MOL petchem Q3 earnings increased on stronger margins

MOSCOW (MRC) -- MOL’s petrochemicals division third-quarter Clean current cost of supplies (CCS) earnings before interest, tax, depreciation and amortisation (EBITDA) rose nearly fourfold on the back of stronger margins, said the company.

MOL Group announced its financial results for the third quarter of 2021. Supported by the macro-economic environment, the doubling petrochemicals margins compared to last year and the internal performance of the company, Clean CCS EBITDA strongly rebounded and came in at USD 1,025mn in Q3 2021. This result brought Q1-Q3 2021 EBITDA to USD 2,583mn that allows MOL to further upgrade full year guidance to reach or even exceed USD 3.2bn. Organic capital expenditure was 18% higher year-on-year in Q3 2021, reaching USD 360mn of which USD 68mn was spent on transformational projects including the Polyol plant construction. Meanwhile, world market perturbances, soaring commodity prices, logistics difficulties and the 4th wave of Covid-19 pandemic create an overall relatively unpredictable operational environment.

Chairman-CEO Zsolt Hernadi commented the results: “The good results of the third quarter have been supported by the favorable external environment and the rebounding regional economic growth. At the same time we also leveraged our strengths, the resilient integrated business model and our highly cost-efficient asset base and operation.

"Our very strong year-to-date 2021 delivery allows us to further upgrade our annual EBITDA guidance, which is expected to reach or even exceed USD 3.2bn. At the same time soaring commodity prices and the implications of the
coronavirus pandemic pose a significant risk to the economy and generate a very volatile operational environment.

"As a result, we remain focused to maintain financial and operational resilience and deliver on our longer-term sustainability related commitments. A higher year-to-date free cash flow generation allows us to fund our sizeable upcoming transformational investments within the framework of MOL’s 2030+ strategy."

As MRC informed before, MOL Petrochemicals Company (formerly known as TVK, part of the MOL Group), the only Hungarian producer of olefins and polyolefins, announced force majeure on the supply of polypropylene (PP) from plant No. 4 at the petrochemical complex in Tiszaujvaros (Tiszaujvaros, Hungary) on 23 September 2019.

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 1,638,370 tonnes in the first eight months of 2021, up by 10% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 989,570 tonnes in the first eight months of 2021, up by 30% year on year. Deliveries of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas shipments of injection moulding PP random copolymers decreased significantly.

MOL Group is an integrated, international oil and gas company with its headquarters in Budapest, with an international and dynamic workforce of 25,000 in more than 30 countries and an industrial history of more than 100 years. MOL's exploration and production activities are supported by more than 80 years of experience in the hydrocarbon industry. It currently has extraction activities in 9 countries and has research assets in 14 countries. MOL Group operates three refineries and two petrochemical plants under integrated supply chain management in Hungary, Slovakia and Croatia, and its retail network includes 1,940 filling stations in 10 countries in Central and South-Eastern Europe.
MRC

MOSCOW (MRC) -- Canada's Pembina Pipeline Corp is asking backers of two competing proposals for carbon capture hubs in the oil-producing province of Alberta to combine efforts with its own plan, reported Reuters with reference to the company's chief executive's statement on Tuesday.

Pembina and TC Energy Corp said in June they were looking to develop a system to transport and sequester carbon. The Alberta government, which controls underground space for burying carbon, called for expressions of interest this autumn.

Carbon capture facilities are expected to be a key part of global efforts to contain emissions from fossil fuel production. Canada is the world's fourth-largest oil producer and aims to cut national greenhouse gas emissions by at least 40% by 2030.

The Pembina-TC plan, called Alberta Carbon Grid, faces competition from at least two others - Oil Sands Pathways, pitched by the largest oil sands producers, and Polaris, a proposal by Royal Dutch Shell.

Pembina has spoken with both groups about joining together and talks remain active, CEO Mick Dilger told Reuters.

"A single, large carbon capture program at scale is by far the most sensible way to do things," Dilger said. "If everybody works together, we'll come up with a more cost-effective solution."

Whether such cooperation happens remains to be seen, Dilger said.

Pembina and TC would need to convince Shell and the Pathways partnership of Canadian Natural Resources, Cenovus Energy, Imperial Oil, Suncor Energy and MEG Energy, of a change in concept, he said.

Pembina and TC proposed a plan that would make use of spare pipelines that they own to reduce costs. The other proposals rely more on new infrastructure, Dilger said.

