Companies shut in 13% of oil production, 4.4% of gas as storms hit US Gulf of Mexico

MOSCOW (MRC) -- In advance of two tropical storms headed toward the US Gulf of Mexico, upstream operators have shut in 13% of the region's total oil production and more than 4% of its natural gas, reported S&P Global with reference to the Bureau of Safety and Environmental Enforcement's (BSEE) statement Aug. 22.

Total shut-in crude amounts to about of 240,785 b/d of oil, along with 19,000 Mcf/d of natural gas, or 4.39% of total US Gulf gas production, BSEE said.

Six producing platforms, or just under 1% of all those in the US Gulf, have been evacuated, along with four rigs, which are 40% of all rigs in the Gulf, the agency said.

In the past 24 hours, BP, Shell and Chevron - three of the US Gulf's biggest producers - said they have shut down production on assorted platforms in the projected paths of the storms.

Some independents are also evacuating crews from platforms ahead of the storms, which should strike the US Gulf Coast by mid-week.

The US Gulf produces currently about 1.85 million b/d of oil and about 2.7 Bcf/d of natural gas.

At 2 p.m. ET, Laura was projected to have mostly crossed over Puerto Rico and headed northwest towards the Louisiana coast, while at about 1 p.m., Marco was forecast to be near the tip of the Yucatan Peninsula and headed northwest for the southeast Texas coast, according to maps by the US National Hurricane Center.

Both storms are predicted to become hurricanes as they near the coast, but currently only Laura is projected to remain at that wind speed (minimum 74 mph) as it is about to make landfall, NHC maps showed.

Laura is targeted to make landfall around Aug. 26. Marco if forecast to be downgraded to a tropical storm prior to striking shore late Aug. 25 or early Aug. 26.

As MRC informed earlier, on 18 August, 2020, Chevron Corp reported a fire at its 112,229-barrel-per-day (bpd) Pasadena, Texas facility. "At this time, flames, smoke may be noticeable to the community. We are coordinating with local officials, and working to resolve the issue as soon as possible," the company reported on August, 19.

We remind that US-based Phillips 66 remains open to developing another ethane cracker for its Chevron Phillips Chemical (CP Chem) joint venture, the refiner's CEO said in March 2018.

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

Barge hits propane pipeline in Port of Corpus Christi, causing explosion

MOSCOW (MRC) -- A dredging barge hit a natural gas liquids pipeline at the Port of Corpus Christi, Texas early Aug. 21, causing an explosion, reported S&P Global with reference to sources.

"Shortly after 8 a.m. CDT today Enterprise Products Partners ("Enterprise") experienced a release of propane from a portion of its South Texas pipeline system at the Port of Corpus Christi. The incident resulted in a fire and unconfirmed reports of injuries," Enterprise said in a statement. "Initial findings indicate that the pipeline was struck by a third-party dredging barge working in the immediate vicinity, however a full investigation will be conducted to determine the cause."

Enterprise "has isolated the affected segment of the pipeline," the company said.

The explosion was caused by the dredging barge Waymon I Boyd, said a spokeswoman from the United States Coast Guard Atlantic Area.

The US Coast Guard shut down vessel traffic in the Corpus Christi Ship Channel Inner Harbor around 8 am Aug. 21, establishing a safety zone from the Inner Harbor Bridge at US Hwy 181 to the Viola Turning Basin.

The spokeswoman for the Coast Guard said there was no estimate for when vessel flow would resume in the safety zone.

The Inner Harbor channel, nicknamed Refinery Row, includes docks and terminals for companies including Citgo, Valero, Trafigura, Buckeye, and Plains Marketing. The channel also contains multiple bulk material terminals.

A Valero spokesperson said the company's Corpus Christi refineries are operating under normal conditions and no Valero employees were impacted by the incident.

No impact was seen in refined products markets. The US Gulf Coast is well-supplied with gasoline and distillates because of low demand stemming from the coronavirus pandemic.

Also, no immediate market impact was felt on the clean or dirty tanker markets, with the length of the channel closure still unknown. Platts Analytics cFlow showed two Aframax tankers and one Suezmax tanker anchored inside the Inner Harbor, and for product tankers two Medium Range ships and one Long Range 1 tanker were shown anchored in the area.

