COVID-19 - News digest as of 15.06.2021

1. US PP exports down by nearly 13% YOY in Jan-Apr 2021

MOSCOW (MRC) -- US polypropylene (PP) exports reached 516,389 mt in the first four months of 2021, down by 12.9% from 593,327 mt a year earlier, reported S&P Global with reference to ITC data. In January-April 2019, the US exported 553,460 mt of PP, up by 7% from 516,389 mt in the same period of 2021, but down by 6.7% from 593,327 mt in the January-April period of 2020, the date showed. PP demand crashed amid the height of pandemic-related shutdowns in April 2020, but began rebounding as shutdowns eased and demand rose for durable goods like vehicles, homes and appliances.


MRC

MOSCOW (MRC) -- Oil prices held near multi-year highs, underpinned by an improved outlook for demand as increased COVID-19 vaccinations help lift travel curbs, reported Reuters.

Brent crude was up 14 cents, or 0.2%, at USD72.83 by 0123 GMT. It rose 1.1% last week and hit the highest since May 2019 of USD73.09 on Friday.

US West Texas Intermediate was also up 14 cents, or 0.2%, at USD71.05 a barrel, after reaching the highest since October 2018 at USD71.24 on Friday and rising 1.9% on the week.

Vehicle traffic is returning to pre-pandemic levels in North America and much of Europe and more planes are in the air as lockdowns and other restrictions are being eased, driving three weeks of gains for the oil benchmarks.

The Organization of the Petroleum Exporting Countries (OPEC) and allies, known as OPEC+, need to increase output to meet recovering demand, the International Energy Agency (IEA) said in its monthly report on Friday.

The OPEC+ group has been restraining production to support prices after the pandemic wiped out demand in 2020.

We remind that as MRC informed earlier, Indian refiners, anticipating a lifting of US sanctions, plan to make space for the resumption of Iranian imports by reducing spot crude oil purchases in the second half of the year. The world"s third-largest oil consumer and importer halted imports from Tehran in 2019 after former US President Donald Trump withdrew from a 2015 accord and re-imposed sanctions on the OPEC producer over its disputed nuclear programme.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.
MRC

MOSCOW (MRC) -- Jinneng Science & Technology Co Ltd is planning to start up its new propane dehydrogenation (PDH) and polypropylene (PP) plant by end of July 2021, according to CommoPlast with reference to market sources.

Based in Shandong, China, the company has a 900,000 tons/year PDH unit and two PP lines each with 450,000 tons/year.

A source closed to the company informed that they will be outsourcing propylene for the trial production of PP line in June-July period.

As MRC reported earlier, initially, the company planned to launch these units with in April last year. Construction was delayed due to longer-than-expected land-use permit procedures, the company said.

According to MRC's ScanPlast report, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.

Located in the Industrial Park of Qihe County (Shandong Province, China), Jinneng Science and Technology Company, Limited is an energy-focused high-tech industrial enterprise based on the production and distribution of fine chemical products and coal chemical products with total assets of 4 billion RMB (USD640 million) and over 3,000 employees. The company was founded in 1998.
MRC

MOSCOW (MRC) -- A fire on the small hydrocracking unit (HCU) was extinguished on Thursday afternoon at Valero Energy Corp’s 335,000-barrel-per-day Port Arthur, Texas, refinery, reported Reuters with reference to people familiar with plant operations.

The fire, which broke out at about noon CDT (1700 GMT), shut the 45,000-bpd 942 HCU at the refinery, the people said.

Valero did not reply to a request for comment.

All personnel at the refinery have been accounted for, the people said. There were no reports of injuries.

The fire started after a seal on a hydrocracker charge pump blew out, the sources said. Because both volatile hydrocarbons and hydrogen are present in an HCU, fires on those units pose a risk of large explosions.

As MRC wrote previously, Valero Energy Corp, the second largest US crude oil refiner, planned to operate its 14 refineries up to 89% of their combined total throughput capacity of 3.15 million barrels per day (bpd) during the second quarter of 2021.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.
MRC

MOSCOW (MRC) -- Indian Oil Corp. Ltd. (IOC) has let contracts to McDermott International Ltd. to provide engineering, procurement, construction, and commissioning (EPCC) services for separate projects involving the addition of new units at two of its refineries in India, according to Oil&Gas Journal.

As part of the first contract, McDermott will deliver EPCC for implementation of a new diesel hydrotreating unit and associated installations to be added as part of IOC’s project to increase crude oil processing capacity at its 6-million tonne/year (tpy) Barauni refinery in Begusarai District, Bihar, McDermott said on June 14.

Under the second contract, McDermott will execute EPCC for a catalytic dewaxing unit to improve quality and production capacity of lubricant base oils at the operator’s 8-million tpy refinery in Haldia, Purba Medinipur, West Bengal, India.

Alongside EPCC services, McDermott’s scope of work under the projects - both of which are scheduled to begin by the end of June - also includes project management, residual process design, detailed engineering, fabrication, transportation, and mechanical completion.

The service provider did not reveal a value of the EPCC contracts.

Officially approved in 2020, the 148.10-billion rupee Barauni refinery expansion will increase crude processing capacity by 3 million tpy to 9 million tpy as well as add downstream polymer units at the site as part of IOC’s strategy to help meet growing domestic demand for petroleum products in India (OGJ Online, Aug. 3, 2020).

According to the latest project documents available from IOC, India’s Ministry of Environment, Forest, and Climate Change (EFCC), and Envirotech East Pvt. Ltd. - which completed the project’s environmental impact assessment study in November 2018 - the Barauni capacity expansion will include construction of the new 9-million tpy atmospheric-vacuum distillation unit (AVU) to replace the refinery’s three existing AVUs, which will be idled (OGJ Online, Apr. 8, 2020).

Alongside addition of the new 1.2-million tpy diesel hydrotreating unit, the project also entails installation of major grassroots units.

The expansion project also will involve revamps and upgrades to increase capacity of current units at the refinery.

Part of India’s commitment to produce cleaner fuels, the Haldia catalytic dewaxing unit- which, once in service, will be the refinery’s second comes as part of IOC’s capacity augmentation of its Bharat Stage VI (BS-VI, equivalent to Euro 6) plant to produce low-sulfur fuels and help reduce India’s current reliance on imports of lube base oils.

First proposed in 2016, the catalytic dewaxing unit at Haldia will be equipped to produce 100% premium API Group III base oils by processing unconverted oil from an upstream hydrocracking unit at the refinery. The unit also will have the capability to produce API Group II base oils, as well as white oil and transformer oil as specialty products, according to a series of IOC official project documents filed with Indian regulators.

In a 2019 description of the proposed project, IOC said the Haldia refinery currently operates a 200,000-tpy catalytic Isodewaxing unit for production of API Group II base oils. The now 10.19-billion rupee (formerly 9.67-billion rupee) second catalytic Isodewaxing unit is scheduled for startup by January 2023, IOC said in May 2021.

As MRC reported before, Technip Energies has been recently awarded a significant Engineering, Procurement, Construction and Commissioning (EPCC) contract by Indian Oil Corporation Limited (IOCL) for its BR9 Expansion Project in Barauni, Bihar, in the Eastern part of India. This EPCC contract covers the installation of a new Once-through Hydrocracker Unit (OHCU) of 1 million metric tonnes per annum (MMTPA) capacity, a Fuel Gas Treatment Unit (FGTU) and the associated facilities.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.

Indian Oil Corporation Limited, or IndianOil, is an Indian state-owned oil and gas corporation with its headquarters in New Delhi, India.
MRC