Advent to sell coating resins maker Allnex to PTT Global Chemical for around USD4.75 billion

Advent to sell coating resins maker Allnex to PTT Global Chemical for around USD4.75 billion

MOSCOW (MRC) -- Buyout group Advent has agreed to sell German coating resins maker Allnex to Thailand’s PTT Global Chemical (PTTGC) for around EUR4 billion (USD4.75 billion), reported Reuters with reference to the companies' statements on Monday.

Allnex, whose products are used in the industrial metal, automotive and packaging industries, has annual revenue of EUR2 billion and employs 4,000 employees worldwide. The deal values Allnex at 12.2 times its annual core earnings.

Advent acquired Cytec Industries’ coating resins business in 2013, rebranded it Allnex and merged it with peer Nuplex in 2016.

PTTGC is a unit of Thailand’s energy group PTT, which is seeking to strengthen its chemicals business. The deal will improve Allnex’ access to raw materials and to the Asian market, which has strong growth potential for coating resins, the companies said.

The deal is expected to close in the fourth quarter of 2021.

As MRC wrote previously, PTTGC abruptly shut down three crackers at its petrochemical complex in Map Ta Phut on 14 April 2021 after a thunderstorm caused a power outage. No. 1 and 4 crackers and the recently launched No. 5 cracker on the site were off-line for around one week. The production capacities of No. 1 and 4 crackers are 461,000 and 515,000 mt/year of ethylene, whereas the new cracker can produce 500,000 mt/year of ethylene and 260,000 mt/year of propylene.

PTT Global Chemical is a leading player in the petrochemical industry and owns several petrochemical facilities with a combined capacity of 8.45 million tonnes a year.
MRC

PVC production in Russia rise by 1% in H1 2021

MOSCOW (MRC) -- Russia's overall production of unmixed polyvinyl chloride (PVC) totalled 515,900 tonnes in the first half of 2021, up by 1% year on year. At the same time, two producers reduced their output, according to MRC's ScanPlast report.

June production of unmixed PVC in Russia was 83,800 tonnes versus 86,100 tonnes a month earlier, SayanskKhimPlast decreased its capacity utilisation. Overall output of polymer totalled 515,900 tonnes in January-June 2021, compared to 509,100 tonnes a year earlier. Two producers reduced their output, whereas Bashkir Soda Company and Kaustik, Volgograd managed to increase their production of resin.

The structure of PVC production by plants looked the following way over the stated period.


RusVinyl produced 29,900 tonnes of PVC in June, with emulsion polyvinyl chloride (EPVC) accounting for 2,300 tonnes, compared to 28,100 tonnes a month earlier. RusVinyl's overall output of resin reached 175,300 tonnes in the first half of 2021, compared to 177,600 tonnes a year earlier.

SayanskKhimPlast reduced its capacity utilisation last month and produced 23,400 tonnes of suspension PVC (SPVC), compared to 26,500 tonnes in May. The Sayansk plant managed to produce 156,900 tonnes of PVC in the fist six months of 2021, compared to 164,3000 tonnes a year earlier.

Baskhir Soda Company produced 23,300 tonnes of SPVC in June versus 23,800 tonnes a month earlier. The Baskhir plant's overall production of resin reached 140,500 tonnes in January-June 2021, up by 8% year on year.

Kaustik (Volgograd) produced 7,200 tonnes of SPVC last month, whereas this figure was 7,700 tonnes in May. The plant's overall production of resin reached 43,200 tonnes over the stated period versus 36,500 tonnes a year earlier.

MRC

COVID-19 - News digest as of 12.07.2021

1. U.S. crude and gasoline stocks fell

MOSCOW (MRC) -- U.S. crude and gasoline stocks fell and gasoline demand reached its highest since 2019, the U.S. Energy Information Administration said, signaling increasing strength in the U.S. economy, said Hydrocarbonprocessing. Crude inventories fell by 6.9 million barrels in the week to July 2 to 445.5 million barrels, the lowest since February 2020, and more than the expected 4 million-barrel drop estimated in a Reuters poll. Crude stocks have declined steadily for several weeks as refiners process more oil into gasoline, diesel and other products. Overall product supplied - a proxy for demand from end-users of fuels - rose to 20.9 million barrels per day (bpd), in line with the same trend two years ago prior to the coronavirus pandemic.

MRC

Venezuela oil company PDVSA resorts to upgraded oil, blends for feeding domestic refineries

Venezuela oil company PDVSA resorts to upgraded oil, blends for feeding domestic refineries

MOSCOW (MRC) -- Venezuela's state-run oil company PDVSA has started producing two upgraded crude grades for domestic refining, aiming at reanimating the country's much-needed output of motor fuels, reported Reuters with reference to a company document and sources close the decision.

Years of under-investment in PDVSA's 1.3 million-barrel-per-day capacity refining network and US sanctions since 2019 have led to intermittent scarcity of cooking gas, gasoline and diesel, making the nation more dependent on imports and forcing Venezuelans to line up for hours and even days to get fuel.

As Venezuela's refineries were originally built to process medium to light crudes, PDVSA's increasingly heavy oil output no longer meets the facilities' diet, forcing the company to decide every month whether to refine its limited stocks of light oil or use it as diluent for its flagship exportable grade Merey.