As MRC wrote before, Enterprise Products Partners LP (EPP), through one of its affiliates, has entered a long-term agreement with Marubeni Corp. of Japan, under which Marubeni will offtake polymer-grade propylene (PGP) produced from a second (PDH 2) plant currently under construction at EPP’s operations in Mont Belvieu, Tex., for supply to global customers. Concluded on June 16, the PGP offtake agreement is part of a long-term collaboration between EPP and Marubeni that also includes the export of liquefied ethylene, the first 25-million lb vessel of which loaded and sailed from EPP and Navigator Holdings Ltd.’s 50-50 joint venture marine terminal at Morgan’s Point, Tex., in early January, EPP and Marubeni said on June 30.

We remind that in July, 2020, Enterprise Products conducted maintenance at its propane dehydrogenation (PDH) unit in Mont Belvieu, Texas. This PDH unit has the capacity of 750,000 mt/y of propylene.

Propylene is the main feedstock for the production of polypropylene (PP).

According to MRC's DataScope report, 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

Sichuan Jinlu Group reports emergency shutdown at PVC plant in China due to flooding

MOSCOW (MRC) -- Sichuan Jinlu Group has halted operations at its Polyvinyl chloride (PVC) carbide based plant owing to flooding in the region, according to Apic-online.

A Polymerupdate source in the US informed that, the company has undertaken an unplanned shutdown at the plant early this week. The exact duration of the shutdown could not be ascertained.

Located at Deyang, China, the PVC carbide based plant has a production capacity of 300,000 mt/year.

According to MRC's DataScope report, imports of suspension polyvinyl chloride (SPVC) into Russia totalled 13,800 tonnes in the first half of 2020, up by 5% year on year, whereas exports grew by 7% year on year.

Sichuan Jinlu Group is principally engaged in the manufacture and sale of chemical materials and processed products. The Company is also involved in the real estate business. The company mainly offers polyvinyl chloride (PVC) resins and caustic soda. During the year ended December 31, 2009, the company manufactured 270,500 metric tons of PVC resins. The company distributes its products mainly in the domestic markets, including the southwestern, southeastern and northwestern areas of China. As of December 31, 2009, the Company had 10 major subsidiaries and two associates.
MRC

Braskem teams up with chemistry technology company for EDC plant

MOSCOW (MRC) -- Brazilian petrochemical producer Braskem has teamed up with a US chemistry technology company to build a demonstration ethylene dichloride (EDC) plant in Brazil that the companies say will use less power and cost less than traditional production methods, according to S&P Global.

If successful, the project could provide Braskem with more Brazil-based EDC production, potentially reducing the company's needs for imports to maintain its normal downstream output of PVC, a construction staple used to make pipes, window frames, vinyl siding and other products.

California-based Chemetry will employ its eShuttle EDC process, which involves a metal chloride reaction with ethylene to make EDC, bypassing the need to make chlorine gas to react with ethylene.

EDC, a precursor to PVC, is traditionally produced by reacting chlorine gas with ethylene after salt and water are split using electricity in the chlor-alkali process. That process makes chlorine gas, hydrogen gas and caustic soda, a key feedstock in the alumina and pulp and paper industries, as a byproduct.

Chemetry's process involves a metal chloride reaction, which the company says uses less energy, without the generation of chlorine gas.

"The difference is that we don't use the salt, water and power to make chlorine gas to then react with the ethylene," said Bob Snyder, chief strategy officer at Chemetry. "We skip the chlorine separation part and just react the chloride ion with ethylene."

That eliminates the need to store, manage or transport chlorine gas or liquid, he said. It also saves power, "since it takes more power to make free chlorine than to just free up the chloride ion," he said.

In May 2019, Braskem shut its sole EDC plant in Brazil and an upstream chlor-alkali plant in Maceio, the capital city of the state of Alagoas, after a government report linked the company's salt mining operation in Maceio to geological damage in the area.

The closures made Braskem wholly dependent on EDC imports to maintain its PVC output, and increased its caustic soda import needs to supply customers.

Braskem announced plans in late 2019 to permanently cease salt mining in Maceio, and has since arranged to receive salt from Chile and later from the Brazilian state of Rio Grande do Norte - north of Alagoas - to feed the chlor-alkali plant.

