Liaocheng Meiwu New Materials temporary halts olefins production in China

Liaocheng Meiwu New Materials temporary halts olefins production in China

Liaocheng Meiwu New Materials Technology, a prominent player in China's petrochemical industry, has implemented an unscheduled shutdown of production at its methanol-to-methanol olefin-to-methanol plant located in Liaocheng, Shandong Province, China, said Chemanalyst.

The facility, with a substantial capacity of 120 thousand tons of ethylene and 180 thousand tons of propylene per year, is undergoing maintenance activities that commenced in early February. The maintenance period is anticipated to span 30 to 45 days, emphasizing the company's commitment to ensuring the optimal functioning of its production infrastructure.

This temporary hiatus in production aligns with Liaocheng Meiwu New Materials' dedication to maintaining operational efficiency and product quality. Unscheduled repairs, although disruptive, are crucial for preventing potential issues and enhancing the longevity of the production facility. The meticulous approach to maintenance underscores the company's commitment to adhering to the highest industry standards.

It is noteworthy that the olefin plant in Liaocheng, where the maintenance activities are currently underway, initiated test production on November 28, 2019. The facility's strategic location in Shandong Province, a vital industrial region in China, positions it to cater to the needs of consumers within the province. Liaocheng Meiwu New Materials Technology specifically targets end users in Shandong Province, including those who import the produced ethylene and propylene. Notably, the company does not possess its own processing facilities, relying on the sale of these key materials to meet the demand in the region.

Ethylene and propylene, the primary outputs of the olefin plant, serve as crucial raw materials in the production of polyethylene (PE) and polypropylene (PP), respectively. The temporary suspension of production at the Liaocheng plant impacts the supply chain of these essential materials, prompting a strategic approach to address maintenance needs while mitigating potential disruptions in the market.

Liaocheng Meiwu New Materials Technology Co Ltd has established itself as a major player in China's petrochemical landscape, focusing on the production of ethylene and propylene. The company's existing olefin production plant, boasting a significant capacity of 300,000 tonnes per year, employs Wison Clean Energy's technology to convert methanol into olefins. This technological approach aligns with the industry's commitment to cleaner and more sustainable production processes.

The decision to undertake maintenance activities at the methanol-to-methanol olefin-to-methanol plant signifies Liaocheng Meiwu New Materials' proactive stance in ensuring the reliability and efficiency of its operations. The company's commitment to delivering high-quality raw materials underscores its responsibility as a key contributor to China's petrochemical sector.

The ongoing maintenance period is not just a measure to address immediate concerns but also a strategic investment in the long-term sustainability of Liaocheng Meiwu New Materials' operations. By taking a brief pause in production to conduct necessary repairs, the company aims to enhance the resilience of its facilities, thereby contributing to consistent and reliable outputs in the future.

We remind, Axens’ designed 3.2-MMtpy ebullated-bed residue hydrocracking (H-Oil®) unit, 3.5-MMtpy distillates hydrocracking (HyKTM) unit and naphtha hydrotreating (NHT) unit were successfully started at Shenghong Refining & Chemical (Lianyungang) Co. Ltd’s crude to paraxylene complex in China’s province of Jiangsu. These single train units aim at maximizing naphtha production as well as improve the coker’s feed quality while processing steam cracker pyoil, diesel, vacuum gas oil, coker gas oil and vacuum residue as feedstocks within this integrated complex.

Sabic expects ‘challenging’ petchems market in 2024, eyes competitiveness of European assets

Sabic expects ‘challenging’ petchems market in 2024, eyes competitiveness of European assets

Sabic expects petrochemical markets to again be “challenging” in 2024 amid slow demand and a lack of significant economic recovery in China, with the company also looking to address the competitiveness of its European assets, according to CEO Abdulrahman al-Fageeh.

“There remains considerable uncertainty heading into the first quarter of 2024,” he said in a presentation on Feb. 27. “Sabic has undertaken a comprehensive portfolio review and identified the pathway to sustained value creation,” he said.

