BASF plans USD6 billion petchem investment in Iran

MOSCOW (MRC) -- BASF, the world’s largest chemical producer, plans USD6 billion of investment in Iran’s petrochemical sector, director of planning at the National Petrochemical Company (NPC) Hamid Reza Rostami says, said Presstv.

The German company will make the investment in Asaluyeh where Iran is carrying out its largest gas development project by tapping gas from the giant South Pars field in the Persian Gulf.

"BASF has decided to make direct investment in Iran, bringing in capital, technology, management and a guaranteed market for products which we welcome," Rostami said on Monday.

The announcement came a day after Iran opened a petrochemical forum in Tehran, with Minister of Petroleum Bijan Zangeneh appealing to foreign companies to re-open their offices in the Islamic Republic.

BASF and industrial gases company Linde sent their executives with German Minister of Economy Sigmar Gabriel to Iran in July to discuss investment and transfer of technology.

The lifting of sanctions in the "next few days" will enable Iran to fulfill its 20-year vision plan, including its target to produce $70 billion of petrochemicals a year at current prices, Zangehen said on Sunday.

NPC Managing Director Abbas Sheri Moqaddam said Iran’s petrochemical production will hit 70 million tonnes in the new Persian year which begins on March 20, 2016.

The products will be worth USD27 billion at current prices, the official said.

Sheri Moqaddam said Iran plans to attract about USD70 billion in foreign direct investment in its petrochemical sector by 2025.

Companies from Germany, France, Spain, Italy, the Netherlands, South Korea, Japan and even the US have indicated readiness to participate in Iran’s petrochemical projects, officials say.

Some Iranian companies are currently in the process of receiving funds from Germany and Spain and "negotiations with respective foreign parties have been finalized, pending official removal of sanctions", NPC projects director Marzieh Shah-Daei said in October.

As MRC informed earlier, 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.

BASF is the leading chemical company. It 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.
MRC

MOSCOW (MRC) -- Saudi Arabia's Petro Rabigh will be restarting its monoethylene glycol (MEG) production unit in Saudi Arabia after it was shut for a turnaround in October, an industry source told TPS.

According to the source, the unit will be restarted sometime in H2 Dec.

This translates to about 73 standard-sized parcels. Rabigh 1 on Saudi Arabia's western coast comprises a 400,000 b/d refinery and a 1.3 million mt/year ethane cracker.

It also contains a 300,000 mt/year of high density polyethylene (HDPE) plant, a 600,000 mt/year of linear low density polyethylene (LLDPE) plant, a 600,000 mt/year of polypropylene (PP) plant and the 600,000 mt/year MEG plant.

As MRC reported previously, in early October 2015, PetroRabigh took off-stream its LLDPE plant for maintenance turnaround. It remained off-stream for around 45 days. Located in Rabigh, Saudi Arabia, the plant has a production capacity of 600,000 mt/year.

Petro Rabigh Corp, also known as Rabigh Refining & Petrochemical Co., is a joint venture between Saudi Aramco and Sumitomo Chemical. Each company holds a 37.5% stake, with the rest of the company’s shares floated on the Saudi Stock Exchange. The company has an annual output capacity of 18 million tonnes of refined products and 2.4 million tonnes of petrochemicals.
MRC

MOSCOW (MRC) -- South Korea's Lotte Chemical has shut its No. 3 monoethylene glycol (MEG) production unit in Yeosu, an industry source told TPS Monday.

The unit, which produces 160,000 mt of MEG a year, was shut due to its low production volume and weak margins, the source told TPS. The unit is expected to remain offline for a month.

"They have to buy C2 to make MEG, but the margin of MEG has been very bad," the source said.

Lotte Chemicals, South Korea's largest MEG producer, operates five MEG production facilities in the country; three in Yeosu and two in Daesan. Daesan No. 1 has an annual operating capacity of 250,000 mt/year, while Daesan No. 2, which was originally scheduled to restart on Nov 6, produces 400,000 mt of MEG a year.

