PetroVietnam says annual output unaffected by COVID-19 pandemic

MOSCOW (MRC) -- Vietnam's state oil firm PetroVietnam said it was on track to meet its targeted rate of production this year, despite the impact of the coronavirus pandemic and the fall in global crude oil prices, reported Reuters.

The company, formally known as Vietnam Oil and Gas Group, produced 18.12 million tons of crude oil and gas equivalent in the year to Nov. 15, meeting 89% of the yearly target set before the pandemic, it said in a statement.

It produced 10.2 million tons of refined petroleum products during the period, meeting 86.5% of its yearly target, the company added.

PetroVietnam is the largest contributor to Vietnam's state budget and often accounts for more than 10% of the Southeast Asian country's gross domestic product.

The company said it paid 61.7 trillion dong (USD2.66 billion) to the state budget in the period, without giving comparative figures.

As MRC informed before, in H1 October, 2020, two consortiums led by Hyundai Engineering & Construction and Technip Italy were bidding for a USD1.8 billion project to upgrade and expand Vietnam’s Dung Quat refinery. Binh Son Refining and Petrochemical said in a statement the project would raise the refinery’s capacity by 30% to 8.5 million tons of crude oil a year, or 170,000 barrels per day (bpd).

We remind that Binh Son Refinery and Petrochemical restarted the polypropylene (PP) plant at the beginning of October 2020 following a major maintenance shutdown. The 150,000 tons/year unit was taken off-stream on 12 August as the producer conducts overhaul at the upstream units.

According to MRC's ScanPlast report, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, excluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

EIA reports slight decline in weekly propane/propylene stocks

MOSCOW (MRC) -- US propane and propylene stocks fell 300,000 barrels (bbl) in the week ended 20 November to 92.6 million bbl, according to Chemweek with reference to the US Energy Information Administration's (EIA) statement Wednesday.

Nationwide stocks were down 0.4% on the week and were 4.2% above year-ago levels of 88.3 million bbl.

A 900,000 bbl build in the PADD 1 (East Coast) region, to 9 million bbl, partially offset declines in all other PADDs. PADD 3 (Gulf Coast) fell 400,000 bbl to 51.8 million bbl, PADD 2 (Midwest) dropped 600,000 bbl to 25.8 million bbl and PADDs 4 and 5 slid 300,000 bbl to 6.0 million bbl.

Exports of propane and propylene increased 99,000 b/d to 1.323 million bbl, while imports rose 24,000 b/d to 152,000 b/d.

Demand, as suggested by product supplied, fell 299,000 b/d to 1.171 million b/d. Refiner and blender net production of propane and propylene rose 15,000 b/d to 2.295 million b/d.

Following the report's release, bids and offers for Mont Belvieu TET (Lone Star) and non-TET (Enterprise) were both 54.375–54.75 cents/gal. That is not far off identical ranges of 54.5–54.75 cents/gal each grade traded ahead of the data.

Conway was last talked at 52.5–53 cents/gal, vs. a pre-EIA range of 52–52.75 cents/gal.

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 ScanPlast report, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, excluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

Indorama secures USD300 mln from IFC to raise recycling capacity

MOSCOW (MRC) -- The first-ever blue loan to a global plastic resin manufacturer will lead to the recycling of 50 billion PET (polyethylene terephthalate) bottles globally a year by 2025 including four countries in Asia and one in Latin America, diverting plastic waste from landfills and oceans, said Chemweek.

The landmark USD300 million financing package has been arranged by the International Finance Corporation (IFC), a member of the World Bank Group, for Indorama Ventures Global Services Limited (IVGS), a subsidiary of Indorama Ventures Public Company Limited (IVL), a leading global manufacturer and recycler of PET resin. The funding will help IVL increase its recycling capacity in Thailand, Indonesia, Philippines, India, and Brazil—countries which are grappling with mismanaged waste and serious plastic waste in the environment—and invest in renewable energy and resource efficiency projects. This marks IFC’s first blue loan exclusively focused on addressing marine plastic pollution. A Blue Loan is an innovative instrument whereby the funds raised are certified and tracked exclusively for projects that support a Blue Economy – i.e. sustainable use of ocean resources for economic growth, improved livelihoods and jobs, and ocean ecosystem health.

"We are honored to receive the first blue loan from IFC," said Yashovardhan Lohia, Chief Sustainability Officer, Indorama Ventures. “Our company, IVL, is building the recycling infrastructure needed to divert waste from the marine environment. By recycling post-consumer PET bottles into new bottles, we give waste an economic value. This drives improvements in waste collection systems, meaning less waste and cleaner oceans."

Indorama Ventures is aiming for a minimum of 750,000 metric tons of recycled PET (rPET) globally by 2025. A key feature of the investment is to create value out of waste—processing post-consumer PET bottles that would have ended up in landfill or been processed into lower-value products—by promoting higher-value bottle-to-bottle recycling which brings significant value generating potential.

"We are pleased to work with IVL, a global leader in PET manufacturing and recycling, to develop scalable solutions to one of the most pervasive and visible issues threatening life under water,” said Alfonso Garcia Mora, IFC Vice President for Asia and Pacific. “This blue loan complements IFC's ongoing work on a circular economy for plastics and enhanced waste management in Asia. It demonstrates that recycling can be an effective intervention to address plastic waste while supporting our overall sustainability and climate change agenda."

Besides helping IVL increase its recycling capacities in five countries, the loan will also help the company invest in other climate-related activities. IVL will install more solar panels at facilities in Thailand and India with other sites to follow, while also securing more renewable energy for its manufacturing facilities. With IFC financing, IVL is working on a Waste Heat Recovery (WHR) project at its PET and fiber manufacturing facility in Indonesia where energy efficiency (EE) measures are expected to reduce the facility’s carbon footprint by as much as 25 percent. In addition to developing innovative WHR projects, IVL will be developing EE projects in Brazil and other manufacturing facilities to meet its corporate targets.

IFC’s financing package comprises a USD150 million senior loan from IFC and parallel loans of USD150 million from the Asian Development Bank (ADB) and Deutsche Investitions-und Entwicklungsgesellschaft (DEG). IFC is also working closely with the World Bank to leverage public-private sector collaboration and develop policies and investments critical to systematically address the complex marine plastic pollution problem.

As MRC informed earlier, Indorama Ventures Sines, a subsidiary of the world leader in the production of polyethylene terephthalate (PET) - Indorama Ventures Company Ltd (IVL), plans to halt production at the refined terephthalic acid (TPA) plant in Sines (Sines, Portugal) in mid-November to conduct planned preventive measures. Repair work at this enterprise with a capacity of 700,000 tonnes/year of TPA per year will continue for one month. Thus, this plant should return to work in mid-December this year.

As per ICIS-MRC Price Report, buying activity has improved in the Russian market of PET chips this week. Most producers reported a limited volume of free PET in the spot market. Converters' opinions regarding November demand in the preforms market differed. Some of them reported good sales, while others reported that demand was low and they have to sell preforms at a price close to their cost.

Indorama Ventures Public Company Limited, listed in Thailand (Bloomberg ticker IVL.TB), is one of the world’s leading petrochemicals producers, with a global manufacturing footprint across Africa, Asia Pacific, Europe and Americas. The company’s portfolio comprises Integrated PET, Olefins, Fibers, Packaging and Specialty Chemicals. Indorama Ventures products serve major FMCG and automotive sectors, i.e. beverages, hygiene, personal care, tire and safety segments. Indorama Ventures has approx. 24,000 employees worldwide and consolidated revenue of US$ 11.4 billion in 2019. The Company is listed in the Dow Jones Emerging Markets and World Sustainability Indices (DJSI).

SQM announces USD1.3-billion capex program

MOSCOW (MRC) -- SQM (Santiago, Chile) has announced a USD1.3-billion capital expenditure (capex) program in Chile during 2021–24. The program includes projects to expand the company's lithium, nitrates, and iodine capacity, said Chemweek.

The plan includes projects costing a combined $240 million that are under way at Salar del Carmen near Antofagasta to expand lithium carbonate capacity from 70,000 metric tons/year to 120,000 metric tons/year and lithium hydroxide capacity from 13,500 metric tons/year to 21,500 metric tons/year. The projects are due to be completed in the second half of 2021. SQM's board recently approved an additional USD150-million investment to hike lithium carbonate and lithium hydroxide capacity to 180,000 metric tons/year and 30,000 metric tons/year, respectively, in 2023.

SQM intends to expand nitrates capacity by 250,000 metric tons/year and iodine capacity by 3,000 metric tons/year. The plan involves a USD270-million investment to increase caliche ore mining capacity, build a pipeline to transport seawater for use in the mines, install mining equipment, and upgrade operational centers. A further USD170 million will be spent to add the nitrate and iodine capacity.

The rest of the USD1.3-billion investment will pay for maintenance, estimated at USD120 million/year during the period of the program. Separately, SQM expects to make a final investment decision in January 2021 on the previously announced Mount Holland, Australia, lithium hydroxide project, a 50/50 joint venture with Wesfarmers (Perth, Australia). The companies delayed the decision at the beginning of this year.

SQM announced the capex plans recently with its third-quarter financial results. The company's net profit collapsed to USD1.7 million in the third quarter from USD60.5 million in the year-earlier period due to a settlement fee related to a class action lawsuit against the company in the US, which had a one-time pretax effect of USD62.5 million. SQM's third-quarter adjusted EBITDA fell 6% year-on-year to USD146 million on sales down 4.3% to USD452.9 million owing to impacts from COVID-19.

