PE imports in Russia rose by 5% in Q1 2017

March PE imports to the Russian market rose to 45,300 tonnes, compared to 38,700 tonnes a month earlier, shipments of all PE grades increased. Overall PE imports reached 114,800 tonnes in January-March 2017, compared to 109,400 tonnes a year earlier. The HDPE and EVA segments accounted for the increase in imports, whereas other PE grades accounted for the decrease in import shipments.

The structure of PE imports by grades looked the following way over the stated period.

Last month's HDPE imports grew to 17,900 tonnes from 13,200 tonnes in February, local companies increased their purchasing of blow moulding and injection moulding HDPE in Uzbekistan, as well as HDPE for extruded coating of steel pipes in Europe. Overall HDPE imports exceeded 42,500 tonnes in the first three months of 2017 versus 30,000 tonnes a year earlier.

March imports of linear low density polyethylene (LLDPE) rose to 12,700 tonnes from 11,900 tonnes a month earlier, with films producers accounting for the main rise in shipments. LLDPE imports totalled 33,600 tonnes in the first three months of the year, compared to 41,900 tonnes a year earlier. An increase in the domestic output, particularly, by Nizhnekamskneftekhim helped to reduce imports.

Last month's imports of low density polyethylene (LDPE) grew to 9,300 tonnes, compared to 7,500 tonnes in February, shipments of film grade PE from Europe and Belarus increased. However, overall LDPE imports fell to 22,300 tonnes in January-March 2017 from 24,800 tonnes a year earlier.

March EVA imports rose to 3,000 tonnes from 2,300 tonnes a month earlier. Imports of this ethylene copolymer grade grew by 55% over the stated period to 8,500 tonnes.

Imports of other ethylene polymers totalled 7,800 tonnes in the first three months of the year.

MRC

MOSCOW (MRC) -- Ineos has announced that it has agreed to acquire the Forties Pipeline System (FPS) and associated pipelines and facilities from BP, as per the company's press release.

The 235 mile Forties pipeline system links 85 North Sea oil and gas assets to the UK mainland and the Ineos site in Grangemouth in Scotland.

Under the terms of the agreement Ineos will pay BP a consideration of up to USD250 million for the business, comprising a cash payment of USD125 million on completion and an earn-out arrangement over seven years that could total USD125 million.

On completion of the deal the ownership and operation of FPS, the Kinneil terminal and gas processing plant, the Dalmeny terminal, sites at Aberdeen, the Forties Unity Platform and associated infrastructure will transfer to INEOS. These assets will transfer as fully operational units, at which point Ineos will be responsible for a strategic UK asset that delivers almost 40% of the UK’s North Sea oil and gas.

It is expected that around 300 people that operate and support the FPS business at Kinneil, Grangemouth, Dalmeny and offshore will become part of the Ineos Upstream business.

Jim Ratcliffe said: "The North Sea continues to present new opportunities for Ineos. The Forties Pipeline System is a UK strategic asset and was originally designed to work together to feed the Grangemouth refinery and petrochemical facilities. We have a strong track record of acquiring non-core assets and improving their efficiency and reliability, securing long term employment and investment. I am delighted that we can now bring this integrated system back under single ownership in Ineos."

BP group chief executive Bob Dudley commented: "BP is returning to growth in the North Sea as we bring important new projects, including the Quad 204 redevelopment and Clair Ridge, into production and pursue further opportunities beyond these. While the Forties pipeline had great significance in BP’s history, our business here is now centred around our major interests west of Shetland and in the Central North Sea.

The pipeline has long been an important feedstock supplier to Ineos at Grangemouth. We believe that through also owning FPS, Ineos will be able produce greater efficiencies and help secure a competitive long-term future for this important piece of UK oil and gas infrastructure."

20% of the oil that passes down the pipeline feeds the Ineos refinery to provide 80% of Scotland’s fuel.

The agreement further expands the Ineos Upstream business following the acquisition of the Breagh and Clipper South gas fields in the Southern North Sea from Letter1 in 2015, which currently supply gas to 1 in 10 British homes.

The acquiring entity will be Ineos FPS Limited, which forms part of INEOS Limited but is not part of the IGH SA Group.

The acquisition and transfer of operatorship is targeted to complete in Q3 this year, subject to the receipt of regulatory and other third party approvals.

As MRC wrote before, in April 2016, Ineos said the second manufacturing unit at Grangemouth’s KG ethylene plant had been brought back to life eight years after being mothballed. Ineos then said it had completed successful operational trials as it prepared to receive shale gas ethane from the US as petrochemical feedstock. The Ineos investment should bring US shale gas economics to Europe. The project includes contracts to acquire gas from the Marcellus Shale in Western Pennsylvania; connection to the new, 300-mile Mariner East pipeline to bring the gas to the Marcus Hook deep water terminal near Philadelphia; the design and commissioning of eight Dragon-class ships that will create a virtual pipeline across the Atlantic; and the construction of a new import terminal, including the biggest shale gas storage tank in Europe at Grangemouth.

The new import terminal at Grangemouth will also benefit the Fife ethylene plant in Mossmorran, Scotland, after it was announced that the owners of the plant had agreed a long-term sale and purchase agreement to secure ethane from mid-2017.

