NSRP may shut its new PP plant in Vietnam due to feedstock shortage

MOSCOW (MRC) -- Nghi Son Refinery and Petrochemical (NSRP) might suspend operations at its new polypropylene (PP) plant in Vietnam in February because of feedstock supply disruption, according to CommoPlast.

The new plant has a production capacity of 400,000 mt/year of PP.

As MRC reported earlier, on 26 January, 2022, state oil firm PetroVietnam blamed NSRP for the recent production cut. State media had reported PetroVietnam had failed to make an early payment under a "Fuel Products Offtake Agreement" (FPOA) with the refinery, causing financial difficulties for Nghi Son. But PetroVietnam, which owns 25.1% of the 200,000 barrel-per-day refinery in Thanh Hoa province, insisted it was not to blame.

We remind that NSRP shut its new PP plant in Vietnam for maintenance on 24 August, 2021, instead of the initially scheduled date of 17 August, for approximately three weeks. The company decided to postpone the maintenance shutdown at this plant by one week from the previous schedule due to the COVID-19 related lockdown. Thus, the new PP plant came back on-line in mid-September, 2021.

We also remind that Vietnam’s Nghi Son oil refinery officially began commercial production from 14 November 2018, following months of tests. The USD9 billion refinery is 35.1% owned by Japan’s Idemitsu Kosan Co, 35.1% - by Kuwait Petroleum, 25.1% - by PetroVietnam and 4.7% - by Mitsui Chemicals Inc.

According to MRC's ScanPlast report, PP shipments to the Russian market were 1,363,850 tonnes in January-November, 2021, up by 25% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.
MRC

MOSCOW (MRC) -- Energy firm Repsol SA said that it had presented the paperwork required by the Peruvian government to restart oil unloading operations at its La Pampilla refinery, following a spill of over 10,000 bbl, said Hydrocarbonprocessing.

New Peruvian Prime Minister Hector Valer said on Thursday the country was facing a fuel shortage due to a government decree that forbids Repsol SA from unloading any new oil into a local refinery. "We are starting the fuel shortage since yesterday, due to a decree that we need to annul," Valer told reporters.

Valer, who was named prime minister on Tuesday, was not involved in the decision to suspend Repsol's Peruvian operations, which had been put in place on Jan. 31.

Peru had ordered Repsol to suspend unloading oil shipments until it submitted new contingency plans in case of a new spill. Peru has yet to say if it will allow Repsol to restart operations based on the new plan.

Peruvian President Pedro Castillo called the spill the worst ecological disaster in the country's recent memory. Repsol has said it will take until the end of February to finish cleaning up the spill. La Pampilla is Peru's largest refinery and accounts for about 40% of Peruvian fuel.

As per MRC, Repsol selected Univation Technologies' UNIPOL polyethylene (PE) technology for its new 300 ktpa plant in Sines, Portugal. The plant will be able to produce a range of products, including HDPE, LDL, used in the pharmaceutical, automotive and food industries.

Earlier it was reported that Repsol notified Gazprom Neft that it was not ready to participate in the development of a new exploration cluster on the Gydan Peninsula in the current economic conditions. It was planned to create a joint venture there to develop the Leskinsky and Pukhutsyakhsky license areas. In June 2019, Gazprom Neft, Repsol and Shell signed an agreement of intent to establish a joint venture to develop these areas. The transaction was scheduled to close in 2020. It was assumed that Gazprom Neft would own 50% in the capital of the joint venture, the shares of Repsol and Shell would each be 25%.

Repsol is the largest oil and gas company in Spain and Latin America, one of the ten largest oil and gas corporations in the world.
MRC

MOSCOW (MRC) -- Brazil’s state-owned oil company Petrobras and Novonor (formerly Odebrecht) cancelled in “mutual agreement” its plans to sell its stake in Braskem, according to BondEvalue.

The announcement came after both companies declared that potential buyers did not meet expectations, without providing any further details on the matter.

Petrobras and Novonor said “The volatile conditions in the financial and capital markets resulted at this time in demand and price levels not appropriate for the conclusion of the transaction.”

The stake in Braskem was expected to be offloaded by February with estimates that the deal could be worth BRL 8.3bn (USD1.47bn) for 20% of Braskem.

Petrobras owns 36.14% of Braskem's shares, including 47.03% of its voting shares. Novonor, a construction company, owns 38.32% of Braskem's shares and 50.11% of its voting shares, either directly or through its subsidiary OSP Investimentos. The two still plan on selling their stakes, but at a time when the markets are less volatile and the economic outlook is more favourable, Petrobras said.

As MRC wrote previously, in August 2021, Petrobras hired JPMorgan Chase & Co as an advisor to sell its stake in the petrochemical company Braskem SA.

We remind that Braskem is no longer pursuing a petrochemical project, which would have included an ethane cracker, in West Virginia. And the company is seeking to sell the land that would have housed the cracker. The project, announced in 2013, had been on Braskem's back burner for several years.

