OMV and ADNOC to cooperate on petrochemical projects

MOSCOW (MRC) -- Energy group OMV and Abu Dhabi National Oil Company (ADNOC) have agreed to cooperate in the petrochemical sector and to explore opportunities to make use of OMV’s recycling expertise, the Austrian company said.

OMV is shifting the focus of its refinery division to aviation fuel and petrochemicals, banking on an ever-increasing appetite for air travel and plastic products.

It agreed to pay USD2.5 billion for a 15 percent stake in ADNOC’s refining business and a new trading joint venture with ADNOC and Italy’s Eni in January.

OMV and ADNOC signed two memorandums of understanding to evaluate future projects and set up a joint working group, it said.

"The agreement underscores our commitment to the strategic partnership with ADNOC and our willingness to bring value-enhancing expertise to this cooperation," said Chief Executive Rainer Seele in a statement.

OMV produces and markets oil and gas, innovative energy and high-end petrochemical solutions – in a responsible way. With Group sales of EUR 23 bn and a workforce of more than 20,000 employees in 2018, OMV Aktiengesellschaft is one of Austria’s largest listed industrial companies. In Upstream, OMV has a strong base in Romania and Austria as part of the Central and Eastern Europe core region as well as a balanced international portfolio, with Russia, North Sea, Middle East and Africa as well as Asia-Pacific as further core regions.

Hengli Petchem says smooth running of new Dalian oil refinery

MOSCOW (MRC) -- China's Hengli Petrochemical Co Ltd says in a filing to Shanghai Stock Exchange its unit's new oil refinery in Dalian has successfully produced gasoline, diesel, aviation kerosene and PX, said Reuters.

The company says the production at the new oil refinery is stable.

Hengli Petrochemical’s unit started test-running of the Dalian refinery, which has an annual capacity of 20 million tonnes, on Dec. 15.

Jiangsu Hengli Chemical Fiber Co., Ltd., through its subsidiary, manufactures woven fabrics. The company was founded in 2002 and is based in Suzhou, China. Jiangsu Hengli Chemical Fiber Co., Ltd. operates as a subsidiary of Hengli Petrochemical Co., Ltd.

New DOTP facility at SIBUR Perm site makes first pilot shipment to customers

MOSCOW (MRC) -- The Perm facility is 100% ready for commissioning, with the first batch of dioctyl terephthalate coming off the line and shipped to customers as part of the pre-commissioning pilot, as per SIBUR's press release.

"We have successfully completed the construction, inert environment testing and support unit launch stages," said Konstantin Yugov, CEO of SIBUR-Khimprom. "Processing environment testing is currently underway as part of the pre-commissioning exercise, with the first batch of DOTP shipped to customers on 9 March."

SIBUR’s Perm-based DOTP facility will be Europe’s largest production site of its kind, setting the stage for the Company to assert its market leadership with 100 kt of DOTP manufactured annually. This eco-friendly and safe plasticiser is a key component in floor and roof coatings, wallpaper, cable compounds and other construction products designed to enhance their durability and wear and cold resistance.

SIBUR’s decision to set up DOTP production served as yet another milestone in the Russian petrochemical industry’s import substitution efforts while also contributing to the nation’s strengthened focus on exports. Today, the Russian market of common plasticisers faces a shortage of about 60 ktpa, which is covered with supplies from Europe. The Perm-based DOTP project will help substitute a major part of alternative product imports and enable plasticiser supplies to export markets, where the demand for DOTP is also rapidly growing.

As MRC informed before, Russia’s largest petrochemicals company, SIBUR, suffered an almost 8% drop in net income last year to 110.8 billion roubles (USD1.7 billion), citing currency weakness and a disposal that had boosted the previous year’s numbers. The weaker rouble, which increases debt held in other currencies, helped to lift SIBUR’s net debt to 317.6 billion roubles, up by 20 percent from 2017. SIBUR has been preparing an initial public offering (IPO) that could raise as much as USD3 billion.

Texas refinery may restart CDU next week

MOSCOW (MRC) -- Valero Energy Corp may restart the small crude distillation unit (CDU) at its 335,000 barrel-per-day (bpd) Port Arthur, Texas, refinery next week, reported Reuters with reference to sources familiar with plant operations.

The AVU 75,000 bpd 147 CDU was shut on March 12 due to a malfunction on the heat exchanger, the sources said. Repaired bundles to be reinstalled on the heat exchanger are expected to be at the refinery by early next week.

As MRC informed previously, in March 2019, Valero Logistics UK Ltd, a subsidiary of Valero Energy Corporation and SemGroup Europe Holding L.L.C., a SemGroup Corporation company, signed an agreement for the purchase of SemLogistics Milford Haven fuel storage facility on the west coast of Wales. Situated across the Haven from Valero’s refinery at Pembroke, the facility is one of the largest petroleum products storage facility in the United Kingdom (UK) with 8.5 million barrels of capacity for storing gasoline, gasoline blendstocks, naphtha, jet fuel, gas oil, diesel, and crude oil.

Planned U.S. oil storage boom faces new scrutiny after tank-farm fire

MOSCOW (MRC) -- A three-day petrochemical fire that spread a cancer-causing chemical and thick smoke over Houston suburbs has spurred calls for tougher safety regulations that could affect a nearly dozen crude-export terminals proposed for the U.S. Gulf Coast, said Hydrocarbonprocessing.

Federal, state and local officials have begun investigating whether Mitsui & Co’s Intercontinental Terminals Co (ITC) met safety and environmental regulations after the fire in Deer Park, Texas, spread quickly among rows of giant tanks that hold up to 3.3 million gallons of fuel each.

The blaze released toxic benzene which led five school systems with more than 108,000 students to shut for two days, and prompted two cities to tell residents to stay indoors.

It burned for three days and destroyed 11 tanks holding fuels used to make gasoline and plastics that sat along the nation’s busiest petrochemical port and among nine oil refineries. On Friday, a leak from a containment dike at the facility prompted new travel restrictions in the immediate vicinity of the plant.

Results from those reviews could affect proposed terminals that would add millions of barrels of oil storage capacity, to cater to a shale boom that has made the United States the world’s top oil producer with more than 12 million barrels pumped each day.

There are already some 90 million barrels of oil storage capacity in above-ground tanks near Houston, estimates data provider Genscape. Harris County, which oversees the ITC tank farm, plans to review the investigations and may propose changes to state regulations, said the county’s chief executive, Lina Hidalgo.

Environmental groups said the fire and lack of notice to residents exposed Texas’s weak oversight of energy and chemical storage sites. “I would like to think there will be a huge push and elected officials would do their due diligence,” said Elena Craft, senior director for climate and health at the Environmental Defense Fund. “We want accountability,” said Bryan Parras, a spokesman for environmental group Sierra Club.

ITC, which had 242 storage tanks holding about 13 million barrels of fuels, is not required to comply with county fire codes because it was built before the county adopted codes in late 2014, said Rachel Moreno, a spokeswoman for the county Fire Marshal.

ITC adheres to fire-prevention guidelines set by industry group the National Fire Prevention Association and the American Petroleum Institute, said ITC spokeswoman Alice Richardson. A temporary loss of water pressure on the first day of the blaze contributed to its spread.

However, critics say the NFPA guidelines set minimum standards and the use of advanced fire-protection systems could have more quickly extinguished the fire before it spread and released millions of tons of carbon monoxide, and thousands of pounds of nitrogen oxides, sulfur dioxide and other pollutants.