PKN Orlen set to build hydrogen hub in Włocławek

MOSCOW (MRC) -- In Poland, oil refiner Polski Koncern Naftowy ORLEN S.A is set to build a hydrogen hub in Wloclawek by the end of 2021, ultimately producing up to 600 kg of purified hydrogen per hour, according to BIOENERGY.

The project provides for the construction of a plant for the production of fuel-cell grade hydrogen, logistics infrastructure, and hydrogen refuelling stations.

Initially, the fuel will be distributed primarily for use in public and freight transport. Furthermore, PKN Orlen has already signed several agreements with local governments as potential customers for the hydrogen.

"We are well aware of the challenges posed by the global trend of new mobility, so our strategy provides for constant development of alternative fuels and low-emission technologies. We are confident hydrogen will be an important transport fuel in the future, so we are ramping up our work in this field. Our goal is to strengthen our leadership position in the demanding hydrogen market. Slated for completion next year and sited in Wloclawek, the project will be a milestone enabling us to successfully compete with the biggest players in the region. As a next step, we plan to build a similar hub at PKN Orlen’s refinery in Plock. A hydrogen purification plant is also being built at our biorefinery in Trzebinia", said Daniel Obajtek, President of the PKN Orlen Management Board.

PKN Orlen will announce a tender procedure for the hydrogen hub, to be sited at the ANWIL plant in Wloclawek, by the end of August. Initially, the plant will run at a capacity of ca. 170 kg per hour, but its modular design will allow it to flexibly increase production in line with growth in demand.

The feedstock that will undergo purification at the Wloclawek plant is produced in an environmentally friendly process of brine electrolysis as a by-product of chlorine extraction and so far has been used by the ammonia unit.

The choice of a hydrogen purification method is being analysed with the project’s technical adviser. The project will comprise a hydrogen purification plant, infrastructure for loading the fuel on rail tank cars and trucks, trailers, a hydrogen fuel supply system, and two refuelling stations.

Initially, the hydrogen undergoing purification at the Wloclawek site will be distributed primarily for use in public and freight transport, including rail transport.

The company has already signed Letters of Intent (LoI) on collaboration in advancing hydrogen-powered public transport services with the Metropolitan Association of Upper Silesia and Dabrowa Basin, Krakowski Holding Komunalny, Miejskie Przedsiebiorstwo Komunikacyjne of Krakow, and the City of Plock. Further agreements are being negotiated with other municipalities.

Also, the company has signed an LoI with PESA Bydgoszcz to develop a hydrogen-powered locomotive, to be used by PKN Orlen for logistics purposes.

As the market expands, the hydrogen fuel will also be used in passenger cars and coaches. In the long term, the company intends to supply its hydrogen for applications in ships and ferries and for stationary applications, such as heating. The hydrogen could also be sold to third parties for resale in other markets, for instance, food or metallurgical industries.

In addition to the hydrogen hub in Wloclawek and a similar project planned in Plock, the company is also developing hydrogen technologies at its Orlen Poludnie biorefinery in Trzebinia, where first fuel-cell grade hydrogen is to be produced in 2021.

Investment in infrastructure for hydrogen-fuelled transport fits into the European strategy of sustainable development and is a response to the EU’s environmental target of a 30 percent reduction in greenhouse gas emissions (GHG) by 2030 compared with 2005.

In common with electromobility and next-generation biofuels, hydrogen has been hailed as a fuel of the future that can provide a real tool to meet the EU’s environmental targets.

As MRC reported earlier, Honeywell has recently announced that PKN Orlen plans to use the UOP Q-Max and Phenol 3G technologies to produce 200,000 metric tons per year of phenol at its facility in Plock, Poland.

Phenol is one of the main feedstocks for the production of bisphenol A (BPA), which, in its turn, is used for the production of polycarbonate (PC).

According to MRC's ScanPlast report, Russia's estimated consumption of polycarbonate (PC) granules (excluding imports and exports to/from Belarus) rose in January-May 2020 by 19% year on year to 38,900 tonnes (32,700 tonnes a year earlier).

COVID-19 - News digest as of 15.07.2020

1. Eni lowers price assumptions, expects to write off EUR3.5 billion in assets value

MOSCOW (MRC) -- Eni (Rome, Italy) says it expects to record a post-tax, noncash impairment charge of approximately EUR3.5 billion (USD3.95 billion) in its second-quarter 2020 results after revising downward its short- and long-term price assumptions for oil and gas following an assessment of the impact of COVID-19 on its trading environment, said Chemweek. Up to EUR2.8 billion of the write-down relates to the value of its upstream assets, with the remaining amount to be recorded in its refining business, says Claudio Descalzi. The company’s long-term price of Brent crude oil has been lowered by USD10/barrel (bbl) from its previous assumption to USD60/bbl from 2023 onward in real terms, he says. The estimated impairment charge has a plus or minus range of 20%, with the estimation representing a drop of around 4% in the value of noncurrent assets, he adds.


Chinese June crude imports hit fresh high at 12.99 mil b/d, surge 34% on year

MOSCOW (MRC) -- China's crude oil imports surged 34.4% year on year to all-time high of 12.99 million b/d or 53.18 million mt in June as Chinese buyers who rushed into the market to secure cheap crudes in late March received their deliveries in the month, reported S&P Global with reference to preliminary General Administration of Customs data as of July 14.

It was the first time China's monthly crude imports had surpassed 12 million b/d, and was 14.6% higher than the previous record high of 11.34 million b/d in May, GAC data showed.

