IG Petrochemicals board approves USD82 million to expand PA capacity in India

MOSCOW (MRC) -- IG Petrochemicals, an established market leader in Phthalic Anhydride (PA) in India, has announced a capital outlay of Rs 600 crore (USD82.6 million) to expand its PA capacity, according to Kemicalinfo.

Thus, the Board of IG Petrochemicals at its meeting held on 09 February 2021 approved the greenfield expansion of PA up to 80,000 MTPA & its Derivatives in Gujarat.

The capex will be financed through internal accruals and borrowings. The project will be completed within three years.

The company’s existing capacity is 220,000 MTPA with capacity utilization of 90%.

The company expects the demand for PA in domestic market to increase due to Govt. focus on Infrastructure spending and demand growth in downstream products like Paints, Plasticizers, Polyvinyl chloride (PVC), Unsaturated polyester resins (UPR) etc., led by good GDP growth in India.

As MRC reported earlier, India to renew antidumping duty on PA imports from Russia, removes Japan from ADD list. Latest ADD on Russian PA imports extends previous five-year period imposed in 2014; Japan removed after being deemed unlikely to resume dumping activities. The Directorate General of Trade Remedies (DGTR) of India on 5 January recommended continuing the ADD after its investigation showed that “there is likelihood of continuation or recurrence of dumping and injury if the existing ADDs are allowed to cease." he south Asian country’s previous five-year ADD on Russian PA imports expired in December 2020.

PA is used as a chemical intermediate in the production of phthalate plasticizers, saturated and unsaturated polyester resins. Phthalic anhydride is widely used in for the production of paints and varnishes and plasticizers for PVC products. In a small amount it is used in the manufacture of rubber products, tires. In addition, it is used in the light, pharmaceutical and electrical industries.

According to MRC's DataScope report, imports of suspension polyvinyl chloride (SPVC) into Russia totalled about 40,800 tonnes in 2020, down by 20% year on year. At the same time, exports decreased by 6%. December SPVC imports to Russia dropped to 0,600 tonnes from 1,600 tonnes in November. High PVC prices in foreign markets and a seasonal decline in demand in the previous two months had put a major pressure on import purchases of PVC from Russian companies.

Australian refinery closure adds to litany of energy, climate failures

MOSCOW (MRC) -- The closure of one of Australia's last remaining oil refineries, carbon border taxes in Europe and a proposal for the world's biggest battery storage plant may seem unrelated at first glance, said Hydrocarbonprocessing.

But they all speak to the ongoing failure of Australia's conservative government to produce a coherent energy and climate change policy, one that gains public and business sector support and recognizes the reality of a changing world. It's no secret that many leading members of Prime Minister Scott Morrison's Liberal-National coalition government are in favor of ongoing, and increased, use of fossil fuels over renewable alternatives.

But it seems the federal government can't even get a fossil fuel policy that works, and the closure of the Exxon Mobil oil refinery in Melbourne is a case in point. The U.S. oil major announced on Wednesday that it plans to shut its 90,000 barrels per day Altona refinery in Australia's second-largest city and convert the 72-year-old plant to an import and storage terminal.

When Altona shuts it will leave Australia with just two refineries, and one of those, the Ampol plant in Brisbane is under review with closure a likely outcome. The country had eight refineries at the start of the century, which were capable of meeting national fuel demand at the time, but the sector has been hit by shutdowns as plants grew older and less competitive and struggled to compete with the new mega-refineries built across Asia, but especially in China and India.

The government has made an attempt to keep some refining capacity, offering up to A$2.3 billion (USD1.8 billion) in a fuel security package, but this was only accepted by Viva Energy , which operates a plant near Melbourne. Australia will likely become almost entirely dependent on fuel imports in coming years and the government has yet to reveal plans on mitigating the risk. It could, for example, build joint storage facilities with regional partners or more tanks locally.

If the government's fuel policies leave something to be desired, the power generation sector is in even worse shape from a policy perspective. Morrison has been pushing what his government calls a gas-fired recovery from the economic hit caused by the coronavirus pandemic. That involves potential subsidies for natural gas pipelines and the construction of a massive gas-fired power plant north of the Sydney, the country's biggest city.

