Russia may start exporting Belarusian oil products in 2021

MOSCOW (MRC) -- Russian deputy prime minister Alexander Novak said Jan. 4 that export of Belarusian oil products via Russian may begin in 2021, reported S&P Global.

"I think 2021 is a very realistic timeframe for deliveries to begin," Novak said in an interview aired on Russian business channel RBC.

In September Novak said that deliveries of Belarusian oil products could reach 4-6 million mt, considering spare capacity at ports in North Western Russia including Primorsk, Saint Petersburg and Ust-Luga.

Russia and Belarus have been discussing exports via Russia since September, after Lithuania imposed sanctions on Belarus. The measures were introduced in response to allegations that presidential elections were not free and fair, and a subsequent crackdown on protests against the result, which saw Alexander Lukashenko remain in office.

In mid December the Lithuanian port of Klaipeda said that Belarusian Oil Company was temporarily suspending oil products exports via the port. Belarus has also used Klaipeda to receive deliveries of crude from alternative suppliers, including Norway, Saudi Arabia and the USA in 2020, when Russia cut deliveries to Belarus over a dispute on supply terms.

According to MRC's DataScope report, overall polypropylene (PP) imports into Belarus rose in the first ten months of 2020 by 6% year on year to 95,500 tonnes. At the same time, homopolymer of propylene (homopolymer PP) accounted for the greatest increase in demand. October PP imports to the Republic of Belarus were 11,600 tonnes, which virtually corresponded to the same figure a month earlier. Local companies maintained high volumes of purchases of all grades of propylene polymers in Europe and Russia. Overall imports of propylene polymers reached 95,500 tonnes in January-October 2020, compared to 90,000 tonnes a year earlier; demand only for homopolymer PP increased, whereas demand for propylene copolymers decreased.

Trinseo raises January PS, ABS and SAN prices in Europe

MOSCOW (MRC) -- Trinseo, a global materials company and manufacturer of plastics, latex binders, and synthetic rubber, and its affiliate companies in Europe, have announced a price increase for all polystyrene (PS), acrylonitrile-butadiene-styrene (ABS) and acrylonitrile-styrene copolymer (SAN) in Europe, according to the company's press release as of 5 January.

Effective January 1, 2021, or as existing contract terms allow, the contract and spot prices for the products listed below rose as follows:

- STYRON general purpose polystyrene grades (GPPS) -- by EUR135 per metric ton;
- STYRON and STYRON A-Tech and STYRON X- Tech and STYRON C- Tech high impact polystyrene grades (HIPS) - by EUR135 per metric ton;
- MAGNUM ABS resins - by EUR400 per metric ton;
- TYRIL SAN resins - by EUR170 per metric ton.

As MRC informed before, Trinseo last raised its prices for all PS and ABS and and grades on 1 December 2020, as stated below:

- STYRON GPPS -- by EUR250 per metric ton;
- STYRON and STYRON A-Tech and STYRON X- Tech and STYRON C- Tech HIPS - by EUR250 per metric ton;
- MAGNUM ABS resins - by EUR305 per metric ton.

According to ICIS-MRC Price report, in Russia, at the beginning of 2021, prices of Nizhnekamskneftekhim's material will increase by Rb10,000/tonne under the pressure from feedstock prices and strong demand in the PS market and will reach their maximum over the past two years. Penoplex plans to raise prices of its material by Rb10,000-12,000/tonne. On the back of this, Gazprom neftekhim Salavat is also expected to raise its PS prices after the New Year holidays. The shortage of material will remain next month.

Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo's technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015. Trinseo had approximately USD3.8 billion in net sales in 2019, with 17 manufacturing sites around the world, and approximately 2,700 employees.

W.R. Grace to review revised 40 North takeover bid

MOSCOW (MRC) -- W.R. Grace says it will review a newly-received USD65/share bid to acquire all outstanding shares in the company from private investment fund 40 North Management (New York, New York), reported Chemweek.

The offer values the company at about USD4.3 billion. It comes two months after Grace rejected a USD60/share, USD4-billion acquisition offer from 40 North in November.

Grace will consider strategic alternatives as part of its review of the latest bid from 40 North. The company’s board will “carefully review and evaluate the proposal,” Grace say. “As part of this review, the board will consider the proposal in the context of the company’s ongoing review of potential strategic alternatives to maximize shareholder value.”

40 North owns a 14.9% stake in Grace and has two seats on the board following an agreement reached in 2019.

40 North released a letter criticizing Grace’s rejection of its earlier offer, which the fund says was “summarily dismissed.” The letter adds that “since that time, (Grace has) neither engaged with us, nor made any public statement about opportunities Grace is pursuing to maximize value.”

The offer represents a 16% premium on Grace’s 11 January closing price, and a 48% premium on Grace’s 6 November closing price, prior to when 40 North’s initial offer was announced.

40 North reiterated its criticisms of Grace, saying that the company’s stock has under-performed since the spin-off of Grace Construction Products (GCP) in 2016, due largely to environmental declines and environmental liabilities. “Grace offers a strong and unique - but unrealized - value proposition that can make it a standout player in the world of specialty chemicals,” 40 North says. “Allowing the Company to continue along its current path, however, guarantees only that the value destruction at Grace will continue and worsen, consistent with its track record since the spin-off of GCP in 2016.”

