Iran to triple installed petchem capacity in a decade

MOSCOW (MRC) -- Iran plans to triple its installed capacity of petrochemicals in the next ten years, Iran's National Petrochemical Company (NPC) Managing director Marziyeh Shahdaie announced in a press conference in Tehran on Wednesday (2 Nov 2016), reported GV.

She also put the current nominal petrochemical output of the country at 64 million tons and the operating output at 46 million tons.

Explaining that the petrochemical industry is a sector requiring high technology and investment to be developed, the official noted, "To expand this industry we need acquiring foreign technology and also attracting foreign investment; therefore, our relations with other countries play significant role in promotion of our petrochemical sector."

Highlighting Iran’s huge potential for development of petrochemical industry Shahdaie said, "The foreigners I met in K-Plastics & Rubber Exhibition, recently held in Dusseldorf of Germany, believed that considering its high potential Iran can be a petrochemical hub in the region."

The NPC official mentioned some of these potentials and advantages as access to the free waters, existence of expert manpower and production of a wide range of petrochemical products, the feature that other petrochemical producers in the region lack, because they do not have both rich oil and gas reserves as Iran enjoys for producing so many petrochemical products.

She said the current policy of the government for the petrochemical sector is development and growth through attracting foreign direct investment (FDI).

As MRC informed before, Iran is planning to develop Mahshahr Petrochemical Special Economic Zone (PETZONE). Addressing a ceremony held to farewell Mahshahr PETZONE’s managing director and welcoming his replacement, Marziyeh Shahdaei, deputy petroleum minister in petrochemical affairs, said Mahshahr PETZONE has been designed in two phases and its second phase is planned to be developed. The project will be carried out by National Petrochemical Company (NPC) as a state body responsible for providing the infrastructure needed for development of the petrochemical sector, she said. She further added that studies are underway for preparation of the second phase of the zone that will be home to petrochemical plants aimed at completing the value chain in the region.
MRC

MOL Group to invest USD1.9bn in petrochemical business

MOSCOW (MRC) -- Hungarian oil and gas company MOL Group has revealed plans to invest USD1.9bn until 2021 to develop its petrochemicals business, said Chemicals-technology.

For the next five years, the company will focus on improving yield of propylene and investment into attractive propylene derivatives.

MOL Group chairman-CEO said: "Following the announcement of our long-term strategy, ‘MOL Group 2030 - Enter Tomorrow’, we are pleased to host today the capital markets day to give the financial community a comprehensive update about our financial targets and the implementation of our strategy in the next five years.

"Relying on our integrated business model’s strong cash-flow generation and our robust balance sheet, we will invest substantial funds into strategic investments to further diversify our business and increase our exposure in areas that are not dependent on the demand for motor-fuels.

"The first phase strategic projects in petrochemicals are expected to contribute USD250m-USD300m annually."
"As a result of our industrial transformation, the first phase strategic projects in petrochemicals are expected to contribute USD250m-USD300m annually to our EBITDA, while the weight of customer services is expected to exceed 20% of our total EBITDA by 2021.

"At the same time, our strong cash-flows will also be able to comfortably maintain the rising trend in dividends for our shareholders."

For further diversification in the propylene value chain, the company will invest more than $500m into its steam crackers in Hungary and Slovakia.

MOL is also planning to invest in propylene oxide based polyols, a high-value product applied in the automotive industry, packaging and furniture manufacturing.

The company is seeking to become the sole fully integrated supplier in CEE, the region, which is driving the European supply growth. Additional investments are being planned for another possible product entry.

MOL also has plans to enhance the feedstock for its petrochemical plants, as well as take the advantage of the growing demand for such profitable products as jet fuel, lubricants and base oils.

As MRC informed earlier, MOL's third-quarter net income fell 24% year-on-year to HUF 68.8 billion as higher tax payments countered the impact of a wider margin.

