China Covid cases surge as country opens up, disrupting offshore fabrication

MOSCOW (MRC) -- Yards face workforce shortages as workers call in sick, but labour crunch will be short lived as Covid symptoms typically last a week, said Upstreamonline.

China’s abrupt abandonment of its zero-Covid strategy without warning early this month has led to an unprecedented wave of infections ripping through the world's top energy consumer and causing serious workforce shortages at offshore fabrication yards.

Under its relaxed policies, people who test positive for the coronavirus are allowed to recuperate at home instead of being forced into centralised quarantine.

A “health code” on a smartphone app is no longer required to enter public places and authorities will stop tracking close contacts and designating high-risk and low-risk areas.

We remind, China will downgrade COVID-19 to a more common infectious disease, manage it at Category B instead of the top-level Category A and scrap quarantine for inbound travellers from 8 January. Currently, COVID-19 is classified as Category B but managed as Category A that applies to diseases like plague and cholera in China.
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MOSCOW (MRC) -- U.S. Chemical Safety and Hazard Investigation Board (CSB) released its final report on the 2018 refinery explosion and fire at the Husky Superior Refinery in Superior, Wisconsin, said CSB.gv.

The accident injured 36 workers, caused roughly USD550 million in damage to the facility and released 39,000 pounds of flammable hydrocarbon vapor into the air. Over 2,500 residents of the City of Superior were evacuated from their homes, and the City of Duluth, Minnesota, issued a shelter in place order.

At the time of the incident, the Superior Refinery was owned by Husky Energy, which had purchased the refinery less than six months earlier in November 2017 from Calumet Specialty Products, LP. In 2021, Husky Energy merged with Cenovus Energy.

The CSB’s final report details how the incident occurred while the refinery was shutting down its fluid catalytic cracking (FCC) unit to perform planned maintenance (called a “turnaround”), a common refining process. Two vessels in the FCC unit exploded, propelling metal fragments up to 1,200 feet away that punctured a nearby asphalt storage tank at the refinery, which ultimately spilled approximately 17,000 barrels of hot asphalt that ignited and caused multiple fires.

The CSB’s final report notes that in addition to smoke from the fires at the refinery, the City of Superior evacuation was based on the potential risk of a release of highly toxic hydrofluoric acid (HF), which was stored and used at the refinery. Although no HF release occurred, the risk of an HF release was present because the HF storage tank was closer to the point of the explosion than the asphalt storage tank and could have been punctured by the debris from the explosion.

CSB Chairperson Steve Owens said, “Refineries with FCC units, including especially those with hydrofluoric acid alkylation units, should review our report thoroughly and ensure that they have the necessary safeguards in place to prevent a similar disaster from occurring at their facilities during shutdowns and startups. This accident could have been avoided.”

As per MRC, bp has reached an agreement to sell its 50% interest in the bp-Husky Toledo Refinery in Ohio to Calgary-based Cenovus, its joint venture partner in the facility. Under the terms of the deal, Cenovus will pay USD300 million for bp’s stake in the refinery, plus the value of inventory, and take over operations when the transaction closes, which is expected to occur later in 2022. bp and Cenovus will also enter into a multi-year product supply agreement.
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MOSCOW (MRC) -- The U.S. Chemical Production Regional Index (U.S. CPRI) fell by 0.4% in November following declines of 0.4% in September and 0.3% in October, according to the American Chemistry Council (ACC), said Americanchemistry.

Chemical output was lower than a month ago in all regions, with the largest declines in the Gulf Coast, home to much of the nation’s basic industrial chemical and synthetic materials capacity. The declines reflect sluggish output in several end-use manufacturing industries and weak export markets.

The U.S. CPRI is measured as a three-month moving average (3MMA) and was developed by ACC to track chemical production activity in seven regions of the United States.

On a 3MMA basis, chemical production within segments was mixed in November. There were gains in the production of coatings, adhesives, and other specialty chemicals; industrial gases; synthetic dyes and pigments; and other inorganic chemicals. These gains were offset by lower production of plastic resins; organic chemicals; synthetic rubber; manufactured fibers; consumer products; fertilizers and crop protection chemicals.

We remind, North American chemical railcar loadings fell for the 14th consecutive week for the week ending on 24 December, according to the latest freight rail data from the Association of American Railroads (AAR). In the US, chemical railcar loadings represent about 20% of chemical transportation by tonnage, with trucks, barges and pipelines carrying the rest. In Canada, producers rely on rail to ship more than 70% of their products, with some exclusively using rail.
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MOSCOW (MRC) -- Evonik has concluded the divestment of its triacetonamine (TAA) derivatives business to Italian chemical company Sabo, said the German chemicals company.

Financial details were not disclosed. The deal had been announced in October.

Production sites in Marl, Germany and Liaoyang, China as well as 250 employees were included in the transaction.

TAA derivatives are a key raw material to produce light stabilisers, with the additives used in low concentration to protect and stabilise polymers against decomposing due to light, heat, or oxygen exposure, and can significantly increase the lifespan of plastics.

The materials are used in applications in a variety of end-use segments, including the automotive and construction industries, as well as in the production of agricultural films.

“We want to continue our profitable growth in the specialty chemicals businesses. And that includes divesting businesses that do not longer fit to our strategic focus and that could have a better future with new owners,” said Evonik’s chairman, Christian Kullmann.

We remind, Evonik has started manufacturing commercial quantities of ceramides - a special class of lipids - at its site in Dossenheim near Heidelberg in Germany. Maximizing capacity utilization at the Dossenheim site provides Evonik with further flexibility and supply security, including increased independence from alternative routes of supply, to cater to the growing demand for ceramides in the personal care market.
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MOSCOW (MRC) - Poland is prepared for a Russian ban on oil sales to countries implementing a price cap, the climate minister said, with the country having cut its intake of Russian crude and secured alternative supplies from producers such as Saudi Arabia, said Reuters.

The Group of Seven (G7) nations and allies including Poland this month agreed a $60 per barrel price cap on Russian seaborne crude. In response, President Vladimir Putin on Tuesday signed a decree that bans the supply of crude oil and oil products from Feb. 1 for five months to nations abiding by the cap.

Poland has been gradually reducing its intake of Russian oil, and after the start of the war in Ukraine stopped buying seaborne Russian oil, top refiner PKN Orlen said. The company says it has secured alternative oil supplies via its partnership with Saudi Aramco.

"We are prepared to process all types of crude oil, this is our advantage," Minister of Climate and Environment Anna Moskwa told a news conference. Moskwa also said that she believed the next EU sanctions package would include a decision on banning Russian oil.

Poland is seeking German support to slap EU sanctions on the Polish-German section of the Druzhba crude pipeline so Warsaw can abandon a deal to buy Russian oil next year without paying penalties, two sources familiar with the talks told Reuters in November.

Poland and Germany promised in spring to try to end imports of Russian oil via Druzhba's northern leg by the end of year, but Orlen remains tied to its contract with Russian oil and gas company Tatneft.

"We believe that the next sanctions package will include a decision on oil," Moskwa said. "The sanctions cancel the contract with Tatneft."

We remind, Transneft has received requests from Poland and Germany for oil in 2023, the state oil pipeline monopoly's head told Rossiya-24 TV, adding that supplies via the Druzhba pipeline's southern spur are expected to hold steady next year. The EU has pledged to stop buying Russian oil via maritime routes from Dec. 5, with Western nations also imposing price caps on Russian crude oil, but the Druzhba pipeline remains exempt from sanctions. Transneft's comments are at odds with suggestions last month that Poland aimed to abandon a deal to buy Russian crude.

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