SIBUR signs recycled PET flakes supply deal for facility at Polief

MOSCOW (MRC) -- SIBUR, Russia’s leading petrochemicals company and one of the most rapidly growing petrochemicals businesses globally, says it has agreed a deal for the supply of recycled plastic as feedstock for the production of polyethylene terephthalate (PET) granules at its Polief plant in Blagoveshchensk, Bashkortostan, Russia, as per the company's press release.

The company has signed a contract to receive up to 4,000 metric tons/year of PET flakes made from recycled food packaging from Autopark No.1 Spetstrans, the largest operator for the collection, removal, and disposal of solid municipal waste in St. Petersburg. Deliveries will begin in 2022, it says.

SIBUR will produce primary polymer PET granules manufactured using add-ins of the recycled PET flakes, with the company’s target overall to use about 34,000 metric tons/year of recycled raw materials in its products. The PET granules produced at the Polief facility will “meet the growing market demand for PET packaging containing recycled materials, and its producers will be provided with a comprehensive solution that combines both primary and secondary PET,” Sibur says.

Autopark No.1 Spetstrans says it is planning to build a plastics processing plant in St. Petersburg within the next two years that will be able to deal with PET as well as high-density polyethylene (HDPE), low-density polyethylene (LDPE), and polypropylene (PP).

SIBUR has also entered into an agreement with TGC-1, a subsidiary of Gazprom (Moscow, Russia), for the supply of renewable electricity as part of its strategy for sustainable development until 2025. The electricity is generated by a hydroelectric power plant at Lesogorskaya, Leningrad, it says. Sibur plans to increase the amount of electricity it consumes from renewable energy sources “both through its own generation and through direct contracts with suppliers of green energy” in order to reduced greenhouse gas emissions, it says.

As MRC reported before, earlier this weak, SIBUR Holding and China Petroleum & Chemical Corporation (Sinopec), China’s leading energy and chemical company, closed the deal to set up a joint venture (JV) at the Amur Gas Chemical Complex after obtaining all the necessary approvals from the regulators of both countries. SIBUR and Sinopec will hold interest in the JV in the amount of 60% and 40%, respectively.

According to MRC's ScanPlast report, Russia's PET consumption reached 61,110 tonnes in November 2020, up by 1% year on year. Overall PET consumption in Russia reached 648,110 tonnes in the first eleven months of 2020 , down by 18% year on year.

SIBUR is a uniquely positioned vertically integrated gas processing and petrochemicals company. We own and operate Russia’s largest gas processing business in terms of associated petroleum gas processing volumes and are a leader in the Russian petrochemicals industry. As of 31 March 2014, SIBUR operated 27 production sites located all over Russia, had over 1,400 large customers engaged in the energy, chemical, fast moving consumer goods (FMCG), automotive, construction and other industries in approximately 70 countries worldwide and employed over 27,000 personnel.

Sipchem to mothball PBT, EVA plants in Saudi Arabia

MOSCOW (MRC) -- Sahara International Petrochemical Co. (Sipchem) is planning to mothball the Polybutylene Terephthalate (PBT) plant, owned by its affiliate, Sipchem Chemical Co., and Ethylene Vinyl Acetate (EVA) Film plant that is owned by affiliate firm, Saudi Specialized Products Co, said Chemweek.

Steps to implement the decision are underway, Sipchem said in a statement to Tadawul, adding that the suspension of both plants will start on Jan. 1, 2021, until further notice. The company expects a positive financial impact starting from Q1 2021 results.

The move is in line with Sipchem's post-merger strategy to improve profitability and efficiency of operations, and ensure best levels of liquidity and stability, along with maintaining the integrity of the financial structure, considering the investment risks resulting from the current economic conditions and the challenges faced by the markets in general.

Sipchem PBT Plant is located in Jubail Industrial City, and EVA Film plant is located in Hail Industry City. Sipchem will make announcement on updates and progress in a timely manner.

According to the data compiled by Argaam, Sipchem announced in January 2019 the commercial start of the ethylene vinyl acetate (EVA) film plant, by affiliate Saudi Specialized Products Company (Wahaj), with a production capacity of 4,000 metric tons.

Early July 2018, Sipchem Chemical Co., an affiliate of Sipchem, commenced commercial operations at its polybutylene terephthalate (PBT) plant in Jubail Industrial City. The total production capacity of the plant is 63,000 metric tons per year.

As per MRC ScanPlast, November imports of other ethylene polymers, including ethylene-vinyl-acetate (EVA), were 9,100 tonnes, compared to 10,100 tonnes in October. Overall imports of other ethylene polymers reached 90,200 tonnes over the stated period versus 85,200 tonnes a year earlier.

Crude oil futures rise as risk-on sentiment grips market

MOSCOW (MRC) -- Crude oil rose during mid-morning trade in Asia Dec. 29 as the oil complex was buoyed by bullish sentiment across risk assets emanating from US President Donald Trump's signing of the massive coronavirus relief and spending package, with a weaker dollar also lending market support, reported S&P Global.

At 10:55 am Singapore time (0255 GMT), the ICE Brent February contract was up 21 cents/b (0.41%) from the Dec. 28 settle to USD51.07/b, while the February NYMEX light sweet crude contract was up 24 cents/b (0.5%) at US47.86/b.

Both markers had fallen by 0.84% and 1.26% on Dec. 28 to settle at USD50.86/b and USD47.62/b, respectively, as concerns over the spread of the highly infectious B.1.1.7 variant of the coronavirus had weighed on the market.

