Mitsubishi Chemical starts turnaround at Kashima cracker

MOSCOW (MRC) -- Mitsubishi Chemical has undertaken a planned shutdown at its naphtha cracker in Japan, according to Apic-online.

A Polymerupdate source in Japan informed that, the company commenced turnaround at the cracker on May 9, 2020. The cracker is likely to remain under maintenance till end-June, 2020.

Located at Kashima, Japan, the cracker has an ethylene production capacity of 540,000 mt/year and a propylene capacity of 270,000 mt/year.

As MRC reported previously, the company last started a two-month maintenance at this cracker in H1 May, 2018.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 557,060 tonnes in the first three month of 2020, up by 7% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments rose because of the increased capacity utilisation at ZapSibNeftekhim. Demand for LDPE subsided. At the same time, PP shipments to the Russian market was 267,630 tonnes in January-March 2020, down 20% year on year. Homopolymer PP and PP block copolymers accounted for the main decrease in imports.

Mitsubishi Chemical with headquarters in Tokyo, Japan, is a diversified chemical company involved in petrochemicals, polymers, agrochemicals, speciality chemicals and pharmaceuticals. The company's main focus is on three business pillars: petrochemicals, performance and functional products, and health care.
MRC

Sinopec SABIC Tianjin Petrochemical shut cracker for maintenance

MOSCOW (MRC) -- Sinopec SABIC Tianjin Petrochemical Co. (SSTPC), a 50-50 joint venture of Sinopec and SABIC, has shut its naphtha cracker in Tianjin on 1 May 2020 for routine maintenance work, reported CommoPlast.

The cracker is expected to remain off-line until early July 2020.

The naphtha cracker is designed to produce 1 million tons/year of ethylene, which supplies several local buyers in the Tianjin area.

Besides, the company is also planning to expand its cracker capacity to 1.3 million tons/year in 2021.

Thus, as MRC informed earlier, in October 2019, SSTPC began construction on an ethylene expansion project in Tianjin Province, China. The project will boost the company's ethylene capacity to 1.3-million t/y from 1-million t/y currently. Cost and a schedule for the project were not given.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 557,060 tonnes in the first three month of 2020, up by 7% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments rose because of the increased capacity utilisation at ZapSibNeftekhim. Demand for LDPE subsided. At the same time, PP shipments to the Russian market was 267,630 tonnes in January-March 2020, down 20% year on year. Homopolymer PP and PP block copolymers accounted for the main decrease in imports.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group"s key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.

Saudi Basic Industries Corporation (Sabic) ranks among the world"s top petrochemical companies. The company is among the world"s market leaders in the production of polyethylene, polypropylene and other advanced thermoplastics, glycols, methanol and fertilizers.
MRC

Chinese CNOOC group to trim 2020 investment by up to 15%

MOSCOW (MRC) -- China National Offshore Oil Corp (CNOOC) will trim annual investment by 10% to 15% in 2020, while maintaining its goal of increasing domestic crude oil and natural gas production for the year, reported Reuters with reference to the company's statement.

CNOOC Ltd, a listed arm of the national offshore energy producer, said during a media briefing the firm will "significantly" cut capital expenditure.

Oil and gas companies worldwide are reducing spending this year following a collapse in oil prices and plummeting fuel demand amid the coronavirus outbreak.

CNOOC did not give any further details on its capital expenditure plan or on its oil and gas production targets for its domestic and overseas blocks.

It will cut total costs by a least 10% and reduce losses at its money-losing firms by 5 billion yuan (USD710 million) in 2020, the statement said.

The company did not give details on the unprofitable businesses. One of its big loss-makers, however, is its gas and power unit, and the company said in March it is set to have its Hong Kong-listed flagship take over that sector.

Capital expenditures at the Hong Kong-listed firm were 79.6 billion yuan in 2019.

The company said in January it would raise 2020 production to 525 million barrels of oil equivalent at both domestic and overseas projects from 506.5 million barrels in 2019. The focus would be on raising domestic output while cutting overseas operations, it said.

CNOOC’s businesses besides oil and gas production include oil refining, petrochemicals manufacturing, liquefied natural gas (LNG) terminals and renewable energy generation.

As MRC wrote before, in early May, 2018, China National Offshore Oil Corporation (CNOOC) and Shell Nanhai B.V. (Shell) announced the official start-up of the second ethylene cracker at their Nanhai petrochemicals complex in Huizhou, Guangdong Province, China.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 557,060 tonnes in the first three month of 2020, up by 7% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments rose because of the increased capacity utilisation at ZapSibNeftekhim. Demand for LDPE subsided. At the same time, PP shipments to the Russian market was 267,630 tonnes in January-March 2020, down 20% year on year. Homopolymer PP and PP block copolymers accounted for the main decrease in imports.

