Italy Triton LNG Terminal Postponed

GDF Suez has postponed the start-up of its Triton LNG terminal in Italy from 2012 to 2013. However, the date is yet to be confirmed as the company has not taken the final investment decision. The comissioning date of 2013 may be due to lengthy process of protocols with the local and national authorities of the LNG terminal. Italy is venturing into many LNG projects as Qatar had earlier agreed to lower prices of LNG over the long run. The agreement was much influenced by the European countries as a whole.

Petrochemical Industry Getting Worse: BASF

As the economy downturn is getting worse, most of the petrochemical companies are not seeing the bottom-out yet; or signs of recovery for their petrochemical business, at least not from BASF. As BASF CEO CEO Jurgen Hambrecht, put it, BASF is not expecting a growth for 2009, worse still is expected to shrink.

To date, as much as 25% of BASF operating units worldwide have been shut down or idling due to uneconomical route of production especially in North America and Asia Pacific. Most of BASF's units are to make coatings, performance plastics, electronics and intermediates which are taking toll due to significant dropped in automatives and construction business.

BASF is expecting that more operating units will be closed and possible of job cuts; especially for units not serving the crops, hygienes and oil & gas industry. The plastic business seems to be taking the strongest hit so far.

LDPE Production in Halt for LyondellBasell UK France

LyondellBasell is reportingly will be idling its production of low density polyethylene (LDPE) units at France and UK. The Carrington unit in the UK has a nameplate capacity of 185,000 tonnes/year, and France's Fos plant has a nameplate capacity of 110,000 tonnes/year of LDPE.

The news comes in the midsts of demand for polyethylene has significantly improved compared to the fourth quarter of 2008 however the idling is due to demand still not within normal patterns especially in Europe. 

Analysts believe that the production cut is more due to extremely steep ethylene contract prices in the market which is the major feedstock for LDPE production.

US Marathon Oil to Sell its Irish Asset to PETRONAS

The US' Marathon Oil has agreed to sell most of its Irish assets to PETRONAS for $180 million.also include a 100% interest in the company's gas storage business with current capacity of 7 billion cubic feet.  

This acquisition includes a 86% stake in the producing Seven Heads gas fieldand a 100% operated interest in the Kinsale Head Area comprising Kinsale Head, South West Kinsale and the Ballycotton gas fields, as well as an 86% interest in the gas producing Seven Heads field which is tied back to Kinsale. All the gas fields at Kinsale area are estimated for current net production of 36 million cf/day. 

Petronas subsidiary Star Energy was appointed for Petronas behalf responsible for the acquisition. 

German Biodiesel Power Plant Facing Economic Threat

Germany’s environment ministry in the wake of economic turmoil must act quickly to ensure Germany's power stations running on palm and soy oil-based fuels and biodiesel do not go bankrupt.

This is after a legal change to restrict palm and soy-based fuels to no longer be counted into biofuels quotas. The resulting consequence is that the plants will no longer receive a bonus for using renewable energy from 1 January 2008 impacting most of power plants margin.

BASF Acquired 66.67% Ciba

BASF has reportedly holding 66.67% stake in Swiss specialty chemicals company Ciba after the expiry of the public tender offer period on 28 October. BASF had previously holding some of Ciba's shares. A total of 45,030,453 of Ciba shares had been tendered to BASF as part of the company’s public tender offer to shareholders of Ciba Holding and after combination of BASF's previous shares, it amounted to 1,011,536 Ciba shares capitalizing 66.67%.

Ticona Extending Distribution with Resinex

Ticona has extended its contract with distribution company Resinex to distribute Ticona’s specialty plastics in Benelux countries, Ireland and the UK alongside with existing Eastern Europe. Resinex distributes for over nine plastic products with 400 modified grades to customers.

Agropolychim Switching to DAP and MAP Chemical Plants

A Bulgarian fertilizer producer, Agropolychim is switching to diammonium phosphate (DAP) and monoammonium phosphate (MAP) at its Devnya plant which has a capacity of 850 tonnes/day of DAP/MAP. The chemical plants has flexibility to swing either DAP/MAP or triple superphosphate (TSP). Agropolychim produces around 25,000-27,000 tonnes/month of TSP mostly for export market.

SABIC Closing UK Aromatics

With sharp increase in feedstock prices, more companies are forced to temporarily shut down petchem units until prices stabilize. SABIC Europe is planning to close down two UK aromatics units at North Tees, near Seal Sands, and the paraxylene plant at Wilton, near Redcar. The closure is planned in end 2008.

SABIC Europe Closing Aromatics Unit

After the recent spike in oil price, petchem business is facing challenges. Due to poor economics, SABIC Europe is closing down two UK aromatics units at North Tees, near Seal Sands, and the paraxylene plant at Wilton, near Redcar.

Dow Stop Production on Polystyreme Poor Economics

Cyclical petrochemical business has brought Dow Europe to temporarily stop production of all its polystyrene (PS) resins at Terneuzen, the Netherlands. However, some operating units across Europe will still operating at reduced rates. Dow Polystyrene (PS) has production plants at Tessenderlo, Belgium, Bilbao in Spain, Schkopau in Germany and Lavrion in Greece and the Terneuzen unit which has an annual capacity of 50,000 tonnes/year.

