Alpek receives corporate approvals for Petrobras PTA-PET facility acquisitions

MOSCOW (MRC) -- Alpek, S.A.B. de C.V. announced that it obtained all necessary corporate approvals to acquire 100% of Companhia Petroquimica de Pernambuco and Companhia Integrada Textil de Pernambuco from Petroleo Brasileiro S.A. for USD385 MM, as per Hydrocarbonprocessing.

This amount is payable on the closing date for the two companies on a debt-free basis, and is subject to adjustments in working capital, among others. The closing of this transaction is still dependent on several conditions precedent, including approval by the Administrative Council for Economic Defense (CADE) in Brazil.

On March 27, Petrobras announced that its Shareholders’ Extraordinary General Meeting approved the sale of PetroquimicaSuape and Citepe to Alpek.

Petroquimica Suape and Citepe operate an integrated PTA-PET facility in Ipojuca, Pernambuco, Brazil with an installed capacity of 640 Mtpy and 450 Mtpy of PTA and PET, respectively. Citepe also operates a 90-Mtpy texturized polyester filament plant on site.

As MRC reported previously, in early May 2017, Alpek completed adding 5,000 mt of propylene storage to its Altamira port terminal. "The mechanical completion is finished and operations should ramp up in the month of May," spokesman Hernan Lozano said. Each of the two spheres has a capacity of 2,500 mt. "The purpose of the project is to make the domestic propylene logistics chain more efficient, as well as to have greater flexibility to import raw material," Lozano said. Indelpro imports monomer on spot and contractual basis and converts it into polypropylene. The completion of the project comes amid the expected startup of Enterprise Products Partners' propane dehydrogenation unit in Mont Belvieu, Texas. Enterprise said the 750,000 mt/year PDH unit is on track to start in Q3 and could double exports year on year.

Alpek is the petrochemicals unit of Mexican conglomerate Alfa.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.

Weak safety standards led to Exxon refinery blast - US agency

MOSCOW (MRC) -- The US Chemical Safety Board (CSB) has concluded that a 2015 explosion at a Torrance, California, refinery then owned by ExxonMobil Corp could have been prevented, the agency concluded in a report issued on Wednesday, reported Reuters.

"This explosion and near miss should not have happened," said CSB Chair Vanessa Allen Sutherland in a statement. "The CSB's report concludes the unit was operating without proper procedures."

The federal watchdog found that weaknesses in the Torrance refinery's safety program led to the blast.

The blast blew a large piece of debris 80 ft to nearby alkylation unit settler tanks containing toxic hydrofluoric acid, which the board called a "near-miss event."

Four workers suffered minor injuries and part of the refinery underwent a lengthy shutdown, contributing to a spike in the state's gasoline prices.

The Torrance refinery supplies 20% of the gasoline in Southern California and 10% statewide.

The explosion occurred when volatile hydrocarbons flowed backward through an idled gasoline-producing fluidic catalytic cracking unit (FCCU) to a pollution control device called an electrostatic precipitator (ESP), the CSB found.

The generation of sparks by the ESP ignited the hydrocarbons setting off the explosion.

The board, which has no regulatory authority and does not assess fines, found that the FCCU was operating without pre-established limits for a shutdown.

The agency also said Exxon relied on safeguards that it could not be sure were working and that a critical safeguard failed.

Exxon said in a statement: "We are confident we understand the cause of the blast and have worked cooperatively with the Chemical Safety Board and staff to fully understand their findings and recommendations."

Regarding the hydrofluoric acid, Exxon said, "There was no evidence the Feb. 18 incident posed any risk to the modified hydrofluoric acid alkylation unit or risk of harm to the community."

Residents near the refinery want local and state officials to ban the use of hydrofluoric acid in making octane-boosting gasoline additives.

Hydrofluoric acid is a highly toxic chemical that can kill or seriously injure at a concentration of 30 parts per million (ppm). As a gas it forms a ground-hugging cloud.

The board said it has asked a federal court to enforce subpoenas requiring Exxon to provide information about safeguards to prevent or mitigate a release of hydrofluoric acid.

Exxon said it "strongly disagrees" with any statement questioning its responsiveness or cooperation with the investigation.

"We offered to make additional documents available if the CSB could provide a sufficient basis for the documents and agreed to respect commercial confidentiality, which they have not done," a spokesman said Wednesday.

PBF Energy Inc, which acquired the refinery last year, "has already implemented a number of measures that address the CSB's recommendations," PBF spokesman Michael Karlovich said in a statement. "We plan to complete two studies later this year that will address the remaining recommendations."

The CSB determines root causes of chemical plant accidents and provides recommendations to companies, industry organizations and regulatory agencies.

As MRC wrote previously, in late March 2015, a fire broke out at the ExxonMobil Chemical plant in Beaumont, Texas. The fire in a propylene unit forced the company to shut down the entire chemical plant. Exxon spokesman Lee Dula said then in a statement that there were no injuries and that all workers have been accounted for.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.

Arkema reports Q1 results

MOSCOW (MRC) -- Arkema has reported Q1 net income that is up 39% at 147 million euros, or 1.94 euro per share, with EBITDA up 17.5% at 355 million euros, meaning a margin of 16.5%, against 16% over Q1 2016, said the company on its web-site.

