Two-day strike to hit output, delivery from Neste oil refinery

Two-day strike to hit output, delivery from Neste oil refinery

MRC -- A planned two-day strike action by Finnish industrial workers early next month will hit output and supply from Neste's oil refinery in Finland, said Hydrocarbonprocessing.

"No finished product will come out, petrol, diesel and the others that we make here," union representative Sami Ryynanen at Neste's Porvoo refinery said.

The strike could affect output for up to a week as production must gradually be reduced ahead of time and then ramped up afterwards, Ryynanen said. A company spokesperson said Neste plans to reduce activity at Porvoo and operate the facility in "a safe state" for the duration of the Feb. 1-2 strike and that deliveries by road, rail and sea would be halted.

It was not immediately clear how much output would be affected. Finnish labour unions have protested in recent months against the right-wing government's plan to favor local work agreements over centralized bargains, limit political strikes and make it easier to terminate work contracts.

"People are worried about their everyday life, we see no other option but to go on strike to impact the government policy," Ryynanen said. Several other unions from service industries to paper and logistics workers have also announced strikes.

Flag carrier Finnair last week said it would cancel many flights as a result of the strike. The Porvoo refinery processes around 10 million tons of crude oil annually.

We remind, Central Asian countries, Afghanistan and Mongolia raised their imports of Russian fuel by around 28% in 2023 to almost 6 MMt, partially offseting a decline in Russian supplies to Europe, according to traders and industry data.Russia has drastically cut supplies of commodities, including oil and gas, to Europe amid deteriorating relations over the conflict in Ukraine.

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Russia's Novatek resumes fuel loadings at damaged Ust-Luga terminal

Russia's Novatek resumes fuel loadings at damaged Ust-Luga terminal

MRC -- Russian energy company Novatek resumed fuel loadings at its Baltic Sea Ust-Luga terminal, damaged in a suspected drone attack, according to industry sources and LSEG data, said Hydrocarbonprocessing.

The attack and ensuing fire have disrupted Russian fuel exports and added to uncertainty in energy markets already rocked by geopolitical jitters and tensions in the Red Sea region, one of the key gateways for global oil exports.

According to the data, the tankers Minerva Julie and Chrystal Arctic are currently being loaded with fuel. Novatek did not immediately respond to a Reuters request for comment.

Novatek said on Sunday it had been forced to suspend some operations at the huge Baltic Sea fuel export terminal and "technological processes" at a nearby fuel-producing complex due to a fire, started by what Ukrainian media said was a drone attack.

Operations at the processing complex have not yet resumed. Analysts have said it would take weeks for the complex to restore full-scale operations. Novatek's terminal accounted for 2.8 million of the 5.2 million tons of naphtha shipped to Asia from the port of Ust-Luga in 2023, LSEG data show.

The complex receives some 7 million metric tons a year of gas condensate, a type of light oil, from Novaket's Purovsky plant in Western Siberia to produce oil products such as naphtha, jet fuel and gasoil. Novatek's complex produces mostly naphtha for Asia, including China, Singapore, Taiwan and Malaysia, as well as jet fuel with delivery to Istanbul for Turkish Airlines.

According to Novatek, in 2022, the Ust-Luga complex produced 6.825 million tons of products, including 4.208 million tons of light and heavy naphtha, 1.052 million tons of jet fuel, 1.487 million tons of ship fuel component (fuel oil) and gasoil as well as 78,000 tons of liquefied petroleum gas.

Analysts said Novatek will now be forced to export more gas condensate instead of high-margin fuel via other terminals.

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Solvay and Huatai expand hydrogen peroxide capacity in China to meet growing photovoltaic demand

Solvay and Huatai expand hydrogen peroxide capacity in China to meet growing photovoltaic demand

MRC -- Solvay and Huatai expand hydrogen peroxide capacity in China to meet growing photovoltaic demand. said the company.

