Orpic aims to complete financing for Liwa plastics project in 2015

MOSCOW (MRC) -- State-owned Oman Oil Refineries and Petroleum Industries Co. (Orpic) expects to achieve financial closure for its Liwa Plastics Project in Sohar, Oman, by the end of this year, reported GV with reference to the Muscat Daily quoting of Orpic Chief Executive Musab al Mahrouqi.

The project, expected to cost USD 3.6-billion, includes an 859,000-t/y ethylene cracker with downstream production of polypropylene and high- and linear low-density polyethylene. It is being set up adjacent to the Sohar refinery, which is being expanded to 180,000 b/d from 116,000 b/d.

Last year, Orpic raised USD 2.7-billion from 20 financial institutions to fund its expansion plans without support from the Oman government, he noted. "This year we plan to raise USD 3.3-billion to USD 3.7-billion for the Liwa project. We will start the process of engaging with financial institutes by October. It will be a challenge, but our target is to achieve financial closure by the end of this year."

As MRC informed previously, in late February 2015, Orpic restarted its polypropylene (PP) plant following maintenance turnaround. The plant was shut in the last week of January 2015. Located at Sohar in Oman, the plant has a production capacity of 340,000 mt/year.

ORPIC (Oman Oil Refineries and Petroleum Industries Company) is one of the leading companies in Oman and has two refineries in that country, in Sohar and Muscat. ORPIC is owned by the Government of the Sultanate of Oman and Oman Oil Company SAOC, the trading company created by the Government of the Sultanate of Oman for managing investments in the energy sector.
MRC

MOSCOW (MRC) --International Polymers Co. has achieved commercial operation at its new 200,000-t/y ethylene vinyl acetate (EVA) and low-density polyethylene (LDPE) plant in Jubail, Saudi Arabia, reported GV.

International Polymers, a venture owned 75% by Saudi International Petrochemical Co. (Sipchem) and 25% by Hanwha Chemical Co., has successfully completed testing equipment and ensuring the facility’s efficiency, production capacity and product quality, Sipchem said.

Ethylene feedstock will be provided by Jubail Petrochemical Co., while Sipchem affiliate International Vinyl Acetate Co. will supply vinyl acetate monomer feedstock.

A technical license agreement was reached with ExxonMobil for the plant, which International Polymers Chairman Ahmad A. Al-Ohali noted is considered the first of its kind in the Middle East.

As MRC informed earlier, on July 22, 2013, Sipchem Chemicals Company (SCC), an affiliate of Saudi's Sipchem, signed an incorporation agreement with Hanwha Chemicals Corporation to form a new company, under name of "Saudi Specialty Products Company" for establishing conversion projects in Saudi Arabia.

This move was down "in line with the company's commitment to implement what has been stated at volume of fuel and feedstock allocation required to establish EA, EVA, WCC and conversion industries issued by Ministry of Petroleum and Mineral Resources".

The Joint Venture between SCC and Hanwha comprised of two manufacturing facilities; the first one located at Hail will produce 4,000 MTPA of EVA films whereas the second one located at Riyadh will manufacture plastic moulds up to 1000 tons. It is noteworthy that Sipchem Chemicals Company owns 75% of new company capital while Korean Hanwha owns 25%.
MRC

MOSCOW (MRC) -- Kavian Petrochemical Co.'s second phase ethylene facility in Assaluyeh, Iran, is nearing completion and scheduled to come on stream this year, reported GV with reference to the Mehr News Agency.

Marzieh Shahedaei, a director of Iran’s National Petrochemical Co., warned, however, that the plant’s ability to achieve its full design capacity of 2-million t/y will depend on the receipt of sufficient ethane feedstock from the delayed phases 15 and 16 of the South Pars gas field.

As MRC informed earlier, Kavian started up the first of two 1-million-t/y trains at Assaluyeh in the Pars Special Economic Energy Zone in late 2012.

"However," Shahedaei noted, "the first phase of the complex is currently working with half of its full capacity due to lack of input material."

Ethylene produced by Kavian is expected to meet the feedstock requirements of petrochemical complexes served by the west ethylene pipeline.
MRC

MOSCOW (MRC) -- Trinseo, a global materials company and manufacturer of plastics, latex and synthetic rubber, has reported its first quarter 2015 financial results with revenue of USD1,018 million and Adjusted EBITDA excluding inventory revaluation of USD151 million, as per the company's report.

Effective January 1, 2015, Trinseo reorganized its business under two new divisions called Performance Materials and Basic Plastics & Feedstocks. The Performance Materials division now includes the following reporting segments: Synthetic Rubber, Latex, and Performance Plastics. The Basic Plastics & Feedstocks division represents a separate segment for financial reporting purposes and includes styrenic polymers, polycarbonate, and styrene monomer. In addition, the Basic Plastics & Feedstocks division includes the results of our two 50%-owned joint ventures, Americas Styrenics LLC, or Americas Styrenics, and Sumika Styron Polycarbonate Limited.