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 2,265,290 tonnes in the first eleven months of 2021, up by 14% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,363,850 tonnes in January-November, 2021, up by 25% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

Braskem S.A. produces petrochemicals and generates electricity. The Company produces ethylene, propylene, benzene, toluene, xylenes, butadiene, butene, isoprene, dicyclopentediene, MTBE, caprolactam, ammonium sulfate, cyclohexene, polyethylene theraphtalat, polyethylene, and polyvinyl chloride (PVC).

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

MOSCOW (MRC) -- Petrobras reached an average of 88% of total load factor of its refineries in the last three months of 2021. In early February, it reached close to 90%, said Reuters.

Operational decisions in refining take into account that, for each barrel of oil processed in the refinery, necessarily, several products are generated and subsequently distributed. For example, when producing diesel, fuel oil is also necessarily produced, which needs to be drained and distributed to end customers.

Therefore, the calculation of the best level of processing always respects, in addition to economic and safety criteria, the technical limitations of product distribution capacity, possible volumes to be stocked, demand behavior, costs and prices.

"Defining the level of use of refineries is complex because it involves different products and must be based on technical-economic criteria. Petrobras is investing in its refineries and the market has grown and demanded more fuel from the company, which results in a use above the historical average”, explains Rodrigo Costa, Director of Refining and Natural Gas at Petrobras.

The presence of new investors, such as Mubadala Capital, which acquired the Landulpho Alves Refinery, in Bahia, reinforces the investment capacity and the service of a growing and increasingly dynamic market, in which Petrobras is one of the actors, participating in together with several others, with pricing in line with global markets being fundamental for the proper functioning of the fuel market in Brazil.

We remind that in August 2021, Petrobras hired JPMorgan Chase & Co as an advisor to sell its stake in the petrochemical company Braskem SA.

We also remind that Braskem is no longer pursuing a petrochemical project, which would have included an ethane cracker, in West Virginia. And the company is seeking to sell the land that would have housed the cracker. The project, announced in 2013, had been on Braskem's back burner for several years.

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

According to MR''s ScanPlast report, Russia's estimated PE consumption totalled 2,265,290 tonnes in the first eleven months of 2021, up by 14% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,363,850 tonnes in January-November, 2021, up by 25% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding PP random copolymers decreased significantly.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

MOSCOW (MRC) -- LyondellBasell has developed polymers based on advanced recycled post-consumer materials. These polymers, branded under the name CirculenRevive, are made using an advanced recycling process to convert plastic waste into feedstock, which is used to produce new polymers, using a mass balance approach, said Hydrocarbonprocessing.

With the support of Greiner Packaging, these polymers will be used to make coffee capsules for Nestle’s Nescafe Dolce Gusto. This collaboration aims to help advance a circular economy for plastic. These polymers meet the strict requirements of the food industry. Both, LyondellBasell and Greiner Packaging sites involved are ISCC PLUS certified. This well-known global certification provides traceability along the supply chain. With the mass balance method, the company tracks how much advanced recycled material goes into the production process of its CirculenRevive products and can attribute the recycled content to the final polymer via a sustainability declaration.

"We are extremely pleased that we can support our customer Greiner Packaging and ultimately Nestle with a circular economy solution from our recently launched Circulen product family," says Richard Roudeix, LyondellBasell Senior Vice President of Olefins and Polyolefins for Europe, Middle East, Africa and India. “CirculenRevive polymers help to address at scale the challenge of hard-to-recycle plastics. The advanced recycling technology can utilize used mixed plastic, which allows for larger volumes of plastic waste to return back into the value chain that would otherwise be destined for energy recovery or landfill. At the same time, these polymers have the same characteristics and high quality as fossil-based materials. Ultimately, LyondellBasell aims to produce and market two MM metric t of recycled and renewable-based polymers annually by 2030.

As MRC informed earlier, LyondellBasell reported an equipment failure at its La Porte linear low density polyethylene (LLDPE) plant, which forced the company to shut down the 355,000 tons/year unit without a return schedule, according to the company's official letter to its customers on 17 June 2021. LyondellBasell is currently evaluating the impact of the event on its ability to supply the materials.

As per MRC, LyondellBasell, one of the largest plastics, chemicals and refining companies in the world, announced it has acquired 100% of PolyPacific Polymers Sdn. Bhd. (PPM) in Port Klang, Malaysia. PPM is a 25kt manufacturing facility producing reinforced and modified polyolefin compounds.

LyondellBasell is one of the largest plastics, chemicals and refining companies in the world. Driven by its 13,000 employees around the globe, LyondellBasell produces materials and products that are key to advancing solutions to modern challenges like enhancing food safety through lightweight and flexible packaging, protecting the purity of water supplies through stronger and more versatile pipes, and improving the safety, comfort and fuel efficiency of many of the cars and trucks on the road. LyondellBasell sells products into approximately 100 countries and is the world's largest licensor of polyolefin technologies.
MRC