AdvanSix swings to Q3

Integrated nylon 6 producer AdvanSix on Friday reported a third-quarter net loss of $8m, compared with net income of $10m in Q3 2022, said the company.

Sales fell 32.6% year on year to $323m while total costs and expenses fell only 28.6% and came in higher than sales.

Sales fell as market-based pricing was unfavourable by 24%, primarily reflecting reduced ammonium sulphate (AS) pricing amid lower raw material input costs and a more stable global nitrogen supply environment.
Nylon pricing was unfavourable due to tough supply and demand conditions.
Raw material pass-through pricing was unfavourable by 8% as a result of a net cost decrease in benzene and propylene.
Overall sales volume decreased about 1%.

AS is a by-product of AdvanSix’s integrated production process. Benzene and propylene are inputs to cumene, which is a key feedstock for the company's products.

We remind, US integrated nylon producer AdvanSix has ended its alliance with biaxially oriented polyamide (BOPA) film maker Oben Group but will continue to support Oben as a resin supplier. Under the alliance, formed in 2019, Oben took on the role of producing BOPA film while AdvanSix managed its commercialisation and distribution in the US and Canada.

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China's PetroChina is proposing to buy up to 8 million barrels a month of Venezuelan crude from state-run oil company PDVSA, according to four people familiar with the matter, hoping to resume a trade suspended four years ago by U.S. sanctions, said Hydrocarbonprocessing.

In October, the U.S. Treasury Department temporarily lifted the sanctions, paving the way for Venezuela to resume exporting crude, gas and fuel to its best customers. Washington has said the six-month reprieve hinges on Venezuela's government embracing a fair and open presidential election next year.

Since the measures were relaxed, some companies that had acquired Venezuelan oil prior to sanctions have sought to revive those deals. PetroChina, China's second-largest oil refiner, has offered yuan payment for about 265,000 barrels per day (bpd) of Venezuelan crude through its joint ventures with PDVSA, which would allow them to rebuild cashflow and capital for production investment, two of the sources said.

"They are working on it," said a person close to PetroChina. The company before sanctions was taking up to six 2 million-barrel cargoes of Venezuelan oil per month. PDVSA and PetroChina did not immediately reply to requests for comment.

Following the U.S. measures, China's government called for a total lifting of sanctions on Venezuela. President Nicolas Maduro traveled with a large delegation to China in September to re-launch bilateral trade, with a heavy emphasis on restoring direct energy trade.

We remind, Petrochina Guangxi has entered into a license agreement with Grace to use its Unipol PP technology for its new 400 kilotons per annum single reactor line in China. With this move, Petrochina Guangxi aims to deliver higher value PP products to the local market. Grace has announced the signing of a new license with Petrochina Guangxi to develop a 400-kilotons per annum single reactor line using its Unipol PP technology.

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Nigeria's state oil firm NNPC Ltd will supply the new 650,000-bpd Dangote oil refinery with up to six cargoes of crude oil in December to be used in test runs, three industry sources with knowledge of the matter said, as per Hydrocarbonprocessing.

The refinery, funded by Africa's richest man, Aliko Dangote, will transform oil trading in the Atlantic Basin and remove a lucrative outlet for fuels produced in Europe and the United States that have for years powered the cars, trucks and generators on the continent.

The refinery is in the Lekki free trade zone near Lagos. Once it is fully up and running, it will turn oil powerhouse Nigeria into a net exporter of fuels, a long-sought goal for the OPEC member that is currently almost totally reliant on imports.

One of the sources, an NNPC official, who declined to be named, specified six cargoes, or 200,000 bpd, would be supplied in December as part of a one-year deal, adding that volumes in future months would be supplied "based on mutual agreement and availability".

The other sources said about 4-5 cargoes, or at least 130,000 bpd, were planned. A Dangote Group official, who did not wish to be named, said "some of the agreements have confidentiality clauses" without elaborating when asked about the NNPC supply deal.

The NNPC official said gasoline and diesel purchases from the refinery would be negotiated in separate contracts at a later date. NNPC has a 20% stake in the refinery. The refinery began the commissioning process in May this year after running years behind schedule at a cost of $19 billion, above initial estimates of $12-14 billion.

Commissioning includes testing the different units that make products from gasoline to diesel and making sure they respond to the control panels. Experts say it can take months for refineries to move from test runs to producing high-quality fuels at full capacity.

We remind, Seaborne diesel and gasoil exports from Russian ports fell 11% in October from a month earlier to about 2.55 MMt due to major maintenance work at refineries and a fuel export ban, data from traders and LSEG showed. Idle primary oil refining capacity for October stood at 4.915 million tons, down by around 1.9% from September, according to Reuters calculations.

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S-based styrenics and engineered materials producer Trinseo lowered on Friday its guidance for the year as it reported a Q3 net loss that was smaller than the same time in 2022, said the company.

The company's shares rose slightly in afterhours trading. The following table shows the company's latest guidance for 2023 and compares with the previous one. Figures are in millions of dollars.

Trinseo expects demand will remain constrained through the rest of the year, and the company will continue to take steps to improve its cost position and cash generation, it said.

On the one hand, Trinseo said economics for its European styrene economics should improve in the fourth quarter. The outlook takes into account the effects of the shutdown of its styrene plant in Terneuzen.

Those improvements should be partially offset by lower styrene margins at its AmSty joint venture.

On the other hand, Q4 profitability for its Plastics Solutions segment should fall from the third quarter because of higher costs for raw materials and because of the strike by the United Auto Workers (UAW).

We remind, Trinseo, a specialty material solutions provider, today announced its decision to discontinue operations at its ethylbenzene styrene monomer (EBSM) manufacturing facility in Terneuzen, the Netherlands, said the company.
This decision was made following the completion of joint negotiations with the Works Council in Terneuzen. The plant is scheduled to officially cease operations in November 2023. With the closure of the EBSM facility, the company will purchase of all of its styrene needs from third party suppliers to support its downstream businesses.

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Seaborne diesel and gasoil exports from Russian ports fell 11% in October from a month earlier to about 2.55 MMt due to major maintenance work at refineries and a fuel export ban, data from traders and LSEG showed, said Hydrocarbonprocessing.

Idle primary oil refining capacity for October stood at 4.915 million tons, down by around 1.9% from September, according to Reuters calculations.

Russia temporarily banned exports of gasoline and diesel from Sept. 21 to cope with a domestic shortage but lifted restrictions on bunker fuel and high sulfur gasoil.

The embargo was partially lifted on Oct. 9 with Russia resuming ULSD exports via Transneft pipelines provided that the manufacturer supplies at least 50% of the produced diesel fuel to the domestic market.

Total October diesel loadings from Russia's port of Primorsk, the main outlet for ULSD exports and completely dependent on pipeline shipments, rose by 10% month on month and by 40% from an initial plan to 977,000 tons, according to LSEG data and traders.

We remind, Last month about 680,000 tons of diesel and gasoil from Russian ports were heading to African countries including Libya, Togo, Morocco, Senegal and Ivory Coast, LSEG data showed. Another 270,000 tons of diesel from Russia in October was destined for ship-to-ship transfers near the Greek port of Kalamata with final destinations for these cargoes not yet known. All the shipping data above are based on the date of cargo departure.

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