Essar Oil UK to spend USD250 MM upgrading Stanlow refinery

MOSCOW (MRC) — Essar Oil UK expects a USD250-MM upgrade of its Stanlow refinery in northwest England to improve its basic profit margin by USD1/bbl as it will be able to process a greater variety of cheaper crude oils and raise output, its chief executive said on Wednesday, said Reuters.

The company, owned by the Indian billionaire Ruia brothers' Essar Group, plans to raise the annual processing capacity of Stanlow by about 10% to 75 MMbbl. The company's gross refining margin, the profit from processing a barrel of crude, stood at USD9.20/bbl in the March quarter, up from USD6.80 a year ago.

The Ruias, who last month completed the sale of their Indian refining business Essar Oil to a consortium led by Russia's Rosneft for USD12.9 B, have so far invested USD800 MM in Stanlow since acquiring it from Royal Dutch Shell in 2011.

Essar plans to complete the expansion of the crude unit and revamp its catalytic cracker by July, S. Thangapandian told Reuters, adding that the refinery would be shut for at least a month to undertake the upgrade.

"The final schedule for the shutdown will be drawn up in two to three months' time," he said, adding that following the expansion the company's petrochemical production would also rise by about 10%.

Essar mostly processes light oils because of stringent emission standards in the UK. But Stanlow's use of North Sea crudes has been cut to about 50%–70% from about 85% with an increase in purchases of oil from north and west Africa.

The refiner earlier this year also took in for the first time a consignment of Eagle Ford shale oil from the United States and has booked two more cargoes, for delivery in October and November, to take advantage of price differentials.

While the supply glut has weighed on Brent and West Texas Intermediate prices, the spread between the two grades holds at about USD4.50/bbl.

"There is scope to buy more cargoes from the US if the differential between Brent-WTI stays above USD3/bbl," Thangapandian said. In the last year Stanlow has processed 37 more grades of crude and the expansion is geared towards further diversifying supplies to process cheaper grades while improving middle distillate yields.

Essar UK supplies 16% of the UK's demand for road transport fuels and operates 36 retail fuel stations but Thangapandian said the company aims to expand this number to some 400 in the next five years.

As MRC informed earlier, India's Essar Group will payUSD1.18 apiece to the minority shareholders who tendered Essar Oil shares under a delisting offer ahead of the company's sale to a consortium led by Russian oil major Rosneft. India's Essar Group in August closed the USD12.9 B deal to sell 98.26% stake in Essar Oil to a consortium of Rosneft, trader Trafigura and Russian fund UCP. The group will pay an additional 8.80 B rupees to minority shareholders, as under the deal shares are valued at 338.28 rupees apiece, it said in a statement.
MRC

Evonik again included in the Dow Jones Sustainability Indices Europe and World

MOSCOW (MRC) -- Evonik has again been included in the prestigious Dow Jones Sustainability Indices (DJSI) Europe and DJSI World, achieving maximum results in the criteria innovation management, climate strategy and customer relationship management, as per the company's press release.

Alongside financial criteria, investors increasingly include ecological and social factors in their investment decisions.
They are guided by leading sustainability indices such as the DJSI.

Every year around 2,500 companies worldwide are invited to participate. In each sector the best of the participating companies are included in the DJSI.

The assessment is performed by the Swiss rating agency RobecoSAM.

As MRC reported earlier, Evonik is expanding its production facilities in Birmingham (Alabama, USA) and Darmstadt (Germany). This will create additional capacity for the production of biodegradable polymers marketed globally under the brand names RESOMER and RESOMER SELECT. These poly-lactic-glycolic-acid (PLGA) copolymers are primarily used to manufacture bioresorbable medical devices and controlled-release formulations for parenteral drug delivery.

Besides, in November 2016, Evonik Resource Efficiency announced that the company would invest in a capacity expansion of its performance foams business at its production site in Darmstadt, Germany. The investment will increase the output of the facility by about 20% as a first step. The Group will be adding production equipment to its operations complex that manufactures products marketed under the Rohacell brand. The expanded production capacity was expected to be operational by the second half of 2017. Evonik’s Darmstadt plant is producing foam products that are used as a core material in the construction of sandwich composites. The global market has shown steady annual growth in the use of composites.

