Ineos enters into first loan on the back of new North Sea assets

MOSCOW (MRC) -- Ineos UK E&P Holdings has entered into its first, five-year, reserve-based lending facility (RBL Facility) of GBP220 million (USD294M), as per OffshoreEnergyToday.

Ineos said on Wednesday that the facility has been secured on attractive terms on the back of the recently-acquired assets from DEA UK and Fairfield Energy.

To remind, Ineos bought interests in the Breagh and Clipper South gas fields in the Southern North Sea in October last year from a UK subsidiary of DEA Deutsche Erdoel AG. Ineos also acquired additional 25% interest in the Clipper South field from Fairfield, also in October 2015.

The company explained that the facility will enable repayment of part of its equity financing for the acquisitions of DEA UK and Fairfield Energy and will facilitate future development expenditures.

Geir Tuft, Ineos Breagh CEO, said: "Ineos is a new entrant to the North Sea and this first step into the oil and gas backed lending market demonstrates support for both our strategic vision and our ambitious plans for the future."

"This first RBL facility is a landmark for INEOS and validates the quality of the assets we acquired in 2015. It is seen as a catalyst to develop future projects and continue to pursue opportunities in the North Sea."

The facility has been arranged by HSBC and Lloyds with participation from Barclays, Deutsche Bank, Goldman Sachs and Bank of Montreal.

We remind that, as MRC informed before, in October 2014, Ineos Upstream Limited signed an agreement with Reach Coal Seam Gas Limited (Reach CSG) to acquire an 80% interest in Petroleum Exploration and Development Licence (PEDL) 162, in the Midland Valley of Scotland. This licence area of 400 km2 is next to PEDL 133, in which Ineos already owns a 51% stake of the shale layer. As part of the deal, Ineos will be the operator of the licence, and will fund the initial appraisal activity (consisting of 2 vertical science wells and 100 km2 of 3D seismic).

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

Bio-based construction polymers market to grow well until 2024

MOSCOW (MRC) -- The global biobased construction polymers market size was USD11.87 bln in 2015. Rising concern towards petrochemical products coupled with increasing adoption of renewable products is expected to propel the market for biobased construction polymers until 2024, as per Plastemart with reference to Grand View Research.

A major source of green-house gas emissions is associated with fossil fuel usage across various industrial operating facilities. Growing concern towards carbon dioxide footprint in large scale manufacturing units has urged the industry to shift towards biobased polymers.

Increasing R&D to develop eco-friendly renewable products has increased the use of bio based polymers in the construction industry. High production costs and less developed global supply value chain are expected to hinder bio based construction polymers. Global bio based product demand is not entirely capitalized to realize the economies of scale and market is less developed to compete with well-established petroleum based product.

A recent breakthrough in technology has shifted focus towards manufacturing bio based polymers from bacterial fermentation. The technology involves synthesizing monomers from renewable sources that include fatty acids, cellulose, and starch.

The favorable regulatory scenario in various countries and initiatives by regional governments in support of biopolymers are expected to have a positive impact on market growth over the forecast period.

Government regulations such as Lead Market Initiative (UK) and BioPreferred (U.S.) favor the use of bio based raw material for polymer production. Major polymer manufacturers are shifting their focus towards developing sustainable technologies and are collaborating with various individual bi based technology firms in order to manufacture bio based polymers.

Polyurethane dominated the global demand and accounted for over 26% of the total volume in 2015. The product segment is expected to grow at a CAGR of 10.2% over the next eight years. Application of biobased polyurethanes as insulation in the building and construction industry is a significant opportunity for the market particularly in the US and Europe.

Bio based epoxies market is estimated to witness moderate growth over the next few years on account of its wide range of applications in the construction industry such as in paints & coatings, adhesives, and in wood & concrete repair.

Polylactic acid (PLA) and Polyhydroxyalkanoates (PHA) are expected to witness the fastest growth in the bio based polymer industry owing to increasing use and numerous advantages over other products. PLA is a bio-derived monomer used as a suspending agent, foam, pore-forming agent, binder and coating adhesive in the construction industry.

