Borealis obtains strong investment grade rating

MOSCOW (MRC) -- Borealis, a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers, announces that it was issued a BBB+ rating with stable outlook by S&P Global Ratings on 9 November 2018, said the company.

It is the first public rating for the company, which has been successfully active in various financing markets over the last ten years and has built up a robust and diversified funding portfolio.

"We consider the assigned strong investment grade rating as a recognition for the excellent work done over the last years to make Borealis one of the strongest players in our industry," says Borealis Chief Executive Alfred Stern.

"With the rating, Borealis will further expand its financing strategy and give our bank partners and investors further comfort in the excellent credit metrics of the company. Now is the right time to take this important step," concludes Borealis CFO Mark Tonkens.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. With its head office in Vienna, Austria, the company currently has around 6,600 employees and operates in over 120 countries. Borealis generated EUR 7.5 billion in sales revenue and a net profit of EUR 1,095 million in 2017. Mubadala, through its holding company, owns 64% of the company, with the remaining 36% belonging to Austria-based OMV, an integrated, international oil and gas company. Borealis provides services and products to customers around the world in collaboration with Borouge, a joint venture with the Abu Dhabi National Oil Company (ADNOC).
MRC

Prices of European PE fell for CIS markets

MOSCOW (MRC) -- The November contract price of ethylene in Europe was agreed down by EUR10/tonne from October. And, as a result, European producers proportionally reduced their polyethylene (PE) prices for this month's shipments to the CIS markets, according to ICIS-MRC Price report.

Negotiations over November PE shipments from Europe to the CIS countries began last Monday. Following the increase of EUR10/tonne in ethylene prices, most European producers announced a similar cut in this month's export PE prices. At the same time, in some cases, producers still maintained October prices.

Thus, negotiations over November high density polyethylene (HDPE) shipments were held in the range of EUR1,080-1,155/tonne FCA, down by EUR10/tonne from October. The Czech producer still had restrictions on exports.

Deals for November shipments of European low density polyethylene (LDPE) were negotiated in the range of EUR1,020-1,080/tonne FCA. In rare cases, deals were reported to have been done at EUR980/tonne FCA.
MRC

HDPE production in Russia up by 4.6% in Jan-Oct 2018

MOSCOW (MRC) -- Russia's production of high density polyethylene (HDPE) totalled 795,900 tonnes in January-October 2018, up by 4.6% year on year. At the same time, only two out of four Russian producers increased their output, according to MRC's ScanPlast report.


October HDPE production in Russia decreased to 64,200 tonnes, whereas this figure was 79,200 tonnes a month earlier. Shutdown for a scheduled maintenance at Russia's two largest producers - Kazanorgsintez and Stavrolen - was the main reason. Overall HDPE production reached 795,900 tonnes in the first ten months of 2018, compared to 760,600 tonnes a year earlier. Gazprom neftekhim Salavat and Stavrolen increased their output, whereas Nizhnekamskneftekhim reduced its production by more than a third in favour of linear low density polyethylene (LLDPE).

The structure of polyethylene (PE) production by plants looked the following way over the stated period.


Kazanorgsintez's total HDPE output fell to 16,800 tonnes in October from 38,200 tonnes a month earlier, the Kazan producer shut down its production capacities for almost a one-month scheduled turnaround on 25 September. The Kazan plant's overall HDPE output totalled 412,400 tonnes in January-October 2018, down by 0.3% year on year.

Stavrolen produced 18,600 tonnes last month versus 25,000 tonnes in September, the Budenovsk producer took off-stream its production capacities for maintenance in the first decade of October. The plant's overall HDPE output reached 241,100 tonnes in the first ten months of 2018, up by 17% year on year. Such a high amount of the increase in the output was caused by the absence of a long scheduled maintenance this year.

Gazprom neftekhim Salavat raised its capacity utilisation in October, the plant produced 11,500 tonnes last month, compared to 9,500 tonnes a month earlier. The Bashkir plant's total HDPE output reached 100,900 tonnes in the first ten month of 2018, up by 33% year on year. Such a high amount of the increase in the output was caused by the absence of a long scheduled turnaround this year, as it was the case with Stavrolen.

Nizhnekamskneftekhim produced HDPE only in April-May and in late September-October during the stated period. Thus, the Nizhnekamsk producer manufactured only 41,600 tonnes of HDPE over the incomplete four months of operations versus 64,700 tonnes a year earlier.

MRC

Ethylene furnaces delivered for Zhejiang Petrochemical complex

MOSCOW (MRC) -- Wison Engineering Services Co. Ltd. has completed delivery of all nine ethylene-cracking furnaces to be installed as part of the naphtha cracking unit at the first phase of Zhejiang Petrochemical Co. Ltd.’s (ZPC) 800,000-b/d integrated refining and petrochemical complex currently under construction in Zhoushan, Zhejiang Province, China, as per OGJ.

Wison Engineering - which was responsible for modularized design, construction, and installation of the project - along with affiliate Wison Offshore & Marine delivered the ninth modular ethylene-cracking furnace to the site at the end of October following delivery of the other eight similar furnace modules earlier in the year, the service provider said.

The core equipment of the naphtha cracking unit - which is composed of nine ethylene-cracking furnaces with an output of 200,000 tonnes/year each and will have the largest single-chain ethylene production capacity in China upon startup - is now fully in place, Wison Engineering said.

With a total weight of about 33,000 tonnes, the nine ethylene-cracking furnace modules for Phase 1 of the complex will be able to produce 1.4 million tpy of ethylene.

The first 400,000-b/d phase of ZPC’s complex is due for startup by December, while Phase 2 - which will nearly double processing and production capabilities at the site - is scheduled for commissioning during first-quarter 2021.

As MRC reported earlier, Saudi Aramco also recently signed a memorandum of understanding with ZPC to acquire ownership interest in the complex.

ZPC - a joint venture of China-based Rongsheng Holding Group Co. Ltd., Juhua Group Corp., Tongkun Group Co. Ltd., and Zhoushan Marine Comprehensive Development Investment Co. Ltd. - previously said it would invest about 160 billion yuan to complete both phases of the project.
MRC

Production problems push PP prices up in Russia

MOSCOW (Market Report) - Prices of polypropylene (PP) continued to rise in November in the Russian market, in particular, homopolymer PP. PP problems at two production sites significantly limited supply in the market, and, as a result, led to further price rise, according to the ICIS-MRC Price Report.

Restrictions on homopolymer PP supply to the domestic market from some producers began in August, and were due to a series of scheduled maintenances at several producers at once in September-October. Many consumers expected that with the end of production repairs, PP supply will increase in the market, and as a result, amid falling demand, will lead to price cuts. But the shutdowns dragged on, and the lack of supply only increased.

SIBUR Tobolsk and Ufaorgsintez, due to certain reasons, were rather difficult and late to come out from preventive repairs. And even after the start-up, these plants had to work with a limited load due to raw materials problems. It is highly probable that the restrictions will continue until the end of November.

Russian producers reduced exports almost two times in September-October on order to balance the domestic market.
Exports are expected to decrease further in November due to the deteriorating market situation. Partly the shortage of Russian homopolymer PP were compensated by imports from Central Asian countries, but these producers also had planned and unplanned production shutdowns in October-November.

The most critical at the current moment is the situation in the segment of injection moulding homopolymer PP. Many companies reported a more serious shortage of supply than in homopolymer PP segment. Prices fro raffia last week grew to Rb105,000-107,000/tonne FCA, including VAT. The low end for injection moulding homopolymer PP was at Rb107,000/tonne FCA, including VAT.
MRC