Indian Government on Fasttrack Mode in Its Bid Against Coronavirus, Seeks Support from Chemical Industry

1. Edition: 24th April 2020 #TheChemAnalystExpress Indian Government Indian Government o on Fasttrack Mode n Fasttrack Mode iin Its Bid Against Coronavirus, Seeks Support Chemical Industry n Its Bid Against Coronavirus, Seeks Support ffrom Chemical Industry rom Key Headlines •Crude Edges Up Higher After Players Plan to Accelerate Production Cuts •Indian Chemical Industry Players Resume Operation After Ease in Govt Restrictions •India’s Industrial Oxygen Gas Manufacturers All Set to Serve the Medical Demand •Deepak Phenolics Commences IPA Production at Its New Facility in Dahej •Lotte Chemicals to Halt Production of Petrochemicals At 2 Lines Asia Pacific Chemicals Pricing (Key Products) •Toluene: Toluene CFR China prices traced benzene which inclined in line with the upstream crude values and slight recovery in the regional demand. Toluene prices settled at $350/ tonne CFR China, registering a rise of $35/tonne from the previous revision. •Phenol: Phenol prices edged higher in Southeast Asia due to improved consumption as many industries plan to ramp up production after a prolonged shut in activities due to Covid-19. CFR SEA Phenol prices climbed to $705 per MT, up by $5/tonne from previous revision. •Styrene Monomer: Styrene prices witnessed a spike on Thursday, influenced by rise in its feedstock values. Styrene prices reached to $555/tonne FOB Korea, showing a rise of $45/tonne. •Benzene: Benzene FOB Korea prices edged higher and settled at $310/tonne, up by $15 as on Wednesday, on firmer crude and improved demand from downstream industries. Crude Oil Scenario Oil rebound on Thursday, after major oil producers agreed to accelerate planned production cuts to face the sudden slump in demand as the pandemic threatens the world with number of infected people rising beyond 2.5 lakh. Oil prices witnessed extreme uncertainties in this week with WTI Crude closing at minus $37.63 on Monday, creating a painful history in the journey of oil market. On Thursday, Brent crude rose by 9.4 per cent, to $22.28 per barrel by 11:53 a.m. EDT, while WTI spiked by 29 per cent, to $17.80 per barrel. Market remained optimistic as Kuwait announced that it had started curtailing oil supplies to the international market, much before May 1st when the deal was supposed to take effect. Index WTI Crude Oil Brent Crude Natural Gas (U.S.) Units USD/bbl. USD/bbl. USD/MMBtu Prices 17.35 22.24 1.819

2. Exclusive News & Analysis Industrial Oxygen Manufacturers to Serve the India’s Medical Needs As the country anticipates escalation in the positive coronavirus cases with total number of confirmed coronavirus cases crossing 21,000 on Thursday, the Indian government has been constantly making efforts to ensure the adequate supplies of essential commodities required during the treatment. One such effort is the grant of permission to the industrial oxygen manufacturers to manufacture and sell the gas for medical use. Medical oxygen is mandatory for maintaining appropriate level of the gas in the patient’s blood and becomes a crucial part of the medical procedure when the patient is on ventilator. The move happened after All India Industrial Gases Manufacturer’s Association’s (AIIGMA) proposal which was aimed at ensuring the adequate availability of oxygen for medical use at this time of crisis. AIIGMA, has all the industrial and medicinal gas manufacturers as its members and is engaged in production of gas cylinders, cryogenic vessels, gas plants, and other allied equipment. The Directorate General of Health Services ( govt. of India) showed his consent towards the move and stated that the industrial gas manufacturers will be provided appropriate license to produce medical-grade oxygen within 24 hours of application, provided they produce it as per the prescribed standards in Indian pharmacopoeia. Experts believe that the grant could prove to be a breakthrough in country’s bid against fighting the spread of virus and encourage other countries to follow the suit who may be running short of the lifesaving gas because of tremendous rise in Covid-19 patients. Facts and Figures ▪Oxygen is India’s largest revenue generating industrial gas In India, however, most of that revenue is generated from the sale oxygen to the steel and metallurgy sector. The AIIGMA stated that around 80% of the total oxygen output is sold to serve other industries that use oxygen while 20% goes for medical use. ▪As per the president of AIIGMA, India has around 80,000 tonnes of total oxygen in stock, while medical oxygen consumption stands at about 700 tonnes per day. However, the government and industry are getting prepared for all sorts of complications. ▪Industrial air separation plants normally operate at around 75-85% operating efficiency which is a fair rate when it comes to maintaining country’s supply and demand. Association believes that to meet the increased demand at the time of crisis, the associated companies can ramp up their production without planning for any new plant construction. • Industry Research Global Plant Shutdowns •Lotte Chemicals to Halt Production Lines at Ulsan Plant Lotte Chemical has announced an indefinite halt in the two Meta Xylene (MeX) production lines and one paraxylene (PX) production line at its Ulsan plant. Lotte Chemical recently expanded its Meta Xylene production lines to increase the production of Isophthalic Acid, but novel coronavirus made the company postpone its plans sensing the demand India’s Industrial Gas Sector Grab Opportunity to Fight on Frontlines During Crisis India's largest manufacturer of high-pressure gas cylinders, Everest Kanto Cylinder Limited, recently announced that it has recently restarted the supply of cylinders used for storing medical oxygen to its customers in India. The company's cylinder manufacturing plants are located in Tarapur (Maharashtra) and Kandla (Gujarat) with the capacity to manufacture over 700,000 cylinders and can manufacture cylinders of all sorts, from portable to jumbo, based on specific requirements of the clients. EKC already has approval and holds a better position to meet the rising demand from hospitals across the country and from other ancillary medical infrastructure treating the Covid- 19 patients.

