Portugal Galp to halt Sines refinery for a month due to lack of storage

MOSCOW (MRC) -- Portugal’s Galp Energia will suspend output as its largest oil refinery at Sines for a month from May 4 as the drastic drop in demand due to the coronavirus outbreak has left the company out of storage space, a Galp spokesman said, as per Hydrocarbonprocessing.

The move follows the suspension on April 10 of the group’s smaller refinery in Matosinhos, bringing all its domestic oil and gas operations - making up 20% of refining capacity on the Iberian peninsula - to a halt.

As MRC informed earlier, Galp Energia said on Tuesday it will kick off its green business by installing renewable energy capacity of 10 gigawatts in the decade ahead. Galp, which last month bought solar power projects from Spain's ACS for 2.2 billion euros (USD2.38 billion), hopes to install 3.3 gigawatts of solar energy in Portugal and Spain alone by 2023, generating more than 10% in equity returns. Fossil fuel companies are racing to adapt to investor-demands for more sustainable business models as public awareness of climate change grows.

As MRC reported before, 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, 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.

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MOSCOW (MRC) -- GAIL (India) Ltd has shut its petrochemical complex in Pata, Uttar Pradesh as the nationwide lockdown severely hit demand and creates logistics bottleneck that leads to bloated warehousing issue, reported CommoPlast.

In fact, market sources informed that following the lockdown, which started on 24 March 2020, about two-thirds of trucks that used to transport the materials to buyers stopped operations.

The plant houses two ethylene crackers with a combined capacity of 950,000 tons/year. Downstream plants include 210,000 tons/year HDPE/LLDPE swing unit, 200,000 tons/year standalone HDPE units, and a 400,000 tons/year metallocene PE unit.

It is unclear when the company would restart the operation as the Indian government extended the lockdown until 3 May 2020 to combat the COVID-19 outbreak.

As MRC reported before, in May 2019, GAIL approved the revival of an existing liquefied petroleum gas (LPG) plant for conversion into a new polypropylene (PP) complex in Usar, Raigad district of Maharashtra, India. The "first of its kind project in India" will have 500,000 t/y of PP capacity, as well as an integrated propane dehydrogenation unit, at an estimated cost of Rs 8,800 crore, GAIL noted. The project is scheduled to be commissioned by fiscal year 2023-2024.

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.

Gas Authority of India Limited (GAIL) is the largest state-owned natural gas processing and distribution company in India. It is headquartered in New Delhi. It has the following business segments: natural gas, liquid hydrocarbon, liquefied petroleum gas transmission, petrochemicals, city gas distribution, exploration and production, GAILTEL and electricity generation.
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MOSCOW (MRC) -- China is set to issue more crude oil import quotas to non-state refiners in its second batch of allowances for 2020, several sources at five independent refineries told Reuters.

China’s Ministry of Commerce will issue quotas totaling 53.88 million tonnes (393.32 million barrels), said the sources, who said they have seen documents outlining the allocations.

The new quotas are the top-up volumes for the first batch of 2020 quotas that were granted at the end of last year of 103.83 million tonnes.

A total of 36 companies, including 31 independent refiners and five trading entities that are affiliated to state-run companies, are expected to receive the second batch of crude import quotas, the sources said.

Private refinery Hengli Petrochemical Co Ltd is set to receive a quota of 8 million tonnes and Zhejiang Petrochemical Corp may receive 9.6 million tonnes, according to company officials.

The refiners have yet to receive the official quota release from the Commerce Ministry, but the release could come within a few days, the sources said.

The ministry did not respond to a faxed request seeking comment.

Non-state crude oil import quotas for the whole year of 2020 were set at 202 million tonnes, the ministry said in November.

As MRC informed earlier, rather than cutting back on imports, China pushed crude oil into storage tanks at almost double the rate in the first quarter of this year than it did in the same period in 2019 as the new coronavirus hit domestic consumption. China doesn’t release official data on flows into strategic and commercial stockpiles, but an estimate can be made by subtracting the amount of crude processed by refineries from the total volume of oil available from both imports and domestic output.

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

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

MOSCOW (MRC) -- A new issue of SIBUR for Clients is now available on the Company's website. The main topic is the situation in the petrochemical market during the COVID-19 pandemic, said the company.

An increase in crude oil supply, the growing coronavirus pandemic, and lockdown measures across the world have sent global markets into a tailspin. Under the circumstances, manufacturers worldwide are trying to repurpose their factories to make more useful products, such as medical equipment. Plastic is once again gaining ground in many markets as the most hygienic material helping to contain the spread of the virus. Companies, including SIBUR, are making every effort to protect their employees and partners while striving to fulfil their obligations.

Sergey Komyshan, SIBUR’s Management Board member and Executive Director:
“We are living in unprecedented times when two crises have coincided to create a perfect storm. The oil crisis and coronavirus outbreak have hit the industry hard, with the pandemic threatening the health and life of people worldwide. Most companies are suspending operations or allowing employees to work remotely during the quarantine and self-isolation.

Despite the challenging circumstances, SIBUR is making every possible effort to fulfil all of its obligations and meet the needs of its clients and partners. I know that our clients are taking the same approach in relation to their customers. We are all in this together. Unity, responsible action and mutual support have never been more important. Take care of yourself and your loved ones! Family is the most valuable thing we have, and the Company gives the health of our employees and their families the highest priority – especially now."

Also in this issue:
China as the first country to be hit by the coronavirus and also the first to curb the outbreak: a firsthand account by SIBUR employees.
How the three ESG pillars are coming into focus of forward-thinking companies.
Myths and misconceptions about plastics: the most common customer misconceptions about plastics.
Leveraging digital marketing to promote construction materials.

Earlier it was reported that SIBUR Holding on March 25 will early pay off bonds of the 12th series for 10 billion rubles. In particular, SIBUR Holding PJSC decided to early repay the 12th series bonds in the amount of 10 billion rubles, the company said. The repayment will take place on March 25, at the end date of the 7th coupon period.

SIBUR Holding PJSC is the largest petrochemical company in Russia and Eastern Europe with full coverage of the industry cycle from gas processing, production of monomers, plastics and synthetic rubbers to plastics processing. The main shareholder of SIBUR Leonid Mikhelson controls 48.48% of the company, Gennady Timchenko - 17%, Kirill Shamalov - 3.88%, the current and former management of the company (including SIBUR chairman of the board Dmitry Konov and head of Gazprom Neft Alexander Dyukov) - 10.6%, Chinese Sinopec and the Silk Road Fund - 10% each.
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MOSCOW (MRC) -- Vietnam’s Binh Son Refining and Petrochemical Co will delay maintenance at its Dung Quat refinery until July 27-September 16 due to the coronavirus pandemic, according to Hydrocarbonprocessing with reference to the company's statement.

It was scheduled to conduct maintenance at the 130,000-barrel-per-day refinery from June 12 to August 1.

The company said in a statement late on Monday that travel curbs due to the coronavirus pandemic had affected its preparation for the maintenance.

Binh Son reported a net loss of 2.33 trillion dong ($99.32 million) in the first quarter of this year, it said.

As MRC informed earlier, Binh Son Refining and Petrochemical took its polypropylene (PP) plant off-stream for a maintenance turnaround in June 2017 for a period of around 7 weeks. The exact date shutdown could not be ascertained. Located in Vietnam,the plant has a production capacity of 150,000 mt/year.

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.
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