Texas refineries run steady although power outages began affecting Texas and Louisiana

Texas refineries run steady although power outages began affecting Texas and Louisiana

MOSCOW (MRC) -- Refineries in Texas continued to operate as usual, although rains, floods and power outages hit Texas and Louisiana on Tuesday, said Hydrocarbonprocessing.

Tropical Storm Nicholas moved slowly toward the Houston metropolitan area after weakening from a hurricane. Nicholas was about 15 miles (24 km) southwest of Houston, Texas by 7 a.m. Central Time (1200 GMT), heading northeast with maximum sustained winds of 60 mph (95 kph), the National Hurricane Center said in a bulletin, after it hit the Texas coast hours earlier.

Although Hurricane Ida knocked off significant amount of refining capacity in the Gulf Coast earlier this month, Texas refineries remained operating as of early Tuesday. Motiva Enterprises' 607,000 barrel-per-day (bpd) Port Arthur, Texas refinery - the largest in the United States - was operating normally as Nicholas was passing over the area on Tuesday morning, said sources familiar with plant operations.

Royal Dutch Shell Plc's 302,800 bpd joint-venture Deer Park, Texas refinery was also operating normally on Tuesday morning after the passage of Nicholas, said sources familiar with plant operations. Nicholas caused widespread power outages as it crossed over the Houston metropolitan area late Monday night and early Tuesday morning.

About 485,000 customers were without power in Texas on Tuesday, Reuters reported. Texas energy company CenterPoint Energy Inc said on Tuesday that about 400,000 homes and businesses in its Houston-area service territory were without power.

More than 40% of the U.S. Gulf of Mexico's oil and gas output remained offline on Monday, two weeks after Hurricane Ida slammed into the Louisiana coast, according to offshore regulator Bureau of Safety and Environmental Enforcement (BSEE).

Damages to an offshore hub that pumps oil and gas from three major oilfields for processing onshore and power outages at onshore processing plants are responsible for the production losses. All four liquefied natural gas (LNG) export plants operating along the Gulf of Mexico, meanwhile, remained in service early Tuesday, according to pipeline feedgas data from Refinitiv.

As per MRC, US petroleum consumption recovered to pre-pandemic levels, but there has been a marked shift from consumer-facing sectors towards industry and freight transportation, mirroring the uneven economic recovery. The total volume of petroleum products supplied to domestic customers climbed to 20.1 million barrels per day (bpd) in May, according to the Energy Information Administration. Volumes were down by less than 300,000 bpd (1.4%) from the same month in 2019, before the COVID-19 pandemic, and were actually 200,000 bpd (1.1%) above the pre-pandemic five-year average for 2015-2019.

As MRC informed earlier, recyclers in Southeast Asia were heard operating with low capacity utilisation in the film grade high density polyethylene (HDPE) market due to COVID-19-led lockdown measures. Market sources also said persistent bottlenecks at ports in Asia and some maintenance-related plant closures are likely to hurt the supply of petrochemicals during the week of Aug. 30-Sept. 3.

We remind that Southeast Asian polyethylene terephthalate (PET) recycling companies will continue facing challenges with the availability of raw materials, due to the low collecting and processing rate, as a result of the COVID-19 pandemic.

According to MRC's ScanPlast report, June estimated HDPE consumption in Russia decreased to 125,900 tonnes from 128,300 tonnes a month earlier. Domestic producers raised their exports, while some producers' output decreased. Russia's overall HDPE shipments to the Russian market totalled 675,670 tonnes in the first six months of 2021, down by 6% year on year. Production increased by 12%, whereas imports fell by 33%.

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Lukoil is considering partner participation in methanol projects

Lukoil is considering partner participation in methanol projects

MOSCOW (MRC) - Lukoil is considering options for participation on a partnership basis in methanol production projects and expects to make an appropriate decision by the end of the year, said the head of the company Vagit Alekperov in an interview to Kommersant.

