Pertamina may resume normal operations at Balongan refinery this week

MOSCOW (MRC) -- Operations at Indonesia’s state oil company PT Pertamina’s 125,000 barrel-per-day refinery in Balongan may return to normal this week, following a fire in some parts of the refinery, reported Reuters with reference to a company director's statement to parliament.

The fire broke out just after midnight last Monday, forcing Pertamina to shut the plant and evacuate around 950 nearby residents. Ten people are being treated in hospital from the effects of the fire.

“For primary processing, it is already operating normally, and a start-up for secondary processing is being carried out,” Djoko Priyono, the director of Pertamina’s refinery arm, Pertamina Kilang Internasional, said.

“It is hoped that by the end of this week, we can return to normal,” he said.

The company had began the restart process at the refinery on March 31, two days after the fire broke out, a Pertamina spokesman, Ifki Sukarya, told Reuters earlier on Monday.

The cause of the fire is still being investigated, Pertamina CEO, Nicke Widyawati told parliament at the same hearing.

As MRC informed before, only four storage tanks were affected, out of the total 72 tanks in Balongan with total capacity of 1.35 million kilo litres.

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).
MRC

MOSCOW (MRC) -- Dozens of Iraqi protesters blocked the entrance to the Nassiriya oil refinery in southern Iraq, a refinery source and a Reuters witness said.

The blockade caused fuel shortages across the southern province of Dhi Qar, with many petrol stations running dry and long queues at the few stations that were still open.

More than 200 unemployed university graduates who had a staged a weeks-long sit-in outside the refinery to demand jobs blocked the entrance and prevented employees from entering the building when the Iraqi parliament passed the budget on Wednesday without addressing their unemployment issue.

The province was unable to produce and refine crude oil and oil derivatives after the refinery's closure, which has a maximum production capacity of 30,000 barrels per day (bpd), the refinery said in a statement without giving further details.

As MRC wrote before, Indian Oil Corp (IOC) , the country's top refiner, has loaded its first cargo of Iraq's newly introduced Basra Medium crude grade, according to ship tracking data from Refinitiv Eikon. IOC loaded the cargo onto Minerva Kalypso, a suezmax-sized vessel, which left Iraq's southern port of Basra on Jan. 4, the data showed. The ship was expected to arrive at Chennai port in southeastern India for IOC's subsidiary Chennai Petroleum Corp (CPCL) around Jan. 14.

We remind that Indian Oil Corp has been operating at 100% capacity since early November, 2020, as local fuel demand has recovered, its chairman S.M. Vaidya said late last year. IOC has been gradually raising crude runs at its plants, which plunged to about 39% at the beginning of April, 2020, when a nationwide coronavirus lockdown hit fuel demand.

We also remind that IOC is expanding its petrochemical capacity by more than 70% from its current 3.2 million tonnes a year. It is also on new technologies that reduces the cost of producing petrochemicals.

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

MOSCOW (MRC) -- Royal Dutch Shell Plc restarted the small crude distillation unit (CDU) on Friday at its 318,000-bpd joint-venture Deer Park, Texas, refinery, said sources familiar with plant operations, said Hydrocarbonprocessing.

The 70,000-bpd DU-1 CDU was shut on Feb 14 by a pump seal failure, the sources said. All other units were shut the following day by severe cold weather.

DU-1 is the last unit shut in February to restart at the refinery.

As per MRC, Royal Dutch Shell reported an outage at its olefins plant in Deer Park, Texas, on 5 January, 2021. The plant flared for 16 hours last Tuesday following unspecified process upset. Maximum steam cracker operating rate in Texas falls to 89%.

As per MRC, Russia's output of chemical products rose in February 2021 by 5.3% year on year. Thus, production of basic chemicals increased year on year by 7.5% in the first two months of 2021. According to the Federal State Statistics Service of the Russian Federation, mineral fertilizers accounted for the greatest increase in the January-February output. Production of benzene dropped to 113,000 tonnes in February 2021, compared to 120,000 tonnes a month earlier. Overall output of this product reached 241,000 tonnes over the stated period, down by 7.5% year on year.

