Oleochemicals

FOCUS for less than 20% of the company's total, but its turnover will be doubled by the acquisition of Huntsman's operations. Innospec, formerly known as Octel, was spun off from Great Lakes in 1998. It divides its operations into three distinct business areas - Fuel Specialities, Performance Chemicals and Octane Additives – which together achieved a turnover of $1.01 bn in 2015. It employs around 1300 staff across 20 countries. Caroline Edser

RAW MATERIALS Linear alkylbenzene MRPL to enhance refining capacity; plans new projects for value-added chemicals Mangalore Refinery and Petrochemicals Ltd (MRPL) will invest up to Rup 150 bn (c € 2 bn) to raise its refining capacity from 18 M tonnes/y to 21 M tonnes/y. The plan, which was first announced in 2013 as part of MRPL's 'Perspective Plan 2030' ['Focus on Surfactants', Jul 2013], includes a petcoke gas complex that will produce syngas along with acetic acid, acrylates, linear alkylbenzene (LAB) and urea. Original Source: Chemical Weekly, 2 Aug 2016, 142 (Website: http://www. chemicalweekly.com) © Sevak Publications & Chemical Weekly Database P Ltd 2016

Oleochemicals Promising long-term outlook for palm oil According to CIMB Research, investors are generally keen on the palm oil sector's long-term prospects but are less bullish on its near-term outlook. Despite the weaker-thananticipated crude palm oil (CPO) levels, CPO prices have still fallen short of reaching forecasts of Ringgit 3000/tonne (c € 650/tonne). CPO is currently trading at Ringgit 2342/tonne from a high of Ringgit 2714/tonne in Apr 2016. Weaker prices came on the back of lacklustre palm oil demand from China, which dropped by 50% year on year in 1H 2016 after the Chinese government's release of 2 M

2

ON

S U R FAC TA N T S

tonnes of rapeseed oil from state reserves [however, CPO exports to China increased sequentially in Jul 2016; see next item]. Other significant drivers for CPO prices in 2H 2016 and 2017 are the development of Malaysia and Indonesia's biodiesel mandates, the effects of El Nino and La Nina on palm oil supplies in 2017, and the outlook for US soybean crops in 2H 2016. CIMB Research is keeping its average CPO price projection at Ringgit 2450/tonne for 2016 and Ringgit 2600/tonne for 2017. Original Source: The Star, 2 Aug 2016, (Website: http://thestar.com.my) © Star Publications (M) Bhd 2016

Palm oil stockpile in Malaysia seen rising in Jul 2016 Malaysia's palm oil inventories increased for a second straight month in Jul 2016 as output continued to recover from the impacts of El Nino. From Jun 2016, inventories grew by 2.2% to 1.82 M tonnes in Jul 2016, according to the median of eight projections in a Bloomberg survey. Crude palm oil (CPO) production is likely to have increased by 3.9% to 1.59 M tonnes, and exports by 15% to 1.3 M tonnes. Malaysia's production may decline to 18.2-18.5 M tonnes in 2016 compared with 20 M tonnes in 2015. Oil World's estimate for global production is a 3.5% drop to 60.4 M tonnes in 2016. Palm oil demand is expected to rise, which also suggests lower palm oil stocks in consuming countries and stronger palm oil prices and recouped competitiveness against other edible oils. Prices in Aug 2016 may trade at Ringgit 2300-2600/tonne (c € 500-565/tonne). In Jul 2016, Malaysia's exports rose by 15%, with deliveries to China increasing by 68% to 225,856 tonnes in Jul 2016 against exports in Jun 2016. Malaysia's imports likely rose to 20,000 tonnes in Jul 2016 from 19,636 tonnes in Jun 2016, while local consumption was estimated at 240,000-290,000 tonnes. Original Source: The Star, 5 Aug 2016, (Website: http://thestar.com.my) © Star Publications (M) Bhd 2016

Ethylene oxide/other Dow announces start-up of Sadara mixed feed cracker Sadara Chemical Co, the 65:35 joint venture between Dow Chemical Co

and Saudi Aramco in Al-Jubail, Saudi Arabia, is reported to be set for full launch by end-2016. The project achieved a significant milestone in August, starting up its 1.5 M tonnes/y mixed feed cracker (MFC). The MFC is one of 26 manufacturing assets being built at the complex in Jubail Industrial City II, the largest of its kind ever built in a single phase. Through Sadara's other manufacturing units, ethylene and propylene produced by the MFC will be subsequently converted to a wide range of valueadded plastics and speciality chemicals. The complex has already commissioned two polyethylene trains ['Focus on Surfactants', Mar 2016]. According to Dow, Sadara remains on schedule for a sequenced start-up process, continuing with the polyethylene and polyolefins envelope to maximize timing in the ethylene cycle, followed by ethylene/propylene oxides and their derivatives. The more than 3 M tonnes/y of performancefocused products will add new value chains to Saudi Arabia's vast petroleum reserves, resulting in the diversification of the economy and region. Original Source: Dow Chemical, 29 Aug 2016 (Website: http://www.dow.com) © The Dow Chemical Company 2016. Original Source: ICIS Chemical Business, 15-21 Aug 2016, 290 (5), 12-13 (Website: http://www.icis.com) © Reed Business Information Limited 2016

Sasol confirms soaring costs for US petrochemicals project S African petrochemicals group Sasol has confirmed preliminary conclusions published in Jun 2016 regarding a major increase in costs for its cracker and chemicals complex in Lake Charles, LA, USA. The investment required is now expected to be $11 bn, $2.1 bn more than initially planned in 2014 ['Focus on Surfactants', Feb 2015], largely due to higher engineering and labour expenses than originally estimated. The $11 bn capital expenditure is predicted to be divided into: $2.6 bn for the polyethylene (PE) facilities; $4.3 bn for the cracker; and $4.1 bn for the ethylene oxide (EO) value chain units and the fatty alcohols facilities. As of 30 Jun 2016 Sasol had already invested $4.8 bn in the project, which is currently 50% complete. Units upstream of the 1.5 M tonnes/y ethane cracker are scheduled to enter service in 2H 2018. Downstream units at the complex will open in 2H 2019, October 2016