EPS imports to Russia drop by 7% in Jan 2020

MOSCOW (MRC) -- Overall imports of expandable polystyrene (EPS) to the Russian market decreased in January 2020 by 7% year on year to 1,400 tonnes, according to MRC's DataScope report.

This figure was at 1,500 tonnes in January 2019.

At the same time, EPS imports to the country was also at around 1,500 tonnes a month earlier.

The Finnish producer Styrochem's material accounted for the bulk of shipments - 57% of the total EPS imports. The Chinese company Loyal occupied the second position. Styrochem's imports grew over the stated period by 39% year on year: from 600 tonnes to 800 tonnes. Loyal's January shipments slumped by 70% year on year. from 2,700 tonnes to 4,100 tonnes.

Chinese imports have plummeted over the past four months. The share of deliveries from China was 21% in January 2020 versus 40% in January 2019 and 27% in December 2019.
MRC

European producers intend to roll over February export PVC prices for March for CIS markets

MOSCOW (MRC) -- Negotiations over prices of European polyvinyl chloride (PVC) for March shipments to the CIS markets began this week. Ethylene prices fell significantly in Europe this month, however, European producers intend to roll over February export PVC prices for March, according to ICIS-MRC Price report.

The March contract price of ethylene was agreed down by EUR50/tonne from the previous month, which theoretically allows to talk about a reduction of EUR25/tonne in net cost of PVC. However, the balanced domestic market and strong demand from the key export markets allowed European producers to maintain export PVC prices at a high level. The roll-over of February export PVC prices for shipments to the CIS markets in March has been discussed.

By maintaining PVC prices steady, European producers were trying to compensate for the decrease in margins in caustic soda production, which had been registered in the last few months.

Demand for PVC rose from consumers in the CIS countries in March because of seasonal factors, and it was basically reduced to the procurement of resin with K=58 and K=70. European producers had no export restrictions, with a few exceptions.

Some buyers reported the desire of some manufacturers to achieve an increase of EUR5/tonne from February in export prices of PVC with K=70, but consumers resisted any attempts to raise prices amid lower feedstock prices.

Overall, deals for March shipments of suspension PVC (SPVC) to the CIS markets were negotiated in the range of EUR725-790/tonne FCA.
MRC

Eni plans oil, gas production plateau in 2025 under energy evolution

MOSCOW (MRC) -- Italian energy group Eni expects its oil and gas production to "plateau" in just five years under a major shift to renewables energy and cleaner fuels which it hopes will slash its carbon emissions, reported S&P Global.

Under the plans, Eni said its upstream production growth will average 3.5%/year up to 2025, with subsequent "flexible decline" mainly for oil afterward. Gas production will make up about 60% of total production by 2030 and rise to 85% in 2050, Eni said.

Oil and gas production will plateau at around 2.3 million b/d of oil equivalent in 2025, Eni said, up from around 1.9 million boe/d expected in 2020.

Reporting fourth-quarter and full-year 2019 earnings Friday, Eni said its oil and gas production averaged 1.87 million boe/d last year, up 5% on the year. In the fourth quarter of 2019, oil and natural gas production averaged 1.92 million boe/d.

"The strategy we announce today represents a fundamental step for Eni," CEO Claudio Descalzi said in a statement. "The result will be a portfolio that is more balanced and integrated and will be stronger for its adaptability and competitive shareholder remuneration."

Eni's long-term strategy builds on an existing goal to reach net-zero emissions from its own exploration and production operations by 2030. By 2050, Eni said it now plans an 80% reduction in net Scope 3 carbon emissions of its energy products sold and a 55% reduction in emissions intensity compared with 2018.

Eni's ambitious long-term strategy comes on the heels of BP's plan to become a "net-zero" carbon emitter across its business by 2050 as pressure mounts on oil companies to shift to cleaner energy and offset their emissions. Rival Shell plans to cut emissions from its products by 50% by 2050, and Total and Repsol have also net carbon reduction targets.

Key to Eni's net emission cuts will be the progressive expansion of Eni's installed global renewables power capacity to 3 GW by 2023 and more than 55 GW by 2050, mainly in OECD countries, it said.

With investments of Eur2.6 billion over the period, the renewable power push will include gas-fired plants with CO2 capture and storage projects.

Downstream, Eni said it plans a major expansion of its biorefining capacity to over 5 million mt/year, with the conversion of its existing Italian refining sites through new plants for the production of hydrogen, methanol and biomethane from waste materials.

