Ukraine could have diesel shortages in May

MOSCOW (MRC) -- Ukraine could face diesel shortages in May because of planned maintenance at the Belarus Mozyr refinery coinciding with a break in supply from Russia's Rosneft, five trading sources told Reuters.

Swiss-based trader Proton Energy Group, which supplied Rosneft diesel and liquefied petroleum gas to Ukraine, stopped exports from April 1 and new supplier Coral Energy has yet to take over, sources have said. Ukraine consumes more than 7 million tons of diesel a year, importing two thirds of its needs, mainly from Russia and Belarus. After Proton stopped supplies, Ukraine sought to increase seaborne imports but volumes have been insufficient.

Rosneft, which supplied about 1.75 million tons of diesel to Ukraine last year via pipelines and railways, does not plan to resume exports next month and Belarus Mozyr refinery is set for planned maintenance from May 15 to June 15, traders said.

Mozyr is expected to supply about 150,000 tons of diesel to Ukraine in May, down from the usual 240,000 tons a month, traders said. "We expect a deficit of around 270,000 tons in May," one of the sources said.

Another source estimated that the diesel shortages could be between 150,000 and 200,000 tons next month, when major grain producer Ukraine would be in the middle of its sowing season. Ukraine has previously increased imports from sea ports and by rail to compensate for shortages, but it was not clear how it would act on this occasion, traders said.

Rosneft, Coral Energy, Mozyr refinery and the Ukranian Energy Ministry did not respond immediately to Reuters' requests for comment.

As per MRC, The Bashkir Soda Company (BSK) has been excluded from the list of a number of organizations against which Ukraine has imposed sanctions. Head of State Volodymyr Zelenskyy signed a decree on the enactment of the decision of the National Security and Defense Council of the country on sanctions, the document was published on the president's website. The sanctions against the BSK were imposed in May 2020 for a period of three years. Restrictions were imposed on trade operations, blocking of assets, complete cessation of the transit of resources, flights and transportation to the territory of Ukraine, suspension of the fulfillment of economic and financial obligations, as well as a ban on participation in the privatization and lease of state property.

According to MRC's DataScope report, last month's PE imports to Ukraine were 28,700 tonnes versus 17,700 tonnes in February, local companies increased their purchases of all PE grades. Thus, overall PE imports reached 63,600 tonnes in January-March 2021, compared to 39,900 tonnes a year earlier. HDPE imports decreased significantly, whereas imports of other PE grades increased.

PPG acquires German automotive wheel coatings producer Cetelon

MOSCOW (MRC) -- PPG completed the acquisition of Germany-based automotive wheel coatings manufacturer Cetelon Lackfabrik, said the company.

PPG announced that it has acquired Cetelon Lackfabrik GmbH, a manufacturer of coatings for automotive and light truck wheel applications. Financial details of the transaction were not disclosed.

Cetelon develops and manufactures a wide range of coating systems for the wheel industry, including certain proprietary technologies. It operates production and sales offices in Ditzingen, Germany, from which it serves many leading wheel suppliers worldwide. Founded in 1948 in Stuttgart, Germany, Cetelon became part of the Berlac Group in 2011. The company employs approximately 95 people globally.

"The strategic acquisition of Cetelon will allow PPG to further build upon its existing coatings product portfolio, liquid and powder coating technologies and color matching capabilities,” said Rebecca Liebert, PPG executive vice president. “Cetelon’s long-standing and established customer relationships will be complementary to PPG’s existing customer base and global presence, and will allow us to continue to deliver industry-leading solutions and drive growth within the transportation industry."

"The sale of Cetelon to PPG is a great result for both companies,” said Daniel Kesselring, chairman, Berlac Group. “While PPG gains Cetelon’s long-standing expertise in the wheel industry, Cetelon will benefit from a highly complementary product offering and from PPG’s global reach."

As MRC informed earlier, 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 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. Last month's production of polymers in primary form in Russia was 861,000 tonnes versus 196,000 tonnes in January. Overall output of polymers in primary form totalled 1,770,000 tonnes over the stated period, up by 8.4% year on year.

Refinery output in China rises nearly 20% on robust demand

MOSCOW (MRC) -- China’s daily refinery throughput surged 19.7% in March from a year earlier, as refiners ramped up operations to meet robust fuel demand and to build up inventory before shutting down for overhaul, reported Reuters.

China processed 59.79 million tons of crude oil last month, data issued by the National Bureau of Statistics (NBS) showed on Friday. That is equivalent to 14.08 million barrels per day (bpd), easing off 14.13 million bpd averaged in the first two months.

The strong year-on-year growth was in part due to a low base a year earlier when Chinese fuel demand was badly hit by coronavirus that forced refineries to slash production.

