Oil edges higher on bargain-hunting but oversupply fears cap gains

MOSCOW (MRC) -- Oil prices rises as investors looked for bargains following the previous day's plunge, but gains were capped as pandemic lockdowns in Europe and a build in US crude stocks curbed risk appetite and raised oversupply fears, reported Hydrocarbonprocessing.

Brent crude futures rose 27 cents, or 0.4%, to USD61.06 a barrel by 0108 GMT, after tumbling 5.9% and hitting a low of USD60.50 the previous day.

West Texas Intermediate (WTI) crude futures climbed 19 cents, or 0.3%, to USD57.95 a barrel, having lost 6.2% and touched a low of USD57.32 on Tuesday.

Both benchmarks touched their lowest levels since early February on Tuesday and have now fallen more than 14% from their recent highs earlier this month.

The front-month spread for both Brent and WTI slipped into contango, where front-month contracts are lower than the later months, a sign that demand for prompt crude is declining.

Germany, Europe's biggest oil consumer, extended its lockdown to April 18, and Chancellor Angela Merkel urged citizens to stay at home for five days over the Easter holiday.

Worries over the pace of the recovery from the pandemic were also heightened after a US health agency said the AstraZeneca Plc vaccine developed with Oxford University may have included outdated information in its data.

Adding to pressure, US crude oil stocks jumped by 2.9 million barrels in the week to March 19, against analysts' expectations in a Reuters' poll for a decline of about 300,000 barrels, according to trading sources citing data from industry group the American Petroleum Institute.

As MRC informed previously, oil producers face an unprecedented challenge to balance supply and demand as factors including the pace and response to COVID-19 vaccines cloud the outlook, according to an official with International Energy Agency's (IEA) statement.

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 241,030 tonnes in January 2021 versus 217,890 tonnes a year earlier. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, PP shipments to the Russian market reached 141,870 tonnes in January 2021 versus 123,520 tonnes a year earlier. Supply of homopolymer PP and PP block copolymers increased.
MRC

Plastic Energy and ExxonMobil to start up new recycling plant in France in 2023

MOSCOW (MRC) -- Plastic Energy (London, UK) is collaborating with ExxonMobil on a new recycling plant in France, which is anticipate to start up in 2023 according to EPPM.

The new facility will convert post-consumer plastic waste into raw materials for the manufacture of virgin-quality polymers.

Plastic Energy and ExxonMobil have been developing plans since 2018. A final investment decision on this project is expected in mid-2021 with startup anticipated in 2023.

Under terms of the agreements with affiliates of ExxonMobil, Plastic Energy will build, own and operate an advanced recycling plant adjacent to ExxonMobil’s Notre Dame de Gravenchon petrochemical complex. The plant will convert difficult-to-recycle mixed plastic waste into raw materials that can be transformed into certified circular polymers and other high-value products at ExxonMobil’s petrochemical complex.

The construction of this new advanced recycling plant will support the circular economy in Europe and will add to Plastic Energy’s growing portfolio of recycling units.

Plastic Energy’s patented, innovative technology transforms plastic waste into raw materials that can be used to create virgin-quality polymers.

The project is expected to be one of the largest advanced recycling plants in Europe, with an initial capacity of 25,000 tonnes of plastic waste per year, and plans to scale up to 33,000 tonnes in the near future.

Karen McKee, President, ExxonMobil Chemical, said: “Our plans with Plastic Energy demonstrate how industry, government and consumers can work together to build a more circular system to capture value from post-use plastic. We’re well-positioned to add value through our expertise in plastic manufacturing and high-performance products to help advance projects like this, which deliver sustainable solutions at scale.”

As MRC wrote previously, ExxonMobil is to shut its aromatics plant in Rotterdam-Botlek, Netherlands, for a six-week maintenance in March-April 2021. This turnaround is part of a larger repairs program at ExxonMobil"s interconnected 191,000-b/d Botlek refinery and Rotterdam aromatics plant beginning in the first quarter. The Rotterdam aromatics plant is one of the largest aromatics production facilities globally and produces pure aromatics such as benzene, orthoxylene, paraxylene (PX), and cyclohexane.

Benzene is a feedstock for the production of styrene monomer (SM), which, in its turn, is a feedstock for manufacturing polystyrene (PS).

According to MRC"s ScanPlast report, January 2021 estimated consumption of PS and styrene plastics in Russia rose by 12% year on year, totalling 45,640 tonnes. The estimated consumption increased year on year for all PS grades.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world"s oil and about 2% of the world"s energy.
MRC

SABIC and POLYRAY collaborate to introduce renewable polycarbonate

MOSCOW (MRC) -- SABIC, a global leader in the chemical industry and POLYRAY (Xiamen Hongtai Optical Co., Ltd.,) announced their collaboration for the use of SABIC’s polycarbonate (PC) resin based on certified renewable feedstock in the lenses of several eyewear end applications such as sunglasses, safety glasses and sports goggles, said the company.

SABIC, a global leader in the chemical industry and POLYRAY (Xiamen Hongtai Optical Co., Ltd.,), an innovative leader in the eyewear lens industry, today announced their collaboration for the use of SABIC’s LEXAN™ polycarbonate (PC) resin based on certified renewable feedstock in the lenses of several eyewear end applications such as sunglasses, safety glasses and sports goggles.

SABIC’s certified renewable polycarbonate – an engineering thermoplastic resin - is part of the company’s TRUCIRCLEportfolio and services. Based on SABIC’s cradle-to-gate peer-reviewed LCA study, use of SABIC’s LEXAN polycarbonate resin can potentially result in reductions in carbon footprint of up to 61% and fossil depletion reduction of up to 35%.

