Olin to redeem 10% Senior Notes issued in connection with the 2015 Dow chlorine products acquisition

MOSCOW (MRC) -- Olin Corporation (Clayton, Missouri) announced that it has notified bondholders that it intends to redeem all USD185 million of its outstanding 10% senior notes due October 15, 2025 (the "Notes"), as per the company's press release.

The Notes are expected to be redeemed on May 14, 2021 at a redemption price in cash of 105% of the principal amount of the Notes (representing an aggregate premium of approximately USD9.3 million).

The Notes were issued in connection with the 2015 Dow Chlorine Products acquisition. Olin expects to fund the redemption using USD195 million of cash generated from operations.

As MRC reported before, earlier this year, Olin announced plans to shut a portion of its diaphragm-grade chlor-alkali capacity in the USA. Thus, the company had permanently shut down about 200,000 metric tons/year of diaphragm-grade chlor-alkali capacity at its McIntosh, Alabama, facility by 31 March. Olin will take a USD5 million of restructuring charge for the move, which the company expects to be cash flow accretive.

We remind that 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 Rosstat's data. February production of sodium hydroxide (caustic soda) was 98,400 tonnes (100% of the basic substance) versus 113,000 tonnes a month earlier. Overall output of caustic soda totalled 211,400 tonnes in the first two months of 2021, down by 4.6% year on year.
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LyondellBasell launched products Circulenrange of Circulen Products

MOSCOW (MRC) -- LyondellBasell announced the launch of a suite of products under the name Circulen enabling brand owners to improve the sustainability of consumer products, said the company.

This announcement marks the next step in LyondellBasell delivering on its sustainability goal of producing and marketing two million metric tons of recycled and renewable-based polymers annually by 2030, which is one of the most ambitious goals in the industry.

The LyondellBasell Circulen product family supports the reduction of plastic waste through the use of recycled content, and a lower carbon footprint through the use of renewable-based content as compared to feedstock from fossil-based sources.

The LyondellBasell Circulen product family supports the reduction of plastic waste through the use of recycled content, and a lower carbon footprint through the use of renewable-based content as compared to feedstock from fossil-based sources.

To help achieve the company's ambitions, LyondellBasell is implementing a multi-pronged approach to advance the circular economy by bringing sustainable solutions to life. "With the new Circulen product portfolio, we are taking concrete action to advance the circular economy today, innovate for the future and partner across the value chain," said Ken Lane, LyondellBasell Executive Vice President Global Olefins and Polyolefins. "Our ambition is bold, yet necessary, and we are committed to doing our part to help address the global challenges of plastic waste in the environment and climate change while meeting customer and brand owner needs."

The LyondellBasell Circulen portfolio is currently available in Europe and will soon be introduced in North America and China. Circulen products are presently used in the new Samsonite Magnum Eco suitcase line, and garden equipment (e.g., watering cans).

As per MRC, Lyondell Basell announced that it has obtained the International Sustainability and Carbon Certification (ISCC) Plus certification, one of the world’s largest sustainability certification systems, for its cracker in Wesseling, Germany, and European polymer sites. As a result of this certification, Lyondell Basell will offer mass balance certificates for its advanced (molecular) recycled and renewable-based Circulen 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 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.

LyondellBasell is one of the largest plastics, chemicals and refining companies in the world. Driven by its employees around the globe, LyondellBasell produces materials and products that are key to advancing solutions to modern challenges like enhancing food safety through lightweight and flexible packaging, protecting the purity of water supplies through stronger and more versatile pipes, improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road, and ensuring the safe and effective functionality in electronics and appliances.
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COVID-19 - News digest as of 15.04.2021

1. China starts rebuilding oil stockpiles in early 2021

MOSCOW (MRC) -- China resumed storing crude oil in the first two months of the year with almost 1MM bpd being added to inventories in January and February, rebuilding stockpiles after a rare drawdown toward the end of last year, reported Reuters. About 920,000 bpd were directed to inventories in the first two months of the year, according to calculations based on official data. The build in inventories comes as refineries make use of new import permits for 2021, after the coronavirus pandemic and a dispute between exporters caused widespread market ructions last year. China doesn't disclose the volumes of crude flowing into strategic and commercial stockpiles. But an estimate can be made by deducting the amount of crude processed from the total amount of crude available from imports and domestic output.


