Westlake reports record Q4 and full year 2021 results

Westlake Corporation’s 4Q net income rose more than fivefold year on year on the back of stronger sales prices and higher margins across most of its businesses, said the company.

Profitability during the quarter was driven by an over sevenfold increase in net income for Westlake’s performance and essential materials business year on year, rising to USD821m due to higher pricing and the impact of hurricane outages in Louisiana during the same period in 2020.

Housing and infrastructure products division 4Q net income rose USD21m year on year to USD86m on the back of healthy housing and remodelling demand.

Westlake Chemical Partners – a limited partnership formed by Westlake Chemical to operate and acquire ethylene production facilities and related assets – recorded net income of USD29.5m during the quarter compared to $15m during the same period a year earlier.

"Market conditions continue to look favourable in 2022," said Westlake CEO Albert Chao. "As the market leader in Performance and Essential Materials including PVC, polyethylene, epoxy, chlorine and caustic soda, we are well positioned to continue to provide value to our customers and investors. The outlook also remains favourable in our Housing and Infrastructure Products with strong market indicators in 2022," he added.

We remind, Westlake Chemical Corp will officially change its name to Westlake Corp, effective 18 February. The new name would reflect the company’s more diversified business portfolio stemming from recent acquisitions and organic and strategic growth, it said. Westlake recently concluded four key acquisitions valued at about USD3.8bn.

Also, Westlake Corporation announced its target to reduce Scope 1 and Scope 2 CO2 equivalent emissions per ton of production by 20% by 2030 from a 2016 baseline.To further reduce its carbon footprint, Westlake’s strategy is to optimally allocate capital to both proven and emerging technologies, including additional product and operational innovations. This strategy includes energy-efficiency projects, increasing power from less carbon-intensive electricity providers, adding more hydrogen as a fuel gas, and other continuous operational improvements.

Westlake is a global manufacturer and supplier of materials and innovative products that enhance life every day. Headquartered in Houston, with operations in Asia, Europe and North America, we provide the building blocks for vital solutions — from housing and construction, to packaging and healthcare, to automotive and consumer.

MRC

BASF’s fourth-quarter net profit fell by 15% year on year to EUR898m, as higher raw material prices and increased energy and logistics costs weighed across all business segments, said the company.

At its European sites, higher natural gas prices translated to about EUR800m in additional cost in the fourth quarter, which was more than half the full-year total of EUR1.5bn. For the whole of 2021, however, BASF swung into a net profit on the back of higher prices and sales volumes.

Sales prices were raised by 25%, while volumes increased by 11% compared with 2020 levels. “All segments achieved price and volume growth in 2021,” Brudermuller said.

Over the next five years to 2026, BASF’s capital expenditures (capex) will be EUR25.6bn, up by EUR2.7bn compared with 2021-2025 levels. “The main reasons for this are our two major growth projects: the new Verbund site in Zhanjiang in China and our battery materials activities," company chief financial officer Hans-Ulrich Engel said.

“These two projects are key to drive BASF’s future growth,” he added. For 2022, BASF forecasts sales to reach between EUR74bn and EUR77bn, with operating profit projected at between EUR6.6bn and EUR7.2bn.

As MRC wrote before, Air Liquide, BASF and Shell are joining Calpine, Chevron, Dow, ExxonMobil, INEOS, Linde, LyondellBasell, Marathon Petroleum, NRG Energy, Phillips 66 and Valero to collectively evaluate and advance emissions reduction efforts in and around the Houston industrial area. Three additional companies have announced their support for exploring the implementation of large-scale carbon capture and storage (CCS) technology in and around the Houston industrial area. The 14 companies are evaluating how to use safe, proven CCS technology at Houston-area facilities that provide energy and products for modern life, including advanced manufacturing for plastics, packaging, motor fuels and power generation.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,487,450 tonnes in 2021, up by 13% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market totalled 1,494.280 tonnes, up by 21% year on year. Deliveries of homopolymer PP and PP block copolymers increased, whreas.shipments of 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

MRC) -- Phillips 66 announced that it intends to reduce the GHG emissions intensity from its operations companywide 50% by 2050, said Hydrocarbonprocessing.

The new target builds upon the company’s previously announced Scope 1 and 2 GHG emissions reduction targets. "We are committed to being part of the solution and helping the world address climate change,” said Phillips 66 Chairman and CEO Greg Garland. “Our 2050 target further reflects our drive to create shareholder value and ensure Phillips 66 participates in the energy transition."

Phillips 66 introduced 2030 targets last year, signaling its commitment to taking action and reducing the carbon intensity of its operations. Both sets of targets are compared to 2019 levels. "We support the ambitions of the Paris Agreement and are increasing our commitment with the 2050 target,” Garland said. “We will continue to prioritize our resources to drive innovation and do our part. The company’s investments to meet its targets will be consistent with its disciplined approach to capital allocation."

