Perstorp converts production to solve Swedish national disinfection crisis

MOSCOW (MRC) -- Perstorp, a global leader in the specialty chemicals market, has started the large-scale production of hand sanitizer and surface disinfectant for the Swedish healthcare sector - at cost price, as per the company's press release.

Thus, leading specialty chemicals innovator Perstorp has converted part of the production at its’ Perstorp plant to now produce hand sanitizer and surface disinfectant. Perstorp has the capacity to produce more than 2 million liters per month. The production capacity is expected to exceed the healthcare sector’s current disinfection shortage. The products are being offered at cost price.

Jan Secher, CEO of Perstorp Group, comments: "Extraordinary times call for extraordinary care. Our large scale production capacity can make a real difference at this time and help to solve the disinfectant shortage in the healthcare sector. This is our contribution to the important work that healthcare professionals are doing every day. I am proud that our innovative staff saw this opportunity to help. They have driven this initiative forward together with valuable help from authorities and partners."

Production has started this week and the aim is to continue for as long there is an acute shortage of disinfection products within the Swedish healthcare sector, that regular suppliers cannot fulfill. Permits and agreements for production have been finalized in record quick time together with authorities and partners. In order to produce the disinfectant, Absolut Company delivers ethanol, which is mixed together with other ingredients. This is delivered to the Perstorp industrial plant with help of Univar Solutions and ExxonMobil. The disinfectant is bottled by Lefab Production and transported by Bertschi, Scandibulk och Eurolink to Socialstyrelsen, which distributes the products to healthcare services in regions across Sweden. The first delivery is expected to reach Socialstyrelsen after the Easter weekend.

Ingrid Bergman, Head of Purchasing at Swedish Region Skane, says: "Due to the global COVID-19 pandemic the shortage of disposables such as sanitizers is a major challenge and an issue of great priority. Perstorp has shown tremendous responsibility and initiative in securing the production chain. They have made production possible by arranging all permits from the healthcare sector in cooperation with us, as well as several authorities and other companies."

As MRC reported earlier, as of May 28 2019, Perstorp has obtained FCN 001967 (Food Contact Notification) from the FDA for the use of Pevalen as a plasticizer in polyvinyl chloride (PVC) polymers for use in repeated use food contact articles.

According to MRC's ScanPlast report, contrary to the seasonal factor, Russian producers of unmixed polyvinyl chloride (PVC) kept a high level of capacity utilisation during the first two months of the year. Overall PVC output totalled 177,100 tonnes in January-February 2020, up by 5% year on yeart. February production of unmixed PVC in Russia was 85,400 tonnes versus 91,700 tonnes a month earlier, producers Bashkir Soda Company and RusVinyl decreased capacity utilisation. Nevertheless, despite lower production in February, the total output of polymer increased in January-February 2020 to 177,100 tonnes from 169,500 tonnes a year earlier.

Perstorp is one of the world leaders in various sectors of the specialty chemicals market, it's pioneer in formalin chemistry, plastics and surface materials. Perstorp was founded in 1881 and is controlled by PAI partners,a major European private equity company. The company has around 1,500 employees in with 22 production plants in Europe, Asia and North America.

Propylene outlook transformed by COVID-19

MOSCOW (MRC) -- The coronavirus disease 2019 (COVID-19) pandemic and the crude oil crash are interacting in complex ways to transform the propylene market, reported Chemweek with reference to the statement of Carlo Barrasa, executive director/global olefins at IHS Markit. Barrasa spoke Tuesday during a live session of the IHS Markit World Petrochemical Conference 2020 Online.

"During the financial crisis, propylene demand fell 3.5% year over year, but then it rebounded by over 11% the following year," Barrasa notes. "Today however, we're not only dealing with a single event - the spread of the coronavirus - we're also dealing with an equally influential event in the crude oil price shock. On the one hand, you have a virus that can greatly impact propylene demand via lower consumption. But on the other hand, you have lower oil prices, which can dramatically change the chemical production dynamics over the upcoming quarters."

The sharp decline in crude oil pricing has lowered the cost of propylene feedstocks and flattened the production cost curve, he says. Indeed, naphtha cash costs have fallen low enough to be favored over liquefied petroleum gas (LPG).

"Less LPG cracking means more propane will be available, which means PDH (propane dehydrogenation) will likely be the preferred on-purpose vehicle, especially in Asia," says Barrasa. "MTO/CTO (methanol-to-olefin/coal-to-olefin) looks like the odd technology out. Some of these units may keep running due to their downstream integration, but at some point the economics have to win out."