We remind that the COVID-19 outbreak has led to an unprecedented decline in demand affecting all sections of the Russian economy, which has impacted the demand for petrochemicals in the short-term. However, the pandemic triggered an increase in the demand for polymers in food packaging, and cleaning and hygiene products, according to GlobalData, a leading data and analytics company. With Russian petrochemical companies having the advantage of access to low-cost feedstock, and proximity to demand-rich Asian (primarily China) and European markets for the supply of petrochemical products, these companies appear to be well-positioned to derive full benefits from an improving market environment and global economy post-COVID-19, says GlobalData.

We also remind that in December 2020, Sibur, Gazprom Neft, and Uzbekneftegaz agreed to cooperate on potential investments in Uzbekistan including a major expansion of Uzbekneftegaz’s existing Shurtan Gas Chemical Complex (SGCC) and the proposed construction of a new gas chemicals facility. The signed cooperation agreement for the projects includes “the creation of a gas chemical complex using methanol-to-olefins (MTO) technology, and the expansion of the production capacity of the Shurtan Gas Chemical Complex”.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020).

Huntsman earnings surge on strong MDI pricing

MOSCOW (MRC) -- Huntsman (The Woodlands, Texas) reports fourth-quarter adjusted net income of USD113 million, up 74% from USD65 million on strong results in the polyurethanes segment, reported Chemweek.

Adjusted earnings per share were USD0.51, beating the average analyst estimate of USD0.44 as compiled by Zacks Investment Research.

Sales totaled USD1.668 billion, up 0.7% YOY from USD1.657 billion. GAAP net income totaled USD360 million, up 17% year-over-year (YOY) from USD308 million.

Revenue in the polyurethanes segment totaled USD1.03 billion, up 5% YOY on higher average pricing for methylene di-para-phenylene diisocyanate (MDI), mainly in China and Europe, partially offset by lower sales volume, which stemmed from unplanned supplier outages. Adjusted EBITDA increased 65% YOY to USD201 million on higher MDI margins driven by higher pricing, partially offset by lower sales volumes. Volumes in building solutions and automotive increased YOY, a trend the company expects will continue in the first quarter, doubling adjusted EBITDA YOY.

Performance products revenue totaled USD265 million, down 5% YOY as sales volume and average selling prices declined owing to to weaker market conditions for several amines businesses. The slight decrease in Adjusted EBITDA declined 5% to USD41 million for the same reason. Huntsman expects first-quarter adjusted EBITDA to increase 10-15% YOY on improved volumes in Asia and the Americas.

Advanced materials revenue dropped 14% YOY to USD207 million as weakness, mainly in the aerospace and commodity markets, reduced sales volume. Adjusted EBITDA decreased due to lower sales volume, partially offset by lower fixed cost. Adjusted EBITDA dropped 36% YOY to USD27 million as the contribution of recently acquired CVC Thermoset Specialties was offset by the divestiture of the India-based DIY consumer adhesives business. The company expects a roughly 40% sequential increase in adjusted EBITDA on improvements in all markets.

Textile effects revenue declined 4% YOY to USD173 million on lower average selling price, the result of lower raw material cost, partially offset by higher sales volume, mainly in the Asia region. Adjusted EBITDA was flat at USD18 million as lower raw material and fixed costs offset the decline in revenue.

As MRC informed earlier, in late December, 2020, SK Capital Partners completed the acquisition of a 39.75% stake, roughly 42.4 million shares, in titanium dioxide maker Venator from Huntsman for roughly USD100 million. The deal includes a 30-month option for the purchase of Huntsman’s remaining approximate 9.5 million shares by SK at US2.15/share. Huntsman spun off Venator in a 2017 initial public offering.

We remind that Nanjing Jinling Huntsman, a joint venture between Huntsman and Sinopec Jinling, shut its propylene oxide plant in Nanjing (Nanjing, Jiangsu Province, China) on November 1, 2020, for scheduled maintenance. This plant with a capacity of 240,000 tonnes/year of propylene oxide was closed until approximately 25 November.

Propylene is the main feedstock for the production of polypropylene (PP).

According to MRC's ScanPlast report, PP shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020).

Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated and specialty chemicals with 2019 revenues of approximately USD7 billion. The company's chemical products number in the thousands and are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets. The company operates more than 70 manufacturing, R&D and operations facilities in approximately 30 countries and employ approximately 9,000 associates within our four distinct business divisions.