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

MOSCOW (MRC) -- By implementing improvement proposals from employees, BASF, the world's petrochemical major, managed to save nearly EUR60 million globally last year, said the producer on its site.

A computer program for labeling samples, a concept for efficient distillation of a solvent, and a new approach to the energy-saving melting of waxes – these and 21,000 other improvement proposals were implemented in 2016, maintaining the high level of ideas of the previous year. BASF rewarded the ingenuity of its employees with bonuses totaling EUR4.4 million.

There was also a host of new ideas implemented at the Ludwigshafen Verbund site, which achieved savings of approximately EUR30 million for the fifth consecutive year. BASF rewarded the performance of its employees at the Ludwigshafen site with EUR3 million in bonuses. Employees of the Petrochemicals division were particularly inventive: their improvement proposals achieved annual net benefits of EUR6.5 million.

Many of the ideas were developed through teamwork. For example, employees at the melamine plant of the Monomers division, working together with colleagues from quality management, implemented an innovative refurbishment concept. In parts of a plant with hundreds of densely stacked pipes, a few pipelines were defective. Rather than idling the entire plant for several months, the colleagues were able to identify the specific lines needing to be shut down, while the remaining lines could continue to operate. This allowed total downtime to be reduced to just eight weeks, and saved costs of approximately EUR2 million.

As MRC informed before, in November 2016, BASF unveiled its plans to invest globally more than EUR200 million in its plastic additives business, approximately half of which in Asia, within the next five years, focusing on capacity expansions and operational excellence.

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 about EUR58 billion in 2016.
MRC

MOSCOW (MRC) -- Petrochemical Industries Company's (PIC) CEO Mr. Mohammed Abdullatif Al-Farhoud announced signing the Front End Engineering and Design (FEED) contract for the Third Olefins and Second Aromatics Project Integrated with Al-Zour Refinery, and that with Amec Foster Wheeler company, said PIC.

Al-Farhoud said after signing the contract that Amec Foster Wheeler won the tender as the project's manager and consultant to carry out primary engineering designs with a total cost of USD34 million. He added that the project is expected to finish and actual production to start during the second quarter of 2022.

Meanwhile, Deputy CEO for Olefins and Aromatics at PIC Mrs. Husneya Hashem said that the Third Olefins and Second Aromatics Project Integrated with Al-Zour Refinery is considered one of the most important strategic initiatives for PIC, and seeks to improve Kuwait's position in the petrochemical industry and execute the company's strategy of expansion in basic petrochemicals. It is also a model of integration between KPC subsidiaries.

Hashem further explained that the project's goal is to build a petrochemical complex to produce 940,000 tons of polypropylene annually, 1.4 million tons of paraxylene annually, 420,000 tons of gasoline annually and 208,900 tons of fuel annually using propene and naphtha from Al-Zour Refinery.

It is worth mentioning that KPC's Board of Directors gave approval for going ahead with executing the petrochemicals complex, after receiving approval from the Supreme Petroleum Council. The project has an initial total cost of USD7.8 billion, joining other mega strategic oil projects in Kuwait.
MRC

MOSCOW (MRC) -- Malaysia's Lotte Chemical Titan unexpectedly shut its No. 1 and 2 naphtha-fed steam crackers at Pasir Gudang (Malaysia) on Tuesday due to an interruption of water supplies, as per Plastemart.

Over the last weekend, a domestic utilities company was carrying out upgrading works which led to the water cut. Water supplies were currently being restored, one source said but it was unclear how long the crackers will remain shut.

The No. 1 cracker can produce 260,000 m tpa of ethylene and 160,000 m tpa of propylene while the No. 2 cracker can make 407,000 m tpa of ethylene and 260,000 m tpa of propylene. The No. 2 cracker had just completed a planned turnaround from February 6 to March 29.

The status of a 100,000 m tpa butadiene extraction unit at the site could not be confirmed. The Lotte Chemical Titan-owned unit obtains its crude C4 feedstock from both crackers.

As MRC reported before, Lotte Chemical Titan, part of Lotte Chemical, shut down its Low density polyethylene (LDPE) unit for a 15-20-day maintenance turnaround in February 2017. Located at Pasir Gudang, Malaysia, the LDPE unit has a production capacity of 230,000 mt/year.

Lotte Chemical Titan produces Malaysia's most comprehensive portfolio of olefins and polyolefins which contribute to the enhancement of everyday life. Lotte Chemical Titan's production site in Malaysia consists of eleven process facilities, two co-generation plants and three tank farms. They are located on 2 sites in Pasir Gudang and Tanjung Langsat in the state of Johor. In 2006, Lotte Chemical Titan acquired PT Lotte Chemical Titan Nusantara, Indonesia’s first and largest polyethylene plant in the country. This acquisition boosted the polyolefins capacity by approximately 50%, thus making the company one of the largest producers in South East Asia. Lotte Chemical Titan was acquired by Lotte Chemical Corp., forming part of the Lotte conglomerate of Korea, in 2010. The company thus became one of Lotte Chemical Corp.’s largest overseas subsidiaries.
MRC