The company’s 2022 capital program of USD1.9 B includes USD916 MM for growth capital, of which 45% supports lower-carbon opportunities. The targets set by Phillips 66 are based on the company’s lower-carbon strategy and leverage its Emerging Energy group. The company has made meaningful progress toward developing a lower-carbon business, pursuing opportunities in renewable feedstocks and fuels, sustainable aviation fuel, the U.S. supply chain for batteries and lower-carbon hydrogen, among other areas.

"Achieving long-term GHG emissions reductions is ambitious and will require changes at and beyond Phillips 66,” Garland said. “Policies are needed to spur investment in lower-carbon infrastructure and technology development, significant shifts are required in consumer behavior, and materials throughout the supply chain must be readily available."

Phillips 66, a diversified energy manufacturing and logistics company, announced fourth-quarter 2021 earnings of USD1.3 billion, compared with earnings of USD402 million in the third quarter of 2021. Excluding special items of USD25 million, the company had adjusted earnings of USD1.3 billion in the fourth quarter, compared with third-quarter adjusted earnings of USD1.4 billion.

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.

Phillips 66 is a diversified energy manufacturing and logistics company. With a portfolio of Midstream, Chemicals, Refining, and Marketing and Specialties businesses, the company processes, transports, stores and markets fuels and products globally. Headquartered in Houston, the company has 14,000 employees committed to safety and operating excellence. Phillips 66 had USD56 billion of assets as of Dec. 31, 2021.
MRC

Equinor's Board of Directors has decided to stop new investments into Russia, and to start the process of exiting Equinor’s Russian Joint Ventures, said the company.

"We are all deeply troubled by the invasion of Ukraine, which represents a terrible setback for the world, and we are thinking of all those who are suffering because of the military action," says Anders Opedal, President and CEO of Equinor. Early this week Equinor will present a commitment to contribute funding to the humanitarian effort in the region.

"In the current situation, we regard our position as untenable. We will now stop new investments into our Russian business, and we will start the process of exiting our joint ventures in a manner that is consistent with our values. Our top priority in this difficult situation is the safety and security of our people," says Opedal. Equinor has been in Russia for over 30 years and entered a cooperation agreement with Rosneft in 2012.

"We have employees from both Ukraine and Russia, and we are proud of how our people from different backgrounds and nationalities collaborate – with mutual respect, as one team in Equinor," says Opedal. Equinor has operated in compliance with Norwegian, European Union and United States’ sanctions. Equinor maintains close contact with the authorities in Norway, the European Union, the United States, and other countries, and will continue to comply with any new sanctions relevant to our operations.

At the end of 2021 Equinor had USD 1.2 billion in non-current assets in Russia. We expect that the decision to start the process of exiting Joint Ventures in Russia will impact the book value of Equinor’s Russian assets and lead to impairments.

As per MRC, BP is seeking to divest the near 20% stake in Russian state-oil company Rosneft it has held since 2013 in the starkest sign yet of the corporate backlash against Moscow’s invasion of Ukraine. BP did not specify how and when it might divest the Rosneft stake. It could write off the shareholding, sell it back to Rosneft or find another buyer. Analysts have speculated that a state-backed Chinese or Middle Eastern group might be interested in the shareholding, but it is thought that BP could struggle to find a bidder. The Qatar Investment Authority is already a major Rosneft shareholder.

We remind, BP completed the formation of its strategic US offshore wind partnership with Norway's Equinor. Under the award, Equinor and incoming strategic partner BP will develop the 1,260 MW Empire Wind 2 and the 1,230 MW Beacon Wind 1 offshore wind projects. The execution of the procurement award is subject to the successful negotiation of a purchase and sale agreement.

MRC

Sahara International Petrochemical Co's (Sipchem) 2021 net profit surged on the back of higher product prices despite, said Argaam.

Sahara International Petrochemical Co, or Spichem, reported a net profit increase of 1,942 percent in 2021. The company's net income reached SR3.59 billion (USD957 million), compared to a loss of SR175 million in 2020, according to a bourse filing.

Sipchem also succeeded in reducing the long-term loans by SR2.1 billion compared to the end of the year 2020. The gearing ratio went down to 34% in 2021. In 2020, the gearing ratio of the company was 54%.

Sipchem distributed a total dividend of SR1.64 billion equivalent to SR2.25 per share, which is considered the highest in the company's history.

Sahara International Petrochemical Co (Sipchem) and industrial gas firm Linde signed an exclusive agreement to set up a joint venture for developing industrial gas projects and networks in Saudi Arabia. Under a 50/50 joint venture, Linde and Sipchem said they intend to connect existing hydrogen and syngas plants owned and operated by the two parties in Jubail Industrial City.

As MRC informed earlier, Sipchem is planning to mothball the Polybutylene Terephthalate (PBT) plant, owned by its affiliate, Sipchem Chemical Co., and Ethylene Vinyl Acetate (EVA) Film plant that is owned by affiliate firm, Saudi Specialized Products Co. Steps to implement the decision are underway, Sipchem said in a statement to Tadawul, adding that the suspension of both plants will start on Jan. 1, 2021, until further notice. The company expects a positive financial impact starting from Q1 2021 results.

MRC