Building on its existing partnership with Huatai Chemical, the strategic alliance will enable the site to produce 48 kilotons of photovoltaic-grade hydrogen peroxide annually by 2025. This strategic investment not only reinforces Solvay's worldwide market leadership but also positions it to efficiently meet the rising demand from the photovoltaic industry, further supporting the growth of the renewable energy sector in Northern China.

"In alignment with China’s ambitious carbon neutrality targets, our collaboration positions Solvay as a key contributor. Leveraging cutting-edge technologies and building on our established presence in the high-purity hydrogen peroxide market, this strategic partnership capitalizes on the rapid expansion of China’s photovoltaic market,” said Philippe Kehren, Solvay CEO. “This project highlights our commitment to sustainability and strengthens our capability to secure a more significant share of the thriving Chinese market, further enhancing our well-established industrial presence in the region."

"Our joint venture with Solvay is a testament to our commitment to innovation and sustainability. This expansion is not just about increasing capacity; it's about contributing significantly to China's carbon neutrality goals and the photovoltaic industry's growth. By boosting our site's capability, we are not only meeting the demands of a rapidly evolving market but also reinforcing our position as a key player in the renewable energy sector," said Mr. Wang Yukang, Chairman of the Huatai Chemicals Group.

Since 2010, Solvay and Huatai have been successfully operating a groundbreaking joint venture, which integrates Solvay's state-of-the-art hydrogen peroxide technology. Situated in the Dongying Technical and Economics Development Zone of the Shandong Province, this plant has strategically positioned Solvay at the heart of the dynamic Chinese market, which is recognized as the world's largest for Hydrogen Peroxide.

We remind, Solvay is partnering with transportation providers KIITOSIMEON and ADAMS LOGISTICS to reduce the carbon footprint of its facility in Voikkaa, Finland.

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PRefChem initiates tender for spot propylene batch with end-of-January shipment

PRefChem initiates tender for spot propylene batch with end-of-January shipment

MRC -- Pengerang Refining and Petrochemical (PRefChem), a collaborative venture between Malaysia's major petrochemical entity Petronas and the state-owned Saudi oil company Saudi Aramco, recently announced a tender on January 19, said Chemanalyst.

The tender is for the sale of a spot shipment of propylene with the intention of swift shipment scheduled for the conclusion of January. Specifically, the batch, totalling 5 thousand tons, is slated to be shipped from PRefChem's facility in Pengerang, located in Johor, Malaysia, on January 28-30.

The application period for this tender extended until January 22, at which point it concluded, indicating a swift turnaround in the procurement process. This development comes against the backdrop of a previous report that highlighted PRefChem's temporary production halt at the cracking unit in Pengerang on November 17. The shutdown was attributed to a technical breakdown, impacting the facility's capacity, which stands at 1.2 million tonnes of ethylene and 609 thousand tonnes of propylene annually. The cracker, essential for the petrochemical production process, was anticipated to remain non-operational for approximately one week to address and rectify the technical issues.

Pengerang Refining and Petrochemical (PRefChem) stands as a strategic alliance between two prominent national oil companies, namely Malaysia's state-owned Petroliam Nasional Berhad (Petronas) and Saudi Arabia's state-owned Saudi Aramco. The collaborative efforts manifest through equal interests in two joint ventures, initially named Pengerang Refining Company Sdn. Bhd. (formerly PRPC Refinery & Cracker Sdn Bhd) and Pengerang Petrochemical Company Sdn. Bhd. (formerly PRPC Polymers Sdn Bhd).

The joint venture's recent issuance of a tender for a spot shipment of propylene reveals a strategic move to manage and optimize their inventory amidst the evolving dynamics of the petrochemical industry. The rapid shipment schedule at the end of January indicates a proactive approach to market demands, potentially addressing the effects of the temporary production halt and ensuring a smooth continuity of supply.

As the application window for the tender closed on January 22, the company awaits responses from potential bidders, and the subsequent steps will involve the evaluation of proposals and the selection of a buyer for the specified propylene batch.