Following the restart of a key upgrader in June, operated by the Petrocedeno joint venture, PDVSA has scheduled the first cargo of light Zuata Sweet synthetic crude to be sent this month to its largest refinery, the 645,000-bpd Amuay, which remained mostly shut in June, according to the document and one of the sources.

PDVSA had stopped producing Zuata Sweet and other upgraded crudes in 2019 shortly after US sanctions deprived the firm and its private partners from the largest market for those grades, the US Gulf.

The state company last month also began production of a new upgraded crude grade, Hamaca 22, at neighboring project Petropiar, with the first 500,000-barrel cargo loading this week at the Jose port bound for Amuay, the document showed.

The company's fuel production has fallen since May after slightly rising in the first four months of the year. Venezuela also imported diesel to ease the lack of motor fuels.

Amuay's three-week paralysis, the continued outage of the El Palito refinery and low output at the Puerto La Cruz refinery contributed to the decline, for a total average of 193,000 barrels per day (bpd) of crude processed last month, 15% of the nation's installed capacity, the source said.

The 310,000-bpd Cardon has been the only refinery with stable output around 120,000 bpd this year, two sources added. PDVSA earlier this year began formulating a crude blend similar to its medium Leona by mixing grades from the Orinoco belt with diluents. That crude has since fed Amuay and Cardon, according to internal company documents.

The move to use blends and upgraded crudes for domestic refining is not only expected to allow more motor fuel output, but it would also free Mesa 30 crude to be used in production of exportable Merey, likely solving bottlenecks that in recent months have caused delays for loading cargoes bound for Asia.

As MRC informed before, in June 2021, Venezuela's political opposition has replaced members of the boards overseeing Citgo Petroleum Corp as factions in the movement led by Juan Guaido try to gain greater influence over Houston-based oil refiner. Citgo split from Venezuelan state-run oil company PDVSA in 2019 after the US imposed sanctions intended to oust Venezuela's President Nicolas Maduro. Then congress chief Juan Guaido appointed new boards and won US court recognition of their authority over the refining subsidiary.

We remind that in September 2020, Citgo Petroleum Corp said it did not plan to idle its 418,000 barrel-per-day (bpd) Lake Charles, Louisiana, refinery damaged by Hurricane Laura. Rumors have circulated since Laura’s passage over the Lake Charles area on Aug. 27 that Citgo was considering shutting the refinery for an indefinite period because of the extent of the damage and continuing low demand for motor fuels in the COVID-19 pandemic.

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

Oil falls in volatile trade as investors seek OPEC clarity

Oil falls in volatile trade as investors seek OPEC clarity

MOSCOW (MRC) -- Oil rose to USD75 a barrel, rebounding from steep losses a day earlier with support coming from a tight market in the short term after OPEC+ talks collapsed this week without a deal to boost supply, said Reuters.

Underlining tightening conditions, U.S. crude inventories are expected to fall this week. The failure of OPEC+ talks on Monday means no output rise has been agreed, while U.S. oil shale firms are hesitating whether to pump more. "The OPEC+ deadlock continues, putting the market in a position of risking a sizeable under-supply in August," said Louise Dickson of Rystad Energy. "U.S. shale producers also seem to be reluctant to invest."

Brent crude was up 44 cents, or 0.6%, at USD74.97 a barrel by 1325 GMT, after slumping more than 3% on Tuesday. U.S. West Texas Intermediate gained 48 cents, or 0.7%, to USD73.85, having declined by more than 2% on Tuesday.

OPEC+, which includes the Organization of the Petroleum Exporting Countries, Russia and other producers, abandoned talks on Monday after three days of meetings failed to close divisions between Saudi Arabia and the United Arab Emirates. "With no agreement, the production and export levels apparently remain unchanged according to the overall framework, which creates the impression that the group does not shy away from over-tightening the market," said Norbert Ruecker of Swiss bank Julius Baer.

The White House said on Tuesday it was encouraged by the ongoing conversation to reach an agreement. Disagreement within OPEC+ could still prompt its members to open the taps. Concern about that scenario had led to Brent falling on Tuesday from a high of USD77.84, the highest since 2018, and U.S. crude sliding from USD76.98, the highest since 2014.

But Saudi Energy Minister Prince Abdulaziz bin Salman dampened concerns of a price war in an interview with CNBC on Tuesday. Away from OPEC+, the first of this week's two reports on U.S. inventories, from the American Petroleum Institute, is out at 2030 GMT. Analysts expect crude stocks to fall by 3.9 million barrels.

As MRC informed earlier, in 2020, total consumption of fossil fuels in the United States, including petroleum, natural gas, and coal, fell to 72.9 quadrillion British thermal units (Btu), down 9% from 2019 and the lowest level since 1991, according to US Energy Information Administration's (EIA) Monthly Energy Review.

We remind that most units were shut on Sunday night and Monday morning (15-16 February) at Marathon Petroleum Corp's 585,000 barrel-per-day Galveston Bay Refinery in Texas City, Texas, as temperatures plunged due to a Arctic cold front reaching the Gulf Coast. They resumed operations in the first half of March.

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