Dow funds nine new global projects to drive social and sustainable solutions

Dow funds nine new global projects to drive social and sustainable solutions

Dow announced its 2022 Business Impact Fund selections: nine projects that help solve social challenges and advance sustainable solutions through multistakeholder collaboration, said Polymerupdate.

Founded in 2016, the Business Impact Fund brings together nonprofit organizations, entrepreneurs, and Dow customers, partners and employees to tackle many of society’s biggest challenges.

“Since its inception, Dow has awarded nearly $10 million through the Business Impact Fund to both solve world challenges while unlocking new business opportunities for the Company,” said Bob Plishka, global director of Strategic Corporate Partnerships, and Dow Company Foundation president. “This year, our selected projects address circularity and waste transformation initiatives, as well as climate protection, water conservation and biodiversity – all of which demonstrate Dow’s commitment to accelerating efforts to create a more sustainable and equitable future."

We remind, Dow, and ByFusion are announcing a new business agreement that continues their collaboration in the greater Boise area to divert hard-to-recycle plastics from the landfill. Dow, and ByFusion are announcing a new business agreement that continues their collaboration in the greater Boise area to divert hard-to-recycle plastics from the landfill, said the company.
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Technip wins work for TotalEnergies refinery conversion project

Technip wins work for TotalEnergies refinery conversion project

MRC --Technip Energies has been awarded a contract for work on the conversion of TotalEnergies’ Grandpuits refinery southeast of Paris into a zero-crude platform oriented towards sustainable aviation fuel (SAF), said the company.

The converted plant will have a capacity to produce 210,000 tonnes/year of SAF from sustainable feedstock such as used cooking oil and animal fat.

The contract covers engineering, procurement services and construction assistance, Technip said.

It did not disclose the contract value and did not comment on the timeline for project completion.

TotalEnergies previously indicated that the project would be completed in 2024.

We remind, Kumho Petrochemical signed a memorandum of understanding with Technip Energies to license a pyrolysis process enabled by US recycling technology company Agilyx. Technip Energies is the exclusive licensor for the Agilyx technology for the production of the recycled monomer via the pyrolysis of waste polystyrene.

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PKN Orlen Q3 net profit quadruples after Lotos takeover

PKN Orlen Q3 net profit quadruples after Lotos takeover

PKN Orlen’s third-quarter petrochemical operating profit dropped 56.4% to zloty (Zl) 350m (USD77.6m) on lower margins and sales volumes and currency depreciation, said Reuters.

Orlen’s Q3 2022 model petrochemical margin fell 18% to EUR1,155/tonne from €1,405/tonne in Q2 2022. Versus Q3 2021, it declined 12.4% from EUR1,318/tonne.

Orlen’s third-quarter petrochemical sales volume decreased by 18% to 1.1m tonnes from 1.4m tonnes in the second quarter of this year.

For polymers, the sales volume declined 7% year on year to 158,000 tonnes in Q3 2022 from 169,000 tonnes in Q2 2022.

There were marked declines for purified terephthalic acid (PTA) (down 24% to 122,000 tonnes), plastics (down 17% to 85,000 tonnes) and fertilizers (down 37% to 179,000 tonnes).

Orlen’s Group net result was boosted by the takeover of second largest Polish refiner Grupa Lotos.

Orlen said it expected its petrochemical model margin to remain at around the level of EUR1,000/tonne as a result of weak demand due to an economic slowdown and, potentially, the negative impacts of rising crude oil and natural gas prices.

We remind, PKN Orlen has submitted an application to the Russian oil pipeline monopoly Transneft for the supply of 3 MMt of oil to Poland through the Druzhba pipeline system in 2023 under continuing long-term contracts. Transneft confirmed to Kommersant that it had received requests from consumers in Poland for the next year, but did not specify who submitted the application or the volume.
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Solvay earnings and outlook lowered by financial analysts

Solvay earnings and outlook lowered by financial analysts

Analysts in the chemical sector expect Belgium's Solvay to report lower profits in 2023 due to volume and price pressures, as per Credit Suisse.