"Polypropylene in Nizhny Novgorod will be provided with its own resources. Propylene from the new cracking in Perm, in addition to providing Saratovorgsintez, can be the basis for new petrochemical projects. We are also considering options for partnering in methanol production. We expect to make a decision by the end of the year," - he said.

According to him, Gazprom's gas will most likely be used there, which is about 2 billion cubic meters per year, but if it gives an opportunity, we can make a swap. "Our relations with Gazprom allow us to look at this issue quite optimistically," Alekperov added.

He explained that we are talking about new construction in ports, the company is looking at suitable sites both in the north and in the south of the country. The head of Lukoil also added that all investment decisions to expand the gas processing plant in Budennovsk had been made.

"In the future, we plan to launch a gas chemical complex. We have invited Deputy Prime Minister Alexander Novak to launch the project. We hope that a joint trip to Stavrolen will take place at the end of September," he said. In addition, the head of Lukoil said that the company is negotiating with Gazprom to buy its gas in Yamal, and if the price rises, it is ready to forcefully put its fields in the region into operation.

At the same time, he added that with a successful outcome of the negotiations, the commissioning could take place at the end of 2023, since the necessary gas pipeline has already been built.

As MRC informed before, Lukoil, the second largest oil company in Russia, has begun construction of a polypropylene (PP) production complex at the Nizhny Novgorod refinery in the city of Kstovo. It is noted that the complex will become the largest polypropylene production facility in Russia integrated into an oil refinery. The raw material for polypropylene production at Lukoil's Nizhny Novgorod site will be propylene from two modernized catalytic cracking units with a capacity of 4 million tons per year. After putting the complex into operation, the enterprise will be able to produce about 500 thousand tons of polypropylene grades.

According to MRC's ScanPlast report, Russia's PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.

Lukoil is one of the leading vertically integrated oil companies in Russia. The main activities of the company include operations for the exploration and production of oil and gas, production and sale of petroleum products. Lukoil is the second largest privately-owned oil company in the world in terms of proven hydrocarbon reserves. The structure of Lukoil includes one of the largest petrochemical enterprises in Russia - Stavrolen.
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PPG expects its sales to be lower in Q3 2021 on a number of factors

PPG expects its sales to be lower in Q3 2021 on a number of factors

MOSCOW (MRC) -- PPG Industries Inc. (PPG) said its sales volumes are being impacted by the increasing disruptions in commodity supplies; further reductions in customer production due to certain parts shortages such as semi-conductor chips; and continuing logistics and transportation challenges in many regions, according to Markets Insider.

As a result, the company lowered its third quarter sales volume outlook. Also, PPG withdraw its guidance for the third quarter and full-year 2021.

The company now expects third quarter sales volumes will be lower by USD225 million to USD275 million, compared to what it anticipated at the start of the third quarter.

PPG noted that raw material inflation for the third quarter is trending higher than previously communicated by about USD60 million to USD70 million.

As MRC reported earlier, in June 2021, PPG announced an expansion of its coatings manufacturing capacity in Europe for packaging applications. The investments at sites in The Netherlands and Poland will support growing customer demand in the region for the latest generation of coatings for aluminum and steel cans used in packaging for beverage, food and personal care items. The projects include a further expansion of the company’s location in Tiel, The Netherlands, which will increase the plant’s production capacity for PPG INNOVEL non-BPA internal coatings for beverage cans by 30%. Expected to be completed in the first quarter of 2022, the project follows a 50% expansion completed at the end of 2020.

BPA is the main feedstock for the production of polycarbonate (PC).