In the Asian trading session, however, oil recouped the losses from Dec. 28, rising in tandem with Asia Pacific equity markets and US equity futures.

Margaret Yang, strategist at DailyFX, told S&P Global Platts Dec. 29: "Crude oil prices are buoyed by favorable sentiment across risk assets on the passing of US stimulus package, as well as a weakening US dollar."

On Dec. 28, Trump had signed the coronavirus relief and spending package, which includes a Congress-approved $900 billion stimulus package and government funding through September 2021, spurring optimism over a US economic recovery.

In an accompanying statement, Trump had demanded that Congress increase direct payments to USD2,000 per individual - a measure that has been approved by the Democrat-controlled US House of Representatives.

"The prospects for energy demand may be brightened by the coronavirus relief aid, especially after the House voted to increase the stimulus check amount to USD2,000 from US600 this morning," Yang said.

Republicans, however, have shown resistance to higher direct payments, and it still remains unclear if the measure will be held to a vote in the Republican-controlled Senate.

Meanwhile, analysts surveyed by S&P Global Platts were bullish in their forecast for US commercial crude drawdown in the week ended Dec. 25, expecting stocks to have declined 3.8 million barrels to around 495.7 million barrels.

Comprehensive data on weekly inventory reports by the American Petroleum Institute and the US Energy Information Administration will be released on Dec. 29 and Dec. 30, respectively.

As MRC informed previously, global oil demand may have already peaked, according to BP's latest long-term energy outlook, as the COVID-19 pandemic kicks the world economy onto a weaker growth trajectory and accelerates the shift to cleaner fuels.

Earlier this year, BP said the deadly coronavirus outbreak could cut global oil demand growth by 40% 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 decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.

Ningxia Baofeng shut coal-based PP plant on unexpected technical issue

MOSCOW (MRC) -- Ningxia Baofeng Energy Group Co Ltd unexpectedly shut its coal-based PP Phase II unit on 27 December 2020 due to technical glitches, according to CommoPlast with reference to market sources.

Based in Ningxia, China, the unit has a production capacity of 300,000 tons/year.

The restart schedule could not be ascertained at the time of this report.

As MRC reported earlier, in June 2020, Johnson Matthey (JM) announced that Ningxia Baofeng Energy Group ha "successfully" commissioned a new methanol plant at Ningxia Baofeng's 600,000-t/y coal-to-olefins complex in Ningxia Province, China.

The 6,600-t/d methanol unit, based on technology from JM, utilizes syngas feedstock and combines advanced JM catalysts to produce stabilized methanol, which is used to produce olefins in a downstream facility.

According to MRC's DataScope report, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.

Ningxia Baofeng Energy Group Co., Ltd. manufactures and distributes chemical products. The company produces methanol, olefin, residue catalytic, and other products. Ningxia Baofeng Energy Group also produces coal tars, petrochemical oils, and other products.

Diversified CPC International completes first phase of new Beaumont facility

MOSCOW (MRC) -- Diversified CPC International (DCPC), an industry leader in the design, production, and distribution of the highest purity specialty gasses for a variety of industries, has completed the first phase of their new Beaumont, Texas plant, according to Hydrocarbonprocessing.

This new facility, which is located at the Iron Horse Terminals, launched a commercial operation in late November 2020. The company has invested USD10 million in Phase I of the project.

“The addition of the new Beaumont facility is a key step in strengthening our competitive position and ensuring DCPC has all the resources to fully support our customers,” said Bill Auriemma, DCPC President and CEO. “We have significantly improved our supply chain capabilities for our aerosol, industrial refrigerant, and solvent extraction customers by consolidating several rail trans-loading operations at one location.”

Company officials have shared that Phase II will include the construction of bulk storage and processing capabilities, while Phase III will bring additional manufacturing capacity on-line in the following years.

“Our in-house engineers have incorporated the latest in manufacturing, safety, and environmental control technology into the design of the Beaumont site,” said William Frauenheim III, DCPC Vice President of Operations. “We are proud of the entire project management team and our partners at Ironhorse for working diligently during this challenging time to complete Phase I on schedule.

“This investment is a key part of our DCPC 5-year strategic plan,” said John P. Dowd II, VP of Strategy and Business Development. “In addition to strengthening our industry-leading customer service capabilities, we will enhance our ability to produce innovative new products that help our customers improve product design, plant efficiencies, safety, and environmental footprints.”

The Beaumont operation will be the second major production and distribution facility the company operates along with its Corporate Headquarters in Joliet, Illinois. DCPC also has regional facilities in Illinois, New Jersey, Florida, Mississippi, and California.

As MRC reported earlier, Exxon Mobil Beaumont confirmed that operations at its cracker resumed in the morning on 26 September, 2019, after being shut down more than a week in the wake of Tropical Depression Imelda. The company shut down chemical production at the plant on Sept. 19, the day after Tropical Depression Imelda dumped dozens of inches of rain across Southeast Texas, and said it was considering similar steps for its refinery. The refinery ultimately remained operational.

The company operates a cracker with a capacity of 830,000 mt of ethylene and 195,000 mt of proplyelen per year, low density polyethylene (LDPE) plant with a capacity of 236,000 mt per year and linear low density polyethylene plant with a capacity of 727,000 tonnes per year. At that time, Exxon’s Beaumont refinery was the fourth-largest oil refinery in Texas, churning through about 370,000 barrels of oil a day to produce gasoline and other fuels. The refinery was then undergoing a major expansion to make it one of the two largest refineries in the country.

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

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.