PPG names acquisition integration head

MOSCOW (MRC) -- PPG Industries has named John Stephenson to the post of director/acquisition integration, according to Chemweek with reference to the company's statement.

In this new role, Stephenson will oversee the integration of PPG acquisitions, including the recently-announced deal for Tikkurila. He will report to PPG chairman and CEO Michael McGarry.

Stephenson was most recently business controller/industrial coatings at PPG. He joined the company in 1985 and has served in a variety of finance functions across its operating segments.

As MRC wrote before, Finnish paints maker Tikkurila said in early February, 2021, that Pittsburgh-based PPG had raised its all-shares offer for the company to 34.00 euros per share, topping a rival bid from Akzo Nobel.

We remind that in February 2020, PPG completed its acquisition of Industria Chimica Reggiana (ICR, Reggio Emilia, Italy), a maker of automotive refinish products. Financial terms of the deal, including purchase price, were not disclosed. The deal was announced on 8 January. ICR was founded in 1961 and employs about 180 people. ICR manufactures automotive refinish products, including putties, primers, basecoats and clear coats. It also makes a range of coatings, enamels and primers for light commercial vehicles and other light industrial coatings applications. ICR employs about 180 people and sells its products in more than 70 countries in Europe, Africa, the Middle East, the US and Latin America.

We also remind that Russia's output of chemical products rose in November 2020 by 9.5% year on year. At the same time, production of basic chemicals increased in the first eleven months of 2020 by 6.6% 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-November 2020 output. November production of polymers in primary form rose to 896,000 tonnes from 852,000 tonnes in October. Overall output of polymers in primary form totalled 9,240,000 tonnes over the stated period, up by 17.1% year on year.
MRC

MOSCOW (MRC) -- Beginning February 13, 2021, a major winter weather system characterized by extreme cold spread across much of the central United States, disrupting energy systems and causing serious health and safety issues Hydrocarbonprocessing.

The extreme weather particularly affected Texas, where utility customers experienced widespread outages and rolling blackouts. The severe weather persisted through much of the week, putting significant pressure on the petroleum complex along the U.S. Gulf Coast, where the infrastructure has rarely needed to accommodate sub-zero temperatures, as well as some states in the Midcontinent. Several Texas refineries accounting for a significant share of total U.S. refining capacity fully or partially shut down, numerous inland crude oil wells closed, and oil pipeline infrastructure was disrupted. The extreme cold also affected petroleum product pipelines; production and refinery operations in the Midwest and inland regions of Texas; and briefly disrupted maritime traffic along the Houston Ship Channel, a crucial waterway for crude oil and petroleum product trade flows.

Although most of the extreme weather appears to have passed, ongoing low temperatures are expected to continue through the week of February 22, according to updates from the U.S. Department of Energy’s Office of Cybersecurity, Energy Security, and Emergency Response. The recovery timeline for affected market participants remains unclear. Reported infrastructure damages potentially indicate that operations could take multiple weeks before returning to normal in several instances.

The Gulf Coast, which EIA tracks as the Petroleum Administration for Defense District (PADD) 3, accounts for more than half of total U.S. refinery capacity, and Texas alone accounts for 5.9 million barrels per day (b/d) of capacity, or about 32% of total U.S. capacity. Weather-related disruptions occurred primarily at several refineries in the Texas Gulf Coast refining region within PADD 3. By the peak of the weather’s impact on February 17, several refineries had announced either substantial or complete shutdowns as a result of external power outages, constrained natural gas supplies, logistical disruptions, or damage to process units because of the week’s cold temperatures and extreme weather. Other refineries in the area that were not forced to shut down capacity still faced similar complications and reduced run rates. In total, according to trade press and company announcements, an estimated 3.7 million b/d, or 20% of total U.S. refining capacity, was shut in as a result of the weather. As much as 5.7 million b/d (31% of total U.S. refining capacity) was affected by the weather to some degree, either as shutdowns or continued operations, but with reduced utilization. Most of the disruptions and shutdowns were announced on or about February 15 among refiners in the Beaumont/Port Arthur, Houston, and Corpus Christi regions of Texas, although refinery issues extend across several states.