PRefChem's tender announcement underscores the agile nature of the petrochemical industry, where companies must navigate unexpected disruptions such as technical breakdowns and swiftly adapt to market conditions. The collaborative efforts of Petronas and Saudi Aramco in PRefChem exemplify the strategic partnerships that play a crucial role in the global energy landscape, leveraging synergies and expertise for sustainable growth and resilience in the face of challenges. Stakeholders will closely monitor developments in the aftermath of the tender announcement to gauge the impact on regional and global propylene markets and assess how PRefChem's strategies align with broader industry trends.

We remind, Hebei Haiwei Group, one of China's prominent petrochemical producers, implemented a temporary shutdown of propylene production at its propane dehydrogenation plant in Hebei Province, China, starting on January 13. This decision was made in order to facilitate scheduled maintenance activities at the facility. The duration of the closure, impacting the propane dehydrogenation unit with an annual production capacity of 500 thousand tons of propylene, remains unspecified at this time.

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US propylene market surges during January amidst PDH outage

US propylene market surges during January amidst PDH outage

MRC -- The US Propylene market experienced a turbulent January 2024, marked by relentless price hikes fueled by a confluence of factors, said Chemanalyst.

The trend, already bullish throughout December, gained further momentum due to a combination of limited supply and surging demand. While a scheduled maintenance shutdown at Enterprise Products Partners' Mont Belvieu plant contributed to the tight supply, the adverse effect was the December 4th outage of their newest 750,000 mt/year PDH unit. This unexpected event, triggered by an operational issue, sent shockwaves through the Propylene landscape. The sudden removal of a major production artery from the equation drastically reduced readily available Propylene, sending scarcity levels soaring.

As per the recent assessment, the Propylene market in the USA keeps on rising with a hike of 10% at the beginning of January 2024 due to supply constraints. Therefore, Propylene Polymer Grade DEL US Gulf assessed at 1090 USD/tonne with a surge of 100 USD during the third week of January 2024. This bullish trend was attributed to an outage of the PDH plant in Texas whose immediate impact was a tightening of supply with a major production artery suddenly out of commission, and readily available propylene dwindling.

Adding fuel to the fire, US Propane and Propylene inventories dipped below more than 90 million barrels for the first time in three months, according to data from the US Energy Information Administration. This declining stockpile further exacerbated the scarcity, creating a perfect storm for price hikes. The affected PDH units have hampered the production of Propylene, leading to a decrease in the overall supply. The magnitude of the impact depends on the duration of an outage which keeps on affecting the margins. As supply falls, the price of the product has skyrocketed during this timeframe. This reflects the increased demand for the limited available product, which is a vital feedstock for many downstream industries, especially Polypropylene production. A shortage of the product can lead to production slowdowns or shutdowns in these industries, impacting sectors like packaging, textiles, and automotive components. The spot export US Polypropylene market, heavily reliant on readily available Propylene and the tightened conditions, slowed movement, and skyrocketing prices became the new reality. This domino effect also intensified inflationary pressures across the industry, as cost burdens stemming from increased supplier prices for metals and plastics, coupled with higher transportation charges, cascaded down the chain.

As per ChemAnalyst, the price of Propylene in the US market is expected to sustain its uptrend throughout January 2024. While the immediate shock of the Enterprise outage may have subsided, its long-term effects continue to ripple through the Propylene landscape. The spot exports US Propylene market, though recovering from the initial shock, still grapples with the consequences of the disrupted supply chain. The unexpected outage, coupled with pre-existing scarcity and inflationary pressures, created a complex landscape with a bullish future.

We remind, Pengerang Refining and Petrochemical (PRefChem), a collaborative venture between Malaysia's major petrochemical entity Petronas and the state-owned Saudi oil company Saudi Aramco, recently announced a tender on January 19. The tender is for the sale of a spot shipment of propylene with the intention of swift shipment scheduled for the conclusion of January. Specifically, the batch, totalling 5 thousand tons, is slated to be shipped from PRefChem's facility in Pengerang, located in Johor, Malaysia, on January 28-30.

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