Citgo has no plans to idle damaged Lake Charles refinery, furlough workers

MOSCOW (MRC) -- Citgo Petroleum Corp said it is not planning to idle its 418,000 barrel-per-day (bpd) Lake Charles, Louisiana, refinery damaged by Hurricane Laura, reported Reuters.

Rumors have circulated since Laura’s passage over the Lake Charles area on Aug. 27 that Citgo was considering shutting the refinery for an indefinite period because of the extent of the damage and continuing low demand for motor fuels in the COVID-19 pandemic.

As MRC informed previously, Citgo Petroleum Corp said an early assessment of its 418,000-bpd Lake Charles refinery revealed “no major structural damage to operating equipment”. Sources familiar with plant operations have said that significant damage was done by the winds of deadly Hurricane Laura, especially to cooling towers, and it would be four to six weeks before the refinery restarts.

We remind that in the first week of July, 2020, Citgo restarted the large gasoline-producing fluid catalytic cracker at its 167,500-barrel-per-day (bpd) Corpus Christi, Texas, refinery.

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.

Borealis to restart Stenungsund cracker in Q4 2020

MOSCOW (MRC) -- The light-feed 625,000-metric tons/year Borealis steam cracker at Stenungsund, Sweden, is expected to restart operations in the fourth quarter this year after a fire broke out at the plant in May, reported Chemweek with reference to the company's statement Friday.

The cracker has been under force majeure for almost four months after the blaze at the plant on 10 May, which was subsequently brought under control the following day.

"The restart will be in Q4 this year," a Borealis spokesperson told OPIS Friday.

The Stenungsund cracker is known to have substantial cavern storage for liquefied petroleum gas (LPG) as feedstock, believed to be in excess of 300,000 metric tons for propane alone, according to sources. Borealis has continued to import cargoes while the steam cracker is offline, with an estimated 270,000 metric tons of LPG imported to the site in the months following the declaration of force majeure, according to OPIS records. The restart could begin in November, according to trading sources.

Borealis also operates a propane dehydrogenation (PDH) plant at Kallo, Belgium, and has started construction on a second PDH unit at the same location, with a last known start-up date pegged for the second quarter of 2022, according to the company. The PDH plant was said at the time to cost USD1 billion and have the capacity to produce 750,000 metric tons/year of propylene.

OPIS is an IHS Markit company.

As MRC informed earlier, Borealis said Monday (11 May, 2020) that it was still investigating a fire that broke out late Saturday at its Stenungsund steam cracker in Sweden. Borealis said in an initial public statement issued Sunday that "its emergency plan was immediately activated by the local crisis team." The fire broke out on 9 May, at 20:45 CEST.

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

According to MRC's ScanPlast report, Russia's overall PE production totalled 1,712,400 tonnes in the first seven months of 2020, up by 58% year on year. Linear low density polyethylene (LLDPE) accounted for the greatest increase in the output. At the same time, overall PP production in Russia increased in January-July 2020 by 24% year on year to 1,063,700 tonne. ZapSibNeftekhim accounted for the main increase in the output.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. With headquarters in Vienna, Austria, Borealis currently employs around 6,500 and operates in over 120 countries.

LyondellBasell JV starts up USD2.6-billion petchem complex in China

MOSCOW (MRC) -- LyondellBasell and Liaoning Bora Enterprise Group have commenced operations at their 1.1-million metric tons/year ethylene plant and associated polyolefins complex at Panjin in Liaoning Province, northeastern China, reported Chemweek.

The cost of the project is approximately USD2.6 billion.

The two companies in September 2019 established a 50/50 joint venture (JV), Bora LyondellBasell Petrochemical Co., for the project.

The ethylene plant has the flexibility to consume naphtha and liquefied petroleum gas. The downstream complex includes units producing 800,000 metric tons/year of polyethylene (PE) and 600,000 metric tons/year of polypropylene (PP) using LyondellBasell’s Hostalen ACP PE technology and the company’s Spheripol and Spherizone PP processes.