The record-high inflow was within expectations, but has caused serious congestion in China waters, S&P Global Platts has reported.

The record June volume brought imports for the first half of 2020 to 10.82 million b/d, up 9.3% on year, despite inflow hitting an eight-month low of 9.72 million b/d in March amid the coronavirus pandemic, the data showed.

GAC releases data in metric tons, which Platts converts to barrels using a 7.33 conversion factor.

For oil products, China's exports fell further to a 16-month low of 3.88 million mt in June from 3.89 million mt in May after hitting a fresh record high of 8 million mt in April, GAC data showed. Exports were last lower at 3.81 million mt in February 2019.

Product exports over January-June rose 3.8% on year to 33.76 million mt, the data showed.

Meanwhile, China's oil product imports edged up 0.7% on year to 16.9 million mt in H1. As a result, China's net oil product exports rose 7.1% on year to 16.86 million mt in the period, the GAC data showed.

As MRC wrote earlier, Chinese independent refineries' June crude imports edged down 0.5% to 4.4 million b/d, or 18 million mt, in June from the record high of 4.42 million b/d in May as Zhejiang Petroleum & Chemical could only manage to take in half of its feedstock tanker arrivals due to port congestion. ZPC received about 2.85 million mt of crude arrivals in June, according to market information collected by S&P Global Platts on July 3.

We remind that Zhejiang Petrochemical Co Ltd started up its ethylene cracker in late December, 2019. Based in Zhejiang, China, the cracker is able to produce 1.4 million tons/year of ethylene.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 595,170 tonnes in the first five month of 2020, up by 10% year on year. Deliveries of all ethylene polymers, except for linear low density polyethylene (LLDPE), rose partially because of an increase in capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market was 457,930 tonnes in January-May 2020 (calculated by the formula production minus export plus import). Deliveris of exclusively PP random copolymer increased.

Three workers injured at Westlake chemical plant in West Virginia

MOSCOW (MRC) --Three workers have been injured at a West Virginia chemical plant after an apparent release of chlorine gas at the plant, reported U.S.News with reference to officials' statement.

The incident happened Sunday evening at the Westlake Chemical plant, which produces caustic soda and chlorine, news outlets reported. Details of what happened at the Marshall County facility weren't immediately released.

One worker was taken to the hospital by ambulance and two others were transported by personnel at the plant, Marshall County Emergency Management Agency Director Tom Hart said.

Route 2 was closed briefly but has reopened.

Westlake’s plant located in Natrium, West Virginia can produce 409,000 dry metric tonne/year caustic soda and chlorine per year.

As MRC informed earlier, May production of sodium hydroxide (caustic soda) in Russia was 112,000 tonnes (100% of the basic substance) versus 101,000 tonnes a month earlier. Russia's overall output of caustic soda totalled 543,000 tonnes in the first five months of 2020, up by 1.4% year on year.

Westlake Chemical Corporation is an international manufacturer and supplier of petrochemicals, polymers and building products with headquarters in Houston, Texas. The company's range of products includes: ethylene, polyethylene, styrene, propylene, chlor-alkali and derivative products, PVC suspension and specialty resins, PVC Compounds, and PVC building products including siding, pipe, fittings and specialty components, windows, fence, deck and film.

Polynt-Reichhold announces maleic project; phthalic plans by year-end

MOSCOW (MRC) -- Polynt-Reichhold has decided to build a 50,000 metric tons/year maleic anhydride plant at its Morris, Illinois, site, said Chemweek.

The move is part of the company’s Strategic Integration Initiative, which was announced in 2019. The company says it is still considering its options for production of another key feedstock, phthalic anhydride, and it expects to make a decision by the end of 2020.

Polynt-Reichhold currently produces both maleic and phthalic anhydride in Italy. The company has 36,000 metric tons/year of maleic anhydride capacity based on benzene at Scanzorosciate, and 65,000 metric tons/year of capacity based on n-butane at Ravenna, according to data from IHS Markit. The company has 30,000 metric tons/year of phthalic anhydride capacity based on ortho-xylene at San Giovanni Valdarno, and 80,000 metric tons/year of capacity at Scanzorosciate.

"For maleic anhydride, we evaluated options for purchasing an existing plant, but this proved to not be feasible,” says Rosario Valido, president and CEO. “Therefore, we decided to go ahead and build our own maleic anhydride plant."

Polynt-Reichhold says its options for phthalic anhydride are integrating with existing operations or construction of a greenfield plant, and a decision is expected by year-end. “An investment in phthalic anhydride will strengthen our competitive position in the Americas while leveraging our proprietary technologies and deep experience operating intermediates facilities in Europe and Asia," notes Valido.

The company owns all of the technology and catalyst manufacturing necessary for the production of phthalic anhydride. Global capacity for maleic anhydride totaled 3.6 million metric tons/year in 2019. The largest producer was Huntsman, with 208,000 metric tons/year of capacity.

Global capacity for phthalic anhydride totaled 6.3 million metric tons/year in 2019. The largest producer was UPC, with 750,000 metric tons/year of capacity. A producer of intermediates, coating and composite resins, thermoset compounds, gelcoats, and niche specialties, Polynt-Reichhold was formed in May 2017 by the merger of Polynt and Reichhold.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 721,290 tonnes in the first four month of 2020, up by 4% year on year. Low density polyethylene (LDPE) and linear low density polyethylene (LLDPE) shipments grew partially because of the increased capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market totalled 347,440 tonnes in January-April 2020 (calculated by the formula production minus export plus import). Supply exclusively of PP random copolymer increased.