Elementis signs sales agreement with UK chemtech firm

MOSCOW (MRC) -- Elementis says it has entered into an exclusive agreement with Aqdot (Cambridge, UK), a supramolecular chemtech company, to sell Aqdot’s odor capture and smart fragrance release solution for use in anti-perspirant and deodorant product formulations, reported Chemweek.

Further details have not been disclosed.

Aqdot’s solution is “complementing our market-leading portfolio of actives and ingredients for anti-perspirant and deodorant applications,” says Stijn Dejonckheere, senior vice president/personal care at Elementis.

As MRC informed before, in December 2020, Brenntag said it signed a deal with Elementis under which Brenntag will distribute the company’s products in coatings, adhesives, sealants, inks and construction materials in Canada. Exact terms of the deal were not disclosed. The product range includes rheology modifiers, defoamers, and various types of additives.

We remind that in April 2020, Brenntag sai it had acquired the operating assets of Suffolk Solutions’ (Suffolk, Virginia) caustic soda distribution business. Financial terms of the deal have not been disclosed.

We also remind that November production of sodium hydroxide (caustic soda) in Russia was 111,000 tonnes (100% of the basic substance) versus 108,000 tonnes a month earlier. Russia's overall output of caustic soda totalled 1,165,600 tonnes in the first eleven months of 2020, down by 1.3% year on year.

Elementis plc is one of the UK's largest speciality chemicals business. The Company comprises three businesses: Specialty Products, Surfactants and Chromium. Both Specialty Products and Chromium hold leading market positions in their chosen sectors. Elementis employs over 1,200 people at more than 30 locations worldwide.

Venezuela receives more airlifts of refinery materials from Iran

MOSCOW (MRC) -- Venezuela has begun to receive a second round of airlifts of materials from ally Iran to help its troubled oil refineries to produce fuel, reported Reuters with reference to three people familiar with the matter and publicly-available flight-tracking data.

The shipment of catalysts to the 955,000 barrel-per-day (bpd) Paraguana Refining Complex (CRP) in western Venezuela comes after Iran sent more than a dozen flights to the area last year to help restart the 310,000 bpd Cardon refinery and alleviate acute gasoline shortages in the OPEC nation.

Iran has also sent three flotillas of vessels carrying fuel to Venezuela, whose oil industry has collapsed after years of underinvestment and mismanagement, as the two US adversaries boosted economic ties in an effort to stay afloat despite escalating sanctions from Washington.

The United States in January 2019 sanctioned state oil company Petroleos de Venezuela as part of a push to oust President Nicolas Maduro, accused of rights violations and rigging his 2018 re-election. Washington has heavy sanctions on Iran to try to get Tehran to abandon its nuclear program.

On Feb. 11, an Airbus plane belonging to Venezuelan state-run airline Conviasa arrived at the Las Piedras airport on the Paraguana peninsula after taking off from Tehran on Feb. 10, with a stopover in Belgrade, according to air traffic monitoring website flightradar24.com.

The plane was carrying catalysts intended for PDVSA, said the three people, who spoke on the condition of anonymity. More than a dozen further similar flights are expected, the people said.

Neither PDVSA nor Venezuela’s information ministry immediately responded to requests for comment.

Currently, Cardon is the only one of Venezuela’s refineries producing gasoline, with its naphtha reformer and catalytic cracking units producing around 60,000 bpd, one of the people said. The nearby 645,000 bpd Amuay refinery is producing naphtha to serve as a feedstock for Cardon’s gasoline units.

The catalysts are expected to help restart gasoline production at Amuay, whose catalytic cracker has been offline since late 2019, in anticipation of planned maintenance at Cardon, the person said.

As MRC informed earlier, pressured by strict US sanctions, Venezuela's oil exports plunged by 376,500 barrels per day (bpd) in 2020, according to Refinitiv Eikon data and internal documents from state-run PDVSA, financially squeezing President Nicolas Maduro.

We remind that in December 2020, a tanker chartered by the National Iranian Oil Company (NIOC) was loading Venezuelan crude for export, documents from state-run PDVSA show, providing evidence of the two countries' latest tactics to expand their trade in defiance of US sanctions. Venezuela and Iran had deepened their cooperation last year as Venezuela had exchanged gold and other commodities for Iranian food, condensate and fuel.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020).