Covestro responds to strong customer demand for PC by increasing its capacities in Shanghai

MOSCOW (MRC) -- Shortly after doubling its polycarbonate (PC) production capacity at its Shanghai site to 400,000 tons per year, Covestro will again significantly expand its capacity to 600,000 metric tons per year, said the producer on its site.

With this step, which is achieved through debottlenecking of its production lines, the company reacts to the strong customer demand for polycarbonates in the Asia-Pacific region. The expanded capacity shall be available starting 2019.

"The expansion is essential to satisfy the growing demand", said Chief Technology Officer Dr. Klaus Schafer. "The successful completion of this project will strengthen our global production network and demonstrates our continuous commitment to the Chinese market."

Michelle Jou, Global Head of Covestro's PC segment, said, "There is a rapidly growing demand for polycarbonate resins and blends, in particular in China. Segments like electronics, healthcare and automotive are our key customer industries in that region. Further expanding our capacity for this high-tech plastic enables us to even better react to the changing needs of our customers and to guarantee sustainable supply."

Especially lightweight, highly transparent, break-proof and easy to shape, polycarbonate is used in many areas of modern life - from electronic and IT appliances to automotive parts to medical devices and LED lighting. With the capacity expansion of the largest polycarbonate production site in the world, Covestro strengthens its global number one position in polycarbonate resins and intends to supply the volumes it needs to continuously outgrow industry. "We have grown our capacity share continuously in recent years and are committed to continue this path. This investment is one of the steps we do to secure the necessary supply", adds Michelle Jou.

As MRC informed previously, in July 2016, Covestro moved forward with a repurposing of its production operations in Brunsbuttel, Germany. The Board of Management then officially approved an expansion of production capacity for the foam component MDI (feedstock for polyurethane) at the site. An existing, idled plant for the precursor TDI will be converted for production of MDI. The plans call for roughly doubling production capacity at the site to a total of approximately 400,000 metric tpa of MDI. Commissioning of the new plant complex is scheduled for late 2018. Preliminary plans call for a total investment volume (in euros) in the low hundreds of millions, which is already included in Covestro’s medium-term capital expenditure budget.

Covestro (formerly Bayer MaterialScience), wiith 2016 sales of EUR 11.9 billion, is an independent subgroup within Bayer. It was created as part of the restructuring of Bayer AG from the former business group Bayer Polymers, with certain of its activities being spun off to Lanxess AG. Covestro manufactures and develops materials such as coatings, adhesives and sealants, polycarbonates (CDs, DVDs), polyurethanes (automotive seating, insulation for refrigerating appliances) etc.

Elliott Group to supply 22 compression trains for Hengli petchem complex

MOSCOW (MRC) — Elliott Group announced today that it has been awarded a contract to supply compression equipment for Hengli Petrochemical Refinery’s integrated refining and petrochemical complex now under construction in Dalian, China.

The new refinery, the largest such project approved to date in China, is part of the Chinese government’s 13th five-year plan of social and economic development initiatives.

The order encompasses 22 compression trains and 28 casings for 14 different services including pressure swing adsorption, continuous catalyst regeneration (CCR), naptha hydrotreating, aromatics, propane/isobutane dehydrogenation, coal to H2, and sulfuric acid alkylation. The units will be built at Elliott’s manufacturing facilities in Sodegaura, Chiba, Japan and Jeannette, Pennsylvania, USA.

"Elliott’s ability to demonstrate technical expertise across various applications, including refrigeration, was key to meeting the customer’s needs for this important project," said John Rann, Vice President of Engineered Products. “This order reinforces Elliott’s strong credentials in refining and petrochemical compression."

When it comes on line in 2019, the complex will provide high-purity paraxylene as feedstock for Hengli’s existing purified terephthalic acid (PTA) plants. In addition to paraxylene, the new complex will also produce gasoline and diesel fuels that meet China 5 clean fuel specifications, as well as jet fuel, base lubrication oils, aromatics, and liquefied petroleum gas (LPG).

Black Sea diesel plant upgrade delayed by a year to 2019

MOSCOW (MRC) — Russia's Rosneft has postponed plans to upgrade a plant on the Black Sea by around a year, delaying the supply of an additional 5.5 MMt of Russian diesel per year, industry sources told Reuters.

Rosneft is building a new hydro-cracking unit at its refinery at the Black Sea port of Tuapse, to produce Euro 5 diesel fuel intended for export, primarily to the Mediterranean.

The new plant, together with other upgrades underway at the refinery, will allow it to produce up to 5.5 MMt of Euro 5 fuel per year. At the moment, the Tuapse refinery does not produce any diesel of that grade.

The latest plan envisaged that the unit would start up in the first quarter of 2018, but that timetable has slipped, four industry sources said, because of construction delays.