In the long term, the Ruwais refinery in the UAE will be the only traditional refinery in operation, Eni said.

Eni said it plans to grow its retail power and gas activities to a customer base of over 20 million by 2050, with a complete transition to biofuels and renewable products by 2050.

"I think in a few years if you're unable to deliver green products, you're going to lose your customers so that is an essential part of the integration we are able to deliver," Descali said while presenting his plans.

As a result of Eni's drive to cut its carbon footprint, the company expects its capital spending to fall over the coming decades, Chief Financial Officer Massimo Mondazzi said.

Last year, Eni's capital investment totaled Eur7.7 billion (USD8.4 billion), nearly all of which was focused on the company's upstream oil and gas division

"Some business in which we are entering are less capital intensive so it's reasonable to project a lower amount of capex going forward," Mondazzi said in a strategy presentation.

By 2035, Eni expects that half of its capex will be focused on its upstream division together with associated carbon capture projects with the remaining 50% going to finance renewable energy and other parts of the business, Mondazzi said.

Expected average returns from the new renewables projects, mostly wind and solar, will be in the range of 7%-12%, he said.

Eni, which replaced 117% of production with new oil and reserves last year, said it did not expect to write off any of its existing proven reserves as stranded assets in its shift to cleaner energy.

The company, which has made a string of major gas finds over the last decade, said it expected to produce 85% of its existing 3P reserves by 2035 as a result of its "resilient and flexible" oil and gas assets which have an average $20/b breakeven.

Eni's net proven oil and gas reserves stood at 7.27 billion boe at the end of 2019, representing a reserve life index of 10.6 years at current production.

As MRC informed earlier, Versalis, the petrochemical division of Italy's Eni SpA, shut is cracker in Priolo, Sicily, for repairs in the last days of December, 2019. The capacity of the cracking unit at this complex is 490,000 tonnes of ethylene and 130,000 tonnes of propylene per year. The maintenance works lasted until February 2020.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).
MRC

Chandra Asri receives tax holiday incentive from government for 2nd petrochemical complex

MOSCOW (MRC) -- PT Chandra Asri Petrochemical Tbk (CAP) has recently received tax incentive from the Ministry of Finance, for the development of its second petrochemical complex, according to IDN Financials.

Erwin Ciputra, President Director of CAP, said the incentive included a 100% corporate income tax (PPh) cut for the first 20 years after the petrochemical complex is operational, and 50% for the next two years.

The tax incentive is given, because the Indonesian government wants to improve the investment climate while simultaneously spurring national economic growth. In addition, this policy is expected to attract more investors to Indonesia.

"We express our highest appreciation to the Ministry of Finance and the government for their continued support for improving the overall investment climate," Ciputra explained through an official statement .

As MRC reported earlier, PT Chandra Asri Petrochemical shut its naphtha cracker in Cilegon for maintenance in early-August 2019. The plant remained off-stream for a period of around 6-7 weeks. Located at Cilegon in Indonesia, the naphtha cracker has an ethylene production capacity of 860,000 mt/year.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).

CAP is the largest integrated petrochemical company in Indonesia and operates the country’s only world-scale size Naphtha Cracker. The CAP plant is strategically located in Banten province, providing convenient access to key customers.
MRC

Arkema shuffles management, Schuller appointed COO

MOSCOW (MRC) -- Arkema is expanding its executive committee to give a “broader and more diversified” representation of its business lines by adding three new members and naming executive vice president Marc Schuller as COO, said the company.

Schuller will oversee coating solutions, industrial specialties and advanced materials, and will be responsible for North America and global raw materials and energy procurement, the company said.

Thierry Le Henaff will continue to oversee the Group’s R&D, headed by Christian Collette, Arkema’s chief technical officer.

Arkema CEO Thierry Le Henaff will continue to oversee group research and development which is headed by CTO Christian Collett.

The three new members - Marie-Pierre Chevallier, Richard Jenkins and Erwoan Pezron - will join Arkema's executive committee on 4 May. They will report to Schuller and their responsibilities set out on that date.

As it was written earlier, in October 2019, Arkema (Colombes, France) announced the proposed divestment of its Functional Polyolefins business to SK Global Chemical (Seoul, South Korea), a subsidiary of SK, the major South Korean corporation. With this project, Arkema continues its shift towards specialty chemicals and advanced materials.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).
MRC