China National Offshore Oil Corporation (CNOOC), the largest offshore oil & gas producer in China. CNOOC businesses cover the main segments of oil & gas exploration and development, engineering & technical services, refining and marketing, natural gas and power generation, and financial services.
MRC

CNOOC, Shell and Huizhou government sign agreement to further expand petrochemical complex in China

MOSCOW (MRC) -- CNOOC Oil & Petrochemicals Co. Ltd (CNOOC), Shell Nanhai B.V (Shell) and the Huizhou Government have announced a strategic cooperation agreement to further expand the CNOOC and Shell Petrochemical Company (CSPC) 50:50 joint venture in Huizhou, Guangdong Province, China, as per Shell's press release.

Due to COVID-19 travel restrictions, the agreement was signed in a virtual online ceremony, attended by dignitaries including Party Secretary of Guangdong Province Li Xi, CNOOC Chairman Wang Dongjin, Shell CEO Ben van Beurden, CNOOC VP for Downstream Chen Bi and Shell Downstream Director Huibert Vigeveno.

The expansion is planned to serve the growing number of intermediate and performance chemicals customers in the key market of China, supplying products including SMPO, polyols, ethylene glycol, polyethylene (PE) and polypropylene (PP). These chemicals are used in a wide range of end products, in healthcare, construction, fabrics, packaging, transport and electronics. For the first time in Asia, Shell would apply its advanced technology for linear alpha olefins. The project is intended to include construction of a new 1.5 million-tonnes-per-year ethylene cracker, with the mega-site bringing economies of scale and enhanced competitiveness.

Thomas Casparie, Executive Vice Present for Shell’s global chemicals business, said "Our growth strategy is based on long-term chemicals demand. We are very selective in our investments, and this agreement underlines Shell’s confidence in both the chemicals business fundamentals and our strategic partnerships with CNOOC and the Huizhou Government."

The CSPC site currently converts a variety of liquid feedstocks into olefins and derivative products. It has a strong track record of safe, reliable and energy-efficient operations. In January 2020, CNOOC and Shell announced the signature of a Memorandum of Understanding to explore its first commercial-scale polycarbonate production unit at the site.

As MRC informed before, the two partners signed Memorandum of Understanding on 16 October 2018 to explore expansion of the existing collaboration. The start-up of the site’s second ethylene cracker was announced on 2 May 2018. The site’s second SMPO plant, which will be the largest in China, is currently in construction.

Ethylene and propylene are feedstocks for producing PE and PP.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 557,060 tonnes in the first three month of 2020, up by 7% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments rose because of the increased capacity utilisation at ZapSibNeftekhim. Demand for LDPE subsided. At the same time, PP shipments to the Russian market was 267,630 tonnes in January-March 2020, down 20% year on year. Homopolymer PP and PP block copolymers accounted for the main decrease in imports.

China National Offshore Oil Corporation (CNOOC), the largest offshore oil & gas producer in China. CNOOC businesses cover the main segments of oil & gas exploration and development, engineering & technical services, refining and marketing, natural gas and power generation, and financial services.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.
MRC

Saudi Arabia must keep cool and balance deep oil cuts with need for gas

MOSCOW (MRC) -- Saudi Arabia’s sweltering summer may complicate the kingdom’s pledge to deepen oil production cuts, said Hydrocarbonprocessing.

Curbing crude output means lower production of associated gas, a byproduct of crude extraction, which Saudi Arabia uses to power air conditioners during the summer months and as feedstock for its petrochemical industry.

While industry sources do not question Saudi Arabia’s ability to deliver on the cuts and note that opening and shutting oil wells is technically easier for OPEC’s biggest producer than in other parts of the world, balancing the supply and demand of gas for the residential sector and industry is a delicate process.

OPEC and allies led by Russia, a group known as OPEC+, agreed last month to reduce output by about 9.7 million barrels per day (bpd) in May and June, a record cut aimed at shoring up sliding prices as coronavirus-related lockdowns crippled the global economy and demand for oil tanked.

In a further step, Saudi Arabia, Kuwait and the United Arab Emirates pledged this week to deepen their cuts by an extra 1.180 million bpd in June.

Because Saudi oilfields pumping lighter crude tend to produce more associated gas than fields with heavier and sour grades, where the cost of production is also higher, the Kingdom’s oil output will likely drift more towards these lighter quality grades, analysts and experts say, potentially worsening the current global glut of such barrels.

“The shutting down of (some) fields is not easy because of the gas,” said one Gulf oil industry source. “But we can reduce production capacity rates at some fields or bring forward field maintenance to reduce output.”

Ethylene and propylene are feedstocks for producing PE and 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.
MRC