Russian PVC producers adjust their plans for shutdowns for maintenance

MOSCOW (MRC) -- Due to the spread of coronavirus, two Russian polyvinyl chloride (PVC) producers adjusted their plans for scheduled shutdowns for maintenance, according to ICIS-MRC Price report.

The plants' representatives and customers said Kaustik (Volgograd) and RusVinyl revised their plans for scheduled turnarounds at their PVC production capacities. The Volgograd producer intends to start maintenance earlier than originally planned, and the Nizhny Novgorod manufacturer rescheduled the outage at a later date.

Thus, Kaustik (Volgograd) intends to carry out the turnaround at its PVC production during three weeks from 1 May. The plant's annual production capacity is 90,000 tonnes.

RusVinyl postponed its scheduled maintenance works from the second half of April to July, the exact dates of the outage have not been announced yet, but traditionally, the turnaround is carried out within two weeks. The plant's annual production capacity is 330,000 tonnes.

It is also worth noting that SayanskKhimPlast traditionally shuts its production capacities for maintenance in June-July, the plant's annual PVC capacity is 350,000 tonnes.

According to MRC's ScanPlast report, Kaustik (Volgograd) produced about 7,400 tonnes of suspension polyvinyl chloride (SPVC) in March, whereas this figure was 7,100 tonnes in February. RusVinyl produced about 29,900 tonnes of PVC in March 2020, with emulsion polyvinyl chloride (EPVC) accounting for 2,400 tonnes, which actually corresponds to the figure a month earlier. At the same time, SayanskKhimPlast produced 28,500 tonnes of SPVC in March, whereas this figure was 26,500 tonnes in February 2020.
MRC

1. Russian PVC producers adjust their plans for shutdowns for maintenance

MOSCOW (MRC) -- Due to the spread of coronavirus, two Russian polyvinyl chloride (PVC) producers adjusted their plans for scheduled shutdowns for maintenance, according to ICIS-MRC Price report. The plants' representatives and customers said Kaustik (Volgograd) and RusVinyl revised their plans for scheduled turnarounds at their PVC production capacities. The Volgograd producer intends to start maintenance earlier than originally planned, and the Nizhny Novgorod manufacturer rescheduled the outage at a later date.



MRC

MOSCOW (MRC) -- Polypropylene (PP) imports into Belarus rose in the first two months of 2020 by 9% year on year to about 17,500 tonnes. All grades of propylene polymers accounted for the increase in demand, according to MRC's DataScope report.

February PP imports into the Republic of Belarus were about 9,700 tonnes, compared to 7,800 tonnes a month earlier, local companies raised their purchasing of PP in Russia. Overall imports of propylene polymers reached 17,500 tonnes in January-February 2020, compared to 16,000 tonnes a year earlier, demand for all PP grades increased, with homopolymer of propylene (homopolymer PP) accounting for the greatest growth.

The structure of PP imports by grades looked the following way over the stated period.

February imports of homopolymer PP reached 6,700 tonnes versus 5,800 tonnes a month earlier, purchasing of homopolymer PP increased in Russia under the pressure of seasonal factors. Overall imports of homopolymer PP reached 12,500 tonnes in the first two months of 2020, up by 10% year on year.

February imports of propylene copolymers to Belarus were 3,000 tonnes versus 2,000 tonnes a month earlier, local companies increased their procurement of injection moulding block-copolymers of propylene (PP block copolymer) from Russian producers. Thus, overall imports of propylene copolymers reached 5,000 tonnes over the stated period, up by 7% year on year.

MRC

MOSCOW (MRC) -- Sinopec Zhenhai Refining & Chemical Company has unexpectedly shut its high density polyethylene (HDPE)/linear low density polyethylene (LLDPE) swing plant and monoethylene glycol (MEG) plant due to technical glitches on its ethylene unit on 16 April, 2020, reported CommoPlast with reference to market sources, .