3. destruction prevailing the world. Lotte Chemical has lowered the operating rated at most of its plants in the wake of the pandemic spread. Several Korean petrochemical companies have been responding to the virus by curtailing their production volumes. SK Global Chemical has already decided to idle its naphtha cracking center (NCC) at the SK Ulsan Complex by December 2020 and permanently suspend its ethylene propylene diene monomer (EPDM) rubber production process by Q2. •French Biodiesel Plants Idled Due to Demand Destruction Groupe Avril, a French biodiesel firm recently revealed shutdown of some of its production units as the pandemic caused a significant slowdown in demand further heightened by social distancing rules. CEO of the organization, Jean- Philippe Puig, revealed that the firm currently has three plants in operation out of six. The company has plants at Bassens, Sete, two at Rouen, Lezoux and Le Meriot. The company observed about 60% decrease in diesel-powered vehicles on the roads due to the coronavirus related restrictions. The demand destruction exacerbated the company to slash down biodiesel prices to several years low to almost negative within 3 months. India Plant Resumptions and New Establishments •Tuticorin Resumes Production After Government Relaxes Second Phase of Lockdown Tuticorin Alkali Chemicals and Fertilizers Ltd has resumed production activities at its plant on 22nd April as the Indian government gave relaxation to certain industries during the second phase of the nationwide lockdown which is going to end on May 3rd. The plant is involved in the production of all grades of soda ash ad ammonium chloride fertilizer. The company had initially shut the plant due to maintenance related issue which got later extended due to the manpower related issues. •Zuari Agro Chemical Resumes NPK-A Plant Production Zuari Agro Chemicals Ltd, Goa has resumed operations at its NPK-A plant on April 22nd after the state government eased restrictions on the essential manufacturing activities amid nationwide lockdown which has been extended till May 3rd. Till now, Goa has reported only 7 positive coronavirus cases and the state is optimistic to become free from the contagion soon. The company’s NPK-A plant is located in Zuarinagar, Goa. •Deepak Phenolics Commences IPA Production at Its New 30 KTPA Unit Deepak Phenolics Limited commenced Iso Propyl Alcohol production on Tuesday at its newly commissioned manufacturing unit having installed capacity of 30 KTPA. The plant is located at the company’s manufacturing complex located in Dahej, Gujarat. The company has invested INR 200 Cr to set up this manufacturing unit and through this aims to reduce country’s import dependence for IPA, which is being popularly used in manufacturing alcohol-based hand sanitizers. The plant would be capable of producing IPA from acetone. The company is also aiming to set up a power plant next to its manufacturing facility to meet the power requirements at its phenol and acetone plant. Major Industrial Projects •Cameron LNG Reaches the Summit of Phase 1 LNG Export Project Cameron LNG has reached the final commissioning stage for its Phase 1, three-train liquefaction-export project in Hackberry, Louisiana, US. It has successfully started pipeline feed gas flow to the last liquefaction train. Phase 1 of the Cameron LNG export project comprises three liquefaction trains that will be capable of exporting approximately 12 million TPA of LNG. McDermott and Chiyoda have looked after the engineering, procurement, construction and commissioning of the project since it started. With the start of Train 3, the company aims to meet the increasing global demand for cleaner and safe energy sources. About 58 LNG cargoes have been shipped from the facility. The commercial operation of Train 3 remains are likely to begin in Q3 2020.

4. Mergers & Acquisitions •BP Enters into Strategic Partnership with Chinese PET Producer CRC BP plc has entered into a strategic agreement with China Resources Chemical Innovative Materials Holdings Limited (CRC). CRC is China’s one of the leading producers of PET (polyethylene terephthalate) plastic, and is an important consumer for PTA (purified terephthalic acid) produced by BP. CRC and BP are eager to work together and support each other along the polyester value chain. BP also agreed to become a shareholder of CRC in addition to the agreement. Through this strategic collaboration, the companies are anticipating effective integration of resources and mutual development of innovative technologies and new products with wider applications to widen their product portfolio. Strategic Investments •Australia Seeks Opportunity as Crude Faces Supply Glut Australia has been keenly eyeing on record low oil prices and planning to develop an oil reserve strategically located in the United States. With coronavirus taking a heavy toll on the global oil industry, starting from oil price war to reaching a negative territory, country’s Energy Minister Angus Taylor stated that it was the right time to act. Australia has long had one of the lowest levels of emergency petroleum stockpiles in Strait of Hormuz, United States. Taylor remarked that Australia would spend USD 59 million to start with the development of oil stockpile already established on the US soil. The two allies signed an agreement in March this year granting Australia the permission to lease space in the US Strategic Petroleum Reserve, in case of emergencies. Get the Chemical and Petrochemical Industry News on Daily Basis, Weekly-Trend & Forecast and Monthly-Analyst Views Subscribe Today! News on WhatsApp/WeChat/Mail First 15 days free news! WhatsApp No. +91-9914868686 For sales related query, dial +91-9958299626 or +91-8882336899 or email at sales@chemanalyst.com

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