Sadara Chemical initiates startup of mixed feed cracker

MOSCOW (MRC) -- Sadara Chemical, a petrochemical joint venture between national oil giant Saudi Aramco and Dow Chemical, started operating its mixed-feed cracker (MFC) at the venture's petrochemical complex in Jubail on 28 August 2016, as per the company's statement.

The MFC is made up of 12 furnaces, of these, seven will be used to crack ethane (gas), while the remaining five will be used to crack naphtha (liquid). Three of the five liquid furnaces are designed so that they can switch between gas and liquid feedstock.

Commenting on the announcement, Sadara CEO Ziad Al-Labban said, "Making memorable history is always cause for celebration, and I am immensely appreciative and proud of everyone who contributed to this achievement. The mixed-feed cracker is the heart of the Sadara chemical complex and the single-most important component that underpins our vision to be a game changer within the local and regional chemical industry."

The MFC is one of 26 manufacturing units located in the USD20 billion Sadara chemical complex in Jubail Industrial City II. Of these units, 14 will deliver products that are completely new to being produced in the Kingdom.

"The state-of-the-art mixed-feed cracker allows us to produce our own basic chemicals on-site, and subsequently to convert these basic chemicals into a wide range of value-added plastics and specialty chemicals through our other manufacturing units. It also allows us to adjust our production levels of chemicals between naphtha-based and ethane-based feedstock in accordance with market demand."

"Sadara’s products will help fill a significant gap in a regional chemical industry dominated by commodity products, with less than 1% of petrochemical production currently defined as specialty chemicals. The introduction of the specialty petrochemicals and chemicals will help support the drive to broaden the secondary and tertiary petrochemical manufacturing landscape in Saudi Arabia, thus making the Kingdom a leading cornerstone to meet the growing demand for specialty products locally and regionally," Al-Labban explained.

As MRC informed before, initially Sadara Chemical planned to start up its mixed-feed cracker in March 2016.

"The Sadara mixed-feed cracker is scheduled to be commissioned in March and will ramp up to a feed of 85 million standard cubic feet per day of ethane and 50,000 barrels per day of naphtha," Chief Executive officer Ziad al-Labban told Reuters in February 2016.

We also remind that, on Dec 8 2015, Saudi Arabia's Sadara Basic Services, fully owned by Sadara Chemical, said that operations had started at its polyethylene (PE) plant in Jubail Industrial City II. The plant is designed to produce 375,000 metric tons per year of products used in specialty applications, such as the manufacture of food-grade plastics.

Sadara is building a world-scale, fully integrated chemicals complex in Jubail Industrial City 2, Kingdom of Saudi Arabia. The complex will be comprised of 26 manufacturing units, will possess flexible cracking capabilities and is expected to produce more than 3 million metric tons of high-value performance plastics and specialty chemical products.

The Dow Chemical Company is an American multinational chemical corporation headquartered in Midland, Michigan, United States. Dow is a large producer of plastics, including polystyrene, polyurethane, polyethylene, polypropylene, and synthetic rubber. The company"s more than 5,000 products are manufactured at 188 sites in 36 countries across the globe.
MRC

MOSCOW (MRC) -- Korea Petrochemical Industry Co (KPIC) is in plans to take a high density polyethylene (HDPE) plant off-stream for a maintenance turnaround, as per Apic-online.

A Polymerupdate source in China informed that the company is likely to shut its plant in October 2016 for a period of around 8-10 days. The exact date of the shutdown could not be ascertained.

Located in Ulsan, South Korea, the plant has a production capacity of 530,000 mt/year.

As MRC reported earlier, KPIC aims to expand its ethylene production capacity by the first half of 2017, company's CEO Jeong Young Tae said in April 2016. Jeong said that KPIC’s ethylene capacity expansion for its Ulsan-based Naphtha Cracking Center (NCC) is ongoing and is expected to start commercial operation from Jun 1, 2017.

Currently, KPIC produces about 470,000 mt/year of ethylene from its Ulsan-based NCC. With the ongoing capacity expansion, the company will be adding 330,000 mt/year of ethylene, and its combined ethylene capacity will reach 800,000 mt/year.

KPIC is one of the key producers of ethylene in South Korea. The company’s ethylene capacity accounts for about 6% of total ethylene production in South Korea. When the capacity expansion is completed, however, the company’s market share will be increased to nearly 10%.
MRC

MOSCOW (MRC) -- Her Majesty’s Government of Gibraltar and Shell have signed an agreement for the supply of LNG for use in power generation in Gibraltar, said Hydrocarbonprocessing.

This agreement includes the construction of a small regasification unit that will receive, store and re-gasify the LNG arriving by ship for use in Gibraltar’s adjacent gas-fired power plant, which is already under construction.

The regasification unit will be operated by Gasnor, a 100% Shell-owned subsidiary with over ten years of operational experience in LNG for marine and small-scale LNG in North Western Europe. The LNG will be stored before being warmed up to its original gaseous state and then piped to the power plant. The unit will also include a berth for a small LNG carrier that will supply the LNG at night, minimizing disruption to the neighboring port, airport and housing estates. There is also potential for LNG bunkering operations in the future, following the appropriate environmental assessments and safeguards.

