Olin to complete chlor-alkali reductions by end of March

MOSCOW (MRC) -- Olin (Clayton, MO) is reducing its chlor-alkali capacity this quarter by 433,000 m.t./year, said Prnewswire.

The company, which first announced the plan in November 2015, says it will take a USD95 million restructuring charge against first quarter 2016 results.

Olin Corporation announced today that its first quarter 2016 results will contain approximately USD95 million of pretax restructuring charges. These charges are associated with its plans to close a combined total of 433,000 tons of chlor alkali capacity across three separate Olin locations. Approximately 80 percent of these restructuring charges represent non-cash asset impairment charges. The cash component of these charges includes employee related costs and contract terminations associated with the Henderson, Nevada facility.

Olin will close its chlor alkali plant in Henderson, Nevada and reconfigure the facility to manufacture bleach and distribute caustic soda and hydrochloric acid. This action will reduce its chlor alkali manufacturing capacity by 153,000 tons. The Henderson workforce will be reduced by approximately 100 positions. The manufacturing of chlor alkali at the location will cease on March 31, 2016. Olin remains committed to maintaining and growing its position as the leading North American supplier of industrial bleach.

The capacity of the Niagara Falls, New York chlor alkali plant was reduced from 300,000 tons to 240,000 tons earlier this year. This plant continues to produce industrial bleach and on-purpose hydrochloric acid, in addition to chlor alkali.

The chlor alkali capacity at the Freeport, Texas facility will be reduced by 220,000 tons. The Freeport site operates both diaphragm and membrane cell technologies. The 220,000-ton reduction will be entirely from diaphragm cell capacity. Following the capacity reduction in Freeport, the site will have 1,450,000 tons of membrane cell capacity and 1,580,000 tons of diaphragm cell capacity. The capacity reduction will be effective March 31, 2016.

As MRC informed earlier, in October 2015, Olin completed merger with Dow chlorine products businesses.

Olin Corporation manufactures chemicals and ammunition products. The Company manufactures and sells chlorine, caustic soda, sodium hydrosulfite, hydrochloric acid, hydrogen, sodium chlorate, bleach products, and potassium hydroxide. Olin also manufactures products that include sporting ammunition, reloading components, small caliber military ammunition and industrial cartridges.

Ineos mulls expansion of US plants to tap cheap gas

MOSCOW (MRC) -- Ineos Group Ltd. is considering expansion of its plants in USA to take advantage of low-cost natural-gas liquids as feedstock for ethylene production, reported Bloomberg.

The company is likely to add 250 mln-1 bln lbs of annual ethylene production at its Chocolate Bayou site south of Houston, Dennis Seith, chief executive officer of the company’s U.S. olefins and polymers unit, said. Additional polypropylene and alpha-olefins capacity may be added at the site. Decisions on all three investments will be made within a year, with the expanded ethylene output available early next decade, he said in an interview.

Abundant shale gas has made the U.S. among the least expensive places to produce ethylene, the most used petrochemical, and derivative products, such as polyethylene plastic, which is used in bags and food packaging. The advantage has "diminished somewhat," however, as crude’s decline has cut prices for naphtha, an alternative raw material for making ethylene, Seith said. Low oil prices are causing delays in investment decisions that could lead to "a very tight market" for ethylene at decade’s end, he said.

"It’s not a predictable environment for investments," he said. Cheap oil could spur more mergers and acquisitions, particularly if state-owned oil companies in the Middle East decide to shed some of their chemical units, Seith said. Ineos may consider purchasing those assets, as well as any that may become available from the pending combination of Dow Chemical Co. and DuPont Co., the chemical industry’s largest merger ever, he said.

Ineos is weighing acquiring its own shale-gas fields in the U.S., complementing its activities in the U.K., he said. The company is working with the British government and local communities to begin extracting gas from shale formations to supply its Grangemouth ethylene plant in Scotland, he said.

Ineos this month began shipping U.S. ethane to Grangemouth, becoming the first European chemical maker to tap U.S. gas. A 1bln lb expansion of polyethylene plastics production at a joint-venture site on the Houston Ship Channel is scheduled to start production in Q4, Seith said.

As MRC informed previously, Ineos is expected to deliver its first US shale gas shipment into Rafnes, Norway on March 23. Ineos said this is the first US shale gas to be shipped to Europe and represents the culmination of a long-term investment by Ineos. To receive the gas, Ineos has built the largest two ethane gas storage tanks in Europe at Rafnes in Norway and Grangemouth in Scotland. Ineos will use the ethane from US shale gas in its two gas crackers at Rafnes and Grangemouth, both as a fuel and as a feedstock.

At Rafnes, Ineos operates the Noretyl cracker with a capacity to produce 570,000 mt/year ethylene and around 80,000 mt/year of propylene, which are used as feedstock for the company’s polypropylene (PP), low density polyethylene (LDPE) and high density polyethylene (HDPE) plants at Bamble.

At Grangemouth, Ineos operates a 1 million mt/year Kinneil Gas (KG) gas cracker using mainly ethane and propane to feed its 330,000 mt/year linear low density polyethylene (LLDPE) plant and 235,000 mt/year PP plant.

