PT Pertamina put out a fire at Balongan refinery storage units

MOSCOW (MRC) -- Indonesia's state oil company PT Pertamina said it has put out a fire that had engulfed part of its 125,000 barrel per day refinery in Balongan, West Java and had begun making preparations to restart the plant, said Hydrocarbonprocessing.

The fire broke out just after midnight on Monday, forcing Pertamina to shut the plant and evacuate around 950 nearby residents. Six were treated at the hospital due to the fire. Pertamina said in a statement that by Wednesday afternoon, fires in all four affected storage units have been extinguished.

The company was conducting a cooling down process and planning to begin preparation to restart the refinery as soon as it is safe to do so, it said. "Hopefully Balongan refinery can be operational again after a thorough inspection is carried out," Agus Suprijanto, a Pertamina spokesman said in the statement.

Pertamina expected the shut down could be lifted in four to five days as damage was limited to the storage area of the plant and did not affect its oil processing area, company officials said on Monday. The company has said that only 7% of the refinery's 1.35 million kilo litres (KL) of storage capacity was affected, and that the tanks that caught fire had been only holding around 23,000 KL of gasoline.

Pertamina said national fuel stocks remained secure, and any shortage of fuel to Jakarta, which Balongan supplies, could be made up by refineries in Cilacap and Tuban. Pertamina said there were no fatalities, though media reported one resident had died from a heart attack that coud have been caused by the shock of the explosion. West Java police said it will investigate the cause of the fire.

Earlier, Pertamina said it aims to restore operations at its Balongan oil refinery in West Java in 4-5 days, as firefighters worked to extinguish a massive blaze that broke out overnight, injuring six people. Pertamina shut the plant with the capacity of 125,000 barrels per day after the massive fire erupted.

We remind that PT Pertamina shut its cracker in Indonesia for maintenance works from 18 March, 2020. This cracker with a production capacity of 578,000 tons remained off-stream until 18 April 2020.

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.

Pertamina is an Indonesian state-owned oil and natural gas corporation based in Jakarta. It was created in August 1968 by the merger of Pertamin (established 1961) and Permina (established 1957). Pertamina is the world's largest producer and exporter of liquefied natural gas (LNG).

Tamilnadu Petroproducts to expand production units in India

MOSCOW (MRC) -- Chennai-based Tamilnadu Petroproducts (TPL), the petrochemicals arm of AM International Group, is expanding its production divisions at an investment of Rs 435 crore, said Financialexpress.

These include capacity augmentation of Linear Alkyl Benzene (LAB) division, revamp of caustic soda facilities and setting up a Propylene recovery unit (PRU). TPL has its plant at Manali in Tamil Nadu that houses different divisions. The LAB capacity would be increased from 1.2 lakh TPA to 1.45 lakh TPA at an estimated cost of Rs 240 crore. The project would be commissioned in about 24 months. The company will invest Rs 165 crore to modernise the caustic soda and chlorine unit by replacing the mono-polar membrane technology with a more advanced bipolar membrane technology.

On completion in about 18 months after required approvals, the production capacity for caustic soda unit will go up to 250 tonne per day from the current 150 tonne. At the present price levels, additional revenue of about 70% is expected from the project, with improved or higher value addition, the company said in a statement.

The PRU, first of its kind in India by a private sector player in the non-refining sector, would involve an outlay of about Rs 30 crore. This will be set up in the same PO manufacturing complex, saving significant trucking and energy costs. Propylene, a bulk chemical intermediate, is the raw material for Propylene Oxide and is derived from LPG.

TPL is in advanced talks with various domestic and international vendors for LPG for the project. The project, technology of which has been developed in-house by the company’s R&D team of engineers and environmental scientists, will be implemented in 12-18 months.

Ashwin Muthiah, vice-chairman, TPL & founding chairman, AM International, said, "TPL will be the first Indian non-refining company in the private sector to build a propylene recovery unit plant. It shows our commitment to bring manufacturing efficiencies by continuous upgrading and introducing state-of-art technology solutions. It is in line with our group philosophy to maximise margins by introducing process efficiency and value additions."

In adherence to the group’s philosophy of optimum leverage, a significant part of the expansion will be funded via internal resources and the remaining through other sources. TPL is a three-decade old LAB manufacturer and has facilities for production of heavy chemicals and Propylene Oxide also.

Earlier it was reported that India imposed anti-dumping duties (ADD) in the range of USD60.92 to USD200.66 per tonne on imports of polyethylene terephthalate (PET) from China for a period of five years from March 27. The duties were introduced after more than a year of investigation based on complaints filed by local manufacturers IVL Dhunseri Petrochem Industries and Reliance Industries Ltd (RIL), which account for over 90% of India's PET production.

According to MRC's ScanPlast report, Russia's February production of sodium hydroxide (caustic soda) amounted to 98.4 thousand tons (100% of the main substance) against 113 thousand tons a month earlier. In the first two months of the year, the total production of caustic soda amounted to 211,400 tonnes, which is 4.6% less than the same indicator of the previous year.