Following the recent approval of a robust Environmental Impact Assessment report, construction of the regasification unit is planned to start towards the end of 2016 with commissioning and first delivery of LNG expected to take place ahead of the start-up of the power plant, expected during the second half of 2017.

The regasification unit’s five double wall stainless steel tanks will have a capacity of 1000 m? each. The LNG will be warmed to a gaseous state in a controlled way by using the heat from the power plant’s cooling system, responding to the power plant’s demands.

As MRC informed earlier, in December 2015, Shell declared force majeure on base chemical products, effective 1 Dec., due to "a technical issue with the ethylene cracker complex" at Pulau Bukom, Singapore.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.
MRC

MOSCOW (MRC) -- China Petroleum and Chemical Corp. (Sinopec) said its net profit fell 21.6% in the first half of 2016, hurt by a steep decline in international oil prices, reported Reuters.

The state-controlled energy firm, Asia's largest refiner, said in a separate statement that Dai Houliang had replaced Li Chunguang as company president and become vice chairman of the board. It said Chunguang had resigned due to his age.

During the first six months of the year, Sinopec posted a net profit of USD2.98 B, down from USD3.8 B a year earlier. Sinopec's peers PetroChina and CNOOC Ltd., both heavy on upstream oil and gas production, were hit badly by falls in crude oil and natural gas prices.

Sinopec's operating income in the first half was USD5.26 B, according to IFRS accounting standard, 13.3% lower than a year ago.

The refiner said its oil and gas output fell 6% in the first six months on-year, with crude oil production down 11.4%, as it was forced to cut output at loss-making fields.

While fuel demand growth in China, the world's second-largest consumer, moderated along with the broader economy, domestic competition heated up after more than a dozen independent refineries were allowed to import crude oil for the first time since late 2015.

As these independents boosted refinery throughput, state majors came under pressure to reduce operations.
Sinopec said its first-half refinery operations fell 2.51% on-year. The firm, however, boosted total domestic refined fuel sales by 3.1%.

"China's economic growth is expected to be steady in the second half of 2016, which will drive the growth of domestic demand for refined oil products and petrochemical products," the company said in a statement,
It added, however, that over-supply in the international oil market is likely to persist and international oil prices will remain low.

"The consumption mix of oil products shall continue to change, and demand for chemical products shall be gradually going for more high-end products," the company said.

As MRC said earlier, Russian petrochemical company Sibur is in talks with shareholder Sinopec about investing in a planned gas chemical plant in Russia's Far East, said Reuters in April 2016, citing Sibur boss Dmitry Konov. Sibur plans to buy gas from fields which Russia's Gazprom will develop in Eastern Siberia. In December, Sinopec paid USD1.338 billion for a 10% stake in Sibur and said it planned to acquire an additional 10% within three years.

Sinopec Corp. is one of the largest scale integrated energy and chemical company with upstream, midstream and downstream operations. Its principal business includes: exploring, developing, producing and trading crude oil and natural gas; producing, storing, transporting and distributing and marketing petroleum products, petrochemical products, synthetic fiber, fertilizer and other chemical products. Its refining capacity and ethylene capacity rank No.2 and No.4 globally. Sinopec listed in Hong Kong, New York, London and Shanghai in August 2001. Sinopec Group, the parent company of Sinopec Corp., is ranked the 5th in Fortune Global 500 in 2012.
MRC

MOSCOW (MRC) -- Iran has detected and removed malicious software from two of its petrochemical complexes, a senior military official said on Saturday, after announcing last week it was investigating whether recent petrochemical fires were caused by cyber attacks, repoted Reuters.

The official said the malware at the two plants was inactive and had not played a role in the fires.

"In periodical inspection of petrochemical units, a type of industrial malware was detected and the necessary defensive measures were taken," Gholamreza Jalali, head of Iran's civilian defense, was quoted as saying by the state news agency IRNA.

Iran is alert to the threat of cyber attack by foreign countries. The United States and Israel covertly sabotaged Iran's nuclear program in 2009 and 2010 with the now-famous Stuxnet computer virus, which destroyed Iranian centrifuges that were enriching uranium.

The National Cyberspace Council announced last week that it was investigating whether the recent petrochemical fires were triggered by a cyber attack.

But when asked if the fire at Iran's Bu Ali Sina refinery complex last month and other fires this month were caused by the newly-discovered malware, Jalali said: "the discovery of this industrial virus is not related to recent fires."
The oil minister said last week that most of the fires in petrochemical plants happened because the privatized petrochemical companies have cut their budgets for health and safety inspections.

We remind that, as MRC wrote before, as of 2015, number of active Iranian Petrochemical complexes are 53, with total production capacity of 59 million metric ton, producing range of polymers, chemicals, aromatics & liquid gas, located mainly at Iranian south region, next to Persian Gulf, called Assaluyeh and Mahshahr Special Economic Zones.

There are 67 developments projects in the country which are under construction, adding 61 million metric ton on total production and estimated to fully run till 2018.
MRC