Based on the U.S. Energy Information Administration’s (EIA) Weekly Petroleum Status Report (WPSR), gross inputs of crude oil and other feedstock to U.S. refineries declined 2.7 million b/d (17.5%) to 12.6 million b/d for the week ending February 19, 2021. The shutdowns resulted in a weekly decline in the gross inputs to Gulf Coast refineries of 2.4 million b/d (27.5%) to 6.3 million b/d, the largest weekly decline since the impact of Hurricane Harvey in September 2017 (Figure 1). The closures will likely continue to affect petroleum markets in the coming weeks, reducing demand for crude oil and production of refined products such as motor gasoline and distillate fuel oil.

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.

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). Supply of exclusively PP random copolymer increased.
MRC

MOSCOW (MRC) -- Japanese trading house Mitsui & Co Ltd said it would invest in the development of a carbon capture and storage (CCS) project in Britain, reported Reuters.

The Japanese company will take a 15.4% share in Storegga Geotechnologies which is developing the Acorn CCS project to store carbon dioxide emissions in depleted North Sea oil and gas reservoirs.

CCS traps emissions and buries them underground but is not yet at the commercialisation stage.

The project is being led by a wholly-owned subsidiary of Storegga Geotechnologies, Pale Blue Dot Energy, with support from Macquarie Group with a 21.5% shareholding and Singapore sovereign wealth fund GIC with a 15.4% shareholding.

The project is expected to be operational by the mid-2020s and will capture some of the 340,000 tonnes of CO2 emissions at the St Fergus gas terminal.

There will also be a project there to convert North Sea natural gas into hydrogen and the CO2 emissions will be captured by CCS. The hydrogen will be used in transport applications, and in gas grids to decarbonise heating in homes and industries.

As MRC informed earlier, Mitsui Chemicals operated its naphtha cracker normally following a maintenance turnaround. The company resumed operations at the cracker on July 19, 2020. The cracker was shut for maintenance on June 11, 2020. Located in Osaka, Japan, the cracker has an ethylene capacity of 500,000 mt/year and a propylene capacity of 280,000 mt/year.

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). Supply of exclusively PP random copolymer increased.

Mitsui Chemicals is a leading manufacturer and supplier of value added specialty chemicals, plastics and materials for the automotive, healthcare, packaging, agricultural, building, and semiconductor and electronics markets. Mitsui Chemicals is a Japanese Chemicals company, a part of the Mitsui conglomerate. The company has a turnover of around 15 billion USD and has business interests in Japan, Europe, China, Southeast Asia and the USA. The company mainly deals in performance materials, petro and basic chemicals and functional polymeric materials.
MRC

MOSCOW (MRC) -- Specialty chemicals company Lanxess completed the acquisition of the French company INTACE SAS on March 1, 2021, said the company.

The Paris-based biocide company is a manufacturer of specialty fungicides for the packaging industry. The parties have agreed not to disclose the purchase price.

The biocides businesses now acquired account for annual sales in the mid single-digit million euro range. LANXESS will integrate them into the Biocides business line within its Material Protection Products business unit. The products are used in particular in paper, paperboard, soap packaging, labels and banknotes.

As per MRC, Lanxess announced force majeure at its maleic anhydride plant in Baytown, Texac due to raw material shortages and equipment outages for necessary safety.

Maleic anhydride is a raw material for the production of tetrahydrofuran, tetrahydrophthalic anhydride, films and synthetic fibers, pharmaceuticals, detergents, plasticizers, maleic, succinic, fumaric and malic acids and a number of agricultural chemicals.

Plasticizers are substances introduced into a polymer material to make it elastic and plastic during processing and operation. In particular, plasticizers are used for the production of polyvinyl chloride (PVC). The share of plasticizers used for the production of PVC products is about 80%.

According to the ICIS-MRC Price Report, price discussions for March supplies of Russian PVC began on Wednesday, supplies of Russian PVC with K64 / 67 were discussed in the range of Rb116,000-120,000/tonne CPT Moscow, including VAT for volumes up to 500 tonnes, against Rb112,000-115,000/tonne CPT Moscow, including VAT in February.

