Sasol resumes commissioning of its new LDPE plant in Lake Charles

MOSCOW (MRC) -- Sasol said Sept. 21 the new low density polyethylene (LDPE) plant, which had been slated to start up in early 2020 before it was damaged by fire during commissioning in January, did not sustain any significant storm impacts, reported S&P Global.

The company has resumed commissioning the plant, the last of the new units in the company's USD12.8 billion Lake Charles expansion, and expects to begin startup once power is fully restored at the site.

As MRC informed earlier, Sasol expects to restart crackers and downstream derivative units at its Lake Charles, Louisiana, complex by early- to mid-October once full load power is restored. "The Sasol Lake Charles site is currently partially energized," the company said.

Sasol added that it had finished damage assessments of all 14 manufacturing units and associated utilities and infrastructure at the complex, which was shut ahead of Hurricane Laura's Aug. 27 assault. Lake Charles took a direct hit from the Category 4 storm, which came ashore Aug. 27 packing 150 mph winds. Sasol said those assessments found moderate wind damage to cooling towers and some insulation and building damage, but no apparent damage to major process equipment, utilities and infrastructure.

Sasol's Lake Charles complex includes 1.5 million mt/year and 439,000 mt/year crackers; a 470,000 mt/year linear low density polyethylene plant (LLDPE); a 380,000 mt/year ethylene oxide/monoethylene glycol (MEG) unit; and a new 420,000 mt/year LDPE plant. The company issued a force majeure declaration on North American PE.

According to MRC's ScanPlast report, July estimated LDPE consumption in Russia decreased to 43,380 tonnes from 55,380 tonnes a month earlier. Angarsk Polymers Plant and Gazprom neftekhim Salavat cut thei shipments to the domestic market because of shutdowns for maintenance. Russia's estimated LDPE consumption grew to 335,000 tonnes in January-July 2020, up by 6% year on year. Despite the long outages, LDPE production increased, and imports also rose.

Sasol is an international integrated chemicals and energy company that leverages technologies and the expertise of our 31 270 people working in 32 countries. The company develops and commercialises technologies, and builds and operates world-scale facilities to produce a range of high-value product stream, including liquid fuels, petrochemicals and low-carbon electricity.

Indian Oil to build PP, base oil plants, raise crude processing capacity

MOSCOW (MRC) -- Country's largest oil marketing company Indian Oil Corporation proposes to leverage its growing petrochemical operations to expand textile business as it looks to diversify operations and offset risks associated with oil operations, said Swarajyamag.

At a recent Asia Pacific oil summit IOC chairman S M Vaidya reportedly said that petrochemical expansion is being targeted by the company as it gives the company ability to de-risk from lower refining margins.

The chairman said that the petrochemical expansion would look into entering niche areas with a possibility of forward integration into textile business.

Petrochemical presents big opportunity in India as the per capita consumption still remains very low. This is expected pick up pace in coming years and IOC wants to capture most of emerging market.

IOC is expanding its petrochemical capacity by more than 70 per cent from its current 3.2 million tonnes a year. It is also on new technologies that reduces the cost of producing petrochemicals.

The project will add a 500,000 metric tons/year PP unit as well as a 235,000 metric tons/year lube oil base stock plant.

According to MRC's ScanPlast report, Russian plants' total PP production grew to 158,800 tonnes in July, compared to 149,400 tonnes a month earlier; ZapSibNeftekhim, Nizhnekamskneftekhim and Poliom increased their capacity utilisation. Russia"s overall PP production reached 1,063,700 tonnes in January-July 2020, compared to 854,500 tonnes a year earlier. Five out of eight producers raised their capacity utilisation, with a new producer - ZapSibNeftekhim - accounting for the main increase in the output.

Indian Oil Corporation Limited, or IndianOil, is an Indian state-owned oil and gas corporation with its headquarters in New Delhi, India.

Nestle Waters and Biffa strike rPET deal

MOSCOW (MRC) -- UK waste management company Biffa has partnered Nestle Waters UK to produce 100% recycled polyethylene terephthalate (R-PET) bottles for Nestle’s Buxton range of bottled water from 2021, the companies announced this week.

Nestle hopes that the partnership will enable it to significantly reduce the amount of virgin plastic in circulation and lead the shift to the use of high-quality food-grade rPET that has been recycled in the UK, rather than sourcing it from Europe.

Biffa has set a target to quadruple its plastic recycling by 2030, and the rPET supplied to Nestle Waters will come from the company’s new ?27.5m plastic recycling facility in Seaham, County Durham in the UK.

The plant has the capacity to process the equivalent of 1.3bn plastic bottles each year and will supply recycled material to Nestle Waters’ Buxton factory from 2021.

Michel Beneventi, managing director for Nestle Waters UK, said: “By working together through sharing expertise across our companies to advance PET recycling for circularity, I believe we can be a force for good, helping to create positive, long-lasting impact and change for the planet.

"Having access to a local rPET supply reduces the carbon footprint of producing, sourcing, and transporting our packaging from outside the UK and demonstrates the value that plastic drinks bottles have when they are recycled.

“Nestle Waters has ambitious commitments to sustainability, with a pledge for all its brands to be carbon neutral by 2025. This collaboration with Biffa is a big step towards helping us achieve that and making a circular system for plastics a reality."

Chris Hanlon, commercial manager at Biffa Polymers, added: “At Biffa, a key pillar of our sustainability strategy is to help build a circular economy in the UK, part of which is to help our customers develop sustainable packaging that can fit into the closed-loop recycling system that we are working to develop.