Meanwhile, the economic disruption created by the COVID-19 pandemic has crushed demand.

"Optimistically, we're looking at an environment that can range from flat demand to what we think is a worst-case scenario, where the world loses a month's worth of demand," says Barrasa. "This equals roughly twice the demand loss we saw during the financial crisis. Either way, we're looking at something other than growth."

The lower cost to produce propylene will not translate directly into greater availability. With populations around the world ordered to limit travel in order to contain the pandemic, fuel demand is way down, and crude oil refining - the cheapest source of propylene - is under pressure to cut back operations. "If there isn't enough RG (refinery-grade propylene), this makes room for other sources of propylene supply."

We reminad that, as MRC informed before, Enterprise Products Partners' Mont Belvieu propane dehydrogenation (PDH) unit in Texas restarted from planned maintenance in the first week of December, 2019. The PDH unit went offline for maintenance on November 13. That day, the company said in a filing with the Texas Commission on Environmental Quality that the RAC "B" turbine shut down, which resulted in flaring. The flaring was estimated to last 72 hours. The unit has a capacity of 750,000 mt/year, according to Platts data.

Propylene is the main feedstock for the production of polypropylene (PP).

According to MRC's ScanPlast report, PP shipments to the Russian market were 192,760 tonnes in January-February 2020, down by 6% year on year. Homopolymer PP accounted for the main decrease in imports.

INEOS announces plans to build a fourth hand sanitiser plant

MOSCOW (MRC) -- INEOS, one of the world’s largest manufacturing companies, has today announced that it is to build a fourth hand sanitiser plant, said the company.

The plant to be built in Etian will be located to serve the hard hit hospitals in Paris and North Eastern France as well as meet the needs of Belgium. The company has also announced that it has met its ten-day target to build a hand sanitiser plant in Lavera France and has today started production of 1 million hand sanitisers a month.

Hand to mouth contamination is one of the main ways that the Coronavirus infects people and there is a critical shortage of hand sanitisers across France and the rest of Europe. INEOS is focusing on meeting the needs of front line medical and care services as well as making “pocket bottle” hand sanitisers available for people’s personal use. These will be produced to World Health Organisation (WHO) specifications.

Sir Jim Ratcliffe, founder and chairman of INEOS says, “Now that production of the INEOS hand sanitiser has started, we are working on the fastest way to get them to where they need to be. I am confident that within a few days our sanitiser will start to be seen in hospitals, surgeries and people’s homes".

INEOS is the leading European producer of the two key raw materials needed for sanitisers – isopropyl alcohol (IPA) and ethanol, producing almost 1 million tonnes. The company is already running these plants flat out and have been diverting more of this product to essential medical use including in the new INEOS factories.

INEOS takes its corporate and social responsibilities extremely seriously. Its products are essential to the production of essential healthcare products from rubber gloves, to PVC saline drips, syringes, ventilators, medical tubing. Its products purify the public’s drinking water. It produces raw materials for soap, phenol for aspirin and paracetamol, and its acetonitrile is being used in pharmaceutical analysis essential in procedures necessary to find a vaccine.

Sir Jim Ratcliffe, founder and chairman of INEOS adds, “INEOS is a company with enormous resources and manufacturing skills. If we can find other ways to help in the Coronavirus battle, we are absolutely committed to playing our part"

Earlier this week, Moody's downgraded its credit rating for INEOS Group Holdings as a result of the pandemic.

As MRC informed before, the restart of the ACN plant of INEOS Nitriles in Seal Sands, UK with the capacity of 280,000 mt/year from the planned maintenance, which began on 27 July 2019, was delayed in late September for a second time because of technical issues. The plant was initially expected to restart at the end of August.

ACN is a feedstock for the production of acrylonitrile-butadiene-styrene (ABS).

According to MRC's DataScopr report, overall ABS imports to the Russian market decreased in 2019 by 4% year on year to 33,700 tonnes.

INEOS is a leading manufacturer of petrochemicals, specialty chemicals and oil products. It has 34 businesses, with a production network spanning 171 manufacturing facilities in 24 countries. From paints to plastics, textiles to technology, medicines to mobile phones - chemicals manufactured by INEOS enhance almost every aspect of modern life. INEOS had sales in 2018 of around $60bn and EBITDA close to €6bn. Its products make a significant contribution to saving life, improving health and enhancing standards of living for people around the world.