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.
MRC

MOSCOW (MRC) -- Nizhnekamskneftekhim (NKNKh, part of TAIF Group) has signed contracts with Lummus Technology LLC for the provision of licenses and technologies for the production of ethylbenzene, styrene and propylene for the olefin complex, the company said.

Facilities include a 250 ktpa ethylbenzene and styrene unit using EBOne and CLASSIC SM technologies, and a 150 ktpa olefin metathesis unit for polymer-grade propylene using Lummus' ethylene dimerization and olefin conversion technology Technology. The units will operate as part of the olefin complex under construction (EP-600).

The contract was signed on 31, March by the general director of Nizhnekamskneftekhim (part of the TAIF group) Ayrat Safin and the vice president and managing director of the ethylene and petrochemical department of Lummus Technology, Stephen Stanley.

Earlier it was reported that the main stage of construction of the Ethylene-600 olefin complex should be completed in December 2022, which will allow the start of production in the second half of 2023.

The complex plans to annually produce 600 thousand tons of ethylene, as well as 272 thousand tons of propylene, 246 thousand tons of benzene, 88 thousand tons of butadiene.

The construction of the olefin complex is carried out within the framework of a memorandum of strategic cooperation concluded in June 2017 between TAIF Group, which includes Nizhnekamskneftekhim, and the German company Linde AG. The basic agreement on the design, supply of equipment and provision of services for the commissioning of the first stage of the future plant was signed between Nizhnekamskneftekhim and the Linde Engineering division. In February 2019, a contract for construction and installation work was signed with the Turkish company Gemont.

As per MRC, Russia's output of chemical products rose in February 2021 by 5.3% year on year. Thus, production of basic chemicals increased year on year by 7.5% in the first two months of 2021. According to the Federal State Statistics Service of the Russian Federation, mineral fertilizers accounted for the greatest increase in the January-February output. Production of benzene dropped to 113,000 tonnes in February 2021, compared to 120,000 tonnes a month earlier. Overall output of this product reached 241,000 tonnes over the stated period, down by 7.5% year on year.

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

MOSCOW (MRC) -- There has been a shortage of suspension polyvinyl chloride (SPVC) in the world since the end of last year, prices are breaking new historical records. The Russian market also does not stand aside from the global trends, producers intend to achieve a further rise in April prices, and in some cases, a price increase of Rb10,000/tonne and higher is being discussed, according to ICIS-MRC Price report.

In March, PVC prices grew again in all regions of the world due to the shortage. And producers announced a further price increase for April shipments, as demand remained strong, and supply was still insufficient. And although Russian producers are not going to raise their export sales, despite more attractive prices in foreign markets in comparison with the domestic one, domestic prices are still being pulled up to the level of the export parity. Russian producers intend to achieve prices of more than Rb130,000/tonne for April shipments of some SPVC grades.

Russian converters still did not have import alternative for prompt shipments, but many converters were not ready to accept new price records either. Some of them even did not even rule out a pause in resin purchases if they are not able to agree with end consumers on new prices for finished products.

The rise in PVC prices in Russia has been continuing since last summer, and many converters were very late in transferring new prices of material onto their finished products. And this is a key factor in negotiations over April deliveries.

Russian producers said in April that Chinese manufacturers had an attractive level of export prices. Offer prices for container shipments started from USD1,260/tonne DAP Moscow, or given all taxes, it was about Rb122,000/tonne, including VAT and delivery, for resin with K=65. But there was one nuance - given the latest difficulties in logistics, the resin will reach the consumer no earlier than mid-May.

This year's export sales of Russian SPVC are comparable to the level of 2020. Although some producers do not rule out an increase in export shipments in case of weaker demand in April from the domestic market due to new price levels.

Discussions on prices for April shipments of Russian PVC began in late March, but some producers postponed the start of negotiations several times. Last week, deals for Russian resin with K64/67 were negotiated in the range of Rb121,500-130,000/tonne CPT Moscow, including VAT, for quantities of up to 500 tonnes, versus Rb116,000-120,000/tonne CPT Moscow, including VAT, in March. Deals for resin with K=70 started from Rb130,000/tonne CPT Moscow, including VAT.
MRC