According to MRC's ScanPlast report, Russia's overall estimated consumption of polycarbonate (PC) granules in the Russian market were almost 56,000 tonnes in January-July 2021, down by 3% year on year (58,000 tonnes).
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U.S. crude production to decrease more than expected after Ida

U.S. crude production to decrease more than expected after Ida

MOSCOW (MRC) -- U.S. crude oil production is expected to fall by 200,000 barrels per day (bpd) in 2021 to 11.08 million bpd, the U.S. Energy Information Administration (EIA) said, noting that Hurricane Ida should force a bigger decline than its previous forecast for a drop of 160,000 bpd, said Hydrocarbonprocessing.

More than 90% of crude output in offshore Gulf of Mexico was shut in late August due to the powerful storm. Several companies are still in the process of returning production to normal levels and restart plans have been slowed due to power outages and damage to some facilities.

As a result of the outage, Gulf of Mexico (GOM) production averaged 1.5 million bpd in August, down 300,000 million bpd from July, the agency said. Output in the GOM is expected to gradually come back online during September and average 1.2 million bpd for the month before returning to an average of 1.7 million bpd in fourth quarter.

The agency also said it expects U.S. petroleum and other liquid fuel consumption to rise 1.55 million bpd to 19.74 million bpd in 2021, a smaller increase compared with a previous forecast for a rise of 1.58 million bpd. For 2022, U.S. crude output is expected to increase to average about 11.72 million bpd, driven by growth in shale production.

The total oil and gas rig count is up about 94% over this time last year. Demand for 2022 is expected to rise 890,000 bpd to 20.63 million bpd, a bigger increase than the agency's previous forecast for a rise of 860,000 bpd.

Globally, an estimated 98.4 million bpd of petroleum and liquid fuels was consumed globally in August, an increase of 5.7 million bpd from August 2020 but still 4 million bpd less than in August 2019, the EIA said.

As per MRC, Oil rose on Monday, supported by concerns over shut output in the United States because of damage from Hurricane Ida, with analysts expecting prices to remain rangebound in a stable market over the coming months. Brent crude rose 55 cents, or 0.8%, to USD73.47 a barrel by 1222 GMT and U.S. West Texas Intermediate (WTI) crude was up 64 cents, or 0.9%, at USD70.36. Brent has held between USD70 and USD74 a barrel over the past three weeks.

As MRC informed earlier, Royal Dutch Shell Plc, one of the largest operators in the Gulf of Mexico, declared force majeure on some oil deliveries due to damage from Hurricane Ida, which has crippled U.S. offshore oil production. More than three-quarters of the U.S. Gulf of Mexico's offshore oil output remained shut following Ida. Crude buyers said the full restart of production remained unclear due to extensive damage to various facilities. The hurricane was one of the most devastating for offshore producers since back-to-back storms in 2005 cut output for months.
MRC

Shell restarting chemical facility in Geismar

Shell restarting chemical facility in Geismar

MOSCOW (MRC) - Royal Dutch Shell, the largest oil producer in the US Gulf of Mexico, said on Monday its Geismar chemical facility in Louisiana is restarting, two weeks after Hurricane Ida forced it shut, reported Reuters.

“The site continues to experience utility and feedstock constraints but has resumed loading capabilities and shipping product,” the company said in a statement.

The Norco to Kenner pipeline, which carries gasoline, diesel and jet fuel to the Shell terminal at the Louis Armstrong International Airport in New Orleans, has also been returned to service.

Shell’s Appomattox, Enchilada/Salsa, and Auger platforms continue to ramp up production, while its Mars, Ursa, and Olympus assets remain shut in, the company said. Meanwhile, damage assessments continued at the Shell Pipeline-operated West Delta-143 offshore facility.

As MRC wrote previously, Shell found evidence of building damage at its 230,611-bpd Norco, Louisiana refinery. But sources familiar with plant operations did not know the extent of the damage or time needed to make the repairs. Shell is awaiting the restoration of external electrical power to the Norco refining and chemical plant complex.

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 1,176,860 tonnes in the first half of 2021, up by 5% year on year. Shipments of exclusively low density polyethylene (LDPE) decreased. At the same time, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.

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.
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