Chemical Week - November 4/11
Newsbriefs
2024-11-08 07:40:55
↘ Alpek to end EPS production at Monaca plant by January
Alpek SAB de CV (Monterrey, Mexico) has announced plans to shut down production of expandable polystyrene (EPS) at its facility in Monaca, Pennsylvania, by January 2025. The company said it will transfer most of the site’s EPS production to other facilities. Alpek said the move will allow it to save about $20 million in cost reductions on a run-rate basis as soon as mid-2025, bringing total savings from cost structure improvement initiatives that began in 2023 to nearly $100 million. Alpek obtained the Monaca site, which has an EPS capacity of 123,000 metric tons per year, through the acquisition of the Nova Chemicals styrenics business in 2020.
↘ Hexpol acquires US nylon compounder Piedmont Resin
Hexpol AB (Malmö, Sweden) said it has acquired 80% of Piedmont Resin Supply LLC (Cartersville, Georgia) from the company’s founders Matt Griffith and Paul Daniel. The acquisition price amounts to $86 million on a cash-and-debt-free basis and is funded by a combination of bank facilities and cash, Hexpol said. Hexpol has an option to acquire the remaining 20%, and Piedmont founders have an option to sell their remaining shares to Hexpol. Piedmont, which has annual revenue of about $60 million, is a leader in technical nylon compounds in the US, with customers from the automotive, transportation and furniture industries, Hexpol said.
↘ Alterra, Neste, Technip offer modular chemical recycling
Neste Oyj (Espoo, Finland), Technip Energies NV (Paris) and Alterra Energy LLC (Akron, Ohio) have partnered to provide a standardized, modular solution to companies interested in building capacity for the chemical recycling of plastic waste by thermochemical liquefaction. Alterra and Neste will license the technology, and Technip Energies will design, engineer and deliver the plant to interested parties globally. The partners said their solution will come in the form of readily designed and engineered liquefaction plant modules, thus lowering pre-investment costs, accelerating implementation, providing highly predictable project economics and reducing overall capital costs.
↘ N. America weekly chemical rail firms on gain in US
During the week ended Nov. 2, chemical railcar volume in North America totaled 47,001 carloads, up 0.9% from the previous week and up 5.9% year over year, according to data from the Association of American Railroads. The four-week moving average (4wma) came to 45,878 carloads, up 0.9% sequentially and up 1.7% year over year. Regionally, 4wma chemical railcar volume was up 1.1% sequentially in the US, up 0.1% sequentially in Canada and up 6.0% sequentially in Mexico. For the year to date, chemical railcar volume in North America is up 3.5%, while total railcar volume is down 2.8%.
↘ Posco completes first stage of Argentina lithium hydroxide plant
Posco Holdings has completed construction of the first of three stages of a 100,000 metric tons per year lithium hydroxide plant at Guemes, Salta province, Argentina. The first stage comprises a 25,000 metric tons per year lithium hydroxide plant processing lithium-rich brine from the Salar del Hombre Muerto salt lake. Posco Holdings aims to complete the second stage of its Guemes project, consisting of a 25,000 metric tons per year plant, over the second half of 2025.
↘ HD Hyundai Oilbank buys Cosmo Energy out of aromatics JV
HD Hyundai Oilbank (Seongnam, South Korea) has acquired the 50% it did not own in HD Hyundai Cosmo Petrochemical Co. (HCP; Daesan, South Korea) from Cosmo Energy Holdings Co. (Tokyo). The deal has made HD Hyundai Oilbank the sole owner of HCP. Financial details of the transaction have not been disclosed. HCP has facilities that produce benzene, toluene and para-xylene (p-xylene) with a combined capacity of 1.42 million metric tons per year. It was founded as a joint venture in 2009. Cosmo said that in recent years, the p-xylene market has seen a prolonged period of stagnation due to the rapid construction of new and additional production units in China, the world’s largest consumer of p-xylene, coupled with a slowdown in the Chinese economy. It added that HCP’s business environment has deteriorated, with almost no chance of improvement in the foreseeable future.