Braskem on Aug. 6 said the company aims to restart the shut plants during the fourth quarter of 2020.

However, the company will still need occasional EDC imports to supplement output from the 520,000 mt/year EDC plant in Maceio. The company started importing EDC several times a year in 2018 after expanding its PVC output.

Isabel Figueriedo, Braskem's vice president and vinyls and specialties business unit leader, said in a statement that Chemetry's technology would support Braskem's efforts to grow and diversify globally.

According to MRC's DataScope report, imports of suspension polyvinyl chloride (SPVC) into Russia totalled 13,800 tonnes in the first half of 2020, up by 5% year on year, whereas exports grew by 7% year on year.

Braskem S.A. produces petrochemicals and generates electricity. The Company produces ethylene, propylene, benzene, toluene, xylenes, butadiene, butene, isoprene, dicyclopentediene, MTBE, caprolactam, ammonium sulfate, cyclohexene, polyethylene theraphtalat, polyethylene, and polyvinyl chloride (PVC).
MRC

Hengyi Industries contracts DuPont Clean Technologies for alkylation technology

MOSCOW (MRC) -- DuPont Clean Technologies (DuPont) has been awarded the contract to supply Hengyi Industries SDN BHD (Hengyi) with licensing and engineering for a STRATCO alkylation unit at the Brunei refinery in Pulau Murara Besar, Brunei, reported Chemweek.

The new refinery will not only supply the domestic market but also plans to produce refined fuel for export. In order to comply with the China VI standard of 10 ppm sulfur content for fuel, Hengyi commissioned DuPont for a STRATCO alkylation unit with 800 kmta (20,750 bpsd) alkylate capacity. The Pulau Muara Besar refinery and petrochemical plant has the capacity to refine 8 million tons of crude oil per year.

The STRATCO alkylation unit will enable Hengyi to generate low-sulfur, high-octane, low-Rvp alkylate with zero olefins that meets the criteria of the China VI standard. Startup is targeted for 2023.

“It is a privilege to be selected by Hengyi for this project award and DuPont is thrilled to be working with them on this grassroots unit to meet specifications for the China VI standard. “We anticipate a strong relationship between our two companies and are excited to cooperate with Hengyi on seeing this project through to completion. We are committed to supporting them for many years to come in helping them to achieve their objectives,” said Kevin Bockwinkel, global business manager, STRATCO alkylation technology.

“We are extremely pleased to be working with DuPont on this endeavor. We look forward to having DuPont design an alkylation unit meeting all of our gasoline pool specifications. DuPont comes with years of valuable experience and proven quality in alkylate production,” said the Hengyi No. 5 Refinery Technical Lead.

The STRATCO alkylation Technology is a sulfuric acid, catalyzed process that converts low-value, straight-chain olefins (propylene, butylene and amylene) into high-value, branched components called alkylate. Alkylate, with its superior blending properties, is a key component for clean gasoline and the STRATCO alkylation technology helps refiners safely produce cleaner-burning gasoline with high octane, low-Reid vapor pressure, low sulfur, zero aromatics and zero olefins.

The STRATCO alkylation technology is licensed and marketed by DuPont as part of its Clean Technologies portfolio in Overland Park, Kansas. DuPont is the world leader in alkylation technology with more than 100 licensed units worldwide and more than 915,000 bpsd (35,800 kmta) of installed capacity. DuPont is committed to alkylation research and has extensive experience in assisting refiners with alkylation research, design, start-ups, test runs, troubleshooting, optimization, revamps, expansions, analytical testing, operator training, turnarounds and HAZOP studies.

As MRC informed earlier, DuPont has launched “Operation Airbridge,” with the US Department of Health and Human Services (DHHS) and FedEx to speed production and delivery of medical garments made from DuPont’s Tyvek material. Operation Airbridge will enable expedited shipping of Tyvek garments critical to coronavirus disease 2019 (COVID-19) relief via air, instead of sea. FedEx Express will transport Tyvek roll goods from DuPont’s Richmond, Virginia, production plant to garment manufacturers in Vietnam. They will then return to the US with finished Tyvek garments to be added to the US Strategic National Stockpile.

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