Sinochem and Halcyon to combine natural rubber business

MOSCOW (MRC) -- China's state-owned company Sinochem International has partnered with Halcyon Agri to combine their natural rubber assets and together create a natural rubber supply chain manager.

To be combined under Halcyon Agri, the new business will register combined revenues of more than USD2.3bn.

Following the completion of the deal, in the upstream segment, the merged entity will have 153,000ha of land in Africa and South East Asia, while in the midstream processing division, will have 35 processing facilities across Indonesia, Thailand, Malaysia, China and Africa, with a total annual processing capacity of around 1.5 million tonnes.

The merged entity will have a distribution network in major hubs across China, Asia, Europe and the US, as well as annual natural rubber and latex sales of over two million tonnes.

As per the terms of the deal, which is expected to end by the third quarter of this year, Sinochem International will acquire a 30.07% shareholding in Halcyon Agri for USD0.75 cents per share in cash and make a mandatory general offer (MGO) to all shareholders of Halcyon Agri at the same price.

The deal is subject to certain conditions and approvals.

With customers from over 100 countries and regions across the globe, Sinochem International is currently involved in industrial investment, logistics, trading and distribution of natural rubber, fine chemicals, agrochemicals, chemical logistics, chemical distribution, and other sub-sectors.

Halcyon Agri, which currently owns 14 natural rubber processing facilities in Indonesia and Malaysia, produces sustainable technically specified rubber. The company is engaged in the origination, production and distribution of natural rubber.

Last June it completed the acquisition of CentroTrade Rubber Group for EUR8.8m. CentroTrade is involved in both dry natural rubber and latex products, and has offices in Singapore, Malaysia, Germany and the US, as well as logistics assets in seven cities across the globe.

As MRC informed earlier, Sinochem received approval from the Fujian Provincial Development and Reform Commission for a refinery expansion and petrochemicals project in Quanzhou. The USD 6.8-billion project will expand the refinery by 25 % to 300,000 b/d from the current 240,000 b/d capacity. The company will also add a 1-million-t/y ethylene cracker, an 800,000-t/y paraxylene unit, a 400,000-t/y polyethylene plant, an aromatics extraction unit with 300,000 t/y of capacity, and secondary units.

Sinochem Group engages in energy, agriculture, chemicals, real estate, and finance service businesses in China and internationally. It is involved in the exploration and production, refining and trading, warehousing and logistics, and distribution and retailing of oil and gas. The company also produces and distributes fertilizers, such as nitrogen, phosphate, potash, and other fertilizers.
MRC

MOSCOW (MRC) -- Shin-Etsu is in plans to shut its polyvinyl chloride (PVC) plant for a maintenance turnaround, reported Apic-online.

A Polymerupdate source in Japan informed that the plant is scheduled to be taken off-stream in May 2016. It is likely to remain off-stream for around four weeks.

Located in Kashima, Japan, the plant has a production capacity of 550,000 mt/year.

We remind that, as MRC informed before, in 2015, Shintech Inc. added almost 700 million pounds of PVC capacity as part of a USD500 million expansion of its plants in Louisiana. Shintech's parent firm - Shin-Etsu Chemical Co. Ltd. of Tokyo - said in a June 19 news release that the firm will addd 660 million pounds of PVC capacity in Louisiana by 2015. Houston-based Shintech makes PVC in Plaquemine and Addis, La. The project also includes 660 million pounds of new capacity for PVC feedstock vinyl chloride monomer (VCM) and 440 million pounds of new capacity for caustic soda.

Shin-Etsu is the world and US' largest PVC producer.
MRC

MOSCOW (MRC) -- The second manufacturing unit at Grangemouth’s KG ethylene plant is brought back to life eight years after being mothballed, said Hydrocarbonprocessing, citing INEOS's officials.

INEOS says it recently completed successful operational trials as it prepares to receive shale gas ethane from the US as petrochemical feedstock. "We are now in great shape to receive shale gas from the US and to finally run the Grangemouth plant at full rate," said Gordon Milne, operations director at INEOS Grangemouth. "When US shale gas finally arrives here in the autumn, this plant will move into the premier league of European petrochemical plants. Bringing the site back into profitability is the best way to secure our future here in Scotland."

Specifically, INEOS confirmed that it has completed successful operational trials on the second manufacturing unit (Train 2) of its gas cracker at Grangemouth, eight years after being mothballed. Train 2 has undergone rigorous recommissioning trials to prepare for the arrival of US shale gas ethane, the company said. The first deliveries of US shale gas are expected to arrive by ship at Grangemouth in the fall of this year.

In 2008, the KG ethylene cracker was unable to operate at full capacity, and INEOS was left with no option but to close the second manufacturing unit. The US ethane will be used as a supplementary feed for the KG ethylene plant at a time when North Sea supplies are dwindling. It will also allow the plant to run at increased rates.

