products from polymers in Russia rose to 8.5% from January to August 2014

MOSCOW (MRC) -- Russia's production of finished products from polymers grew by 8.5% over the first eight months of 2014. Russian films producers accounted for the main increase, whereas the construction sector demonstrated negative results, reported MRC analysts.

August production of main products from polymers in Russia dropped by 8.4% from July due to a number of factors.

According to the Federal State Statistics Service of the Russian Federation, the August output of non-combined and unreinforced films decreased to 109,000 tonnes from 112,000 tonnes in July. Thus, production of these products in Russia totalled about 720,700 tonnes from January to August 2014, up by 28.4% year on year.

Last month's output of plates and sheets was about 18,500 tonnes (19,300 tonnes in July). Production of these products by Russian companies reached 144,000 tonnes over the stated period, up by 2.2% year on year.

August production of plastic pipes, hoses and fittings unexpectedly fell to 55,800 tonnes (56,000 tonnes in July). The overall output of these products reached 358,400 tonnes over the first eight months of 2014, down by 9.1% year on year.

Last month's production of plastic windows, their frames and sills also showed a negative result, which is not typical for this time. Production fell to 2.6 million sq. meters versus 2.9 million sq. meters in July. The output of plastic windows and window sills was about 16.1 million sq. meters from January to August 2014, down by 9.1% year on year.
mrpclast.com