Revenues reached 2,152 million euros, up 13.7% (+9.5% like-for-like). Volumes, which rose 4.6%, have been particularly driven by strong demand in Asia and in some of the chemist's key markets.

The sound performance achieved in Q1, in a context of rising commodity prices, fully backs Arkema's target to report 2017 EBITDA of 1.3 billion euros.

Sales for the three months ending March 2017 rose 13.7% to 2.15bn euros, backed by a 4.6% increase in volumes, with earnings before interests, tax, depreciation and amortization (EBITDA) up 17.5% at 355m euros.

For the whole of 2017, Arkema is targeting a 1.3bn euros EBITDA.

As MRC informed earlier, Arkema has completed the sale to INEOS of its 50% stake in Oxochimie, their oxo alcohols manufacturing joint venture, and of the associated business.

Arkema is a leading European supplier of chlorochemicals and PVC. Kynar and Kynar Flex are registered trademarks of Arkema Inc.

PP production in Russia in Q1 decreased by 3%

MOSCOW (MRC) - Production of polypropylene (PP) in Russia decreased to 353,900 tonne in first three months of this year, down 3% year on year, compared to the same period of 2016. The largest increase in PP production accounted for three producers, according to MRC ScanPlast.

March PP production in the country increased to 119,600 tonnes, compared with 108,700 tonnes in February. SIBUR Tobolsk and Stavrolen increased their production rates. Total PP production in Russia reached 353,900 tonnes in Jan-March 2017 against 361,400 tonnes, an increase showed Stavrolen, Ufaorgsintez and Poliom.

Structure of PP production over the reported period looked as follows.

The largest producer of PP in Russia - SIBUR Tobolsk in March produced about 48,200 tonnes against 34,800 tonnes a month earlier. Tobolsk-Polymer's PP production reached 129,500 tonnes in Q1 2017, which is practically the same as in Q1 2016.

March production at Poliom were about 17,000 tonnes, while a month earlier this figure was 16,800 tonnes. Total PP production at the plant over the reported period was about 52,400 tonnes, up 5% year on year.

Stavrolen (LUKOIL) increased capacity utilisation in March, total polypropylene production had increased to 11,100 tonnes against 10,100 tonnes in February. Overall PP production at the plant exceeded 30.600 tonnes in January-March, up 5% year on year.

March PP production at Ufaorgsintez decreased to 9,100 tonnes from 10,300 tonnes a month earlier. Producer reduced capacity utilisation because of technical problems at the propylene preparation site. The producer's PP output at Ufaorgsintez increased to 30,200 tonnes in January-March 2017 compared with 29,900 tonnes year on year.

March PP production at Nizhnekamskneftekhim increased to 18,900 tonnes from 16,900 tonnes a month earlier. The producer's PP production in Q1 remained the same from last year's level - 54,600 tonnes.

Tomskneftekhim also increased production volumes in March, and the final production of propylene polymers was 11,700 tonnes against 11,100 tonnes in February. Total PP production at Tomskneftekhim over the reported period reached 34,800 tonnes, compared with 35,600 tonnes year on year.

Neftekhimiya (Kapotnya) shut its production capacities for turnaround in March, as a result PP production decreased to 3,600 tonnes compared with 8,600 tonnes a month ago. The producer's PP output in Jan-March reached 21,800 tonnes, one third down year on year.


Celanese completes Nilit Plastics acquisition

MOSCOW (MRC) -- Celanese Corporation, a global technology and specialty materials company, today announced it has completed the acquisition of the nylon compounding division of Nilit, a major independent producer of high performance nylon polymers and compounds, said the company on its site.

Financial details of the transaction are not being disclosed at this time.

This acquisition further extends Celanese’s leadership position in the engineered materials business to a global nylon solutions provider. The acquisition includes Nilit Plastics’ nylon compounding product portfolio, customer agreements and manufacturing, technology and commercial facilities in Germany and China. In addition, the acquisition is complementary to the company’s capabilities and track record of innovation, quality and service.

As previously announced, Nilit will retain ownership of its nylon fibers and nylon polymerization businesses worldwide, including facilities in Israel, the United States, China and Brazil.

Nylon compounds continue to be a material of choice in automotive, E&E, consumer and industrial applications. This acquisition delivers on Celanese’s intention to complement and grow its broad portfolio by becoming a leading, global nylon compound supplier.

"Nylon is increasing in applications and end uses in growth industries where Celanese is already focusing significant product, solution and customer development activities," said Scott Richardson, senior vice president of the Celanese engineered materials business. "The addition of the Nilit nylon compounding product portfolio will extend Celanese’s engineered materials solutions offering, and when combined with the company’s world-class operating model, we are well positioned to be the first choice materials solutions provider for our customers."

Celanese Corporation is a global technology leader in the production of differentiated chemistry solutions and specialty materials used in most major industries and consumer applications. Our two complementary business cores, Acetyl Chain and Materials Solutions, use the full breadth of Celanese’s global chemistry, technology and business expertise to create value for our customers and the corporation.