BASF and PETRONAS to build polyisobutene production plant in Malaysia

MOSCOW (MRC) -- BASF and PETRONAS Chemicals Group Berhad (PCG) will build a new world-scale production plant for highly reactive polyisobutene (HR-PIB) at the site of their existing joint venture, BASF PETRONAS Chemicals Sdn Bhd, in Kuantan, Malaysia, as per BASF's press release.

The plant, which will be the first of its kind in South East Asia, with a total annual capacity of 50,000 metric tons of HR-PIB, is expected to start production in the fourth quarter of 2017. HR-PIB is an important intermediate product for the manufacturing of high performance fuel and lubricant additives, including additives for sludge prevention.

"Leveraging excellence in technology will be an important factor in accelerating future profitable growth globally and especially in Asia," said Dr. Christian Fischer, President of BASF’s Performance Chemicals division. "With this investment, we are building on the solid, long-term relationship with our strategic partner PETRONAS."

BASF PETRONAS Chemicals’ fully integrated Kuantan site is one of BASF’s two Verbund sites in the Asia Pacific region. According to Fischer, the joint investment with BASF’s partner PCG at the Kuantan Verbund site will further increase security of supply for HR-PIB, especially for the Asian market. The new plant will further strengthen the global footprint of BASF as the leading supplier of this product.

BASF has over seventy years of experience in the manufacturing of HR-PIB. Besides the new plant in Asia, the company operates production facilities for HR-PIB at its Verbund sites in Ludwigshafen, Germany and Antwerp, Belgium, and within a joint venture with Sinopec YPC in Nanjing, China. BASF offers the broadest range of polyisobutenes in the market with different molecular weights which are marketed by the global business unit Fuel and Lubricant Solutions under the brand names of Oppanol and Glissopal.

In addition to the proposed plant, BASF PETRONAS Chemicals is also building two plants at its Kuantan site namely an integrated aroma ingredients complex for the manufacturing of citronellol, L-menthol as well as citral and its precursors which are widely used in the flavour and fragrance industry; and a 2-ethylhexanoic acid (2-EHA) production plant for the manufacturing of 2-EHA compound for the production of synthetic lubricants as well as oil additives. It is also used for functional fluids like automotive coolants, metal salts for paint dryers, plasticizers, stabilizers, catalysts and other applications in various industries.

BASF PETRONAS Chemicals is a Malaysian-based joint venture between BASF SE and Petroliam Nasional Berhad (PETRONAS), Malaysia’s National Oil Company, under its subsidiary PETRONAS Chemicals Group (PCG). Incorporated in 1997, the company operates an integrated complex situated at the Gebeng Industrial Zone, Pahang. The company’s share of capital is 60% held by BASF SE and 40% by PCG with a total investment of about RM3.4 billion (USD900 million) in production facilities for Acrylic monomers, Oxo Products and Butanediol. The range of chemicals produced by BASF PETRONAS Chemicals meet the growing demand in various industries including plastics, adhesives, lacquers, dyestuff, automobile and industrial coatings, paper, diapers, water treatment, textile and leather.

BASF is the world’s leading chemical company. Its portfolio ranges from chemicals, plastics, performance products and crop protection products to oil and gas. BASF had sales of over EUR74 billion in 2014 and over 112,000 employees as of the end of the year.
MRC

MOSCOW (MRC) - Production of unmixed polyvinyl chloride (PVC) in Russia increased to 398,600 tonnes in the first six months of this year, up 24% compared to the same period of 2014. The largest increase in PVC production occurred for RusVinyl and Bashkir Soda Company, according to MRC ScanPlast.

All Russian PVC producers decreased PVC production in June, having produced 66,600 tonnes against 71,400 tonnes in May. Russia's production of unmixed PVC totalled 398,600 tonnes in the first six months of the year, compared with 322,400 year on year.

SayanskKhimPlast decreased production rates to 90% on the back of ethylene shortage, however, this factor was more than offset by RusVinyl and growth in production volumes at Bashkir Soda Company. Structure of PVC production over the reported period looked as follows.

SayanskKhimPlast last month decreased PVC production to 20,100 tonnes against 21,700 tonnes in May. Total PVC production by the producer was 118,800 tonnes in the first six months of this year, down 22% year on year. Because of the significant decline in the supply of ethylene in the current year SayanskKhimPlast works with capacity utilisation of 80-90%.

Bashkir Soda Company (BSC) produced about 20,400 tonnes of suspension polyvinyl chloride (SPVC) in June, while in May this figure was 21,700 tonnes. Producer's production of SPVC totalled 125,300 tonnes in January - June of this year, up 11% year on year.

RusVinyl (JV of SIBUR and SolVin) last month reduced capacity utilisation, the total output of PVC was 18,200 tonnes (including 426 tonnes of emulsion PVC (EPVC), while in May the output of PVC was at the level of 19,600 tonnes. The producer's PVC production totalled 106,900 tonnes in January-June 2015.