Evonik, the creative industrial group from Germany, is one of the world leaders in specialty chemicals. Its activities focus on the key megatrends health, nutrition, resource efficiency and globalization. Evonik benefits specifically from its innovative prowess and integrated technology platforms. Evonik is active in over 100 countries around the world.
MRC

Texas edges closer to recovery after Harvey as key pipeline restarts

MOSCOW (MRC) — The US Gulf Coast moves closer to recovery from Hurricane Harvey on Monday when the biggest American fuel system restarts a key segment shut down by devastating rains and officials weigh how to pay for billions of dollars in damage, said Reuters.

The move by Colonial Pipeline to resume transporting distillates such as diesel fuel comes as the Gulf region's energy industry starts to come back online. Flooding from Harvey drove up fuel prices by shutting down almost a quarter of US refining capacity.

The storm came ashore on Aug. 25 as the most powerful hurricane to hit Texas in more than 50 yr. It killed an estimated 50 people, displaced more than 1 MM and damaged some 200,000 homes in a path of destruction stretching for more than 300 mi.

Colonial said it expected to reopen a Texas section of its network from Houston to Hebert, Texas, on Monday, which is the Labor Day holiday. The line would be ready to start moving gasoline on Tuesday, it said. The pipelines' reopening will restore links between refineries along the Gulf Coast, the US petrochemical hub, to markets in the Northeast.

Another fuel system, Explorer Pipeline, said a link running from Texas to Oklahoma restarted on Sunday, with a second pipeline from Oklahoma into the Midwest expected to resume on Monday. Retail fuel costs surged through the weekend amid fears of shortages, despite the restart of several key Gulf refineries that had been crippled by Harvey.

Treasury Secretary Steven Mnuchin challenged Congress on Sunday to raise the government's debt limit in order to free up relief spending. Texas Governor Greg Abbott said the storm had caused up to USD180 B in damage.

President Donald Trump's administration has asked Congress for an initial USD7.85 billion for recovery efforts, a small fraction of what will eventually be needed. Even that amount could be delayed unless Congress quickly increases the government's debt ceiling, Mnuchin said. The United States is on track to hit its mandated borrowing limit by the end of the month unless Congress increases it.

Houston Mayor Sylvester Turner said the city expected most public services and businesses to be restored by Tuesday, the first day after the Labor Day holiday. About 37,000 families were staying in 270 shelters in Texas, the highest number reported by the American Red Cross.

The city mandated the evacuation of thousands of people on the western side of Houston on Sunday to accommodate the release of water from reservoirs that otherwise might sustain damage. The storm stalled over Houston, the fourth-largest US city, dumping more than 50 in. on the region.
MRC

Daqing Petrochemical took off-stream HDPE/LLDPE plant in China

MOSCOW (MRC) -- Daqing Petrochemical has shut a high density polyethylene/linear low density polyethylene (HDPE/LLDPE) swing plant for a maintenance turnaround, as per Apic-online.

A Polymerupdate source in China informed that the plant was taken off-line for maintenance on September 6, 2017. It is likely to remain under turnaround for about one week.

Located in Daqing city, China, the plant has a production capacity of 250,000 mt/year.

As MRC informed before, in 2012, Daqing Petrochemical successfully commenced production at the newly built 600,000 tpa ethylene unit, which broght the company's annual ethylene production to 1,2 mln tonnes.

Daqing Petrochemical Company is a regional branch company of Petro-China Company Limited. It is a giant-scale petrochemical complex producing oil products, chemicals, fertilizers and chemical fiber with the major raw materials of crude oil, light hydrocarbon and natural gas from Daqing oilfield.
MRC

European PVC prices was rolled over for CIS countries in September

MOSCOW (MRC) - Negotiations on the prices of European polyvinyl chloride (PVC) for September supplies to the markets of the CIS countries had started last week. Despite the rise in ethylene prices in the region, European producers mostly kept the August level of PVC export prices for shipments in September, according to the ICIS-MRC Price Report.

September contract price of ethylene was agreed up EUR30/tonne from the level of August, which makes it possible to talk about reducing the cost of polyvinyl chloride by EUR15/tonne at least.

Some European producers have increased export prices by EUR10/tonne, but in most cases August prices were rolled over.

In general, negotiations on September shipments of suspension polyvinyl chloride (SPVC) to the CIS markets were held in the range of EUR790-850/tonne FCA, which practically corresponds to the August level.

The supply of polyvinyl chloride was sufficient at most producers, although some buyers reported a limited supply of resin with K70 at some producers.
MRC