Credit Suisse has cuts its earnings before interest, tax, depreciation, and amortisation (EBITDA) forecast by an average of 14% in fiscal year 2023-2024, which is 9% below the consensus. Credit Suisse has also reduced Solvay's target prices to €87/share and lowered its rating on the stock to underperform from outperform.

The change was driven by Solvay’s exposure to the later-cycle end market which Credit Suisse believes has insulated it from immediate headwinds, but says will come to an end next year.

It is forecasting a fall in Solvay's utilisation rates for soda ash in fiscal 2023, a lower than expected increase in demand for aerospace composites and a pricing headwind for specialty polymers.

“Solvay has outperformed core chemicals peers by 25% year to date... In 2022, peers’ earnings forecasts peaked in May; Solvay’s remained at all-time highs despite expected end market weakening in 2023."

Credit Suisse said rising costs will lead to a volume reduction of about 3% in 2023, compared with a market consensus of a 1% increase. “We also believe the proportion of fixed costs within Solvay (and therefore operating leverage to volume changes) is above the broader European peer set (Solvay 45% relative to peers 35%),” it added.

Baader Bank took a similar stance in an investment note to clients last week. "Due to the global macro uncertainties, there will be a lot of working capital management at the end of this year so as to start 2023 with the appropriate level for a year in which we anticipate lower volumes and pricing pressure,” said Baader analyst Martin Schnee.

There are some bright spots for Solvay as lower energy costs could provide some relief. The siphoning off of its commodity activities from its specialty business could also act as a cushion.

We remind, Solvay and Orbia recently announced their entry into a joint venture framework agreement to create a partnership for the production of suspension-grade polyvinylidene fluoride (PVDF), creating the largest capacity in North Americam said the company. As it is further stated in a press release, the joint venture will create the largest PVDF production facility for battery materials in the region. The total investment is estimated around 850 million USD, partially funded by a grant to Solvay from the U.S. Department of Energy for a total of 178 million USD.

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Shell to acquire renewable natural gas producer Nature Energy

Shell to acquire renewable natural gas producer Nature Energy

Shell Petroleum NV, a wholly owned subsidiary of Shell plc (Shell), has reached an agreement with Davidson Kempner Capital Management LP, Pioneer Point Partners and Sampension to acquire 100% shareholding of Nature Energy Biogas A/S (Nature Energy) for nearly USD2 bn (EUR1.9 bn), said the company.

The acquisition will be absorbed within Shell’s current capital range, which remains unchanged. Based in Denmark, Nature Energy is a producer of Renewable Natural Gas (RNG) from agricultural, industrial, and household wastes.

By purchasing the shares in Nature Energy, Shell will acquire the largest RNG producer in Europe, its portfolio of cash generative operating plants, associated feedstock supply and infrastructure, its pipeline of growth projects and its in-house expertise in the design, construction, and operation of innovative and differentiated RNG plant technology.

This acquisition will further increase Shell’s ability to work with its established customer base across multiple sectors to accelerate its transition to net-zero emissions. It will also support Shell’s ambition to profitably grow its low carbon fuels production and customer offering in our world-leading customer-facing Marketing business.

“Shell’s competitiveness in low carbon fuels derives from capabilities across the value chain, combining a world-class Trading and Supply organisation with access to differentiated technology and production assets,” said Huibert Vigeveno, Shell’s Downstream Director. “Acquiring Nature Energy will add a European production platform and growth pipeline to Shell’s existing RNG projects in the United States. We will use this acquisition to build an integrated RNG value chain at global scale, at a time when energy transition policies and customer preferences are signalling strong growth in demand in the years ahead.”

The transaction is subject to regulatory approvals and is expected to close in Q1 2023. Nature Energy is cash generative, and the acquisition is expected to be both accretive to Shell’s earnings from completion and deliver double digit returns.

We remind, Shell Chemical Appalachia LLC announced it has commenced operations of its Pennsylvania Chemical project, Shell Polymers Monaca (SPM). The Pennsylvania facility is the first major polyethylene manufacturing complex in the Northeastern United States and has a designed output of 1.6 MMt annually.
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