Kaustik (Volgograd) in June also showed a slight decrease in production, last month's PVC production was about 7,900 tonnes, compared with 8,300 tonnes in May. The producer's PVC production over the six months of the year was 47,700 tonnes, down 1% year on year.


MRC

MOSCOW (MRC) -- A Chinese company has approached Lukoil to start talks on buying the Russian firm's refinery in Romania, according to a letter obtained by Reuters, after Lukoil's unit there was accused of money laundering and tax evasion, said Reuters.

Earlier this month, Romanian prosecutors seized some of Lukoil's assets in an investigation on suspicion of money laundering - accusations Lukoil denied and then asked for help from the European Commission to fight the charges.

Thomas Mueller, Lukoil's vice president for oil refining, said last week the company, Russia's No.2 oil producer, was approached about the possible sale of the Ploiesti refinery but that it had no intentions to sell.

In a letter of intent dated March 2015, obtained by Reuters, Ion Epureanu, general director of British Virgin Islands-based company Kajel Holdings Limited, offered Lukoil the opportunity of starting talks on buying Petrotel which owns Ploiesti.

Kajel Holdings was mandated by China Peace Petroleum Group, based in Beijing, whose website says it focuses on importing and exporting oil products, among other businesses.

Lukoil's spokesman confirmed receiving the letter and reiterated that the company does not plan to sell its Romanian refinery, one of four belonging to the company outside Russia, with an annual refining capacity of 2.4 million tonnes of oil.

Epureanu when reached by telephone confirmed the content of the letter but declined further comment. Reuters could not reach China Peace Petroleum Group due to the late hour in China.

In October of last year Romanian prosecutors, police and customs inspectors raided the offices of Lukoil near the city of Ploiesti in an investigation into alleged tax evasion and money laundering concerning an estimated 230 million euros.

As a result, Lukoil briefly shut down its local refinery.

Lukoil is one of the world's biggest vertically integrated companies for production of crude oil & gas, and their refining into petroleum products and petrochemicals. The company is a leader on Russian and international markets in its core business, which accounts for over 20% of Russian oil production and 18% of the total Russian oil refining. Lukoil also controls two of the largest petrochemical plants in Russia and Ukraine: Stavrolen and Karpatneftekhim.
MRC

MOSCOW (MRC) -- CB&I has been awarded a contract in excess of USD90 million by NefteGazIndustriya for the Afipsky oil refinery in Russia, said Hydrocarbonprocessing.

The scope of work includes detailed engineering, procurement, fabrication and supply of a steam methane reformer for a large-scale hydrogen plant, hydrocracking heaters and Breech-Lock exchangers.

CB&I previously announced two awards on the project—the technology license and FEED contract and detailed engineering and procurement services for multiple process units.

"The Afipsky project is a successful example of CB&I's full scope of capabilities, from licensing, engineering and engineered products," said Luke Scorsone, president of CB&I's fabrication services operating group.

"This award is a reflection of the customer's confidence in our ability to offer the most complete supply chain solution - showcasing our expertise in fabrication, technology and engineering," he added.

As MRC informed earlier, CB&I and Clariant announced that their new Ziegler-Natta (ZN) polypropylene catalyst plant in Louisville, Kentucky, is on schedule to begin production in 2015.

Chicago Bridge & Iron Company known commonly as CB&I, is a large multinational conglomerate engineering, procurement and construction (EPC) company. CB&I specializes in projects for oil and gas companies.
MRC

MOSCOW (MRC) -- BASF and Linde have sent their representatives to Iran with German Minister of Economy Sigmar Gabriel to resurrect the projects which were put on ice after sanctions were imposed on Tehran in 2011, said Presstv.ir, citing Managing Director of Iran's National Petrochemical Company (NPC) Abbas She’ri Moqaddam.

BASF and Linde have sent their representatives to Iran with German Minister of Economy Sigmar Gabriel to resurrect the projects which were put on ice after sanctions were imposed on Tehran in 2011.

European companies are in a rush for a hinterland of trade opportunities in Iran after adopting a sour grape approach toward the country for years. Their return comes in the wake of finalized nuclear negotiations between Iran and the P5+1 group of countries.

The EU endorsed the talks as did the UN Security Council, paving the way for the removal of sanctions which have curbed business with the Islamic Republic for years.

She’ri-Moqaddam said Iran’s petrochemical sector had a capacity to absorb USD70 billion of investment but the country was also in a quest for the transfer of technology. The official said his company also planned to negotiate with French and Dutch companies.

Minister of Petroleum Bijan Zangeneh, however, said Iran planned to invest USD80 billion in its petrochemical sector in the next 10 years.

Chinese companies, including Sinopec, have also indicated an interest in investing in Iran's petrochemical industry. The petrochemical industry is the biggest source of foreign earnings for Iran after oil. Several petrochemical companies are listed on Iran’s main bourse, offering a variety of commodities for trade.

Last year, Iranian companies exported USD14 billion of petrochemical products. Iran’s total petrochemical production capacity stands at 60 million metric tons per year which the country plans to double.
MRC