INEOS Group Limited is a privately owned multinational chemicals company consisting of 15 standalone business units, headquartered in Rolle, Switzerland and with its registered office in Lyndhurst, United Kingdom. It is the fourth largest chemicals company in the world measured by revenues (after BASF, Dow Chemical and LyondellBasell) and the largest privately owned company in the United Kingdom.

FREP restarted PP and PE units in China after unscheduled shutdown

MOSCOW (MRC) -- Fujian Refining & Petrochemical (FREP) has restarted a polypropylene (PP) and polyethylene (PE) units following an unplanned shutdown, as per Apic-online.

A Polymerupdate source in China informed that the units restarted recently. It was shut on March 15, 2016 owing to a technical glitch at its upstream cracker.

Located in Fujian province, China, the two PE units have a production capacity of 500,000 mt/year each while the two PP units have a production capacity of 330,000 mt/year and 220,000 mt/year.

As MRC reported previously, Sinopec Maoming Petrochemical shut down its low density polyethylene (LDPE) plant for maintenance turnaround on February 28, 2016. It was slated to remain shut until 5-6 March. Located at Guangdong in China, the plant has a production capacity of 250,000 mt/year.

Earlier, in late January 2016, CNOOC and Shell Petrochemicals Co (CSPC) shut down its PP, high density polyethylene (HDPE) and LDPE plants on account of severe cold weather. The plants remained off-stream for about 7-8 days.

Braskem to modify Bahia cracker, receive US ethane from Enterprise

MOSCOW (MRC) -- Braskem (Sao Paulo) plans to modify its steam cracker in Bahia, Brazil, for the use of up to 15% ethane feedstock, which will be supplied under a 10-year contract with Enterprise Products Partners (Houston), said Chemweek.

Braskem is investing R380mn (USD106.15mn) in modifications to its Camacari plant and Aratu port terminal in anticipation launching ethane imports by the end of the second quarter of 2017. The ethane will meet up to 15pc of the feedstock needs of the company's cracker in Camacari, Bahia state.

The new contract, which is indexed to the price at Mont Belvieu, Texas, comes at an advantageous time for Braskem. Ethane has been trading at or near its fuel value for the last three years as US production outpaces demand, leading to more than 500,000 b/d in ethane rejection in the US market.

The adoption of ethane is part of a broader plan by Braskem to reduce its dependence on naphtha acquired from Brazilian state-controlled oil company Petrobras.

Braskem reached a long-term naphtha supply contract with Petrobras on 23 December. At the time the company said the new contract did not entirely meet its expectations, but it deemed it necessary to sign the deal to avoid uncertainty in the sector.

Brazilian conglomerate Odebrecht controls Braskem with a 38pc stake. Petrobras holds 36pc and the remaining shares are publicly listed.

Enterprise Products expects to complete construction of its ethane export facility at Morgan's Point in the Houston ship channel in the third quarter of 2016. The facility will have a loading rate of roughly 200,000 b/d.

As MRC informed earlier, Brazilian petrochemical firm Braskem has completed its BRL50m (USD19m) Bahia facility expansion to increase its linear low-density polyethylene (LLDPE) production capacity. The investment forms part of the company"s aim to meet the growing demand for metallocene-based resins. Through this initiative, the company intends to increase its polyethylene production capacity of LLDPE by 120,000mt per year to 470,000 mt/yr.

Braskem is Brazilian main producer of polyethylene and polypropylene. In addition with ongoing plants located in both petrochemical complexes, in April 2008 Braskem opened a 300,000 metric ton polypropylene plant in the city of Paulinia (Sao Paulo).


Bain Capital to sell additional Trinseo shares

MOSCOW (MRC) -- Trinseo says that private equity firm Bain Capital (Boston) will sell 9.6 million shares in the company in a secondary public offering, cutting its stake in Trinseo to 58.6%, from 76.4%, said Businesswire.

The exact timing of the stock offering has not been determined, and Trinseo itself will not receive any proceeds from the sale, all of which will go to Bain. Bain purchased Trinseo, formerly Styron, from Dow Chemical for USD1.63 billion in 2010, and sold a minority stake in the company in a USD190-million initial public offering (IPO) in 2014.

Concurrently with and subject to the completion of the offering, the Company has agreed to repurchase from the Underwriter 1,600,000 of the ordinary shares that are being sold by the Selling Shareholder in the offering at a price per-share equal to the price per-share to be paid by the Underwriter to the Selling Shareholder. Because a repurchase transaction will be completed as part of the offering, in order to satisfy certain requirements of Luxembourg law, promptly following the completion of the offering, the Company intends to commence a tender offer to offer to purchase up to an additional 1,075,000 shares from its shareholders (other than the Selling Shareholder) at the same price per share that it paid to the Underwriter for the shares repurchased as part of this offering. The Company intends to fund the share repurchases with cash on hand.

A shelf registration statement (including a prospectus) relating to the offering of ordinary shares was filed with the SEC on March 15, 2016 and became effective on March 18, 2016. Before you invest, you should read the prospectus included in that registration statement and the documents incorporated by reference in that registration statement as well as the prospectus supplement related to this offering.

As MRC informed earlier, Styron, the global materials company and manufacturer of plastics, latex and rubber, has announced it has changed its name to Trinseo, effective February 1, 2015.

Trinseo is a leading global materials company and manufacturer of plastics, latex and rubber, dedicated to collaborating with customers to deliver innovative and sustainable solutions. 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.