Zagros Petrochemical to restart No. 2 methanol plant in Iran

MOSCOW (MRC) -- Zagros Petrochemicals is in plans to bring on-stream its No. 2 methanol plant following an unplanned outage, as per Apic-online.

A Polymerupdate source in Iran informed that, the company is likely to resume operations at the plant by this weekend. The plant was shut on July 13, 2020 owing to technical issues.

Located in Assaluyeh, Iran, the No. 2 plant has a production capacity of 1.65 million mt/year.

As MRC reported earlier, in late April, 2020, the first phase of Connell Chemical Industry Ltd.'s 600 KTA MTO complex, a 300 KTA MTO plant, successfully started up and produced on-spec ethylene and propylene. This project is the first large-size chemical project brought online during period when Chinais in the process of restarting the economy while fighting COVID-19 pandemic. The MTO plant started feed-in at 8:18 AM on April 15, produced on-spec propylene at 7:00 AM on April 18, and produced on-spec ethylene at 4:00 AM on April 20.

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

According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC

SOCAR, BP to start new petrochemical project in Turkey

MOSCOW (MRC) -- The Turkish Competition Council has given permission to SOCAR and BP to establish a joint venture that will operate in the petrochemical sector, local media reported on July 22, said Azernews.

Earlier it was reported that SOCAR and BP applied to the relevant institutions in Turkey to establish a joint petrochemical company, which will be called Mercury complex, in April 2020. Recall that on December 20, 2018 SOCAR and BP signed contractual principles for evaluation of plans for creation a world-class petrochemical complex in Turkey and establishment of a joint venture to manage it.

The construction of the new petrochemical complex is expected to enable Turkey to cover the current account deficit by USD6 billion annually. Moreover, the project will increase the share of SOCAR in petrochemical market of Turkey to 35-40%.

Construction of the complex was planned to begin during the current year in order to put the enterprise into operation in 2023-2025. However, due to low oil prices and to the COVID-19 pandemic, the project implementation has been postponed until 2021.

The Mercury complex will be built near the Petkim petrochemical complex and the STAR refinery in Aliaga region. The enterprise will produce 1.25 million tons of purified terephthalic acid (PTA), 840 thousand tons of paraxylene (PX), 340 thousand tons of benzene.

PTA is the main raw material in the production of polyester from which beverage and food containers, packaging materials, photo and film and other consumer and industrial goods are derived.

According to ICIS-MRC Price report, in Russia, July formulae prices for contract customers were in the range of Rb65,000-67,500/tonne CPT Moscow, including VAT. Prices of material in the spot market remained steady last week, Russian producers continued to ship material from 20 tonnes at a price of Rb70,000-72,000/tonne CPT Moscow, including VAT.
MRC

COVID-19 - News digest as of 23.07.2020

1. AkzoNobel profits, sales fall on sharply lower demand

MOSCOW (MRC) -- AkzoNobel says that its net profit in the second quarter of 2020 dropped 44% year on year (YOY), to EUR129 million (USD149 million), said Chemweek. Sales went down 19%, to €1.98 billion from EUR2.45 billion in the same period of the previous year. The fall in sales, which dragged profits down, is mainly due to the impact of COVID-19 on end-market demand that resulted in 18% lower volumes YOY, the company says. EBITDA fell 25% YOY, to EUR297 million, the company says. Margin-management and cost-saving programs were able partly to offset the negative effect of lower demand, the company says. AkzoNobel announced preliminary results last week.



MRC

Versalis starts the production of Invix, bioethanol-based disinfectant at Crescentino

MOSCOW (MRC) -- Versalis, Eni's chemical company, has launched a new line to produce liquid hand disinfectant marketed under the brand name Invix at its plant in Crescentino (Vercelli, Piedmont), to meet the growing demand as a result of the current health situation across the nation, said the company.

The disinfectant, which has been developed based on the formulation provided by the World Health Organization and authorized by the Italian Ministry of Health, is a medical device, the active substance of which is ethanol obtained from vegetable raw materials. The bio-ethanol is produced at the Crescentino plant, designed to process residual biomasses, which has been adapted to temporarily use corn glucose syrup as a raw material to cope with the health emergency.