↘ Lotte Chemical targets $1B from sale of overseas shares
Lotte Chemical Corp. has announced plans to raise 1.4 trillion South Korean won ($1.0 billion) by selling shares in overseas subsidiaries to improve the company’s financial stability. By the end of 2024, it plans to sell a 40% stake in Lotte Chemical Louisiana LLC (LCL) for 660 billion won. With the sale, Lotte Chemical USA Corp.’s stake in LCL will fall from 100% to about 60%. According to S&P Global Commodity Insights, LCL produces ethylene glycol with a capacity of 700,000 metric tons per year. Lotte Chemical also intends to sell its stake in PT Lotte Chemical Indonesia (LCI) in 2025 to raise about 700 billion won. It did not specify the size of the LCI stake it plans to sell. LCI plans to start up a new naphtha cracker at Cilegon, Indonesia, in 2025. Lotte Chemical in July announced plans to transform its portfolio by the end of the decade, de-emphasizing basic petrochemicals and increasing its focus on specialty chemicals.
↘ Syensqo cuts guidance again on Boeing strike, plans job cuts
Syensqo SA (Brussels) has announced an additional cut to its full-year EBITDA outlook, to €1.4 billion-€1.44 billion, reflecting the negative impact that the strike at Boeing is expected to have on the company’s fourth-quarter results. Syensqo had downgraded its EBITDA guidance to €1.4 billion- €1.475 billion in August. The impact of the Boeing strike, which ended on Nov. 5, was largely contained in the third quarter, but Syensqo’s fourth-quarter outlook assumes a full three-month shutdown at the affected plants, said Syensqo CEO Ilham Kadri at a press conference on Nov. 5. Syensqo has separately announced that it is opening consultations for a reduction of 300-350 jobs, primarily in France, the US, Belgium and Italy. The move forms part of the company’s plan “to adapt its organization to better meet the evolving needs of its customers and focus on projects that will accelerate growth.”
↘ Solenis gets BASF flocculants
Solenis LLC has closed the acquisition of BASF SE’s flocculants business for mining applications. Terms, including purchase price, were not disclosed. The acquisition will enable Solenis to offer flocculants and other products used for solid-liquid separation and material handling in mining applications to mining and mineral processing customers.
↘ Merck ADC expansion
Merck KGaA has announced a €70 million investment that will triple the capacity for antibody-drug conjugates (ADCs) at its bioconjugation center of excellence facility at St. Louis, Missouri, enhancing the company’s contract development and manufacturing organization (CDMO) offering. “ADCs represent a transformative approach to oncology, enabling targeted therapies that minimize damage to healthy tissues,” said Benjamin Hein, head/life science services at Merck’s life science business.
↘ Pacifico Mexinol supply deal
Mitsubishi Gas Chemical Co. Inc. is negotiating with Transition Industries LLC for a supply of 1 million metric tons per year of “ultra-low carbon” methanol from the latter’s Pacifico Mexinol project. On Oct. 28, Transition Industries announced that the two companies had signed a letter of intent toward entering a long-term sales agreement.
↘ Covestro ISCC Plus status
Covestro AG has has acquired International Sustainability and Carbon Certification (ISCC) Plus status for its South Deerfield, Massachusetts, specialty films production site. The films produced there will be used across multiple end-market segments such as healthcare and mobility. Covestro’s compounding facility at Newark, Ohio, and its site at Baytown, Texas, are already certified.
↘ Nayara enters PP market
Nayara Energy Ltd. (Mumbai) has started up a new 450,000 metric tons per year polypropylene (PP) plant at its Vadinar, India, refinery, marking the company’s entry into the PP market. W. R. Grace & Co. has licensed its Unipol PP process technology for the unit, which employs Grace’s Consista nonphthalate catalysts. Nayara, an affiliate of Rosneft Oil Co. (Moscow), announced the PP plant in 2019 as part of an $850 million petrochemical project. South Asia has an annual PP trade deficit of 2.7 million metric tons, according to data from S&P Global Commodity Insights.
