Saudi Aramco, ADNOC India refinery project costs escalate to USD70 Billion

MOSCOW (MRC) -- The cost of oil and petrochemicals refinery project to be built jointly by Saudi Aramco and Abu Dhabi National Oil Co. (ADNOC) in India is expected to reach USD70 billion, reported Kemicalinfo with reference to WAM news agency.

A joint economic council between the United Arab Emirates and Saudi Arabia reviewed the planned plant on Wednesday at a meeting on the sidelines of Saudi Crown Prince’s visit to his Gulf ally.

"The initial cost is estimated at USD70 billion, a 36 percent escalation in the project cost of the refinery project due to shifting of the project to Roha in the Raigad district, about 100 km south of Mumbai, from the originally proposed site at Ratnagiri, about 400 km south of Mumbai."

In September, India’s oil minister said the refinery would cost more than the originally planned USD45 billion.

The proposed 1.2 million barrel per day project, to be jointly developed by the Aramco-Adnoc combine and the Indian refiners Indian Oil Corporation, Bharat Petroleum and Hindustan Petroleum on a 50:50 partnership basis, is also expected to have a chemicals capacity of 18 million tonnes annually.

As MRC wrote previously, in November 2018, Saudi Aramco and ADNOC signed a framework agreement to explore opportunities for collaboration in the Natural Gas and Liquefied Natural Gas (LNG) sector. The cooperation brings together two of the world’s leading energy producers from the Arabian Gulf to jointly work together in an area of strategic importance for both companies as they seek to boost revenues from the natural gas and LNG business segments. Saudi Aramco and ADNOC will jointly assess investment opportunities across the natural gas and LNG value chain, exchange technical knowledge and expertise in natural gas and LNG growth markets.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,724,670 tonnes in the first ten months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market in January-October 2019 totalled 1,066,520 tonnes, up by 7% year on year. Supply of block copolymers of propylene (PP block copolymer) and homopolymer of propylene (homopolymer PP) increased, demand for statistical copolymers (PP random copolymer) decreased.

Saudi Aramco is an integrated oil and chemicals company, a global leader in hydrocarbon production, refining processes and distribution, as well as one of the largest global oil exporters. It manages proven reserves of crude oil and condensate estimated at 261.1bn barrels, and produces 9.54 million bbl daily. Headquartered in Dhahran, Saudi Arabia, the company employs over 61,000 staff in 77 countries.

Huntsman to recycle PET scrap into polyester polyols at its Taiwan facility in 2020

MOSCOW (MRC) -- Huntsman has announced that in 2020, its polyols production facility in Kuan Yin, Taiwan, will begin to utilise the company's well-proven Terol polyols technology to recycle distressed PET streams to satisfy the growing demand from the regional PIR foam insulation market, according to GV.

According to the company, its proprietary trans-esterification process enables the use of severely distressed PET scrap that otherwise would have been destined for landfills or found its way into the oceans. This way the company not only recycles low-quality PET scrap, but then transforms it into energy-saving polyurethane insulation - the most effective insulants available in the market, as measured by R-value, said Huntsman.

While any form of PET will suffice, since 2014 the company has used the equivalent of 5 billion 500 ml PET bottles to manufacture approximately 290 million lbs of Terol polyester polyols in Houston, TX, USA. These polyols are a raw material in the production of MDI-based polyurethane insulation products, which provide energy savings in residential, commercial and industrial buildings. They are a key building block for polyisocyanurate (PIR) boardstock systems and spray polyurethane foam (SPF), as well as pour-in-place applications, such as picnic coolers, entry doors, garage doors, refrigerators and freezers. These energy-saving polyurethane insulations benefit society by reducing the costs of heating and cooling homes and commercial buildings and prolonging the shelf life of perishable foods, said Huntsman.

Terol polyols are said to contain up to 60 % recycled waste. While all these polyols contain recycled content, six Terol polyols have been certified by Underwriters Laboratories (UL) Environment. In 2014, the company became the first US polyester polyol manufacturer to receive the designation. UL verified Huntsman’s pre-consumer recycled, post-consumer recycled and renewable resource content claims by reviewing the company's manufacturing practices and raw materials sources.

In 2018, Huntsman acquired Demilec, a leading North American SPF insulation manufacturer and distributor for residential and commercial applications. A consumer of Terol polyester polyols, Demilec produces a full suite of closed- and open-cell MDI-based SPF formulations, and focuses on bio-preferred, renewable and recyclable products that reduce energy consumption through highly efficient insulation properties.

As MRC informed earlier, in August 2019, Huntsman Corp, the US chemicals group, sold two of its businesses to Thailand-based petrochemicals company Indorama Ventures for more than USD2bn.

According to MRC's ScanPlast report, Russia's estimated PET consumption dropped in September 2019 by 10% year on year, totalling 58,210 tonnes. Overall, 551,320 tonnes of PET was processed in Russia in the first nine months of 2019, up 9% year on year.

Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated and specialty chemicals with 2017 revenues of more than USD8 billion. Its chemical products number in the thousands and are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets. The company operate more than 75 manufacturing, R&D and operations facilities in approximately 30 countries and employ approximately 10,000 associates within its four distinct business divisions.