As MRC wrote previously, Canadian midstream energy companies Pembina Pipeline and Inter Pipeline (IPL) are mulling the prospects of dehydrogenation/polypropylene (PDH/PP) production in Alberta province. On May 31, 2021, Pembina and Inter Pipeline entered into an agreement to create one of the largest and best positioned energy infrastructure companies in Canada. Together the companies' diversified and integrated asset base can support and grow an extensive value chain for natural gas, natural gas liquids and crude oil, from wellhead to end user, that far exceeds anything either company can do separately.

According to MRC's ScanPlast report, PP shipments to the Russian market were 1,138,510 tonnes in the first nine months of 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

Pembina Pipeline has been a gas supplier to the North American power system for over 60 years. Pembina owns and operates pipelines that transport a variety of hydrocarbon fluids, including conventional and synthetic crude oil and others, produced in Western Canada and North Dakota.
MRC

MOSCOW (MRC) -- BASF, the world's petrochemical major, is reorganizing its global research activities, as per the company's press release.

In the course of the second quarter of 2022, they will be bundled in a central research unit based in Ludwigshafen. Detlef Kratz (59), President, will lead the new central division, which will have around 3,500 employees. Kratz currently heads BASF’s Process Research & Chemical Engineering division in Ludwigshafen.

At the same time, around 1,800 researchers will move to operating divisions – and thus work even more closely with the business units. This will further strengthen the customer focus of research and development. Details on the future global structure of BASF’s research will be announced by the company at a later date.

Jianfeng Jeffrey Lou (53), President, Advanced Materials & Systems Research, BASF Advanced Chemicals Co., Ltd., Shanghai, will take over as Head of Greater China, BASF (China) Company Ltd., Shanghai, on January 1, 2022.

Stephan Kothrade (54), President, Greater China, BASF (China) Company Ltd, Shanghai, will take over as Head of the Intermediates division, Ludwigshafen, Germany, on the same date. The current head of the division, Andrea Frenzel (51), President, will take a sabbatical at her own request.

As MRC reported earlier, BASF is strengthening its global catalyst development and helping customers to bring new products faster to the market. As part of this strategy, BASF is building a new pilot plant center at its Ludwigshafen site. The new Catalyst Development and Solids Processing Center will serve as a global hub for pilot-scale production and process innovations of chemical catalysts. The new building is scheduled for completion by mid-2024.

We remind that BASF aims is to electrify its production processes for basic chemicals, which are currently based on fossil fuels.

We also remind that in mid-February, BASF said it was restarting one of its steam crackers at its Ludwigshafen complex in Germany after operations were halted earlier that month due to a technical issue. The naphtha cracker produces ethylene and propylene, and is one of two crackers on the site. One has a production capacity of 420,000 metric tons/year, with the other"s capacity at 240,000 metric tons/year.

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 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in the first nine months of 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries.
MRC

MOSCOW (MRC)--The export trades for Turkmenbashi refinery’s polypropylene (PP) were held on Monday.
Demand for PP was strong, all volumes of PP put up for the trades were sold out during one trading day, according to ICIS-MRC Price report.

Market participants said 1,400 tonnes of Turkmenbashi refinery’s injection moulding PP and PP for films to be sold for export were put up for the trades at the State Commodity and Raw Materials Stock Exchange of Turkmenistan.
The starting prices were set at USD950/tonne and USD1,610/tonne, respectively. All polypropylene was sold out in one day of trades.

After an almost three-month break, 1,000 tonnes of injection moulding and 400 tonnes of film polypropylene were put up for export. The increased demand has led to deals being made above the starting level. Injection moulding PP was sold at USD1,613/tonne FOB / FCA, film PP was sold at USD1,661/tonne, FOB / FCA.
Deals were done with shipment within six months.

MRC

MOSCOW (MRC) -- Karpatneftekhim (Kalush, Ivano-Frankivsk region), Ukraine's largest petrochemical plant, has raised its high density polyethylene (HDPE) prices for November shipments to the domestic market under the pressure from higher feedstocks prices, according to ICIS-MRC Price report.

The plant's customers said on 1 November, the Ukrainian producer increased its HDPE prices for shipments to the domestic market by USD50/tonne from October. Polyethylene (PE) prices for small-sized consumers rose to USD1,720/tonne FCA, excluding VAT.

At the same time, November polyvinyl chloride (PVC) prices are planned to be settled by the end of the week.

Karpatneftekhim is one of the largest enterprises of Ukraine's petrochemical complex. Currently, the plant can produce annually 300,000 tonnes of PVC, 200,000 tonnes of caustic soda, about 180,000 tonnes of chlorine, as well as 250,000 tonnes of ethylene and 100,000 tonnes of polyethylene.
MRC