Based in Zhenhai, China, the plant has a 450,000 tons/year HDPE/LLDPE plant and 650,000 tons/year MEG plant.

Both plants are expected to remain shut for 7 days.

Meanwhile, the company's 620,000 tons/year styrene monomer (SM) plant and 500,000 tons/year polypropylene (PP) plant are running at reduced rate. A source closed to the company informed that they are currently outsourcing propylene temporarily to continue production at lower rate.

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.

MEG is one of the main feedstocks for the production of polyethylene terephthalate (PET).

As per MRC's ScanPlast report, Russia's estimated PET consumption decreased to about 53,890 tonnes in February 2020, down by 3% year on year. 100,830 tonnes of PET chips were processed in Russia in the first two months of 2020. February PET production in Russia dropped to 45,800 tonnes, down by 5% year on year. Russia's overall PET production fell in January-February 2020 by 13% year on year.
MRC

MOSCOW (MRC) -- Canada’s steam-driven oil facilities are bearing the brunt of output cuts as the industry copes with low prices, and deeper reductions may risk permanent damage to the sites, said Hydrocarbonprocessing.

The COVID-19 pandemic has severely cut fuel demand as the global economy slows, leading refiners to reduce purchases of crude. Canada, the world’s fourth-largest oil producer, has started slashing production, but analysts say the biggest cuts lie ahead.

Steam-assisted gravity drainage (SAGD) projects heat seams of tarry bitumen and account for nearly half of Canadian oil sands production. Maintaining temperature and pressure is necessary to keeping the reservoir in shape for future production.

ConocoPhillips on Thursday became the latest producer to cut Canadian steam-driven production, chopping 100,000 barrels per day (bpd). "Shutting down those (sites) sounds a lot easier than it actually is,” Alberta Premier Jason Kenney told reporters on Wednesday, when asked about closing such sites to avoid spreading coronavirus infections. “It can cause permanent damage to their reservoir and jeopardize billions of dollars of assets."

Husky Energy and Cenovus Energy have also made cuts to steam-driven production, estimated at 15,000 bpd and up to 45,000 bpd respectively. Such sites face cuts because they produce bitumen, a form of heavy oil that requires the added cost of blending with ultra-light oil to move it through pipelines, said Matt Murphy, upstream analyst at Tudor Pickering Holt & Co.

Canada has cut oil sands output by more than 300,000 bpd, and total shut-ins may grow to 1.5 million, TD analyst Menno Hulshof said in a note. The higher estimate represents nearly one-third of Canadian output. Up to 80% of SAGD volumes may be curtailed, Hulshof said.

ConocoPhillips intends to reduce volumes to the lowest level possible without damaging its reservoir. “We’re not going to shy (from restoring production) if we see any risk to reservoir damage or anything that’s going to impair our ability to bring it back,” Chief Operating Officer Matt Fox told analysts.

Cenovus is confident that it can safely adjust production, as it has done so previously, spokeswoman Sonja Franklin said. Companies can manage risks by injecting some steam during curtailments to maintain pressure, Murphy said.

Mines also face cuts. Suncor Energy has cut output sharply at its Fort Hills mine, about 85,000 bpd, according to Murphy.

Imperial Oil plans to curtail output first at its Kearl mine, if necessary, because it can modulate production more easily than its Cold Lake SAGD site.

Canadian Natural Resources, by contrast, would keep mines running even in a price “meltdown” because they produce lighter synthetic crude at lower cost, President Tim McKay said last week.

As MRC informed earlier, ConocoPhillips said it would cut gross production by 225,000 barrels of oil per day while also suspending its share repurchase program and cutting back further on capital spending to weather the collapse in oil prices. Oil and gas producers have sunk deep into crisis mode over the past month as the slump in demand caused by coronavirus lockdowns left the world’s big producers producing far more than current needs and crude prices falling below USD30.

According to MRC's ScanPlast report, 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.
MRC