Qatar Petroleum announces 5-year naphtha sale agreement with Shell

MOSCOW (MRC) -- Qatar Petroleum, for and on behalf of Qatar Petroleum for the Sale of Petroleum Products Company (QPSPP), has concluded a five-year sale agreement with Shell International Eastern Trading Company (SIETCO), a registered business of Shell Eastern Trading (Pte) Ltd., which is based in Singapore, reported The Peninsular.

Under the agreement, QPSPP will supply SIETCO with a total of 900,000 metric tons of full-range naphtha and plant condensate per year, starting in April 2020.

H E Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs and the President and CEO of Qatar Petroleum, said, "We are pleased to achieve this milestone agreement in our effort to directly sell to users of our products. It is also our pleasure to expand our global relationship with SIETCO, which delivers to customers in key markets in Asia such as China and to Shell’s ethylene cracker in Singapore."

Qatar Petroleum and Shell have a long-standing strategic partnership through several shared investments in Qatar’s energy industry. This includes Qatar Liquefied Gas Company Limited (Qatargas 4), which produces and exports about 7.8 million tons of LNG per annum, and Pearl GTL, the world’s largest gas-to-liquids plant.

The relationship with Shell also includes strategic global partnerships, which include a petrochemical joint venture in Singapore, a joint venture to develop LNG marine fueling (bunkering) infrastructure at strategic shipping locations across the globe, as well as exploration operations in Brazil, Mexico and Argentina.

As MRC wrote previously, in November 2019, Qatar Petroleum signed a 10-year Liquefied Petroleum Gas (LPG) supply agreement with China’s Wanhua Chemicals. The agreement is for the sale of approximately 800,000 metric tons per year of LPG over a period of 10 years.

We remind that China’s top petrochemical maker Wanhua Chemical Group aims to increase LPG imports to about 5.5 million mt in 2020 from 4 million mt this year as it procures feedstock from diversified sources ahead of new projects in Yantai and widens trading activities in Asia.

A 1 million mt/year ethylene integration project - phase two of its petrochemical project in northeast Shandong province - will be the first ethylene cracker to use LPG as feedstock globally and is set for commercial production in the second half of 2020. Together with associated downstream units and a nearby feedstock storage rock cavern with a capacity of 1.2 million cubic meters, the project is costing around Yuan 20 billion.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,724,670 tonnes in the first ten months of 2019, up by 7% year on year. Shipments of all PE grades increased. The estimated PP consumption in the Russian market in January-October 2019 totalled 1,066,520 tonnes, up by 7% year on year. Supply of block copolymers of propylene (PP block copolymer) and homopolymer of propylene (homopolymer PP) increased, demand for statistical copolymers (PP random copolymer) decreased.

Penoplex reduces December PS prices for Russian market

MOSCOW (Market Report) -- Penoplex, Russia's largest producer of foaming polystyrene (PS), has reduced its December selling prices of general purpose polystyrene (GPPS) Stairovit by Rb1,500/tonne for the Russian market, according to ICIS-MRC Price report.

Thus, the company's prices for December shipments will be in the range of Rb94,500-96,500/tonne, CPT Moscow, including VAT, this month.

Demand for December quantities was very strong in the market.

As reported earlier, Penoplex did not lower its November selling prices for Russian buyers, maintaining them at the level of October - R96,000-98,000/tonne CPT Moscow, including VAT.

Penoplex is a large Russian producer of polymer-based building and decorative materials. The company began its activity in 1998 with the launch of Russia's first line for the production of heat-insulating materials from extruded polystyrene foam under the PENOPLEX trademark. The company has eight production sites, seven of which are located in Russia and one - in the Republic of Kazakhstan (Almaty region), with a total production capacity of 4 million cubic metres.

Nizhnekamskneftkehim reduces December PS prices for Russian market

MOSCOW (MRC) -- Nizhnekamskneftekhim (part of the TAIF group) has reduced its December selling prices of high impact polystyrene (HIPS) and general purpose polystyrene (GPPS) by Rb2,000/tonne for Russian buyers, according to ICIS-MRC Price report.

At the same time, Nizhnekamskneftekhim adopted an unconventional approach to pricing on the back of lower prices of material in foreign markets. Thus, December polystyrene (PS) prices decreased by Rb3,000/tonne and they will roll over for January for those buyers that will contract PS quantities for two months in advance. For those buyers that will contract only December quantities, this month's prices will be reduced by only Rb1,000/tonne.

Almost all the interviewed market participants said that under such conditions, buyers' choice was obvious and most of them would choose an option with the reduction of HIPS and GPPS prices by Rb3,000/tonne in December and their roll-over for January 2020.

Supply of PS from Nizhnekamskneftekhim will increase this month, several buyers for whom quantities were limited last month said the producer had fully met their orders for December-January. On the back of this, the Russian PS market is expected to become balanced and the upper range of Nizhnekamskneftekhim's material is expected to decrease by about Rb5,000/tonne and to come closer to the lower one.

As reported earlier, Nizhnekamskneftekhim reduced its PS prices for the Russian market by Rb2,000/tonne in November, despite a shortage of PS in the Russian market.

PJSC "Nizhnekamskneftekhim" (NKNK) - one of the largest Russian manufacturers of petrochemical products. The industrial complex of the company includes ten major production plants and ten departments (Railway Transport, Ethylene trunk, etc..). NKNKh produces more than 120 types of chemical products, including synthetic rubber, polyethylene, polypropylene, polystyrene, surfactants. Nizhnekamskneftekhim is a member of TAIF Group of Companies.