South Korean four largest petrochemical makers plan to invest 10 trillion won in 2017

MOSCOW (MRC) -- South Korea's 4 largest petrochemical companies are planning to make an investment of approximately 10 trillion won (USD9 bln) in total this year, rising by over 20% from a year ago, as per Plastemart.

LG Chem’s capital expenditure for this year is estimated at 2.7 trillion won (USD2.4 bln. "My company’s average annual investment has been fixed at 3 trillion won (USD2.7 billion) for 2017 to 2019," said LG Chem CFO Jung Ho-young. 1.7 trillion won (USD0.9 bln) is scheduled to go to its battery business and basic material business this year. In addition, an R&D investment of one trillion won is planned for its new businesses such as water treatment and biotechnology development.

The capital expenditure of Lotte Chemical, which posted a profit of 815.2 billion won (USD733 mln) in Q1 of this year, is expected to amount to 2 trillion won (UAD1.8 bln) this year. 120 billion won (USD10.8 miln) is slated to go to its special synthetic rubber manufacturing facilities about to be completed in Yeosu, South Korea and 300 billion won (USD270 mln) is to be invested in its ethylene manufacturing plant scheduled to be completed in the second half of this year in Malaysia. This company is planning to further increase its investment through the IPO of Lotte Chemical Titan in the country and is currently expanding its facilities in its ethylene cracking complex (ECC) in Yeosu in order to increase its production capacity from one million tons to 1.2 million tons. Moreover, its ECC construction project in Louisiana is planned to be completed in the second half of next year at an investment of 2.9 trillion won (USD2.6 billion).

Hanwha Chemical’s subsidiary Hanwha Total, in the meantime, recently decided to invest 500 billion won (USD450 mln) to expand its naphtha cracking center (NCC) in the Daesan Petrochemical Complex. Furthermore, it is going to invest one trillion won in its adhesive manufacturing facilities and the like.

SK Innovation is planning to invest three trillion won this year and most of the amount is likely to go to SK Global Chemical, its subsidiary in the petrochemical industry, for restructuring of its business to revolve around chemical business. In this context, SK Global Chemical acquired Dow Chemical’s ethylene acrylic acid business for 420 billion won (USD378 million) in February this year.

As MRC informed before, in late 2015, the South Korean government was pushing forward with consolidation of the petrochemical industries, which were mired in a supply glut and the protracted global economic recession. The restructuring on the petrochemical industry was led by the Ministry of Trade, Industry, and Energy. Although working-level officials of major petrochemical firms such as LG Chem, Lotte Chemical, and SK Global Chemical held a meeting in September 2015, in order to discuss issues like capacity adjustment, they no longer did it out of concern that it might be construed as an act of collusion by the Fair Trade Commission. At the time of the meeting, the company officials talked about issues such as volume purchase of naphtha and sharing of wharf and storage facilities to save cost. The focus of the first-stage talks between the companies and the ministry was on consolidating firms producing purified terephthalic acid (PTA), which include Hanwha General Chemical and Samnam Petrochemical.
MRC

MOSCOW (MRC) -- On a year-on-year basis, sales revenue was up 25 per cent and production was higher by 24 per cent at Indorama Ventures Public Company Limited (IVL), said Fibre2fashion.

Core EBITDA for the company grew by 60 per cent to THB 7,681 million (USD221.74 million). The superior performance is a reflection of the strategic fit of IVL’s acquisitions of selected portfolios.

One of the world’s leading petrochemicals producers, IVL’s first quarter performance benefitted from expanded margins from successful integration of the High Value-Added (HVA) categories of polymers, fibres and packaging, and other assets acquired in 2016, and the added benefit of normalised production from its EOEG facility in the US.

In the 12 months ending March 31, 2017, IVL’s existing businesses, excluding the acquisitions made in 2016, delivered improved results as well from better capacity utilisation and operational excellence projects to reduce cost. The company reported volume growth in all geographic areas. Overall operating rate remained at 86 per cent over the previous 12 months in Q1 2017, which enabled margin expansion and better asset utilisation.

Core EBITDA in last 12 months was THB 30 billion, up 37 per cent year-on-year and ROCE improved to 12 per cent, reflecting the company’s prudent approach towards growth and capital allocation.

“We had a strong start to 2017 with Q1 performing very well on all of its key performance indicators. Through a unique integrated business model and growth in our HVA portfolio, we continue to outperform and deliver industry-leading performance despite continuing industry over-capacity. Our robust earnings and significant EBITDA growth in the quarter and last 12 months is a reflection of the successful deployment of our focused strategies of earning diversification, growth in key geographies and value-enhancing integration,” commented Aloke Lohia, Group CEO of IVL.

Over the past 5 years or so, IVL has invested substantially in creating a diversified earnings stream via its HVA portfolio. Diversification into HVA, which now accounts for 50 per cent of overall core EBITDA, has enabled the company to deliver robust earnings on a sustained basis.