MOL Hungarian Oil and Gas PLC is an integrated oil and gas company. The Company produces crude oil, petroleum products, bitumens, lubricants and natural gas. MOL owns and operates refineries, oil and gas pipelines, service stations, and natural gas storage facilities.
MRC

Trinseo expands capacity for S-SBR in Germany

MOSCOW (MRC) -- Trinseo, a global materials company and manufacturer of plastics, latex binders and synthetic rubber, has announced to expand capacity for Sprintan solution styrene butadiene rubber (S-SBR) at its synthetic rubber manufacturing complex in in Schkopau, Germany, as per GV.

The capacity increase is a response to rising customer demand, said the company. The asset upgrade at the company’s facility will add 50 kt of S-SBR capacity, increasing its global S-SBR production by 33 %. This additional capacity is expected to be online in January 2018.

"This investment is in line with Trinseo’s strategy to grow our Performance Materials businesses, in particular our S-SBR business, which has seen very strong market demand," said Hayati Yarkadas, Senior Vice President and Business President, Performance Materials. "This expansion in Schkopau is the fastest solution to meet our customers’ growing demand for our Sprintan Rubber products, as well as next generation development grades of advanced S-SBR."

Sprintan S-SBR rubber grades are said to provide low rolling resistance as well as wet grip and durability. As CO2 emissions regulations and tire labeling requirements continue to expand beyond the EU to other regions, there is a strong drive in the automotive industry towards energy efficient tires, Trinseo said.

As MRC reported earlier, Trinseo and its affiliate companies in Europe increased prices for all polystyrene (PS), acrylonitrile-butadiene-styrene (ABS) and acrylonitrile styrene copolymer (SAN) grades in November. Effective as of 1 November, or as existing contract terms allow, the November contract and spot prices for the product listed below rose for Europe as follows:

- STYRON general purpose polystyrene grades (GPPS) - by EUR50/tonne;
- MAGNUM ABS resins - by EUR50/tonne;
- TYRIL SAN resins - by EUR45/tonne.

Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo's technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015. Trinseo had approximately USD4.0 billion in revenue in 2015, with 18 manufacturing sites around the world, and more than 2,200 employees.
MRC

Plastic sector of Vietnam under pressure from foreign firms

MOSCOW (MRC) -- Plastic firms in Viet Nam are facing fierce competition and are at the risk of being acquired by foreign companies, experts said at a conference in HCM City on 2 November 2016, as per GV.

Pham Van Bac, deputy head of construction ministry's department of building materials, said the plastic industry has potential to grow as plastic consumption in the country is still low, even as he acknowledged the challenges the sector faces.

As per the National Housing Development Strategy, the annual housing area growth is expected to be 5 to 10 per cent, or equivalent to 1-1.2 million sq m, which will increase the demand for building materials, which includes plastic.

There are two main products in building plastics - plastic pine and plastic profile - and these are being used instead of wood and steel for door and window systems.

Statistics from the ministry shows that a house on average has 40 sq m of doors and windows. Of this, 35 per cent or 15 sq m is plastic. In addition, 80 to 90 per cent of constructions have been using plastic doors and windows.

The demand for plastic has risen from 37 kg per person in 2013 to 41 kg in 2015. This level is still low compared to the average of 48.5 kg per person in ASEAN region and the world average of 69.7 kg. The US has the highest demand for plastic, with an average of 150-169 kg per person per year.

"The rising demand means that local plastic firms have the opportunity to increase their market share by making investments to improve technology and capacity," Bac said.

The recovery of the real estate and construction sectors has stimulated demand for plastic products, Dang Tran Hai Dang, deputy director of VietinBankSc's research centre, said. The plastic sector also has a prosperous outlook thanks to the many free trade agreements Viet Nam is part of.

However, the local plastic sector has to face the challenges of competition from foreign producers and the risk of unstable imported material supplies, Bac said.

Many foreign plastic companies have invested in Viet Nam to take advantage of land leasing and taxation incentives and the availability of cheap materials, among other things. Foreign investors prefer acquiring local companies with certain market share and good performance as they can save money.

Dang listed some major acquisitions since early 2016, including Korea's Dongwon Systems Corporation's takeover of Minh Viet Packaging One Member Company Ltd. Thailand's SCG Building Materials is planning to pump in USD 6 billion to consolidate its position in the Vietnamese plastic market, he said.

