French union calls for widespread shutdown of refineries by workers

MOSCOW (MRC) -- Oil workers from the hardline French CGT union voted on Friday to shut down production at Total's Normandy refinery and to prolong the strike at Grandpuits refinery for 72 hours, a union official said, reported Hydrocarbonprocessing.

The vote, aimed at pressuring the socialist government of President Francoise Hollande to withdraw a labor reform bill which the unions consider as unfavorable to workers, could stoke concerns over refined products supply in France.

A prolonged strike at refineries in France in 2010 led to a glut of crude in Europe because it could not be delivered to refineries, and a spike in refined products prices due to low output from refineries.

Total's five refineries in France have already been running at "minimum output" since May 17, a CGT union official told Reuters on Thursday, after oil sector workers decided to join the rolling protest that began in March.

The union members at the refineries met on Friday to decide whether to halt production at the refineries.

"In Normandy, 56% voted for a complete shutdown of the refinery and in Grandpuits, they voted to prolong the strike for 72 hours," CGT delegate Thierry Defrense, told Reuters.

Defrense said workers were in talks with the refinery's management on the shutdown process which could take up to five days, and given that a restart could also take up to four days, he said the 198,600-bpd Normandy refinery could be out for up to 12 days.

He said Total's management could decide to also halt production at the 102,000-bpd Grandpuits refinery, where output had been cut in the past days and reservoirs were full due to a blockade by striking workers preventing supplies from leaving.

Defrense said workers were still meeting at Donges, La Mede and Feyzin refineries. He added CGT Union workers in Le Havre port were blocking a crude storage facility, preventing imports.

Another CGT union official said on Friday the goal of the strike was not to create (fuel) shortages but to obtain the withdrawal of the labor bill. However, it has led to supply disruption and shortages in some parts of France.

A Total spokesman said on Thursday although refineries were running normally, it faced supply disruption because striking workers were blockading refineries, and one in five service stations in some areas lacked fuel, including some in Paris.

We remind that, as MRC informed previously, in April 2016, French oil and gas company Total said that its refining margins in Europe had fallen to USD35.1/ton in the first quarter of the year. Europe's biggest refiner still reported a European refining margins indicator (ERMI) of USD38.1/ton in the fourth quarter of 2015, a table showed on its website.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
MRC

MOSCOW (MRC) -- After a good year in 2015, Wacker Chemie AG expects continued growth in sales and operating result during the current year, said the producer on its site.

This was underscored by CEO Rudolf Staudigl at the Munich-based chemical company’s 2016 Annual Shareholders’ Meeting. "We want to lift our sales by a low-single-digit percentage this year and estimate that EBITDA, adjusted to exclude special income, will climb by 5 to 10 percent," said Staudigl in a speech to some 1,100 shareholders at the International Congress Center in Munich. In the first quarter of 2016, WACKER posted substantial quarter-over-quarter gains in both sales and adjusted EBITDA.

In his speech, Staudigl gave details of the company’s strategic alignment in the years ahead. "2016 marks a turning point for Wacker," explained the CEO. "We have completed our new polysilicon site at Charleston in the US state of Tennessee, and will be ramping up the facilities there to full capacity this year. With the site complete, capital expenditures will decline significantly in 2016 and in the coming years. In the future, our investments will focus on facilities for manufacturing intermediate and downstream products at our chemical divisions. As a result, our cash flow will increase substantially and our net financial debt will decline further."

For 2015, Wakcer is distributing a total of EUR99.4 million in dividends to its shareholders, compared with its payout of EUR74.5 million for the previous year. The dividend per dividend-bearing share amounts to EUR2.00 after EUR1.50 the year before. The Executive and Supervisory Boards’ other proposals were also adopted by large majorities.

As MRC wrote previously, in 2013, Wacker Chemie AG officially launched its new production plant for ethylene-vinyl-acetate copolymer (EVA) dispersions at its Ulsan site in South Korea. The additional 40,000 tonnes from the second reactor line increases the site's EVA-dispersion capacity to a total of 90,000 tonnes per year. The production capacity of the site has, thus, almost doubled, making the plant complex one of the biggest of its kind in South Korea.

Wacker Chemie AG is a worldwide operating company in the chemical business, founded 1914. The company is controlled by the Wacker-family holding more than 50 percent of the shares. The corporation is operating more than 25 production sites in Europe, Asia, and the Americas. The product range includes silicone rubbers, polymer products like ethylene vinyl acetate redispersible polymer powder, chemical materials, polysilicon and wafers for semiconductor industry.
MRC

MOSCOW (MRC) -- Indonesia’s PT Pertamina (Persoro) and Saudi Aramco have let a contract to a subsidiary of Amec Foster Wheeler PLC to provide engineering and project management services for the upgrade and expansion of the 348,000-b/d Cilacap refinery on Java, Indonesia, said Ogj.

Amec Foster Wheeler Energy Ltd. will execute the basic engineering design study as well as finalize the process configuration and licensors’ packages for the proposed upgrading project over the next 9 months, Pertamina and Aramco said.

The overall expansion, which comes as part of Pertamina’s Refinery Development Master Plan (RDMP) to increase Indonesia’s energy security and ensure the long-term competitiveness of its refineries (OGJ Online, Oct. 7, 2013), will cost an estimated USD4-5 billion, the companies said.