↘ Stahl opens dispersions unit
Stahl BV (Waalwijk, Netherlands), a producer of specialty coatings for flexible materials, has opened a polyurethane dispersions (PUD) unit in Singapore. “The new facility for PUD manufacturing in Singapore is designed to serve the Asian and South Pacific markets, spanning from China and Japan to New Zealand,” said Dennis Koh, site and operations manager at the Stahl Singapore subsidiary. The company said its PUDs provide fastness, water resistance, print retention and high flex durability for products with demanding applications. PUD technology plays a key role in reducing solvent usage, it added.
↘ GSFC plant starts up in India
Gujarat State Fertilizers & Chemicals Ltd. (GSFC; Vadodara, India) has started production of hydroxylamine sulfate crystal at the company’s Fertilizernagar, India, site. The production capacity of the plant is 6,600 metric tons per year. Other details of the project have not been disclosed. According to the company’s website, hydroxylamine sulfate is used as a reducing agent in photographic processes, dyeing, synthetic fibers and purification of several water-soluble products.
Air Products reports earnings beat, exits Texas green hydrogen
↘Jameson Croteau
Air Products reported net income of $793.0 million for its fiscal fourth quarter, up 13% year over year on strong results in Asia and Europe and positive pricing in the Americas. Adjusted EBITDA was $1.41 billion, up 12% year over year. Sales were $3.19 billion, flat year over year as 1% higher volumes and pricing were offset by 2% lower energy cost pass-through. Volume was up 5% sequentially.
Adjusted earnings of $3.56 per share were up 13% year over year and 8 cents above consensus analysts’ estimates, as reported by S&P Capital IQ.
Air Products also announced that its $4.5 billion joint venture to produce green hydrogen in North Texas is no longer being pursued. The project never reached a final investment decision, and the company has sold its development rights to its project partner. Air Products said that the project did not meet its established guidelines for new, low-carbon projects. “We do not make FID until we have an anchor customer and until we have loaded 75% of our existing facilities,” said Chairman, CEO and president Seifi Ghasemi.
Additionally, Air Products announced that its $2 billion sustainable aviation fuel production and distribution hub with World Energy at Paramount, California, is on hold as the companies await permits, which have been challenged by an environmental group.
Orlen eyes suspension, cancellation of olefins project
↘Mark Thomas
Orlen SA has announced a review of its Olefins III petrochemical expansion at Płock, Poland, amid soaring project costs and a series of construction delays that have pushed back its estimated completion to at least 2030.
Options include the potential “termination of the project in its current form or its temporary, partial suspension,” the company said on Nov. 6. Other possibilities include project optimization with respect to the plant’s output capacity and utilization of current existing units at the site, Orlen said.
The company now estimates the capital expenditure and project-related costs for Olefins III would amount to between 45 billion and 51 billion Polish zlotys ($11.15 billion-$12.64 billion). “Continuation of the project with the current scope and scale […] is unprofitable,” it said.
Orlen said that completion of the project’s construction works “would be feasible no sooner than at the beginning of 2030.” The project was originally scheduled to start operations this year, with the most recent information last year putting the startup in 2027.
Orlen said its management board decided on Nov. 6 that it would concentrate further analysis on options for the petchems complex. “Selection of the strategic options has been made to safeguard the company’s interest and is made on the basis of petrochemical market analysis, [the] macroeconomic situation and project profitability,” it said.
Orlen said in a separate statement that the project would not generate positive future cash flow, and it announced a planned write-down of 912 million zlotys in its upcoming third-quarter petchem business results, mostly related to Olefins III.
Estimated costs, put at 13.5 billion zlotys at its launch in 2021, have risen almost fourfold. The project includes a 740,000 metric tons per year steam cracker and derivative units.
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