SIBUR decreased export EPS prices for September delivery

MOSCOW (MRC) - SIBUR-Khimprom (SIBUR group), the leading producer of expandable polystyrene (EPS) in Russia, decreased export prices for shipments in September, according to ICIS-MRC Price Report.

According to sources in the market, the September price of expandable polystyrene were reduced by USD30/tonne compared with the August price offers FCA Voronezh, excluding VAT.

OJSC "SIBUR Holding" is the gas processing and petrochemical company. SIBUR owns three pyrolysis units, two plants for the production of base polymers, producing low density polyethylene (LDPE) and polypropylene (PP), three factories for the production of synthetic rubber, producing basic and special rubbers and thermoplastic elastomers, and 13 enterprises producing a wide range of semi-finished products of plastics and organic synthesis, including polyethylene glycols, alcohols, BOPP films, expandable polystyrene, acrylates, and flexible PVC.

KPIC to shut down HDPE plant in Ulsan for maintenance

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%.

Shell and government of Gibraltar sign LNG supply agreement

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.

Profit of Chinese Sinopec slumps 21.6% in first half 2016

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.

Iran detects malware in petrochemical plants

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.