Three of the sources, who all spoke to Reuters on condition of anonymity, said the unit will now only start operating in mid-2019. A fourth industry source said that in the best case scenario, start up could be at the end of 2018.

Rosneft declined to comment. Euro 5 is a grade of diesel with a low sulphur content and is widely used in diesel vehicles in Europe.

The influx of Euro 5 diesel from the Tuapse plant onto the Mediterranean market would create additional competition for other refiners supplying the market. These include European refiners, and Saudi Arabia.

Annual demand for Euro 5 diesel in southern Europe is around 80 MMt, according to traders' estimates, so the Tuapse plant, once running at full capacity, would account for just under 7% of that demand.

The launch of the Tuapse unit would also make it harder for Mediterranean refiners to obtain feedstock. At the moment, many of them buy in fuel oil and vacuum gas oil—the raw material for producing diesel—from Rosneft.

Once the Rosneft hydro-cracker is up and running, at least some of those volumes are likely to be diverted to Tuapse instead.

Arkema inaugurated new specialty molecular sieve production capacities at Honfleur

MOSCOW (MRC) -- Arkema's new specialty molecular sieve capacity has been unveiled at the Honfleur plantю This new plant will enable the Group to support its customers’ growth in the refining and petrochemicals markets, in particular in Asia and the Middle East, as per the Plastemart.

This investment of some EUR60 million supports the development of the High Performance Materials segment, represents one of the Group’s growth drivers, and consolidates its No. 2 world ranking in molecular sieves.

Arkema is the world’s second largest producer of molecular sieves. These products are used for their adsorption and dehydration properties, primarily in industrial gases and in some petrochemical plants, as well as in health (medical oxygen), construction, and pharmaceutical packaging applications.

The inauguration on the Honfleur site marks the official launch of the doubling of capacity for Arkema’s specialty molecular sieves dedicated to aromatics separation in petrochemicals, in particular xylene separation. The new facility will enable Arkema to support its customers’ growth in the refining and petrochemicals markets, in particular in Asia and the Middle East, supplying the synthetic textile and PET bottle end-markets. This new unit demonstrates Arkema’s expertise in specialty molecular sieves, while consolidating the IFPEN (IFP Energies nouvelles)/Axens/ Arkema cluster of excellence in France for the supply of innovative technologies and solutions.

Representing an investment of some EUR60 million, this capacity extension concerns two ultra high performance molecular sieve plants producing in particular the latest generation Siliporite SPX 5003. The plants came on stream in line with the planned timetable.

In line with the Group’s progress drive, the best available techniques chosen for these new facilities enabled to develop a new technology to optimize the recycling of the plant’s effluents. Furthermore, by using digital technologies, ergonomics and working conditions matters could be addressed from the project’s design phase.

As MRC wrote previously, in 2016, Bostik, the specialty adhesives business line of Arkema, expanded its cementitious products manufacturing capacities, based on its world-class Polymer Modified Binder (PMB) technology, at its Seremban plant in Malaysia. As a leading global adhesive specialist for construction, consumer and industrial markets, Bostik will be able to serve growing construction market demand in Central Malaysia, North Malaysia and Sabah regions.

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

PE imports to Russia grew by 3% in the first four months of 2017

MOSCOW (MRC) -- Overall imports of polyethylene (PE) into the Russian market increased in the first four months of 2017 by 3% year on year to 160,000 tonnes. Shipments of high density polyethylene (HDPE) and ethylene-vinyl-acetate (EVA) grew significantly, according to MRC's DataScope Report.

Last month's PE imports to the Russian market virtually remained at the March, totalling 45,200 tonnes. Overall PE imports reached 160,000 tonnes in January-April 2017, compared to 155,400 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 rose to 18,400 tonnes from 17,900 tons in March, local companies continued to gradually increase their HDPE purchasing in Uzbekistan. Overall HDPE imports reached 61,000 tonnes in the first four months of 2017 versus 40,000 tonnes a year earlier.

April imports of linear low density polyethylene (LLDPE) were 12,200 tonnes, compared to 12,500 tonnes a month earlier, shipments of film grade PE decreased, whereas demand for rotational moulding PE increased significantly. LLDPE imports totalled 45,600 tonnes in the first four months of the year, compared to 62,500 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) fell to 6,900 tonnes from 9,300 tonnes in March, shipments of PE for lamination from Europe were reduced. Overall LDPE imports decreased to 29,400 tonnes in January-April 2017 from 34,900 tonnes a year earlier.

April EVA imports rose to 3,500 tonnes from 3,000 tonnes a month earlier because of the improved supply from Russian producers of injection moulding products. Imports of this ethylene copolymer grade grew by 55% over the stated period to 12,000 tonnes.

Imports of other ethylene polymers totalled 12,100 tonnes in the first four months of the year.