In addition to increasing crude oil processing capacity at Cilacap to 370,000 b/d, the project, once completed, will enable the refinery to:
• Maximize production of gasoline and diesel volumes that meet more stringent emissions standards.
• Improve the quality of base oils production.
• Expand production capacity of aromatics to more than 600,000 tonnes/year.
• Expand production of polypropylene to more than 160,000 tpy.
Front-end engineering design for the project is due to be completed in 2018, with engineering, procurement, and construction activities scheduled to kick off in 2019.

The companies said they expect to complete the entirety of Cilacap’s upgrade by yearend 2022.

As MRC informed earlier, Pertamina and Russia's Rosneft signed a framework deal this week on an oil refinery in Indonesia. Pertamina has been looking for a development partner for the USD12-billion Tuban refinery project.

MRC

MOSCOW (MRC) -- PolyOne has announced that its ColorMatrix business has licensed the right to manufacture, market and sell a high-performance light blocking technology for liquid dairy packaging from leading PET resin and concentrate manufacturer Novapet, said the producer on its site.

Novapet’s DCU (Dairy Concentrate Ultra) additive protects liquid dairy products packaged in monolayer PET bottles from degrading due to light radiation. Novapet has already established DCU additive as a reliable light-blocking solution, and will retain commercial and manufacturing responsibility for the product in France, Italy, Portugal and Spain. PolyOne will manufacture, market and sell the product as ColorMatrix™ Lactra™ SX Light Blocking Additive in all remaining markets.

"The DCU additive fits perfectly with our existing portfolio of specialty additives for protecting liquid dairy products," explains Bjoern Klaas, general manager, ColorMatrix at PolyOne. "We appreciate Novapet’s in-depth understanding of the PET packaging market and its strong focus on product development and innovative product solutions."

David Gonzalez, managing director at Novapet, added, "Novapet is pleased that PolyOne recognizes the value of our DCU product. With our tried and trusted technology and PolyOne’s global market penetration, this license agreement is the best solution to grow sales globally."

Traditionally packaged in laminate paper cartons or multilayer HDPE bottles, Ultra High Temperature (UHT) milk products are popular in Europe and have been growing in popularity in Asia and Latin America. As the market expands, dairy processors are looking for ways to differentiate their packaging to engage consumers. Switching to DCU additive-modified PET gives processors this ability, in addition to reduced weight and other cost advantages, because it allows lighter weight, monolayer PET bottles to preserve liquid dairy products.

ColorMatrix Lactra SX is supplied as a solid masterbatch, and provides the ability to tailor the level of light protection by adjusting the dosage (%) to match the needs of each individual product. As an alternative to multilayer preforms, this additive can easily be added to PET using a single-stage process that gives identical light blocking performance at a lower machinery cost. The simpler injection process can also lead to reduced production waste, while lightweighting lowers production costs per bottle.

As MRC reported before, in January 2016, PolyOne Corporation announced the acquisition of Magenta Master Fibers (Magenta), an innovative developer of specialty solid color concentrates for the global fiber industry. PolyOne purchased Magenta from BASF for USD22 million, which represents a multiple of 6.8x EBITDA. The acquisition is expected to add USD16 million to revenues and be accretive to earnings in 2016.

PolyOne Corporation, with 2015 revenues of USD3.4 billion, is a premier provider of specialized polymer materials, services and solutions with operations in specialty polymer formulations, color and additive systems, polymer distribution and specialty vinyl resins.
MRC

MOSCOW (MRC) -- BASF has announced that its Construction Chemicals division has started production of waterproofing solutions from the MasterSeal solutions range at its plant located in Bolshoe Tolbino, Podolsk District, Russia, reported GV.

BASF thus extends its portfolio of Master Builders Solutions in Russia and enhances the supply network for regional markets and customers.

"We recognize the need for quicker service and delivery of construction chemical solutions in world-class quality", said Ralf Spettmann, Head of BASF’s Global Construction Chemicals division. "Our solutions and our experts are where our customers are. We progressively expand our production and distribution network in Russia and other markets with excellent growth rates and prognoses", he added.

At Podolsk, BASF is already producing a large range of concrete admixtures, flooring solutions, cementitious grouts, and concrete repair mortars. The new production lines for MasterSeal 550 and 588 waterproofing solutions address special needs like tolerance to very harsh conditions (up to –50 C). They are e. g. used to protect potable water reservoirs.

Sergey Vetlov, Managing Director of BASF Construction Systems Russia and CIS, said: “Local production allows for more flexible pricing and delivery to local customers compared to importing products from production sites abroad.” Furthermore, BASF will offer shorter lead times as the plant is located in close proximity to end users.

Besides the Podolsk site, BASF is producing construction chemicals in Russia also in Kazan (Tatarstan) and is planning to construct a third plant in 2017.

As MRC wrote previously, last week, Deutsche Nanoschicht, a wholly owned subsidiary of BASF New Business GmbH, opened its new pilot plant for the manufacture of high temperature superconductors. The facility, located at Rheinbach, Germany is based on an in-house developed chemical manufacturing process and has a fifty times higher capacity than the company’s laboratory plant used to date. The pilot plant is an important step on the way to market launch of the superconductors.

BASF is the largest diversified chemical company in the world and is headquartered in Ludwigshafen, Germany. BASF 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. BASF generated sales of more than EUR70 billion in 2015.
MRC