BP operates US refineries between 80-85% of capacity

MOSCOW (MRC) -- BP Plc’s three largest US refineries are operating between 80 and 85% of their individual crude oil processing capacities because of limited storage, reported Reuters with reference to sources familiar with operations at the plants.

Previously, the sources had told Reuters that BP’s 430,000-barrel-per-day (bpd) Whiting, Indiana, refinery, 242,000-bpd Cherry Point, Washington, refinery, and the 155,000-bpd joint-venture refinery in Toledo, Ohio, were operating at 85% of their capacities.

As MRC informed earlier, BP said the deadly coronavirus outbreak could cut global oil demand growth by 40 per cent this year, putting pressure on Opec producers and Russia to curb supplies to keep prices in check.

We also remind that, in September 2019, six world's major petrochemical companies in Flanders, Belgium, North Rhine-Westphalia, Germany, and the Netherlands (Trilateral Region) announced the creation of a consortium to jointly investigate how naphtha or gas steam crackers could be operated using renewable electricity instead of fossil fuels. The Cracker of the Future consortium, which includes BASF, Borealis, BP, LyondellBasell, SABIC and Total, aims to produce base chemicals while also significantly reducing carbon emissions. The companies agreed to invest in R&D and knowledge sharing as they assess the possibility of transitioning their base chemical production to renewable electricity.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 383,760 tonnes in the first two month of 2020, up by 14% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased due to the increased capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market were 192,760 tonnes in January-February 2020, down by 6% year on year. Homopolymer PP accounted for the main decrease in imports.

BP is one of the world's leading international oil and gas companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemicals products for everyday items.

Pertamina seeks to defer gasoline imports as coronavirus hits demand

MOSCOW (MRC) -- State-owned Pertamina, Asia’s biggest gasoline importer, is in talks with suppliers to defer petrol imports in April as Jakarta’s measures to fight the coronavirus has hit demand for its fuel, a company spokeswoman said, as per Hydrocarbonprocessing.

Indonesia has joined other countries in imposing restrictions on people’s movements to prevent the spread of the coronavirus, bringing traffic to a standstill and hitting fuel consumption. The cargoes are “postponed until we need it again” depending on demand, Pertamina’s spokeswoman Fajriyah Usman told Reuters, adding that the company was also trying to manage its fuel through storage.

She said sellers should agree to let Indonesia postpone imports at time when global demand has been hit. The country’s gasoline imports have fallen by about half of their average monthly total in 2019 of 1.2 million tonnes of gasoline (333,333 barrels per day), Refinitiv Oil Research.GL-ID-IMP-TOT showed.

“Indonesia gasoline imports could be about 100,000 to 150,000 barrels per day lower in April year-on-year,” said Matthew Chew of IHS Markit. A source said Pertamina was planning refinery run cuts as Indonesia’s fuel consumption has nearly halved while storage space was limited.

Pertamina buys gasoline from trading companies including Singapore-based Hin Leong and Aramco Trading Co. Indonesia’s fuel stockpiles have also risen close to levels before major festivals such as Ramadan and Eid, indicating ample supplies.

Pertamina’s gasoline stocks can last over 22 days, Pertamina said in a statement on April 3. The Pertamax Turbo brand, a 98-octane grade, can last for 42 days while kerosene stocks are enough for 89 days, Pertamina said in the statement.

Pertamina’s gasoil stocks on the other hand are sufficient for more than 24 days, with “Pertamina Dex”, with cetane number 53, is enough for more than 53 days, the company said. Pertamina also said that since a working-from-home rule was implemented in mid-March, daily fuel sales have been declining by about 16% to 113,000 kilolitres (kl) from the usual 134,000 kl.

But demand for LPG is still growing, with sufficient supplies to last for 16 days, the company said.

As MRC informed earlier, on March 19, Pertamina stopped production at the liquid catalytic cracking unit in Balongan (Balongan, West Java, Indonesia) with the aim of carrying out planned preventive measures. Repair work on this installation with a capacity of 180 thousand tons of propylene per year will continue until April 20 of this 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 383,760 tonnes in the first two month of 2020, up by 14% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased due to the increased capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market were 192,760 tonnes in January-February 2020, down by 6% year on year. Homopolymer PP accounted for the main decrease in imports.