The compnany believes that this new organizational structure better reflects the nature of Trinseo by grouping together segments with similar strategies, business drivers and operating characteristics.

Commenting on the company’s performance, Chris Pappas, Trinseo President and Chief Executive Officer, said, "We had a great start to 2015 with a very strong first quarter. We had record Adjusted EBITDA excluding inventory revaluation at the consolidated level, and in our Basic Plastics & Feedstocks division. In addition, we had record Adjusted EBITDA in the Performance Plastics segment. We are now seeing the strength of our consistent EBITDA in the Performance Materials division coupled with the cyclical lift in the Basic Plastics & Feedstocks division."

Pappas continued, "We recently refinanced our debt, creating a new capital structure that is consistent with our public company peers and which provides us with increased liquidity, a natural hedge against our euro-denominated EBITDA, and a much lower cost of borrowing, which will positively contribute to our earnings and free cash flow. At current interest rates, the transaction will reduce our cash interest by approximately USD37 million per year, which equals approximately sixty-five cents of earnings per diluted share."

Revenue in the first quarter decreased 25% versus prior year and 9% versus prior quarter due to the pass through of lower raw material cost, with the significant decline in the overall energy complex, and currency, as the euro weakened in comparison to the U.S. dollar. These impacts were partially offset by an increase in sales volume across all of our segments, which was aided by customer restocking in the current quarter after a period of destocking in the latter part of 2014.

First quarter Adjusted EBITDA of USD109 million included a USD42 million unfavorable impact from inventory revaluation. Adjusted EBITDA excluding inventory revaluation of USD151 million was USD68 million higher than prior year and USD47 million higher than prior quarter. These increases were due mainly to higher margins in polycarbonate, from the company's restructuring efforts and market improvement, higher margins in Performance Plastics, due to declining raw material costs during the quarter, and improved performance in styrene monomer, styrenic polymers, and at Americas Styrenics driven by first quarter industry restocking and overall stronger market conditions ahead of planned outages.

Formerly known as Styron, Trinseo has completed the name change process for most legal entities around the world. Some Styron companies are still completing this process and will continue to do business as Styron until their respective name changes are complete.

Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo’s technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015.
MRC

MOSCOW (MRC) -- The business environment surrounding the Sumitomo Chemical Group was good during the twelve months ended 31 March 2015 (FY14), although there were areas with sluggish market conditions and weak shipment volumes, said the company.

Under these circumstances, the Sumitomo Chemical Group undertook group wide efforts to improve business performance by increasing selling prices and expanding sales volumes, as well as by cutting costs through thorough streamlining. As a result, the group’s sales for FY14 increased by JPY132.9 billion compared with the previous fiscal year, to JPY2,376.7 billion. The group posted operating income of JPY127.3 billion, ordinary income of JPY157.4 billion and net income of JPY52.2 billion, all representing increases from the previous fiscal year.

Market prices for petrochemical products dropped due to lower feedstock prices in the second half of FY14. Market prices for synthetic resins also fell, but shipments from Singapore and Japan increased. The weaker yen had a positive effect on sales from overseas subsidiaries in yen terms. As a result, the segment’s sales increased by JPY14.1 billion compared with the previous fiscal year, to JPY806.2 billion, and operating income grew by JPY16.3 billion, to JPY21.2 billion.

The company decided to pay a year end dividend of JPY3 per share. As a result, the company’s annual dividend for fiscal 2014 was JPY9 per share, including an interim dividend of JPY6 per share, unchanged from the previous fiscal year.

Operating cash flow in FY14 increased by JPY66.5 billion compared with the previous fiscal year, to JPY260.9 billion, due to an increase in income before income taxes and collection of money advanced relating to Petro Rabigh's Rabigh Phase II Project. Cash flow from investing activities was negative JPY56.6 billion, a decrease in cash outflows of JPY78.5 billion compared to the previous fiscal year, due to a decrease in payments for purchase of fixed asset. This resulted in free cash flow of JPY204.2 billion for FY14, compared with JPY59.2 billion for the previous fiscal year. Cash flow from financing activities was negative JPY151.5 billion. The balance of cash and cash equivalents at the end of the fiscal year increased by JPY69.7 billion over the previous year, to JPY202.0 billion.

For FY15, the company forecasts that sales will decrease by 5.3%, to JPY2,250.0 billion, while operating income and ordinary income are projected to be JPY145.0 billion and JPY160.0 billion respectively and net income to be JPY80.0 billion, assuming an exchange rate of JPY115.0/US$ and a naphtha price of JPY47 000/kl.

As MRC informed earlier, Sumitomo Chemical will permanently wind up the operations of an ethylene plant at its Chiba Works in Ichihara, Chiba, in or before September 2015, following a decline in domestic demand for ethylene derivative.

Sumitomo Chemical is a Japanese based manufacturer of a diverse range of products, including basic chemicals, petrochemicals and plastics, fine chemicals, agricultural chemicals, IT-related chemicals and pharmaceuticals.
MRC