PHA produced from microorganism is used as a coating, viscosifier, and pore-forming agent. The other bio based polymers produced worldwide include Polytrimethylene terephthalate (PTT) and Polybutylene succinate (PBS).

Major applications include pipe and insulation. The pipe was the largest application segment and accounted for over 37% of the global demand in 2015. The construction industry has been a major consumer of plastics with their applications ranging mainly from pipe fittings & insulation.

Use of plastics compounding is also increasing in pipes and fittings segments supported by their reduced cost structures, long life span, corrosion resistance and light weight.Typical applications where bio based construction polymers are used include window and door profiles, pipes and guttering, cement, flooring, glazing, sealants and adhesives, insulation, building panels and roofing.

The growing trend of using bio based polymer in profiles used in bridge engineering for all composite structures is anticipated to propel the market growth over the forecast period. Profile application is expected to witness the fastest growth at a CAGR of 10.6% over the next eight years. Other construction applications include bridge bearings, FRP bridge section, glazing sealant, concrete molds, concrete jointing, cladding panel, and floorings anchor fixings.

The major demand is expected from emerging markets of Asia Pacific and South America. Countries such as China, India and Brazil are anticipated to witness high growth owing to increasing infrastructure activities and favorable bio
based product political framework.

Moderate growth is expected from matured markets such as North America and Europe. Countries such as U.S. and U.K. are expected to lose their market share to Asia Pacific countries owing to less infrastructural activities taking place in these regions.

Major companies include SK Chemicals, BASF SE, Evonik Industries, Mitsubishi Gas Chemical, Nature Works LLC, Bio-On, Toyobo, DuPont de Nemours, Teijin Plastics and PolyOne. Other players include Tate & Lyle, Hiusan Biosciences, Kaneka TEPHA, Synbra and Metabolix.

As MRC informed before, the bio-based polyethylene (PE) market is estimated to grow to USD751.9 mln by 2019 at a CAGR 12.3%, as per MicroMarket Monitor.
MRC

Global liquid crystal polymer market to reach USD1.23 bln by 2020

MOSCOW (MRC) -- Global LCP demand was 46.1 kilo tons in 2013 and is expected to reach 81.7 kilo tons by 2020, growing at a CAGR of 8.6% from 2014 to 2020, as per Plastemart with reference to Hexa Reports.

Global liquid crystal polymers (LCP) market is expected to reach USD 1.23 billion by 2020. Shift in trend towards miniaturization of electrical components such as surface mount device and connectors is expected to drive global LCP market.

Growing demand for lightweight, high performance materials from automotive industry in order to improve fuel efficiency is also expected to have a positive influence on the market growth. Lower welding strength and warpage associated with LCP is expected to remain a key challenge for market participants.

Electrical & electronics emerged as the leading application segment and accounted for 81.5% of total market volume in 2013. Growing engineering resins demand for manufacturing ultra-thin electrical components is expected to remain a key driving factor for this segment.

LCP is favored over other engineering resins such as polyphenylene sulfide (PPS), nylon 46 and polyphthalamide (PPA) which has further propelled market growth. Electrical & electronics is also expected to witness the highest growth rate of 8.9% over the forecast period. LCP demand from automotive industry is expected to grow at an estimated CAGR of 7.3% from 2014 to 2020. Shift in trend towards adoption of lightweight, high performance materials from automotive industry particularly in the U.S. and Europe is expected to drive this segment.

As MRC wrote before, LCP's market is projected to register a CAGR of 6% between 2015 and 2020 to reach USD1.2 bln by 2020, as per ReportLinker. LCPs are chemically aromatic co-polyesters. But they differ from the engineering plastics PET and PBT most notably in their molecular structure. They are known for their high temperature resistance, excellent mechanical properties, good solvent resistance and low water absorption compared to other heat-resistant polymers. They have good electrical insulation properties, low flammability and a low coefficient of thermal expansion.
MRC

Daelim to take off-stream HDPE plant in South Korea for maintenance

MOSCOW (MRC) -- South Korea-based Daelim Industrial is likely to shut its high density polyethylene (HDPE) plant for a maintenance turnaround, as per Apic-online.