Lanxess is a leading specialty chemicals concern with a turnover of EUR7.2 billion in 2018. The group employs approximately 15,400 people in 33 countries. Currently, the concern includes 60 manufacturing enterprises. Lanxess core business is the development, production and marketing of chemical intermediates, additives, specialty chemicals and plastics. The concern is included in the lists of the world's leading sustainability indices: the Dow Jones Sustainability Index (DJSI World and Europe) and FTSE4Good.
MRC

MOSCOW (MRC) -- Braskem Idesa says it is reopening its Etileno XXI ethylene-polyethylene (PE) petrochemical complex at Coatzacoalcos, Mexico, after signing agreements with Mexico’s state-owned companies Petroleos Mexicanos (Pemex) and National Natural Gas Control Center (Cenagas), reported Chemweek.

The complex was forced to shut down in December 2020 after Cenagas halted gas supplies to the plant. This followed unsuccessful talks between Braskem Idesa and Pemex over the renegotiation of an existing supply contract for feedstock ethane.

Braskem Idesa says it has now signed documents with both Pemex and Cenagas that will enable the facility’s “continued operation.” An agreement with Cenagas covers natural gas transport services for a term of 15 years. This is, however, conditional upon the outcome of further discussions between Braskem Idesa and Pemex over “potential amendments to the ethane supply contract and for the development of an ethane import terminal,” it says.

A memorandum of understanding (MOU) signed by Braskem Idesa and Pemex has set out “respective understandings” for the ethane supply discussion, as well as a forward process to enter into definitive documentation, approval by Braskem Idesa’s shareholders and creditors, and with reservations of rights, it says.

With the signing of these agreements, Braskem Idesa “immediately commenced to receive the service of natural gas transportation, which had been unilaterally terminated,” it says. The existing ethane supply contract between the two companies “has not been modified and remains in full force and effect,” it adds, noting that it “cannot predict the outcome of such discussions with Pemex, its shareholders, and creditors.”

Braskem Idesa announced in December it was taking steps to shut the Etileno XXI petrochemical complex after Cenagas halted gas supplies. Cenagas had said at the end of November it would not renew a contract for supply of natural gas and blocked supplies the following day, according to Braskem Idesa in a statement at the time. There were indications that the decision was driven by Mexican President Andres Manuel Lopez Obrador, who had announced that Pemex would no longer supply natural gas to Braskem Idesa as the contract terms were deemed to be unfair, according to Adrian Calcaneo, senior consultant with IHS Markit, at the time of the petchem plant’s announced shutdown.

Pemex has struggled to meet ethane supply commitments to the plant, the largest petchems investment in Latin America, as Mexico’s oil and gas production has declined significantly in recent years. Earlier in 2020, Braskem Idesa began importing ethane from the US to the plant. The company has spent $4 million on logistics infrastructure to be able to import up to 12,800 barrels/day of ethane, 19% of the volume required by the facility.

The Etileno XXI complex, which comprises a 1.05-million metric tons/year ethylene plant and three polyethylene (PE) units, had a utilization rate of 84% in the third quarter of 2020, according to a Braskem presentation later in the year. The main grades of PE produced are high-density polyethylene (HDPE) for blow molding and film, and low-density polyethylene (LDPE) for film.

As MRC informed earlier, in June 2020, Braskem announced the selection of Charleston, South Carolina for its new global export hub facility to serve international customers. The hub will provide packaging, warehousing and export shipping services to support Braskem's polypropylene (PP) production facilities in the United States. With the design and development phase well underway, the new global export hub was expected to be completed by the third quarter of 2020 and will have a capacity to support export shipments of up to 204,000 metric tons/year of PP and specialty polymers.

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). Supply of exclusively PP random copolymer increased.

Braskem S.A. produces petrochemicals and generates electricity. The Company produces ethylene, propylene, benzene, toluene, xylenes, butadiene, butene, isoprene, dicyclopentediene, MTBE, caprolactam, ammonium sulfate, cyclohexene, polyethylene theraphtalat, polyethylene, and polyvinyl chloride (PVC).
MRC