Foreign companies are making inroads into the Vietnamese market and putting pressure on domestic production, he said, adding that their experience and financial potential will help them benefit from the free trade pacts.

Nguyen Ba Hung, chairman of Dong A Plastic Group (DAG), said most domestic plastic producers are using old technologies, which affects their competitiveness. "DAG has gradually replaced its technology with those from Europe. We will invest around USD 1 million for research and development in the near future," Hung said.

The BIDV Securities Corporation has forecast that the average demand for plastic products will increase to 45 kg per person per year in 2020, which represent an annual growth of 4 per cent.

As MRC informed earlier, Honeywell has signed a Memorandum of Understanding (MOU) with Vietnam Oil and Gas Group (PetroVietnam) to advance their cooperation in Vietnam’s oil and gas industry. Under the terms of the MOU, Honeywell will have the opportunity to provide professional consulting services and advice to PetroVietnam and its subsidiaries for future investment projects, as well as to support PetroVietnam in engineering design and economic and technical project feasibility studies for all of its facilities.

In 1999, Honeywell UOP licensed the CCR Platforming and Penex processes to Petrovietnam’s Dung Quat refinery, for the production of fuels, fuel blending components and aromatics. In 2009, UOP licensed an additional aromatics complex, and alkylation and sulfur removal processes to the Nghi Son refinery.

We also remind that Vietnam Polystyrene had expanded the production capacity of its expandable polystyrene (EPS) plant by 50,000 mt/year by end-April 2014. Located in Vietnam, the plant has a production capacity of 40,000 mt/year.

Solvay polyamide compounding unit in Mexico to serve growing automotive markets

MOSCOW (MRC) -- Solvay has announced to build a Technyl polyamide (PA) compounding unit in San Luis Potosi, Mexico, with initial annual capacity of 10KT, as per Plastemart.

This new facility is expected to become operational in the third quarter of 2017 to serve the region’s and America’s growing automotive market and consumer goods market.

Mexico is the second largest producer of automobiles and commercial vehicles in the Americas and is ranked seventh worldwide with annual production exceeding 3.5 million units in 20151. In addition, many consumer goods and electrical equipment players are located close by, offering new opportunities for Solvay. Vincent Kamel, President of Solvay Performance Polyamides, stated:

"This new plant will help us to support our fast growing Technyl polyamide business in North America, in addition to our current capabilities. Many of the world’s top automotive OEMs are located in the region, which makes it an ideal base for us to serve both local and U.S. markets and contribute with our solutions to cleaner mobility."

To minimize investment cost and time to market, Solvay is partnering with Chunil Engineering, one of its major customers. Solvay is planning additional investments to serve the NAFTA2 market. Peter Browning, General Manager of Solvay’s Engineering Plastics Business Unit, explained: "Our collaboration with Chunil Engineering - a global automotive tier 1 - enables us to optimize the site’s infrastructure including the use of power, water and waste treatment. As our business develops we will expand this modular 10KT unit’s capacity to meet the rapidly growing needs of our customers in the region."

Solvay supports customers worldwide with a complete array of advanced services designed to speed the development of new applications, from material characterization to application validation. This offering includes 3D printing of functional prototypes in Sinterline PA6 powders, predictive simulation with MMI Technyl Design as well as part testing at fully equipped APT Technyl Validation centers.

As MRC informed previously, in early January 2016, Solvay unveiled its plans to sell its polyamide business and gave investment bank Goldman Sachs a mandate to find a buyer. Polyamides, which can take the form of nylon, are used in textiles, carpets, clothing and car seats. Solvay has steadily shifted from a base chemical and plastics company to one making speciality materials used by the oil and gas sector or in cosmetics and high-performance polymers.

Solvay S.A. is a Belgian chemical company founded in 1863, with its head office in Neder-Over-Heembeek, Brussels, Belgium. The company has diversified into two major sectors of activity: chemicals and plastics. Solvay supplies over 1500 products across 35 brands of high-performance polymers - fluoropolymers, fluoroelastomers, fluorinated fluids, semi-aromatic polyamides, sulfone polymers, aromatic ultra polymers, high-barrier polymers and cross-linked high-performance compounds.
MRC