Throughput for the first quarter of this year was 174.04 million tons, up 16.5% year.

Crude oil output rose 3.3% in March versus the same month a year ago to 17.09 million tons, or 4.02 million bpd. Output for the January-March period climbed 1.4% year-on-year at 49.18 million tons.

Natural gas output last month jumped 12.1% from a year earlier to 18.5 billion cubic meters (bcm), and was up 13.1% at 53.3 bcm for the first quarter.

As MRC wrote previously, Zhejiang Petrochemical Co Ltd (ZPC) has started up its No. 2 cracker in Zhoushan, China, which is part of the company's phase 2 petrochemical project in the cournty. Thus, the cracker with an annual capacity of 1.4 million tons/year of ethylene and 700,000 tons/year of propylene began trial runs in early April, 2021. The commercial production at this facility is expected in the coming weeks.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated polyethylene (PE) consumption totalled 356,370 tonnes in the first two month of 2021, down by 9% year on year. Shipments of exclusively low density polyethylene (LDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market was 246,870 tonnes in January-February 2021, up by 30% year on year. Supply of homopolymer PP and PP block copolymers increased.

Yansab earnings, sales rise in the first quarter of 2021

MOSCOW (MRC) -- Yanbu National Petrochemical Co. (Yansab) reported a net profit after Zakat and tax of SAR 420.3 million for the first quarter of 2021, compared to a net profit of SAR 104.5 million in year-earlier period, said Argaam.

The robust rise was fueled by an increase in average selling prices of all products despite lower production and sales volume, and higher feedstock average costs. Moreover, the company recorded SAR 64 million in impairment of ongoing capital works.

Yansab reported profit rise of 26.3% when compared to the previous quarter.

Shareholders’ equity, excluding minority interest, decreased 3.7% to SAR 14.791 billion in Q1 2021, from SAR 15.262 billion a year earlier.

As per MRC, Yanbu National Petrochemical Company (Yansab), part of Saudi Basic Industries Corporation (Sabic), restarted its cracker after a planned turnaround. Thus, the cracker in Yanbu, Saudi Arabia, which can produce 1.38 mln mt/year of ethylene and 400,000 mt/year of propylene, resumed operations on 15 February, 2021. It was shut for a turnaround on 5 February.

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.

Yansab is the most recent SABIC, (Saudi Basic Industries Corp), affiliate in Saudi Arabia, and will be the largest Sabic petrochemical complex. It will have an annual capacity exceeding 4 million metric tons (MT) of petrochemical products including: 1.3 million MT (metric-tons) of ethylene; 400,000 MT of propylene; 900,000 MT of polyethylene; 400,000 MT of polypropylene; 700,000 MT of ethylene glycol; 250,000 MT of benzene, xylene and toluene, and 100,000 MT of butene-1 and butene-2.

ExxonMobil picks Sinopec Engineering for construction of multi-billion cracker project in China

MOSCOW (MRC) -- Sinopec Engineering (Group) and ExxonMobil (Huizhou) Chemical (EMHCC) have entered into a BEPC (basic design, engineering, procurement and construction) contract for the proposed Huizhou Chemical Complex Project (Phase I), according to Indian Chemical News.

Under the contract, the Group will provide EMHCC with BEPC services for the project. The main scope of the services includes the basic design, engineering, procurement and construction of all the process units, utilities and infrastructures. The contract value is estimated to be multibillion USD.

The project, which remains subject to final investment decision, will be located in Daya Bay Petrochemical Park, Huizhou, Guangdong, China.

The main units of the project include a 1.6 million tonnes/year ethylene flexible feed steam cracker, downstream polymer and derivative units and utilities. The main product units include two performance polyethylene (PE) lines and two differentiated performance polypropylene (PP) lines.

As MRC informed before, ExxonMobil, the US energy major, is considering whether to close down its Slagen oil refinery in Norway, which has a capacity to process 120,000 barrels of crude per day, turning the site into an import terminal. The refinery at Slagentangen near Toensberg in south-east Norway was built in 1961 and process crude oil from the North Sea, exporting about 60% of the output, according to Exxon.

Ethylene and propylene are feedstocks for producing PE and PP.

According to MRC's ScanPlast report, Russia's estimated polyethylene (PE) consumption totalled 356,370 tonnes in the first two month of 2021, down by 9% year on year. Shipments of exclusively low density polyethylene (LDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market was 246,870 tonnes in January-February 2021, up by 30% year on year. Supply of homopolymer PP and PP block copolymers increased.

EMHCC is a wholly-owned subsidiary established by Exxon Mobil Corporation (ExxonMobil) in China.

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.