The product acts as an effective disinfectant, thanks to the alcohol and hydrogen peroxide content, and as an emollient, because of its glycerine content.

The new range of Invix disinfectants will soon be expanded to include gel and surface sanitizing products.

As part of Eni's initiatives supporting communities to handle the current health situation, and thanks to the collaboration of the Italian National Customs Agency and its Vercelli department, several dozens of tonnes have already been delivered to the Piedmont Regional Environmental Protection Agency [ARPA] and the Civil Defence service of the Piedmont Region.

As MRC informed earlier, Versalis plans to increase its 30 ktpa acrylonitrile butadiene styrene (ABS) production at Mantova, Italy in the first quarter of 2021. It was decided to postpone the expansion and maintenance schedule at the plant until the first quarter of 2021 due to market conditions and the impact of the coronavirus pandemic.

According to MRC ScanPlast, ABS production in Russia in May amounted to 780 tonnes. For the period January - May this year, the volume of production of Russian ABS plastics amounted to 4,240 tonnes, down 17% compared to last year.

Versalis is a petrochemical company, a 100% subsidiary of the Italian oil and gas company Eni SpA. The company produces a wide range of petrochemical products and is also one of the world's leading elastomer companies.

Eni S.p.A. (Ente Nazionale Idrocarburi) is an Italian oil and gas company headquartered in Rome. Eni operates in 70 countries around the world.
MRC

Crude oil futures slip on rising coronavirus infections worldwide

MOSCOW (MRC) -- Crude oil futures traded lower during mid-morning trade in Asia July 20 as rising coronavirus infections worldwide weighed market sentiment down, reported S&P Global.

At 10:30 am Singapore time (0230 GMT), ICE Brent September crude futures were down 24 cents/b (0.49%) from the July 17 settle at USD42.90/b, while the NYMEX August light sweet crude contract was down by 20 cents/b (0.46%) at USD40.39/b.

Rising demand and a strong drawdown on inventories, with the US Energy Information Administration's data showing inventories falling 7.5 million barrels and total product supplied for distillate fuel oil climbing 22% to 3.69 million b/d for the week ended July 10, signaled improving demand-supply fundamentals and kept prices buoyant last week.

However, lingering concerns over rising coronavirus infections worldwide and its impact on demand continued to weigh on market sentiment and limited the upside. The rolling three-day daily average for cases globally is at a record high 242,000, with the US contributing to nearly 30% of these case counts, latest data from John Hopkins University showed.

"Even though the US had continued to see a rising number of cases, printing a record daily count of above 77,000 into the end of last week, the relatively contained mortality rate compared to the earlier flare up in the March to April period had perhaps downplayed some of the market concerns on hand," Pan Jingyi, market strategist at IG, said in a July 20 note.

On the supply front, while OPEC+ has agreed to taper production cuts to 7.7 million b/d starting from August, extra compensation cuts of roughly 840, 000 b/d from previously non-compliant countries indicates only 1.1 million b/d of returning production, instead of the anticipated 2 million b/d.

At the same time, even as an increased supply of crude from producers was seen as largely negative for the oil markets amid an uncertain demand outlook, the willingness of member nations to comply with agreed production cuts and a guarantee of the principle of compensation is ultimately supportive.

"In the coming months, my rangebound price forecast remains anchored to the view that OPEC compliance will provide a dependable price plank. At the same time, bullish ambitions will continue to be thwarted by the COVID-19 demand risk," Stephen Innes, chief global markets analyst at AxiCorp, said in a note July 20.

He added that, while "the medium and longer-term trajectory looks broadly positive", the steepening epidemic curve has to flatten and oil demand has to pick up again before the market will view oil as an absolute risk-on trade.

As MRC wrote previously, global oil consumption cut by up to a third in Q1 2020. What happens next in the oil market depends on how quickly and completely the global economy emerges from lockdown, and whether the recessionary hit lingers through the rest of this year and into 2021.

Earlier this year, BP said the deadly coronavirus outbreak could cut global oil demand growth by 40 per cent in 2020, putting pressure on Opec producers and Russia to curb supplies to keep prices in check.

And 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 DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC