Axiall and Lotte Chemical announce Louisiana ethane cracker final investment decision

MOSCOW (MRC) -- Axiall Corp. and Lotte Chemical Corp. will make a combined USD3 billion capital investment in two new chemical manufacturing plants in Lake Charles, Louisiana, said the companies in their press-releases.

LACC LLC, a subsidiary of Axiall and Lotte Chemical USA Corp.’s 50–50 joint venture Eagle US 2 LLC, will invest USD1.9 billion to build the steam cracker adjacent to Axiall’s Lake Charles chlor-alkali manufacturing plants to take advantage of existing infrastructure, competitive US shale feedstock resources, and ethylene distribution infrastructure, according to a series of releases from the JV and Louisiana Economic Development (LED).

Adjacent to the new steam cracker, Lotte separately will invest an additional USD1.1 billion to build and operate the US’ largest MEG plant, from which 600,000 tpy of MEG will be exported to customers in Europe and Asia, according to Soo Young Huh, Lotte Chemical’s president and chief executive.

To secure the combined projects, the state of Louisiana offered the companies a competitive incentive package that includes a USD4.55-million modernization tax credit for the ethane cracker, as well as economic development award program incentives of USD700,000 for the cracker and USD1.47 million for the MEG plant, which will pay for site infrastructure improvements, LED said.

With site preparation already under way and full construction due to begin during second-quarter 2016, the grassroots cracker and MEG plant are scheduled for startup in early 2019.

LACC also confirmed it has let an additional contract to CB&I, Houston, to provide engineering, procurement, fabrication, and construction (EPC) for the ethane cracker, which will use the service company’s proprietary highly selective SRT cracking heaters as well as its recovery section design.

CB&I's scope of work under the USD1.3 billion EPC contract also includes supply of spheres and fabricated pipe spools.

LACC previously let a contract to CB&I to deliver detailed engineering and early procurement services for the project following the service provider’s previous delivery of front-end engineering and design and other early-stage engineering works for the cracker.

In November, Samsung Engineering has been awarded an early works contract from Lotte Chemical for a 700,000-t/y monoethylene glycol (MEG) project at Lake Charles, La.

Lotte Chemical is a member of the Lotte Group in Korea, which has been listed on the Korean Stock Exchange since 1991. Lotte Chemical is a leading manufacturer of petrochemical products, such as ethylene, propylene, butadiene, polyethylene, polypropylene, ethylene oxide/glycol, compound resin, polyethylene terephthalate, polycarbonate, methyl methacrylate, ethylene oxide derivatives, benzene, toluene, mixed xylene, purified terephthalic acid and purified isophthalic acid among others. Lotte Chemical, headquartered in Seoul, South Korea, has manufacturing facilities located throughout South Korea, China, Malaysia, Indonesia, Pakistan, UK and the USA.

Axiall Corporation is a leading integrated chemicals and building products company. Headquartered in Atlanta, Axiall has manufacturing facilities located throughout North America and in Asia to provide industry-leading materials and services to customers.

PVC production in Russia grew by 21% over eleven months of 2015

MOSCOW (MRC) -- Russia's overall production of unmixed polyvinyl chloride (PVC) rose over the first eleven months of 2015 by 21% year on year and totalled 711,600 tonnes. All Russian plants increased their output, with the exception of SayanskKhimplast, according to MRC's ScanPlast report.

November production of unmixed PVC in Russia grew to 69,500 tonnes from 63,300 tonnes because of the increased capacity utilisation at RusVinyl. Russia's overall PVC production reached 711,600 tonnes from January to November 2015 versus 589,100 tonnes a year earlier. All plants increased their PVC production, SayanskKhimplast, a leader in the previous years, which was forced to reduce its output by 23% because of lower ethylene supply, being the exception.

The PVC production structure by producers looked the following way over the stated period.

SayanskKhimplast had to cut its production to 13,600 tonnes last month from 18,100 tonnes in October because of an even greater reduction in ethylene supply from Angarsk Polymer Plant. As reported earlier, the Sayansk plant has been forced to operate at lower capacity utilisation since February due to a shortage of ethylene. As a consequence, the plant's total production of suspension polyvinyl chloride (SPVC) fell to 193,200 tonnes over the first eleven months of the year, down by 25% year on year.

Bashkir Soda Company produced 21,600 tonnes of SPVC in November, whereas this figure was 22,100 tonnes in October. The Bashkir plant's total output of resin rose to 220,200 tonnes from January to November 2015, up by 10% year on year. The producer is most likely to produce over 240,000 tonnes of PVC in 2015, which corresponds to the plant's adopted strategy.

in November, RusVinyl (JV of SIBUR and SolVin) virtually reached 100% capacity utilisation both at its production of emulsion polyvinyl chloride (EPVC) and at its SPVC production. Last month's output of these PVC grades was 2,200 tonnes and 24,100 tonnes, respectively, versus 1,050 tonnes and 14,300 tonnes in October. Thus, the plant's overall production of resin totalled 210,900 tonnes (8,400 tonnes of EPVC) over the first eleven months of the year, whereas this figure did not exceed 32,000 tonnes a year earlier.

Kaustik (Volgograd) slightly increased its production last month, the output of SPVC was about 8,000 tonnes versus 7,800 tonnes a month earlier. The plant's total production of resin exceeded 87,300 tonnes from January to November 2015, up by virtually 5% year on year. The increased output was mainly achieved due to a delay of a scheduled shutdown for maintenance (the turnaround was postponed from October 2015 to March 2016).


Asahi Kasei plans maintenance at SM plant in 2016

MOSCOW (MRC) -- Asahi Kasei Chemicals, an affiliate company of a major Japanese chemical producer Asahi Kasei Corporation, is likely to shut its styrene monomer (SM) plant for a maintenance turnaround, as per Apic-online.

A Polymerupdate source in Japan informed that the plant is planned to be shut in March 2016. It is slated to remain off-stream for around 2 weeks.

Located in Mizushima, Japan, the cracker has a production capacity of 390,000 mt/year.

As MRC wrote previously, Asahi Kasei took off-stream its No.3 styrene monomer (SM) plant for a maintenance turnaround on 25 September. The shutdown was expected to remain in force for a period of around 45-50 days. Located in Mizushima, Japan, the plant has a production capacity of 390,000 mt/year.

Asahi Kasei Corporation is a global Japanese chemical company. Its main products are chemicals and materials science.

BASF, Sumitomo Chem explore in vitro system for chem safety check

MOSCOW (MRC) -- Sumitomo Chemical Co., Ltd. and BASF have agreed to collaborate on research into a more sustainable, in vitro system for chemical safety evaluation, said Basf on its site.

Recent years have seen an increase in stringent regulations for registration of agricultural chemicals and pharmaceuticals, and the demand to increase human relevance of safety studies. For these reasons, Sumitomo Chemical and BASF aim to create a system that supports the development of safe chemicals, while reducing the need for conventional animal testing.

As the first step in their research, Sumitomo Chemical and BASF aim to establish a new line of fully functional cultured cells to enable the safety evaluation of chemicals in a more efficient and more precise way than conventional methods.

Dr. Peter Eckes, President of BASF Bioscience Research, said: "BASF celebrates its 150th anniversary this year, and we have a history of continuous commitment to sustainability throughout our operations. In this collaboration we are combining the strength of both companies to develop new methods to reduce animal testing."

Ikuzo Ogawa, Managing Executive Officer of Sumitomo Chemical in charge of technology and research & development, said: "We will contribute to building a sustainable society through supplying safer chemicals. We are very delighted to work on the collaborative research of such great social significance in the year marking the 100th anniversary of the start of Sumitomo Chemical’s operations."

As MRC informed earlier, BASF plans USD6 billion of investment in Iran’s petrochemical sector. 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 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.

Production of products from polymers in Russia down 4.9% over eleven months of 2015

MOSCOW (MRC) -- Production of finished goods from polymers in Russia dropped over the first eleven months of 2015 by 4.9% year on year. The construction sector accounted for the greatest fall in the output, reported MRC analytsts.

The decrease in the production of products from polymers accelerated in November and reached 8.1%. The output of products from polymers fell by 4.9% from January to November 2015, whereas this figure was 4.6% over the first ten months of the year. Seasonal factors affected the production of polymer products in November most of all.

The film industry accounted for a positive growth in the output, whereas the construction sector - for a major fall in production.

According to the Federal State Statistics Service of the Russian Federation, November production of plastic pipes, hoses and fittings reduced to 42,400 tonnes from 48,400 tonnes in October. Lower output was mainly caused by a seasonal decline in demand for pipe products. Overall production of these products from polymers totalled 435,200 tonnes over the first eleven months of 2015, down by 14.8% year on year.

Last month's output of non-combined and non-reinforced films dropped to 70,800 tonnes from 77,500 tonnes in October partially because of a shortage of feedstock in some production segments. Overall production of these products was 964,100 tonnes from January to November 2015, up by 4.1% year on year.

November production of plates and non-porous sheets reached 18,900 tonnes versus 22,900 tonnes a month earlier. The output of plastic plates and non-porous sheets totalled 222,200 tonnes from January to November 2015, down by 1.3% year on year.