Al-Fageeh said the review would optimize its internal resources to “enhance its core focus on petrochemicals. Additionally, we are pursuing a number of initiatives to address the competitiveness of our European assets.” The company is “ultimately striving for a maintainable and modernized footprint in the region,” he said. No further details were given regarding which assets in Europe are being reviewed.

In January, Sabic implemented the permanent closure of one of its two polycarbonate (PC) production lines at Cartagena, Spain. The LX2 PC production line was shut down on Dec. 31 after the closure was first announced in October. The resins line had been idle since October 2022 due to difficult market conditions and was “no longer sustainable,” it said at the time. In November, Sabic recorded an impairment charge of 255 million Saudi riyals ($68 million) in its fiscal accounts for the third quarter of 2023 as part of the restructuring program in Europe.

The portfolio review also includes its previously announced divestment of subsidiary Saudi Iron & Steel Co. (Hadeed), which is proceeding as planned, he said.

Sabic said in an outlook that it anticipates capital expenditure in the range of $4 billion-$5 billion in 2024. In the first nine months of 2023, capex was about $2.8 billion. It did not provide a figure for 2023 capex.

In January, the company announced the final investment decision to go ahead with its $6.4 billion petrochemical complex at Gulei, Fujian Province, China, with partner Fujian Energy and Petrochemical Group. The project will have a mixed-feed steam cracker with a production capacity of up to 1.8 million metric tons per year of ethylene, along with ethylene glycol, polyethylene, polypropylene and PC.

Sabic posted a fourth-quarter net loss from continuing operations, excluding Hadeed, of 1.48 billion riyals, swinging from a profit of 540 million riyals in the third quarter and 350 million riyals in the prior-year period. EBITDA of 3.33 billion riyals fell 41% sequentially on 3% lower sales volumes, with its EBITDA margin of 10% down from 16%. The average sales price rose by 1% sequentially. Sales of 35.03 billion riyals declined 3% sequentially and 11% year over year.

For the full year 2023, Sabic’s sales declined 23% year over year to 141.54 billion riyals, and net earnings from continuing operations plunged to 1.3 billion riyals from 15.8 billion riyals in 2022. Including Hadeed, Sabic swung to a net loss of 2.77 billion riyals from a profit of 16.53 billion riyals. The company’s average selling prices and volumes on a year-on-year basis in 2023 dropped by 21% and 2%, respectively. The EBITDA margin fell to 13% from 20% a year earlier. Nonrecurring items of 3.47 billion riyals were the “result of impairment charges and write-offs of certain capital and financial assets, as well as provisions for the restructuring program in Europe and constructive obligations,” it said.

While petrochemical makers are expanding their production capacities, including Sabic, demand for most petrochemicals is “still low,” al-Fageeh said. “The petrochemical industry navigates a challenging operating environment — underwhelming demand within our target markets led to lower year end product prices and there remains considerable uncertainty heading into the first quarter of 2024,” he said.

Sabic’s fourth-quarter petrochemical sales fell 4% sequentially to 32.14 billion riyals, driven primarily by lower sales volumes, it said. EBITDA of 2.12 billion riyals declined 52%. Global methyl tert-butyl ether prices decreased by 18%, burdened by lower gasoline prices and weak seasonality, it said. Ethylene glycol prices, however, rose 3% sequentially due to extended and unplanned shutdowns. Global polyethylene and polypropylene prices increased slightly, by 1%, with support from higher resin and gas pricing, it said. Average PC prices declined by 4% sequentially due to lower global demand.

We remind, Saudi Basic Industries Corp. (SABIC), a prominent entity listed on the Saudi stock exchange, is gearing up to make a bid to acquire a stake in Braskem, a leading petrochemical company headquartered in Brazil. It is worth noting that SABIC is predominantly owned by Saudi Aramco, holding a significant 70% stake in its ownership. Contrary to previous speculations, SABIC plans to pursue an independent bid for the stake in Braskem and will not engage in a partnership with the Abu Dhabi National Oil Co. (ADNOC) from the United Arab Emirates (UAE) for this endeavor. Reports indicate that ADNOC has already initiated the due diligence process in connection with this potential transaction.