The company says its lithium sales volumes increased sequentially, jumping 40% to 17,600 metric tons in the third quarter compared with the second quarter. SQM expects even higher lithium volumes in the fourth quarter. Iodine prices were stable with the company seeing a recovery in demand, which it expects to be back at 2019 levels next year.

As MRC informed before, approximately 220 million tons (MT) of plastic waste is generated globally each year. Of this, around 90MT is mismanaged and leaking into the natural environment, 70MT is landfilled, 30MT is incinerated and another 30MT is recycled. If the plastics value chain is to become more sustainable, the industry must focus on reducing the amount of mismanaged waste and recapturing as much of its value as possible. To do this, more investment must be allocated to chemical recycling technologies.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers" inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

INEOS and Hyundai sign MoU on hydrogen

MOSCOW (MRC) -- INEOS and Hyundai have signed a memorandum of understating (MoU) to explore potential joint hydrogen businesses, the European chemicals major said on 22 November, said the company.

Hyundai and INEOS will jointly investigate opportunities for the production and supply of hydrogen as well as the worldwide deployment of hydrogen applications and technologies. Both companies will initially seek to facilitate public and private sector projects focused on the development of a hydrogen value chain in Europe.

The agreement also includes the evaluation of Hyundai’s proprietary fuel cell system for the recently announced INEOS Grenadier 4x4 vehicle. This cooperation represents an important step in INEOS’ efforts to diversify its powertrain options at an early stage.

Hyundai’s proprietary modular fuel cell system, which evaluation vehicles will use, has already proven reliable and effective in the Hyundai NEXO SUV. The world’s first dedicated hydrogen-powered SUV has the longest driving range among hydrogen-powered vehicles in the market. Hyundai is one of leading company in the field of fuel cell technology having started the world’s first mass production of fuel cell electric vehicles in 2013.

"INEOS’ move into the development of a fuel cell electric vehicle and hydrogen ecosystem marks yet another milestone towards sustainable and clean transportation,” said Saehoon Kim, Senior Vice President and Head of Fuel Cell Center at Hyundai Motor Company. “Hyundai believes this will provide an important low-carbon option across a wide range of sectors. We also hope our decades-long expertise in hydrogen fuel cell work in synergy with INEOS’ expertise in field of chemistry to realize the mass production of green hydrogen and fuel cells for the Grenadier."

Peter Williams Technology Director INEOS, said, “The agreement between INEOS and Hyundai presents both companies with new opportunities to extend a leading role in the clean hydrogen economy. Evaluating new production processes, technology and applications, combined with our existing capabilities puts us in a unique position to meet emerging demand for affordable, low-carbon energy sources and the needs of demanding 4x4 owners in the future."

INEOS recently launched a new business to develop and build clean hydrogen capacity across Europe in support of the drive towards a zero-carbon future. The company currently produces 300,000 tons of hydrogen a year mainly as a by-product from its chemical manufacturing operations.

Through its subsidiary INOVYN, INEOS is Europe’s largest existing operator of electrolysis, the critical technology that uses renewable energy to produce hydrogen for power generation, transportation and industrial use. Its experience in storage and handling of hydrogen combined with its established know-how in electrolysis technology, puts INEOS in a unique position to drive progress towards a carbon-free future based on hydrogen.

In 2018, Hyundai Motor Group announced its mid- to long-term roadmap, Fuel Cell Vision 2030, to increase annual production of hydrogen fuel cell systems to 700,000 units by 2030.

As per MRC, Ineos declared force majeure on its low density polyethylene (LDPE) supplies from one of its plants in Cologne, Germany due to a power outage on November 11. The company could not be reached for comments at the time of publication, however. The force majeure is slated to last for 3 weeks. The company’s metalocene linear low density polyethylene (mLLDPE) unit at the same site was reported to be unaffected, meanwhile.

As MRC wrote before, a 660,000-metric tons/year phenol-acetone plant operated by Ineos in Gladbeck, Germany, was shut for maintenance from 27 October until 6 December, 2020.

According to MRC's ScanPlast report, September estimated LDPE consumption in Russia fell to 23,930 tonnes from 47,610 tonnes a month earlier. Russian producers reduced their domestic LDPE shipments due to shutdowns for maintenance at production capacities in Ufa, Tomsk and Kazan. Russia's estimated LDPE consumption totalled about 406,500 tonnes in January-September 2020, which virtually corresponded to the last year's figure.

INEOS Group Limited is a privately owned multinational chemicals company consisting of 15 standalone business units, headquartered in Rolle, Switzerland and with its registered office in Lyndhurst, United Kingdom. It is the fourth largest chemicals company in the world measured by revenues (after BASF, Dow Chemical and LyondellBasell) and the largest privately owned company in the United Kingdom.