A Polymerupdate source in South Korea informed that the plant is planned to be shut in November 2016 and it is likely to remain off-stream for around 15-20 days. The exact date of the shutdown could not be confirmed.

Located in Yeosu, South Korea, the plant has a production capacity of 270,000 mt/year.

As MRC informed previously, South Korea-based Daelim's petrochemical business division is planning to invest KRW74bn (USD67m) to expand its highly reactive polybutene plant located at Yeosu National Industrial Complex. The investment will help the company expand annual output of its existing Yeosu plant from 65,000t to 100,000t by November 2016. Following expansion, the company will be able to produce 185,000t of polybutene per year, including the polybutene plant's annual production output of 85,000t of general-purpose polybutene.

Daelim Industrial was established in 1939, and its E&C (Engineering & Construction) and Petrochemical Groups are the main lead of the Daelim Business Conglomerate (Chaebol). The fields covered by Daelim Industrial as one of the top EPC Company in Asia to the Middle East include gas, petroleum refining, chemical and petrochemical, power and energy plants, building and housing, civil works, and industrial facilities. Daelim Group has 17 subsidiary companies under its umbrella which includes Daelim Industrial (Construction Division), Daelim Industrial (Petrochemical Division), etc.
MRC

Williams Partners to explore monetizing Geismar olefins plant

MOSCOW (MRC) -- Williams Partners LP has initiated an adviser-led process to explore the monetization of its indirect ownership interest in the Geismar, Louisiana olefins plant and complex, reported Hydrocarbonprocessing.

The process may result in a sale or a long-term, fee-for-service tolling agreement.

Williams currently holds an approximate 88.5% undivided ownership interest in the Geismar olefins plant and is operator of the facility. In 2015, Williams placed in service an expansion of the facility that increased its ethylene production capacity by 300 Mtpy, for a total production of 975 Mtpy of ethylene and 57 Mtpy propylene . The plant is a predominantly ethane-fed, light-end natural gas liquids cracker. Williams has held an ownership stake in the Geismar plant since 1999.

"Given the attractive long-term outlook for U.S. ethylene crackers, we believe our Geismar plant presents an attractive investment opportunity for potential buyers, especially those seeking to quickly backward integrate into ethylene in the US Gulf Coast," Armstrong said. "In addition, we believe this asset provides an attractive value proposition for those considering the timing and cost-overrun risks of building a new ethylene facility in the US Gulf Coast in the coming years."

Armstrong added, "We believe the potential monetization of this asset would create significant value for Williams Partners and our decision to explore alternatives with respect to the Geismar olefins plant is consistent with Williams’ strategy to narrow its focus and allocate capital to its strong core, natural gas-focused business."

If the process results in a sale, Williams Partners would expect to use a portion of the proceeds to reduce debt in order to maintain investment-grade credit metrics and the balance of the proceeds would reduce planned equity issuances.

As MRC informed previously, in late March 2016, Williams announced the startup of its second offgas liquids extraction plant, a key asset in the company’s Canadian midstream and petchem complex. The new plant boosts domestic production of petchem feedstocks and significantly reduces emissions in the oil sands production process while recovering valuable natural gas liquids (NGLs) and olefins.

Williams, headquartered in Tulsa, Okla., is one of the leading energy infrastructure companies in North America. It owns controlling interests in both Williams Partners L.P. and Access Midstream Partners, L.P. through its ownership of 100% of the general partner of each partnership. Additionally, Williams owns approximately 66% and 50% of the limited partner units of Williams Partners L.P. and Access Midstream Partners, L.P., respectively. On June 15, 2014 Williams proposed the merger of Williams Partners and Access Midstream Partners. The proposed merger has been approved by boards of each partnership and was closed in early 2015.
MRC