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Crude futures going down on profit-taking after overnight hike

MOSCOW (MRC) -- Crude oil futures ticked lower during mid-morning in Asia April 15 on profit-taking, after a bullish report from the US' Energy Information Administration sent prices hurtling nearly 5% higher overnight, while an improved demand forecast from the International Energy Agency provided a further boost to sentiment, reported S&P Global.

At 10:43 am Singapore time (0243 GMT), the ICE Brent June slipped 3 cents/b (0.04%) lower than the April 13 settle at USD66.55/b, while the May NYMEX light sweet crude contract was down 10 cents/b (0.16%) at USD63.05/b.

Prices ticked lower this morning as investors locked in profits after a meteoric rally overnight, which propelled the Brent and NYMEX light sweet crude markers to settle 4.57% and 4.94% higher at USD66.58/b and USD63.15/b, respectively.

The sharp rise was driven by better-than-expected headline numbers from the April 14 EIA report, which showed a 5.89 million-barrel decline in US commercial crude inventories to 492.42 million barrels in the week ended April 9. This draw was more bullish than the 2.9 million-barrel draw forecasted by analysts in a S&P Global Platts survey, and the 3.61 million-barrel draw reported by the American Petroleum Institute on April 13.

The EIA report also showed a 310,000-barrel build in US gasoline inventories, but this build was a source of relief to the market, as it was much smaller than the 5.57 million-barrel build reported by the API. Distillate inventories also declined counter-seasonally by 2.08 million barrels.

Crucially, the report showed an improvement in EIA's implied total refined product supplied metric, a proxy for demand, which climbed 1.09 million b/d to an eight-week high of 20.33 million b/d. Implied gasoline demand jumped 1.8% to 8.94 million b/d, the strongest since August, with implied demand also registering an 8% increase to a 13-week high of 1.36 million b/d.

Meanwhile, sentiment in the market was further boosted by an upward revision to the IEA's demand outlook, a day after OPEC unveiled an improved forecast. In its April 14 report, the Paris-based agency said that 2021 global oil demand will grow 230,000 b/d faster than previously forecast, expanding 5.7 million b/d to 96.7 million b/d.

"Oil markets fundamentals look decidedly stronger," the IEA said. "The massive overhang in global oil inventories that built up during last year's COVID-19 demand shock is being worked off, vaccine campaigns are gathering pace and the global economy appears to be on a better footing," the IEA reasoned.

As MRC informed earlier, 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 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.
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Advanced Petrochemical restarts PP plant and PDH unit in Jubail after maintenance

MOSCOW (MRC) -- Advanced Petrochemical Co. announced that it has resumed operations at two plants in Jubail, Saudi Arabia after the completion of a scheduled turnaround, reported Argaam with reference to a bourse filing.

Thus, operations at the company's polypropylene (PP) plant began on 28 March, 2021, whereas operations at its propane degydranation (PDH) unit restarted on 11 April, 202. Both plants were shut for repairs on 11 March, 2021,

As per the filing, the maintenance works were implemented in line with the occupational safety and health standards, despite the COVID-19 outbreak.

There is no significant change in the costs associated with the maintenance activities, the statement added.

The relevant financial impact will likely appear on financial statements of the first two quarters of 2021, based on expected prices of feedstock and polypropylene.

As MRC wrote before, SK Advanced started up a new PP plant in Ulsan, South Korea on 23 March, 2021, and managed to produce on-specification PP at this plant in the week ending 9 April, 2021.The PP unit is a joint venture between PolyMirae and SK Advanced, using the “Spheripol” process of LyondellBasell, and have an annual output of 400,000 tons/year.

According to MRC's ScanPlast report, 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.
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