Solvay expands R&I center to internationalize its oil & gas business

MOSCOW (MRC) -- Solvay has inaugurated a newly expanded Oil & Gas lab in its world-class Singapore Research & Innovation Centre, reported the producer on its site.

The dedicated lab space, team and resources will enable Solvay’s Novecare global business unit to internationalize its oil & gas business to serve its regional customers looking to develop in the segments of production, cementing and stimulation, especially in fast growing countries such as China, Malaysia and Australia, among others.

The new lab showcases state-of-the art equipment and will focus on leading innovation and product development projects for customers in Asia Pacific. It will provide comprehensive solutions for cementing, stimulation and production applications, together with a dedicated team working on Enhanced Oil Recovery (EOR) Solutions. This is done in collaboration with Solvay’s global teams and strategic partners.

Employing its successful specialty formulation model, Solvay can now quickly develop and produce tailor-made chemicals and solutions to fit the unique geological conditions of local shale formations.

"We want to be close to our customers and continue the momentum to internationalize our oil and gas portfolio and formulated solutions. With high regional demand for oilfield chemicals, this expansion provides our customers close proximity to a partner with comprehensive solutions and custom formulations," explained Emmanuel Butstraen, Solvay Novecare President.

The lab expansion coincides with Solvay’s announcement of the inauguration of its alkoxylation plant in Singapore, the largest facility of its kind in Asia. The "on-pipe" investment will help meet that demand, complementing existing India and China facilities and joining Solvay Novecare’s seven other alkoxylation plants in Europe and North America. Located in the world-class integrated petrochemical hub of Jurong Island, the plant receives a key raw material, ethylene oxide via a dedicated pipeline, and fatty oleochemicals from nearby countries, providing a safe and sustainable source of supply for the near and long term.

As MRC informed earlier, in early July 2015, Solvay and Ineos announced the start-up of their Joint Venture INOVYN, a world-class competitive player in chlorovinyls, following European Commission approval. The finalized terms of the Joint Venture agreement remain materially unchanged from those announced in June last year. Solvay received upon closing an upfront cash payment of EUR150 million - subject to customary adjustments such as actual working capital levels. In addition to contributing their entire European chlorovinyl business, Solvay has transferred liabilities estimated at EUR260 million into the Joint Venture. In three years’ time, Solvay will exit INOVYN and receive an additional, performance-based payment targeted to be EUR280 million, with a minimum of EUR95 million. Thereafter, INEOS will be the sole owner of the business.

Solvay S.A. is a Belgian chemical company founded in 1863, with its head office in Neder-Over-Heembeek, Brussels, Belgium. The company has diversified into two major sectors of activity: chemicals and plastics. Solvay supplies over 1500 products across 35 brands of high-performance polymers – fluoropolymers, fluoroelastomers, fluorinated fluids, semi-aromatic polyamides, sulfone polymers, aromatic ultra polymers, high-barrier polymers and cross-linked high-performance compounds.
MRC

MOSCOW (MRC) -- Dow Chemical has announced that it has received a favourable private letter ruling from the US Internal Revenue Service (IRS) with respect to the proposed transaction involving a significant portion of Dow’s chlorine value chain and Olin Corp, reported the producer on its site.

"This milestone underscores our ability to achieve tax efficiency for this landmark transaction that will enhance value for both Dow and Olin shareholders and advance Dow’s portfolio transformation," said Andrew N. Liveris, Dow’s CEO. "We are pleased to see this strategically significant transaction moving forward on schedule."

As previously announced on March 27, Dow will separate its US Gulf Coast chlor-alkali and vinyl, global chlorinated organics and global epoxy businesses, and then merge these businesses with Olin in a Reverse Morris Trust transaction. The merger will result in Dow shareholders receiving at least a majority of the shares of Olin, with existing Olin shareholders owning the remaining shares.

The transaction has a tax-efficient consideration of USD5 billion, and a taxable equivalent value of USD8 billion to Dow and Dow shareholders.

The next transaction milestone is Olin shareholder approval.

The transaction is expected to close by the end of 2015, subject to the completion of customary closing conditions. All required antitrust regulatory clearances have been achieved, including the US clearance as announced on June 16, and other countries as announced by Olin on July 6.

The Dow Chemical Company is an American multinational chemical corporation. As of 2007, it is the second-largest chemical manufacturer in the world by revenue (after BASF) and as of February 2009, the third-largest chemical company in the world by market capitalization (after BASF and DuPont). Dow is a large producer of plastics, including polystyrene, polyurethane, polyethylene, polypropylene, and synthetic rubber.
MRC

MOSCOW (MRC) -- Lotte Chemical, a subsidiary of Lotte Group, has restarted its aromatics plant following a short maintenance turnaround, as per Apic-online.

A Polymerupdate source in South Korea informed that the plant restarted on July 16, 2015. It was under a weeklong maintenance turnaround.

Located at Daesan in South Korea, the plant has a benzene capacity of 240,000 mt/year, toluene capacity of 120,000 mt/year and solvent-MX capacity of 72,000 mt/year.

As MRC informed before, in mid-April 2015, Lotte Chemical restarted its styrene monomer (SM) plant in South Korea following a three-week maintenance turnaround. Located at Daesan in South Korea, the plant has a production capacity of 580,000 mt/year.

We remind that in early 2013, a major South Korean pertochemical and polymer producer, Honam Petrochemical, and one of the largest South Korean PET and PTA producer, KP Chemical, decided to merge into a new company with a new name Lotte Chemical Corporation. The newly formed company believes that this move will strengthen its position both in domestic and international markets and is in a line with Lotte Chemical's strategy to become a leading global company.

The Lotte Group currently has a presence in Indonesia via its subsidiary, Honam Petrochemicals, which acquired Malaysia’s polyolefin major Titan Chemicals in July 2010. Included in the acquisition was Titan’s Indonesian subsidiary - PT Titan Petrokimia Nusantara (TPN), which has a polyethylene (PE) production capacity of 450,000 tonnes/year.
MRC

MOSCOW (MRC) -- Royal Dutch Shell expects billions of dollars more in savings from its proposed ?55bn takeover of BG Group than previously disclosed as it uses the enlarged company’s scale to slash costs in its deepwater oil business and natural gas trading arm, said Financial Times.

Stung by a slide in Shell’s share price, which has tumbled 13 per cent since the BG deal was announced in early April, chief financial officer Simon Henry has sought to turn round investor scepticism over the economics of the deal.

The Anglo-Dutch energy company has told investors and analysts that so-called "value synergies" — benefits that cannot yet be quantified under City takeover rules — are likely to be “a multiple” of the USD1bn in annual projected savings from merging head offices and other cost-cutting.

Ben van Beurden, Shell’s chief executive, is also likely to use the company’s interim results on July 30 to outline a substantial cut to this year’s capital investment, as it adjusts to a 50 per cent plunge in oil prices since last summer.
Few in the City have questioned the deal’s logic, which gives Shell huge deepwater Brazilian reserves and cements its position as the world’s biggest supplier of liquefied natural gas after Qatar.

But concerns have grown that Shell needs oil prices of USD90 a barrel for the deal to work, its projected savings are too low and new LNG supplies will send Asian prices even lower.

Shell’s shares have in the past year underperformed those of a group of “supermajors” including BP, whose share price rose after it announced steep spending cuts. This year’s capital spending budget at Shell is expected to be revised lower, by several billion dollars from the USD33bn announced at the end of April, reflecting project deferrals.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.

MRC

MOSCOW (MRC) -- Mitsui Chemicals and SKC, a subsidiary of SK Holdings Co. Ltd, have started operations of their new equally-owned Mitsui Chemicals & SKC Polyurethanes Inc. joint venture, reported GV.

The new company, headquartered in Seoul, South Korea, and having operations in both South Korea and Japan, has the capacity to produce a total of 720,000 t/y of toluene diisocyanate, diphenylmethane diisocyanate and polyols.

As MRC wrote previously, in late May 2015, The European Commission (EC) approved, under the European Union Merger Regulation, the proposed polyurethanes materials joint venture between Mitsui Chemicals Inc. and SKC.

Mitsui Chemicals is a leading manufacturer and supplier of value added specialty chemicals, plastics and materials for the automotive, healthcare, packaging, agricultural, building, and semiconductor and electronics markets. Mitsui Chemicals is a Japanese Chemicals company, a part of the Mitsui conglomerate. The company has a turnover of around USD15 billion and has business interests in Japan, Europe, China, Southeast Asia and the USA. The company mainly deals in performance materials, petro and basic chemicals and functional polymeric materials.
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