POLYRAY is the first ISCC PLUS certified lens supplier for the eyewear industry, giving their customers a consistent proof of a sustainable supply chain. ISCC is an independent global organization that provides the leading certification system offering solutions to address sustainability requirements for all feedstocks and markets, as well as traceability throughout the supply chain. ISCC PLUS certification can be a powerful tool for companies along the supply chain to address various environmental and social standards.

SABIC’s TRUCIRCLE portfolio and services for circular solutions span design for recyclability, mechanically recycled products, certified circular products from feedstock recycling of used plastics and certified renewables products from bio-based feedstock.

SABIC has not yet lifted the force majeure on the supply of high-density polyethylene (LDPE) from the plant in Wilton (Wilton, UK). So, since the end of September last year, the company has been carrying out preventive measures at this enterprise with a capacity of 400 thousand tons of LDPE per year, which should continue along with repair work at the cracking unit at the same site. However, unexpected technical problems were discovered at this plant, in connection with which force majeure circumstances were announced on November 3, 2020.

As per MRC' ScanPlast, Russia's overall consumption of polycarbonate (PC) granules (excluding exports from Belarus) totalled 8,100 tonnes in January 2021, up by 20% year on year (6,800 tonnes a year earlier). 1,600 tonnes of PC were consumed for the production of injection moulding products in Russia over the stated period, up by 4 times year on year (410 tonnes).

SABIC is a diversified company manufacturing chemicals, industrial polymers, fertilizers and metals. It is the largest state-owned company in Saudi Arabia. Sabic is currently the world's second largest producer of ethylene glycol, the third largest polyethylene producer, and the fourth largest polypropylene producer.
MRC

NKNKH started production of thermoplastic elastomers

MOSCOW (MRC) -- The first batch of thermoplastic elastomer (TPE) has been received at the new production facility of DSSK PJSC Nizhnekamskneftekhim, Realnoe Vremya reports.

It is a polymer granule. The products are used for the manufacture of road surfaces, which improves the quality and durability of asphalt. Thermoplastic elastomers are also used in the production of roofing materials.

The thermoplastic elastomer production process is fully automated. Finished granules are packed on a special filling line in a special soft container - big bags. The key features of TPEs include high mechanical strength and the possibility of multiple processing without harm to the environment.

Earlier it was reported that the first briquette of a new brand of rubber was obtained at the production of DSSK of Nizhnekamskneftekhim.

According to the ScanPlast survey of MRC, Nizhnekamskneftekhim produced a little less than 17,200 tonnes of propylene polymers in February against 18,500 tonnes a month earlier. In January - February, the total polymer output at the Nizhnekamsk plant reached 35,600 tonnes against 36,100 tonnes in 2020.

PJSC "Nizhnekamskneftekhim" (NKNKH) is one of the largest Russian producers of petrochemical products. The production complex of the company includes ten factories of the main production and ten departments (railway transport, main ethylene pipelines, etc.). NKNKh produces over 120 types of chemical products, including synthetic rubber, polyethylene, polypropylene, polystyrene, surfactants. Nizhnekamskneftekhim is part of TAIF Group.
MRC

Celanese to expand its UHMW-PE production capacity in Europe

Celanese to expand its UHMW-PE production capacity in Europe

MOSCOW (MRC) -- Celanese Corporation, a global chemical and specialty materials company, has announces its intent to expand its GUR ultra-high molecular weight polyethylene (UHMW-PE) production capacity in Europe, as per the company's press release.

In addition to the recently announced Bishop, Texas, GUR expansion of approximately 15,000 tonnes per year coming online beginning in 2022, Celanese intends to invest in additional capacity for GUR in Europe.

The expansion in Europe is expected to be online beginning in 2024 with an annual nameplate capacity of approximately 34K,000 tonnes. Site selection for this new European facility is underway, and Celanese is considering both existing and greenfield locations for a GUR production unit.

The addition of a new UHMW-PE production facility in Europe will support the significant growth in the company’s high-value GUR engineered materials portfolio. With this investment, Celanese will be able to support the double-digit growth for LIBS (Lithium Ion Battery Separators) in the electric vehicle (EV) market. The new facility will also have the option to produce medical grade GUR.

Financial details of this GUR expansion are not being disclosed at this time. Additional project details will be announced as further developments are available.

As MRC reported earlier, Celanese Corporation has also announced that its Clear Lake, Texas integrated chemical manufacturing facility will begin utilizing recycled carbon dioxide (CO2) as an alternative feedstock in the production of methanol, a key raw material in the manufacture of numerous acetyls products, including acetic acid, vinyl acetate monomer (VAM), ethyl acetate and other derivatives.

We remind that in H2 February, 2021, Celanese declared force majeure on its products in the Americas and EMEA region due to the severe winter weather that has heavily curtailed US petrochemicals and refinery production and operations on the US Gulf Coast.

According to MRC's DataScope report, January EVA imports to Russia rose only by 0,07% year on year to 3,084 tonnes from 3,087 tonnes a year earlier, and overall imports of this grade of ethylene copolymer into the Russian Federation dropped in January-December 2020 by 3,41% year on year to 38,170 tonnes (39,520 tonnes in 2019).

Celanese Corporation is a global technology leader in the production of differentiated chemistry solutions and specialty materials used in most major industries and consumer applications. Based in Dallas, Celanese employs approximately 7,700 employees worldwide and had 2020 net sales of USD5.7 billion.
MRC