Petchems a bright spot in an otherwise arduous earnings season

Petrochemicals are offering growth as energy companies struggle with lingering low crude prices, though some face project delays and others are proceeding with caution, the latest quarterly earnings season shows.

Here’s a roundup of some of the highlights from the most recent round of earnings reports and calls.

Exxon Mobil Corp and longtime partner Sabic last week announced they may build a 1.8 million mt/year ethylene plant in Texas or Louisiana, marking the Saudi Arabian chemical maker’s entrance into the North American market. Exxon already is building a new 1.5 million mt/year cracker at the chemical complex at its Baytown, Texas refinery, but Jeff Woodbury, vice president of investor relations and secretary, told analysts last week that the company expects global chemical demand to grow 1% above gross domestic product through 2040, and ethylene demand will grow about 4% per year. “That translates into capacity additions about 6 million to 7 million tons per annum of additional capacity,” he said.

LyondellBasell Industries said the company will move forward on a new 1.1 billion pounds (500,000 mt)-per-year high density polyethylene plant in La Porte, Texas, to start up in 2019 that will increase the company’s US polyethylene capacity by 18%. An ethylene capacity expansion at its Corpus Christi, Texas, complex also is expected to be finished by the end of the third quarter. However, Lyondell indefinitely delayed the 550 million pounds (250,000 mt)-per-year ethylene expansion at its Channelview, Texas facility that had been planned for 2017 for economic reasons, Chief Executive Bob Patel said. He also said Lyondell can take debottlenecking steps during a turnaround at Channelview in 2018 and 2019. In the near term, Lyondell will focus on the HDPE plant and a potential new propylene oxide/tertiary butyl alcohol plant in the Houston area. The company expects to decide in the first half of 2017 whether to move ahead with the PO/TBA plant, and “it looks good so far,” Patel said.

Enterprise Products Partners Chief Executive Jim Teague said last week the company expected the first ship at the company’s new ethane export facility at the Houston Ship Channel on Monday, but the vessel had not yet been called in while the terminal makes final preparations this week. By year-end, the 200,000 b/d facility should be exporting roughly 1.9 million barrels per month. The company also is considering an ethylene export facility. Lyondell CEO Patel said on his company’s call that ethylene exports would benefit the US as “kind of a relief valve” for US ethylene producers with Asian ethylene selling for higher prices.

Enterprise customers canceled three LPG cargo loadings in July and expected more to be canceled this month as weak crude prices squeeze NGL spreads and siphon arbitrage between the US Gulf Coast and Northwest Europe and even southeast Asia, executives said. However, Enterprise more than offset that decline by loading nine cargoes of polymer grade propylene (PGP) in July after adding propylene export capability. The company’s new 1.65 billion pounds (750,000 mt)-per-year propane dehydrogenation plant in Mont Belvieu, Texas is slated to come online in the second quarter of 2017, delayed from the end of 2016 with narrow PGP margins amid low oil prices. Teague said the company’s propylene strategy is evolving with ongoing supply talks with international customers.

Phillips 66 executives said Chevron Phillips Chemical’s US Gulf Coast petrochemicals project is 80% complete with expected startup in the second half of 2017, delayed from mid-2017. Two polyethylene plants with a combined capacity of 500,000 mt/year at Phillips’ Sweeny, Texas refinery and chemical complex will be finished before the second half of 2017, but the startup of its new 1.5 million mt/year ethane cracker at the Cedar Bayou, Texas facility was delayed several months to the second half of 2017.

Royal Dutch Shell delayed final go-aheads on liquefied natural gas projects in Canada and Lake Charles, Louisiana, while greenlighting a 1.5 million mt/year ethane cracker in  Pennsylvania and a new ethylene cracker with derivative units with CNOOC in China that will more than double current capacity. Chief Executive Ben van Beurden said Shell’s appetite for new projects shrank upon repositioning integrated gas from being a growth business to a cash engine upon its $50 billion acquisition of gas giant BG Group.

Dow Chemical President and Chief Operating Officer Jim Fitterling said the multi-feed cracker at its $20 billion, 26-unit Sadara chemical complex with Saudi Aramco in Jubail is “in a rampant startup activity right now” with commercial operations expected in the third quarter. All construction should be finished by year-end with commissioning thereafter. The company’s Freeport, Texas cracker is more than 70% finished and remains on track to start up by mid-2017. The company expects incremental delays and postponements of ethylene projects, keeping global ethylene and polyethylene rates high.

Source: http://blogs.platts.com/

Discount Heating Oil Prices is a company where one can find the lowest home heating oil prices. The company also provides delivery assistance to your home punctually and securely. Just visit the official website, enter your zip code, browse the lowest price available on heating oil in your place and click on the “buy now” button. Getting discount heating oil in Massachusetts is now just a click away from you

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s