March 2010: a month of heavy cracker maintenance and several new capacity start ups

The month of March will kick off an unusually heavy season of cracker maintenance in Asia, expected to keep ethylene and propylene supplies tight in the region, as per Chemorbis. Simultaneously, some previously started up new capacities have picked up pace amid new start ups will also be seen. China Sinopec Zhenhai plans to start commercial operations at its new 1 mln tpa cracker complex in March, supporting a new 450,000 tpa LLDPE plant and a 300,000 tpa PP plant. It is reported that trial runs for the PE plant will start March 8 and on March 28 for the cracker. The PP plant is reported to have achieved on-spec production in January and was fed propylene feedstock on January 28 from the spot market. While Panjin Petrochemical actually started up its new 450,000 tpa steam cracker in December, operations have been unstable leading to a delay in starting up the polymer units. Market players reported that the new 300,000 tpa HDPE/LLDPE swing plant is expected to start up once the cracker has stable operations. The new PP plant with a capacity of 250,000 tpa was last reported starting up in December. After the 1 mln tpa complex of Sinopec Tianjin started up in December, the cracker and downstream units were shut again at the end of January after reaching on-spec production, but will start up again in H2-February. The cracker will support a new 300,000 tpa HDPE plant, a 300,000 tpa LLDPE plant and a 450,000 tpa PP plant. Other new plants include Liaoning Huajin Tongda Chemicals Co which started at new 450,000 tpa cracker which had started test runs at the end of January. Datang Inner Mongolia had successful test runs in January at its new 460,000 tpa plant, presumably leading to commercial operations by March. Southeast Asia Shell’s 800,000 tpa cracker in Singapore is scheduled to be running by the end of February. In Thailand, there is a lot of activity expected next month with several new plants ready to offer March cargoes. PTT Chemical Public Co (PTTCH) started up its new 1 mln tpa cracker and reached on-spec production in early February with commercial ops starting this month. After the cracker start up, PTT Polyethylene Company (PTTPE) will restart its new 400,000 tpa LLDPE in the last week of February. The plant actually started up in December but was shut in January due to technical problems and was not able to offer February cargoes. The company’s new 300,000 tpa LDPE plant is still scheduled to start in March, although the company is reportedly mulling a delay due to issues with ethylene feedstock. Unfortunately the company’s new 300,000 tpa HDPE plant has been suspended by court order until environmental issues are resolved. Siam Cement Group’s (SCG) new 400,000 tpa HDPE plant was running near full rates in early February and the new 400,000 tpa PP plant at 80% rates and offers for March cargoes are expected. Meanwhile, the company’s new 900,000 tpa cracker will be starting up in March. On another note, SCG’s new 350,000 tpa LLDPE plant was suspended by court order pending resolution of environmental issues. India Haldia Petrochemicals has reached on-spec production at their newly expanded complex in mid-February. Ethylene capacity was expanded by 150,000 tpa, propylene by 60,000 tpa, PE by 120,000 tpa (includes a 335,000 tpa HDPE and 335,000 tpa HDPE/LLDPE swing plant), PP by 75,000 tpa. The company plans to build up stocks after a long outage and then offer export cargoes in late March. Market sources report that export destinations include China, Europe, and Pakistan. Indian Oil Corporation was starting up its new steam cracker in the first half of February. The cracker has an ethylene capacity of 800,000 tpa and propylene capacity of 650,000 tpa. The company expects stable production at the cracker by mid-March. By end-March, the downstream polymer units are expected to start up as well. These include a 600,000 tpa PP plant, a 300,000 tpa HDPE plant, and a 350,000 tpa HDPE/LLDPE swing plant. The company reportedly said it plans to export up to 15-20% in the future. Europe Sabic has a new 400,000 tpa LDPE plant starting up in the UK with commercial operations expected within the first quarter. Borealis’ new 350,000 tpa LDPE plant in Sweden was in the process of starting up in early February with commercial operations presumably in place by March. The company will also shut some existing plants leading to a net capacity increase of 200,000 tpa once those plants are shut. Middle East Sharq’s new 1.3 mln tpa cracker in Saudi Arabia had started up at the end of December but was reportedly not able to reach full rates, leading to reduced rates at its new polymer units. Sharq’s new units include 400,000 tpa HDPE and 400,000 tpa LLDPE plants. The company’s existing plants with a total capacity of 750,000 tpa of LLDPE had also been run at low rates in January due both to the low cracker rates and technical problems. However, by the end of January, the company said it was running three of its four plants at 100% and was planning to return to normal production levels overall at the complex by March. Yanbu National Petrochemical (YANSAB) had been planning to start up its new 500,000 tpa HDPE plant in Saudia Arabia at the end of January, though updates on the progress are not available. The Yanbu area of Saudia Arabia had reportedly been affected by heavy floods at the end of November which affected several complexes in the area following water and power supply outages. Sources reported that affected companies included Natpet, PetroKemya, Yansab, and Yanpet leading to much reduced output from the country. Although the producers would not give specifics, customers had reported that February cargoes from several major producers in Saudi Arabia had been reduced. There have been no reports of reduced March cargoes thus far. There were reportedly also problems at some plants in Al-Jubail. Another new capacity which is expected to make a greater impact in March is PetroRabigh. Although the complex which is supported by a 1.3 mln tpa cracker was started previously, a lack of feedstock had led to unstable operating rates. However, sources at the company have said they expect to reach full rates in February. The company has a 350,000 tpa LLDPE plant, a 250,000 tpa easy processing PE plant, and a 300,000 tpa HDPE plant. In Qatar, Qatofin started up its new LLDPE plant with 450,000 tpa capacity at the end of last year and was expecting full production in the middle of February. A trader had earlier reported that there would be more of an impact felt for March cargoes as allocations would be larger once the plant was at full rates. It is unclear yet when the supporting 1.3 mln tpa cracker will start up, though it was last reported to have been delayed to Q1 of this year.
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