The complex will supply the packaging, transportation, building and construction, and healthcare and hygiene industries. The materials produced at the facility will be sold for use within China.

The two companies are planning medium-to-long-term collaboration on additional petchem projects that could be deployed in multiple phases over the next 10 years.

"The northeast is on the forefront of China's next round of regional revitalization. It is an attractive destination for investment, with abundant natural resources, upgraded infrastructure, and improving business environment, supported by the government's long-term development vision," says Qu Baoxue, the controlling shareholder of Bora.

Demand for polyolefins "has returned in China after the pandemic-related economic slowdown earlier in the year, and the long-term growth trends are very favorable for this project," says Bob Patel, CEO of LyondellBasell. "We look forward to potential future opportunities that would allow us to expand our local manufacturing footprint."

The Bora LyondellBasell Petrochemical ethylene plant is one of four steam crackers scheduled to start up in China by the end of this year.

According to IHS Markit, Asia is the largest and fastest-growing polyolefins market in the world. China accounts for more than 60% of the Asian polyolefins market and represents 40% of worldwide polyolefins growth.

As MRC informed earlier, LyondellBasell has already invests in several chemical plants in China, including a joint venture with a unit of state refiner Sinopec Corp.

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.

Bora is one of more than 40 independent Chinese refiners that have grown rapidly since late 2015 to account for a fifth of China’s total crude oil imports.

LyondellBasell is one of the largest plastics, chemicals and refining companies in the world. Driven by its 13,000 employees around the globe, LyondellBasell produces materials and products that are key to advancing solutions to modern challenges like enhancing food safety through lightweight and flexible packaging, protecting the purity of water supplies through stronger and more versatile pipes, and improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road. LyondellBasell sells products into approximately 100 countries and is the world's largest licensor of polyolefin technologies.

COVID-19 - News digest as of 04.09.2020

1. ExxonMobil weighs global job cuts after unveiling Australian lay-off plan

MOSCOW (MRC) -- ExxonMobil Corp is assessing possible worldwide job cuts, a spokesman said, after the company announced a voluntary lay-off program in Australia, according to Hydrocarbonprocessing. Exxon is the latest oil major to embark on axing jobs spurred by a historic collapse in fuel demand because of the coronavirus pandemic. The company has slashed capital spending this year by 30% to around USD23 billion and said in August it planned both capital and operating expense cuts to defend its dividend after reporting losses in the first and second quarters.


Chevron Phillips Chemical declares force majeure for PE in USA

MOSCOW (MRC) -- Chevron Phillips Chemical declared force majeure Sept. 1 on its polyethylene (PE) products after assessing the impact of Hurricane Laura to its Gulf Coast PE operations, the company said in a letter seen by S&P Global.

"Unfortunately, it has become apparent that issues arising in connection with the hurricane and the associated outages have impacted our planned production and delivery of polyethylene products," CP Chem stated.

CP Chem operates a 420,000 mt/year high-density polyethylene (HDPE) plant in Orange, Texas, and an 855,000 mt/year cracker in Port Arthur.

The company plans to minimize the impact of the event and return to full PE deliveries as soon as possible, the letter said.

Although there was no exact recovery timeline, the letter stated that it's working to evaluate the duration of the interruption.

The letter follows a group of force majeure declarations by other petrochemical producers this week, including Westlake Polymers, Ineos Olefins & Polymers and Sasol, which are all recovering from widespread power outages and damage from Laura, which made landfall on Aug. 27.

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.

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.

Headquartered in San Ramon, California, Chevron Corporation is the the second-largest integrated energy company in the United States and among the largest corporations in the world. Chevron is involved in upstream activities including exploration and production, downstream activities including refining, marketing and transportation, and advanced energy technology. Chevron is also invested in power generation and gasification processes.