As MRC informed previously, Lotte Chemical, a subsidiary of the South Korean Lotte Group, shut its low density polyethylene/ethyl vinyl acetate (LDPE/EVA) swing plant for a maintenance turnaround on October 12, 2015. It remained off-stream for around one month. Located at Daesan in South Korea, the plant has a production capacity of 135,000 mt/year.

Lotte Chemical Corporation manufactures a wide range of petrochemical products such as high density polyethylene, polypropylene, and ethylene glycol. The company's products are used in manufacturing general housewares, pipes, films, fabrics, bottles, containers, and automotive parts.
MRC

MOSCOW (MRC) -- China’s crude processing climbed to a record after some refineries resumed operations following maintenance, said Bloomberg.

Refineries in the world’s second-largest oil consumer processed 43.92 million metric tons of crude last month, 3.3% higher than a year earlier, according to data released Saturday by the Beijing-based National Bureau of Statistics. That’s about 10.73 million bpd and up 2.6%, on a daily basis, from October. Last record was June’s 10.59 million barrels a day.

Higher oil processing in China coincided with record oil-product exports in November as refiners tapped overseas markets to reduce fuel stockpiles. Net fuel exports rose for a fifth month to 2.22 million tons last month, 77% higher than the previous month.

"For refineries, processing more oil is good for their margins, but in the meantime, they need to be able to sell," Jean Zou, an analyst with ICIS China, said before the data were released. "They may keep their runs high as long as they can find export markets for their products."

China Petroleum & Chemical Corp. restarted Yangzi refinery’s crude-distillation unit at the end of October, while Sinochem Group’s Quanzhou plant boosted runs to more than 80% of capacity last month following maintenance, industry website Oilchem.net said.

China’s power production last month rose 0.1% from a year earlier to 466 billion kilowatt hours, Saturday’s data showed. China’s crude output fell 0.5% from a year earlier to 17.66 million tons, while natural gas production climbed 0.2% to 11.1 billion cubic meters. Coal output declined 2.7% to about 320 million tons.

As MRC informed earlier, Shell Nanhai B.V. (Shell) and China National Offshore Oil Corporation (CNOOC) signed a Heads of Agreement (HOA) to expand their existing 50:50 joint venture (JV) in Huizhou, Guangdong Province, China.

MRC

MOSCOW (MRC) -- Kuwait's Equate has recently lowered the operating rate for its Kuwait-based monoethylene glycol (MEG) production units to between 70-80%, industry sources told TPS.

A company source from MEGlobal, EQUATE's trading arm, confirmed with TPS that its operating rates had been lowered, but could not comment further.

Industry sources told TPS that the plants were shut over the weekend due to supply tightness for upstream feedstock. Unconfirmed reports of the shutdown first surfaced last Friday afternoon, and triggered a rebound on MEG spot prices.

Equate runs two MEG plants in Shuaiba, Kuwait, with a combined operating capacity of 1.45 million mt/year. Its No. 1 MEG plant has an annual production capacity of 530,000 mt/year, while its No. 2 MEG unit produces 615,000 mt of MEG a year.

As MRC informed previously, Equate Petrochemical Company President and CEO Mohammad Hussain said a project aimed at increasing polyethylene (PE) production would be completed in the first half of next year. The first phase of this project regarding production of ethylene would end this year, while the second phase, the PE plant, would be completed next year, he said. Hussain, answering a KUNA question in a news conference on fringes of the 10th session of the forum of the Gulf Petrochemicals and Chemicals Association (GPCA), said this project would contribute to boosting polyethylene production from 825,000 tons to a million tons.

Established in 1995, Equate Petrochemical Company is an international joint venture between Petrochemical Industries Company (PIC), The Dow Chemical Company (Dow), Boubyan Petrochemical Company (BPC) and Qurain Petrochemical Industries Company (QPIC). Commencing production in 1997, Equate is the single operator of a fully integrated world-scale manufacturing facility producing over 5 million tons annually of high-quality petrochemical products which are marketed throughout the Middle East, Asia, Africa and Europe.
MRC