The INEOS investment should bring US shale gas economics to Europe, the company says. The project includes contracts to acquire gas from the Marcellus Shale in Western Pennsylvania; connection to the new, 300-mile Mariner East pipeline to bring the gas to the Marcus Hook deep water terminal near Philadelphia; the design and commissioning of eight Dragon-class ships that will create a virtual pipeline across the Atlantic; and the construction of a new import terminal, including the biggest shale gas storage tank in Europe at Grangemouth.

The new import terminal at Grangemouth will also benefit the Fife ethylene plant in Mossmorran, Scotland, after it was announced that the owners of the plant had agreed a long-term sale and purchase agreement to secure ethane from mid-2017.

Access to this new source of feedstock will help complement supplies from North Sea natural gas fields, the company says. The agreement should also ensure the competitiveness of an additional major manufacturing facility in Scotland and help secure skilled jobs over the long-haul.

As MRC informed earlier, a few day later INEOS confirmed that its vessel, the INEOS Intrepid, has arrived at the INEOS petrochemicals plant at Rafnes in Norway, carrying 27.500m3 of US shale gas ethane.

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.
MRC

MOSCOW (MRC) -- Kemira, a Finland based chemical company, is planning to build a new sodium chlorate production line and cell-room at its facility located at Joutseno, said Chemicals-technology.

As part of its growth strategy, the company plans to invest around EUR50m to EUR60m in the proposed expansion. Following the approval of certain regulatory requirements, construction of the planned facility is expected to begin by June this year, and the company's own technology will be used to increase the Joutseno site's existing capacity.

"The consumption of bleaching chemicals is increasing due to the recent pulp mill expansions and the announced greenfield projects in the Nordics." Expected to be operational by the last quarter of the next year, the new facility will provide employment to around 200 persons indirectly during construction.

Sodium chlorate is the raw material for chlorine dioxide (ClO2), which is made on-site at the pulp mills and is used as the primary bleaching agent for kraft pulp.

Kemira pulp and paper segment president Kim Poulsen said: "The consumption of bleaching chemicals is increasing due to the recent pulp mill expansions and the announced greenfield projects in the Nordics. "We want to invest in our sodium chlorate capacity to ensure our ability to effectively serve our customers. "This investment supports our strategy to grow faster than the market and to strengthen Kemira's position as the leading chemical supplier for the pulp and paper industry."

Currently, the company's Joutseno site is employing 67 people, and produces several chemicals for the pulp and paper industry. In 2014, the company made an investment at its plant located in Oulu, Finland to expand its presence in the tough bleaching chemical market.

The company currently has various bleaching chemical production units in Europe, inlcuding Aetsa, Joutseno and Oulu in Finland; Helsingborg in Sweden; and Europoort in the Netherlands.

As MRC informed earlier, Kemira has acquired certain assets of Polymer Services, LLC, a privately owned company, headquartered in Plainville, Kansas.

Kemira is a chemical industry group that consists of three main segments. Kemira is headquartered in Helsinki, Finland. Kemira became the world's biggest provider of the pulp and paper chemicals after its acquisition of the pulp and paper chemical operations of Lanxess.
MRC

MOSCOW (MRC) -- The US Department of Justice is investigating possible corruption in contracts among Brazilian petrochemical company Braskem, engineering conglomerate Odebrecht and the country's state-run oil company Petrobras, said Reuters.

Local daily Valor Economico said the Justice Department was focusing its investigation on whether the companies violated the Foreign Corrupt Practices Act in naphtha supply contracts since 2009 between Petrobras and Braskem, which has Odebrecht as a controlling shareholder. Braskem has been the target of a shareholder suit filed in mid-2015 in the United States over the alleged release of false statements to shareholders.

Braskem on Tuesday said that its lawyers abroad were sharing information with the DOJ and the Securities and Exchange Commission about an internal investigation it opened last year. Odebrecht said it had not been notified by the DOJ and would therefore not comment. The Department of Justice and SEC had no comment.

In morning trade on the Sao Paulo stock change, Braskem fell 1.6%. Braskem trades as an American Depository Receipt on the New York Stock Exchange, where the stock fell 2.1%. Braskem, Latin America's largest petrochemical company, has long relied on Petrobras to supply it with naphtha, the main feedstock that it uses for producing plastics and other petrochemicals.

Petrobras and Odebrecht are at the center of a wide reaching corruption investigation in Brazil that has jailed dozens of engineering company executives, former Petrobras directors as well as politicians and political party officials.

As MRC informed earlier, Braskem Idesa, the 75-25 joint venture between Braskem and Grupo Idesa, started injecting ethane at their Etileno XXI cracker project at Coatzacoalcos, Mexico.

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).

MRC