Over the next two years, IVL is committed to investing around $1.2 billion on identified growth and maintenance-related projects. Additionally, and during the same period, the company believes that there will be financial headroom for further investments based on its projections of internal cash accruals and prudent borrowing capacity.

“We look forward to another year of disciplined growth. PTA expansion in Rotterdam in mid-2017 and startup of US gas cracker by end 2017 would not only provide strategic integration but are expected to further improve the quality and sustainable growth of earnings of IVL,” Lohia added. (RKS)

MRC

MOSCOW (MRC) – Honeywell UOP announced that it has signed an agreement with the Jordan Petroleum Refinery Company (JPRC) to facilitate a USD1.6 B expansion of its refinery in Zarqa, Jordan, said Hydrocarbonprocessing.

This expansion will increase the capacity of the facility to 120,000 bpd and will allow JPRC to upgrade the quality of its product to meet Euro V emissions specifications.

"The expansion of the Zarqa refinery is a very important project because, in addition to improving the quality of products, it will grow its capacity to 120,000 barrels per day," said JPRC CEO Abdul Karim Alaween. "It will help us meet the rising demand for fuel, which is growing at an average of 3% every year."

As part of the project, which is the fourth such expansion of the JPRC refinery, Honeywell UOP will provide manager licensing services, technology licensing, front-end engineering design consultancy services, and basic engineering design. It also will provide catalysts and process equipment, and training and start-up services.

Technologies provided by Honeywell UOP will include crude and vacuum distillation units—designed by Houston-based Process Consulting Services, Inc.—for distilling crude oil into various fractions. Honeywell UOP also will provide Unicracking and hydrotreating units to create clean distillate, as well as CCR Platforming, Penex, MinAlk, Merox and Selectfining units for producing cleaner-burning high-octane motor fuels, and a Polybed PSA unit for purifying hydrogen.

The Jordan Petroleum Refinery Company, Ltd. (JPRC) is the sole oil refining company of Jordan, publicly traded on the Amman Stock Exchange, with headquarters in the capital of Amman, and a refinery in Zarqa, 35 km east of Amman. The company manufactures a variety of fuels and refinery derivatives, and wholly owns a subsidiary oil marketing company. Moreover, JPRC operates a lube oil blending facility, three LPG bottling stations and LPG storage facilities in Amman, Zarqa and Irbid. The company also owns and operates an oil terminal and storage facilities in the port city of Aqaba.
MRC

MOSCOW (MRC) -- Haldia Petrochemicals Ltd (HPL) has brought on-stream its HDPE/LLDPE swing plant at the petrochemical complex located in the eastern Indian state of West Bengal, as per Apic-online.

A Polymerupdate source in India informed that the plant was restarted last week following an unplanned outage. The company has encountered technical glitch at the LLDPE line of the swing plant and was shut in end-February 2017.

Located at Haldia in the eastern Indian state of west Bengal, the complex can produce 700,000 mt/year of ethylene and 350,000 mt/year of propylene and provides feedstock to a 330,000 mt/year high density PE plant, a 370,000 mt/year HDPE/linear low PE swing plant and a 350,000 mt/year polypropylene unit.

As MRC informed before, in October 2016, HPL reported a massive fire at the petrochemical complex located in the eastern Indian state of West Bengal.

Haldia Petrochemicals Ltd is a modern naphtha based petrochemical complex at Haldia, West Bengal, India. Haldia has played the role of a catalyst in emergence of more than 500 downstream processing industries in West Bengal with a capacity to process more than 3,50,000 TPA of polymers, among which are polyethylene (PE) and polypropylene (PP).
MRC

MOSCOW (MRC) – Honeywell UOP announced that Zhejiang Petrochemical Co. Ltd. will use four of its Polybed pressure swing adsorption (PSA) units to supply high-purity hydrogen for its new integrated refining and petrochemical complex in Zhoushan, Zhejiang Province, said Hydrocarbonprocessing.

The complex will use Honeywell Experion distributed control systems from Honeywell Process Solutions, and the PSA units will be controlled by Honeywell C300 controllers integrated with the Experion system.

Zhejiang Petrochemical earlier awarded petrochemical process technology licensing, engineering design and catalysts to Honeywell UOP. When completed, the new plant will be the largest crude-to-chemicals complex in China and one of the largest in the world, manufacturing petrochemicals to make plastic resins, films and fibers, as well as fuels.

"Our customers in China are selecting UOP’s PSA technology as an extremely competitive and reliable source of high purity hydrogen,” said John Gugel, vice president and general manager, Gas Processing and Hydrogen at Honeywell UOP. “This is critical because hydrogen is essential to the operation of any refinery or petrochemical plant, and the quality of that hydrogen helps determine the efficiency of the entire complex."
MRC