"The collaboration with Nestle Waters UK is a great example of this strategy in action, using recycled plastic to manufacture plastic bottles for resale. It demonstrates that when used correctly, plastic can have a sustainable role in modern life and we’re very much looking forward to working with Nestle Waters UK and helping it to achieve its recycling goals."

Many R-PET players in the UK and in mainland Europe are waiting to see the outcome of Brexit trade talks ahead of the 31 December 2020 deadline.

A no-deal Brexit may cause problems for R-PET entering the UK from mainland Europe if it is delayed at customs checks, which could have knock-on effects on availability from next year.

As MRC informed before, Nestle is to invest up to Swiss francs (Swfr) 2bn (USD2.1bn) to shift packaging production from virgin to recycled polymers over the next five years. The company is to source up to 2m tonnes of food-grade recycled plastics and has allocated Swfr1.5bn up to 2025 to pay a premium for those materials as part of a drive to create a viable market for those products. The company will seek operational efficiencies to keep the process revenue neutral.

According to MRC's ScanPlast report, Russia's estimated PET consumption totalled 367,720 tonnes in the first six months of 2020, up by 19% year on year. Russian companies processed 62,910 tonnes of material in June.

Fire at Hazira gas processing plant in Surat under control: ONGC

MOSCOW (MRC) -- A fire broke out at an Oil and Natural Gas Corporation (ONGC) plant in Surat in early hours of Thursday, reported Hindustan Times.

It was brought under control and no casualties or injuries were reported, ONGC tweeted.

“Around 3am, three consecutive blasts took place at ONGC Hazira Plant which led to the fire. Firefighters are present at spot. No casualty has been reported so far. The activity of depressurizing the pressurized gas system underway by ONGC officials,” said Dr Dhaval Patel, Surat’s collector had said.

“The fire has been brought under control. There were no casualties or injuries reported,” ONGC tweeted.

More details are awaited.

As MRC informed earlier, four people were killed and three seriously injured in a fire at an oil and gas processing plant on the outskirts of Mumbai run by India’s Oil and Natural Gas Corp. The fire broke out in the morning, on 3 September. ONGC supplies crude oil from the plant to the Mumbai-based refineries of Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum (HPCL) as well as natural gas to city gas distribution company Mahanagar Gas Ltd in Mumbai.

We remind that in January 2020, BPCL said it would invest about Rs25,000 crore to set up an ethylene cracker plant at Rasayani, 50 kilometres from its Mumbai refinery, as the firm pushes further into the petrochemicals business to fuel growth.

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.

Oil and Natural Gas Corporation (ONGC) is an Indian multinational oil and gas company. Its registered office is now at New Delhi, India. It is a Public Sector Undertaking (PSU) of the Government of India, under the administrative control of the Ministry of Petroleum and Natural Gas. It is India's largest oil and gas exploration and production company. It produces around 70% of India's crude oil (equivalent to around 30% of the country's total demand) and around 62% of its natural gas.

Crude oil prices rangebound after Libya's NOC lifts force majeure

MOSCOW (MRC) -- Oil futures were caught in a range during the mid-morning trade in Asia Sept. 21, even as Libya's state-owned National Oil Corp. lifted the force majeure on oil fields and ports on Sept.19, raising concerns of oversupply in a market plagued by demand uncertainty, reported S&P Global.

At 11.15 am Singapore time (0315 GMT), ICE Brent November crude futures were trading at $43.19/b, up 0.04 cents/b (0.09%) from the Sept. 18 settle, while the NYMEX October light sweet crude contract was at $41.14/b, up 3 cents/b (0.07%).

Libya's NOC lifted the force majeure on oil fields and ports, excluding facilities where militants are still present, after the Libyan National Army's leader Khalifa Haftar said on Sept.18 in a public broadcast that a blockade on oil exports, effective since Jan. 18, would be lifted immediately.

The lifting of NOC's force majeure could result in the return of up to 1.1 million b/d of crude oil that Libya had been pumping to the market before the blockade was imposed, marking a significant increase over the 100,000 b/d pumped during the blockade.

The return of Libyan crude could add to the woes of the OPEC+ coalition, which has been struggling with non-compliance issues from members as it tapers its oil output cuts to 7.7 million b/d from August onwards, from the 9.7 million b/d cut mandated from May through July.

While the OPEC+ meeting held on Sept. 17, during which Saudi energy minister Prince Abdulaziz bin Salman secured commitments from compliance laggards to compensate for their excess production, boosted market sentiment, traders are now concerned over the prospect of additional oil from Libya amid weak demand.

"The market can ill afford more crude hitting the market," ANZ analysts said in a Sept. 21 note. They reasoned that "The resurgence in COVID-19 infections around the world has seen many governments halt the easing of restrictions".

Stephen Innes, chief global markets strategist at AxiCorp , echoed a similar sentiment in a Sept. 21 note where he expressed concern over the possibility that wider-sweeping lockdowns will weigh down oil demand, with the coronavirus pandemic entering the unchartered territory of the winter months. "Winter months could prove to be one of the bitterest obstacles of them all," Innes said in the note.

As MRC informed earlier, global oil refiners reeling from months of lackluster demand and an abundance of inventories are cutting fuel production into the autumn because the recovery in demand from the impact of coronavirus has stalled, according to executives, refinery workers, and industry analysts. Refiners cut output by as much as 35% in spring as coronavirus lockdowns destroyed the need for travel. As lockdowns eased, refiners increased output slowly through late August. But in top fuel consumers the United States and elsewhere, refiners have been decreasing rates for the last several weeks in response to increased inventories, a sustained lack of demand, and in response to natural disasters.

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.