Saudi Aramco secures several deals valued at USD6 bn

Saudi Aramco secures several deals valued at USD6 bn

Aramco, a prominent player in the global energy and chemicals landscape, has taken a significant stride towards advancing its strategic localization initiatives by finalizing a series of 40 corporate procurement agreements valued at a staggering $6 billion with suppliers operating within the Kingdom of Saudi Arabia, said Chemanalyst.

These agreements signify a monumental leap towards reinforcing Aramco's domestic supply chain ecosystem, a pivotal component in bolstering the company's resilience, dependability, and agility to effectively cater to the dynamic demands of its customer base. Furthermore, these arrangements provide suppliers with invaluable long-term visibility into demand patterns, empowering them to capitalize on forthcoming growth prospects and spearhead localization endeavors.

Moreover, these agreements seamlessly align with the overarching objectives of Saudi Aramco's iktva program, a cornerstone initiative aimed at nurturing a vibrant economic landscape and fostering fresh avenues for Saudi nationals. The recent conclusion of 40 such agreements is anticipated to inject vigor into the domestic value chain, thereby amplifying the ecosystem that Aramco is actively nurturing. This strategic maneuver catapults us towards a more prosperous, diversified, and resilient supply chain, pivotal for ensuring uninterrupted business operations. Additionally, these accords signify a significant milestone in our ongoing iktva journey, providing our partners with a gateway to harness opportunities in an increasingly dynamic and diversified operational milieu.

Spanning across a myriad of sectors, the recently sealed corporate procurement agreements encompass a diverse spectrum of product categories, including indispensable commodities such as instrumentation, electrical equipment, and drilling equipment. Furthermore, Aramco has entered into two strategic Memoranda of Understanding with key partners, aimed at fostering collaboration in localization efforts and driving the development of the supply chain ecosystem.

These initiatives underscore Saudi Aramco's steadfast commitment to bolstering the domestic economy, enhancing the capabilities of local suppliers, and fostering sustainable growth within the Kingdom of Saudi Arabia. Through these strategic alliances and localization endeavors, Saudi Aramco continues to play an instrumental role in steering economic diversification and creating opportunities for the nation's workforce.

Saudi Aramco, officially known as the Saudi Arabian Oil Group or Aramco (previously Arabian-American Oil Company), stands as a state-owned entity specializing in petroleum and natural gas. It serves as the national oil company of Saudi Arabia. Renowned for its vast reserves, Saudi Aramco boasts the world's second-largest proven crude oil reserves, exceeding 270 billion barrels (43 billion cubic meters). Additionally, it holds the distinction of having the highest daily oil production among all oil-producing companies.

We remind, Saudi Arabia's government ordered state oil company Aramco to halt its oil expansion plan and to target a maximum sustained production capacity of 12 MM bpd, 1 MM bpd below a target announced in 2020. Saudi Arabia for decades has been the main holder of the world's only significant spare oil capacity, providing a safety cushion for global supplies in case of major disruptions caused by conflict or natural disasters. In recent years, fellow member of the Organization of the Petroleum Exporting Countries the United Arab Emirates has also built-up spare capacity.

Shell ends force majeure on phenol and acetone supply to US

Shell ends force majeure on phenol and acetone supply to US

Royal Dutch Shell, the Anglo-Dutch oil and gas giant, has officially lifted the force majeure on the supply of phenol and acetone to Deer Park, Texas, USA, said Chemanalyst.

According to market sources, the line, boasting a substantial capacity of 363,000 tonnes of phenol and 225,000 tonnes of acetone annually, has resumed full operational status. The declaration of force majeure, made in mid-October the previous year, had stemmed from a technical malfunction that temporarily disrupted the supply chain.

This recent development marks the resolution of the issue, signifying that the supply of phenol and acetone to Deer Park, Texas, has returned to normalcy. The reinstatement of operations is expected to have a positive impact on the downstream users and industries reliant on these chemical components.

It's worth noting that this is not the only instance where Shell has faced force majeure challenges. In early February, Shell had previously declared force majeure for the supply of butadiene to Norco, located in Louisiana, USA. For this specific line, with an annual capacity of 265,000 tonnes of butadiene, operations were suspended, and the force majeure status was expected to persist at least until the end of February. The exact cause of the outage remains undisclosed at this time. As a consequence, clients of the site faced force majeure implications and supply restrictions.

Royal Dutch Shell, headquartered in The Hague, Netherlands, operates globally and is actively involved in the exploration and production of oil and gas across more than 80 countries. The company has ownership stakes in over 30 refineries and boasts a substantial presence in the chemical industry. In addition to its core oil and gas operations, Shell has diversified interests, including ownership of numerous chemical enterprises and engagement in the production of solar panels and other alternative energy sources.

The resolution of the force majeure on phenol and acetone supply to Deer Park signifies a positive step forward for both Shell and its downstream customers. The timely restoration of operations is crucial for maintaining a steady supply chain and meeting the demands of various industries dependent on these chemical products.

However, the force majeure situation with butadiene supply to Norco raises questions about the challenges and uncertainties that can impact the operations of major players in the oil and gas industry. The undisclosed cause of the butadiene supply disruption underscores the complexity of managing unforeseen technical issues and their ripple effects on downstream users.

As Shell navigates these challenges, its ability to efficiently address force majeure situations and ensure the reliability of its supply chains will continue to be closely monitored by industry observers. The broader implications of such disruptions on global markets and the downstream industries highlight the interconnectedness of the energy and chemical sectors and the importance of swift and effective resolution strategies.

We remind, in early February, Royal Dutch Shell, a prominent Anglo-Dutch oil and gas company, declared force majeure concerning the supply of butadiene to its facility in Norco, Louisiana, USA, said Chemanalyst.
Market reports have confirmed the shutdown of a line with a substantial capacity of 265,000 tonnes of butadiene annually. This operational halt is anticipated to persist at least until the conclusion of February, with the precise cause of the disruption remaining undisclosed.

Yokogawa releases OpreX carbon footprint tracer to support decarbonization in the process manufacturing industries

Yokogawa releases OpreX carbon footprint tracer to support decarbonization in the process manufacturing industries

Yokogawa Electric Corporation announced the development and release of OpreX Carbon Footprint Tracer, a solution in the OpreX Transformation lineup that targets the carbon footprint management needs of companies in the process manufacturing industries, said Hydrocarbonprocessing.

OpreX Carbon Footprint Tracer is a cloud service that calculates CO2 emissions based on measurement data and other types of primary information collected from instrumentation systems, power monitors, and other systems, and a consultation service that aids in the formulation of strategies for calculating and reducing CO2 emissions. This is a total solution for the process manufacturing industries that enables the visualization and reduction of CO2 emissions.

For the calculation of CO2 emissions, this service realizes seamless integration with the SAP® Sustainability Footprint Management service and ERP solutions offered by SAP, enabling the visualization and management of product carbon footprint (PCF) based on European standards. The support for European standards and linkage with the SAP Sustainability Footprint Management service is a world first, giving companies in the process manufacturing industries the ability to both visualize and manage their PCF.

We remind, Russia ordered a six-month ban on gasoline exports from March 1 to keep prices stable amid rising demand from consumers and farmers and to allow for maintenance of refineries in the world's second largest oil exporter. The ban, first reported by Russia's RBC, was confirmed by a spokeswoman for Deputy Prime Minister Alexander Novak, President Vladimir Putin's point man for Russia's vast energy sector.