The feedstock price hike comes mostly from the recent increase in global oil price. PS demand has been low for several months impactin producers in Europe including BASF, Total Petrochemicals, Dow, Polimeri Europa and INEOS NOVA.

SABIC Europe Butadiene Unit on Force Majeure

SABIC Europe has declared force majeure on butadiene supply as its Geleen butadiene (BD) unit in Netherlands with the chemical plant operating rates reduced due to technical issue.

The butadiene unit has a capacity of 130,000 tonne/year butadiene extraction.
Butadiene supply gets major cut due to at least two other cases of butadiene forces majeures in other plants at LyondellBasell’s Wesseling, Germany, unit and the other at INEOS Olefins’ Cologne, Germany, site.

Butadiene is currently under extremely tight supply due to recent production issues, combined with strong demand both domestically and abroad pushing the price to record high.

First Jatropha Plant By Wartsila Finland

Finland company, Wartsila has won a $11 million contract to build a 9 megawatt combined heat and power (CHP) plant in Belgium that will run on vegetable oil from the jatropha plant and to produce both electricity and heat.

This will be the first Jatropa facility in the world using carbon dioxide neutral fuels that do not compete with food crops since Jatropha oil was a liquid biofuel with great potential as it could be harvested outside the world’s rainforest areas, even near deserts.

Commissioning of the plant is expected to begin in February 2009 operated by Greenpower NV, a joint venture of Thenergo and four local agricultural companies and a private investor.

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BASF Puts-off Coal to Gas Petrochemical Plan

BASF has put off plans for a massive $2.5 billion coal gasification project due to uncertainties over the costs of Europe's emission trading scheme. The petrochemical complex would produce gas from coal as widely practiced in China to make methanol and ammonia, initially planned to be built either at BASF’s base in Ludwigshafen, Germany, or elsewhere.

Coal is regarded as cheap feedstock compared to natural gas for key raw material to the petrochemical industry.

New Dow/BASF HHPO Technology Plant Delayed

Dow/BASF joint-venture for a 300,000 tonne/year capacity hydrogen peroxide-to-propylene oxide (HPPO) plant at Antwerp, Belgium is delayed until the second part of 2008 which was previously scheduled to come on-stream in May 2008. This will be the first HPPO petrochemical plant in the world incorporating the JV technology by Dow and BASF. It was claimed that the process technology is more economical and environmentally friendly.

PKN Orlen Joint-Venture with Basell

PKN Orlen's nitrogen fertilizer profits were dropping due to heavy competitions from companies based in countries east of Poland. PKN Orlen's subsidiary, Anwil sales of ammonium nitrate products declined 6.9% to 135,000 tonnes in the fourth quarter of 2007.

PKN Orlen has Joint-Venture with Basell through Basell Orlen Polyolefins, a 50:50 share, is posting higher profit of Zl120m. As of now, PKN profits mostly come from other business than its fertilizer products due to the competitions.

European Companies Urged to Grow in Specialty Chemicals

Central and Eastern Europe (CEE) chemical companies were urged to grow in specialty chemicals. European specialty market’s production value expected to rise 7% a year until 2012, compared to only 4% for the commodity market.

Long gone the commodities game of sustainable long-term success with a focus on operational excellence, the money now is in specialty markets as value-added chemicals.

CEE companies should venture into huge strong domestic demands for specialty chemicals such as titanium oxide (TiO2), soda ash, methylene diphenyl diisocyanate (MDI), toluene di-isocyanate (TDI), specialty plastics and adhesive.

In general, CEE companies have great advantage in terms of highly qualified and motivated workforce with solid experience and tradition in running petrochemical plants. The biggest obstacle currently is probably sourcing of oil and gas, which most CEE companies are dependant on Russia.

Biodegradable Plastics Need Organics Disposal Program

Biodegradable bags which have been in discussion for many years, seem to have grown at slower pace with development expected to happen due to the growth of organic recycling in the US as predicted by BASF.

Biodegradable bags are now extensively used as organic waste collection bags, can liners and lawn and leaf bags in the US, Canada and Europe. The long waited biodegradable into grocery bags is yet to happen. Grocery bags are one of the major used of plastics in the bags segment. Currently polyethylene bags (PE Bags) are used.

The conversion of biodegradable bags, is only feasible if an organics collection program is available, since the technology is in place but it needs implementation to fully close the life cycle.

Recently, BASF has launched its Ecovio, a biodegradable plastic using foam. Ecovio is made from BASF’s biodegradable polyester Ecoflex and polyactic acid.

Petrochemical Deals: PETRONAS Acquiring Star Energy

Petronas International Corporation has announced that it has successfully received valid acceptances of Star Energy Share by acquiring approximately 97.56% in value and voting rights of Star Energy Group PLC. The acquisition was done through PETRONAS subsidiary, Petronas International Corporation Ltd (PICL)

It is expected that the full transfer of Star Energy Shares in accordance with the compulsory acquisition notices will happen by March 2008.

Petrochemical News: BASF Becoming European Company

BASF has completed on its European Company status, changing the name of the company from BASF to BASF SE (Societas Europea). The company had also established BASF Euaropa Betriebsrat consisting 23 members from 12 European countries. BASF SE now has 12 boardmembers representing equal half for shareholders and employee representatives.

The European status would make BASF SE in the near future incorporation of more European employees especially in the area of EU cross border information and employees consultation and rights.