Going private can enable Grace “to quickly and decisively undertake critical actions to arrest its steady decline and turn the tide towards enhanced profitability and growth,” the fund’s letter adds.

Goldman Sachs and Moelis & Company are acting as Grace’s financial advisors in reviewing the proposal, while Wachtell, Lipton, Rosen & Katz is its legal advisor. Citi and J.P. Morgan are acting as financial advisors to 40 North.

As MRC wrote before, in October 2020, W. R. Grace & Co. licensed UNIPOL PP process technology to Dongguan Grand Resource for two additional lines. This is part of the continued investment in UNIPOL PP Process Technology lines by DGR. The first license was signed in 2016. Building additional capacity at the same site will help DGR further optimize costs, shorten construction time, and broaden their product portfolio.

We also remind that in April 2018, W. R. Grace & Co. completed the USD416 million acquisition of the Polyolefin Catalysts business of Albemarle Corporation.

According to MRC's ScanPlast report, Russia's estimated polyethylene (PE) consumption totalled 1,990,280 tonnes in the first eleven months of 2020, up by 1% year on year. Only high density polyethylene (HDPE) shipments increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 090,900 tonnes in the first eleven months of 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.

A leader in polyolefin catalysts and licensing, W.R. Grace has the world’s broadest portfolio of polypropylene and polyethylene catalyst technologies used to produce thermoplastic resins for a variety of applications. A leading innovator and strategic partner to its customers, Grace supplies catalyst solutions for all polyolefin processes, as well as polypropylene process technology and process controls. Grace employs approximately 3,700 people in over 30 countries.

PPG to acquire German industrial coatings maker

MOSCOW (MRC) -- PPG Industries announced it will acquired Worwag (Stuttgart, Germany), a producer of liquid, powder and film coatings for industrial and automotive applications, said Chemweek.

Terms of the transaction, including purchase price, have not been disclosed. The deal is expected to close in the first half of this year.

Worwag, a family-owned business, has operations in several countries in Europe, the Americas and Africa, and generates about EUR220 million/year (USD269 million) in revenue. It has about 1,100 employees.

"The addition of Worwag will also enhance PPG’s waterborne, direct-to-metal, liquid and powder coatings offerings, and allow us to further expand current customer distribution in key geographies," says Rebecca Liebert, executive vice president at PPG.

The deal is the second substantial acquisition announced by PPG this year, and the fourth since mid-November, including the USD1.52-billion acquisition of Finnish decorative coatings producer Tikkurila.

As MRC informed earlier, PPG said 24 December that it has completed the acquisition of specialty transport coatings maker Ennis-Flint.

We remind that Russia's output of chemical products rose in October 2020 by 7.2% year on year. At the same time, production of basic chemicals grew in the first ten months of 2020 by 6.3% year on year, according to Rosstat's data. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the January-October output. October production of polymers in primary form grew to 857,000 tonnes from 852,000 tonnes in September. Overall output of polymers in primary form totalled 8,340,000 tonnes over the stated period, up by 17% year on year.

Shell to acquire stake in Enerkem renewable chemicals and biofuels plant

MOSCOW (MRC) -- Shell will take a 40% interest in a waste-to-fuels plant using technology developed by Enerkem, a leading Canadian clean tech company, accoridng to Kemicalinfo.

Enerkem announced the project in December 2020, subject to finalization of commercial agreements.

The approximately CD875 million (USD686 million) commercial-scale facility will be constructed in Varennes, Quebec, and will produce low-carbon fuels and renewable chemicals products from non-recyclable waste using Enerkem’s proprietary technology.

Commissioning of the first phase of the facility is scheduled for 2023.

Critical investment in the plant comes from Shell, Enerkem, Suncor, Proman and Hydro-Quebec, as well as from the Quebec and Canadian governments.

“Building a commercial-scale low-carbon fuels plant is one of the ways Shell is advancing cleaner fuels and evolving to meet the changing expectations of our customers,” said Michael Crothers, Shell Canada President and Country Chair.

“Canada is well suited to capitalize on the energy transition thanks to the ingenuity of Canadians and our willingness to work together. We’re grateful for the collaboration between industry and government that has been instrumental in making this project a reality.”

Once completed, the plant will treat more than 200,000 tons of non-recyclable waste and wood waste per year with an annual production of nearly 125 million liters of low carbon fuels.

“The Varennes Carbon Recycling plant demonstrates our commitment and ability to use wastes as a feedstock to provide our customers with low carbon, high quality and affordable products,” added Crothers.

Shell has been a significant producer of ethanol as a low carbon fuel for the last ten years through Raizen, its joint venture in Brazil. Bioethanol is an effective way to reduce road transport emissions today, without the need to invest in new vehicles or infrastructure and already play a significant role in helping to decarbonise road transport in the Americas and in Europe.

As MRC reported earlier, Royal Dutch Shell plc. said in November that its petrochemical complex of several billion dollars in Western Pennsylvania is about 70% complete and in the process to enter service in the early 2020s. The plant's costs are estimated to be USD6-USD10 billion, where ethane will be transformed into plastic feedstock. The facility is equipped to produce 1.5 million metric tons per year (mmty) of ethylene and 1.6 mmty of polyethylene (PE), two important constituents of plastics.

Ethylene and propylene are feedstocks for producing 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.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.