PP prices reached another historical record in Russia at the end of March

MOSCOW (MRC) - The shortage of polypropylene (PP) in several regions of the world has become the main reason for the rapid rise in prices since the beginning of the year. The Russian market did not stand aside, and in February - March, local converters faced an unprecedented rise in prices. By the end of March, prices reached another record, with some sellers announcing further increase for April shipment, according to the ICIS-MRC Price Report.

PP prices grew dynamically in the markets of Latin America, Europe and Turkey, and at the same time, export prices for Russian producers also grew. As a result, under the pressure of the export alternative and limited supply from a number of suppliers, PP prices began to rise in the Russian market as well.

In the late March prices of homopolymer PP in Russia increased by more than 50% since the beginning of the year, setting new historical records. The export prices of Russian producers exceeded the prices in the domestic market in February - March.

So, depending on the direction of export, export deals in the first month of spring were in the range of USD1,840-2,130/tonne FCA, for homopolymer PP. And only by the end of March, domestic prices of polypropylene in Russia approached export parity for certain regions, while prices stabilised in some export markets. It was very difficult for Russian converters during February - March to pass the new polypropylene price to the cost of finished products.
The processes of renegotiating the prices of finished products were very painful, especially with retail chains.

Because of this the market was divided into three parts. The first group reduced purchases due to difficulties in passing new PP prices to finished products, there were cases of complete suspension of work. The second group of companies, despite record price levels, has good demand for finished products and is ready to accept higher prices in order to fully fulfill obligations to their customers.

The third group of buyers does not have an increased demand for finished products and is ready to put up with low capacity utilisation. Spot offers for the supply of homopolymer PP raffia in the first days of February started at Rb113,500/tonne CPT Moscow, including VAT, whereas at the end of March the cost of this PP from some sellers exceeded the level of Rb170,000/tonne CPT Moscow, including VAT.

A similar situation was with other types of polypropylene. Last week, price discussions started regarding April supplies of polypropylene, with some sellers discussing further price increases. Deals of propylene copolymers were discussed above Rb200,000/tonne CPT Moscow, including VAT.

COVID-19 - News digest as of 31.03.2021

1. Pandemic prompts Spanish oil refiner to offer furlough scheme for 30% of its staff

MOSCOW (MRC) -- Spanish oil refiner Petronor, majority-owned by Repsol, has offered a furlough scheme for one third of its 900 employees in response to a major reduction in fuel demand due to the COVID-19 pandemic, according to Hydrocarbonprocessing. The refinery in Bilbao, northern Spain, with a capacity of 220,000 barrels of crude oil per day has been processing crude at 60% capacity for 271 days, the company said on Monday, during which time it offered training to keep employees active. Unable to keep this up, the company said it would now start negotiations with labour representatives to decide on temporary layoffs until the end of 2021.


Clariant joins the European Circular Plastics Alliance

MOSCOW (MRC) -- Clariant (Muttenz, Switzerland), a focused, sustainable and innovative specialty chemical company, has officially joined the EU Circular Plastics Alliance, which is part of the company's active support for the transition towards a more circular plastics economy, as per the company's press release.

The alliance aims to enhance plastics recycling in line with the objectives of the EU Circular Economy Action Plan and the Green Deal program.

Clariant is committed to the Alliance’s goal to boost the EU market for recycled plastics to 10 million tons by 2025. The company’s focus is on addressing the obstacles that are hampering a higher circularity of products within the plastics value chain, in line with the waste hierarchy principles. Clariant’s strategy is based on a smart combination of design for reduction, recycling, and reuse options, as well as solutions for mechanical or chemical recycling.

“Specialty chemicals can act as enablers for new solutions that enhance circularity of plastics by maintaining the value of products, materials and resources in the economy for as long as possible, and by minimizing the generation of waste. Clariant aims to be a leading provider of specialty chemicals that are indispensable to transform a one-way plastics value chain into a circular plastics economy,” said Richard Haldimann, Head of Sustainability Transformation.

Back in 2019, Clariant also established EcoCircle, a company-wide initiative that goes beyond a product focus, looking at the entire value chain, identifying the most sustainable and viable solutions for a circular plastics economy. “With EcoCircle we have the right platform and competencies to identify solutions for closing the loop and to engage with key stakeholders to accelerate plastics circularity,” added Richard Haldimann.

As MRC wrote previously, earlier this month, Clariant and India Glycols Limited (IGL), a leading company in the manufacturing of green technology-based chemicals, announced a strategic partnership to establish a 51-49% joint venture (JV) in renewable ethylene oxide (EO) derivatives.

And in October 2020, Clariant announced the construction of a new state-of-the-art catalyst production site in China. This project represents a significant investment which further strengthens Clariant’s position in China and enhances its ability to support its customers in the country’s thriving petrochemicals industry.

The new facility will be primarily responsible for producing the Catofin catalyst for propane dehydrogenation, which is used in the production of olefins such as propylene. Thanks to its excellent reliability and productivity, Catofin delivers superior annual production output compared to alternative technologies, resulting in increased overall profitability for propylene producers, says the company. Construction at the Dushan Port Economic Development Zone in Jiaxing, Zhejiang Province was scheduled to commence in Q3 2020, and Clariant expects to be at full production capacity by 2022.

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.

Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints.