Featuring Sanjeev Dutta, Executive Director of Commodities, DMCC. With the pandemic allowing for devise of newer trade routes, consolidating the existing once, especially in concern with scarcity of bunker space. Rising interest rates, price volatility and trade pattern changes which contributes to the increased financial costs. American Petroleum Institute President and CEO Mike Sommers joined the podcast to share the industry’s perspective on the new offshore leasing plan, its impact on broader supply and demand dynamics and next steps.Stick around for Binish Azhar with the Market Minute, a look at near-term oil market drivers.Related content: US Interior Department plans three offshore oil, gas lease sales over next five years (subscriber content)Whale-related litigation muddies waters, forces delay of US Gulf oil, gas lease sale (subscriber content)US offshore oil, gas producers raise alarm about financial assurance proposal (subscriber content)ĭoes the global trade industry require up to USD 500 million in working capital to maintain its flow? In the DMCC’s report released in the last year, one of the key areas of recommendation is the importance of enhanced trade finance mechanisms to facilitate trade flows globally. US-based sellers rely on foreign sources of MTBE demand, particularly in Latin America.In about two months, Interior Secretary Deb Haaland is expected to formally approve a new National Outer Continental Shelf Oil and Gas Leasing Program, putting a five-year offshore leasing plan back on the books after the country’s previous program expired over a year ago.As one could imagine, the oil industry was not pleased to hear that only three lease sales for acres in the Gulf of Mexico would be conducted over the next five years. MTBE is a gasoline blendstock used to reduce emissions, but it has been phased out of the domestic gasoline blending pool for US consumption and is produced for export. Of the chemical intermediate operations being sold, EO makes MEG, which in turn makes polyester fibers, antifreeze and polyethylene terephthalate (PET), the resin used to make plastic bottles.

LAB is a surfactant used to make chemicals in laundry detergent, lubricant additives and in oil production. Huntsman's linear alkyl-benzene (LAB) manufacturing site at the Chocolate Bayou site south of Houston and a surfactants plant in Dayton, Texas, are also included in the deal, according to the companies. The plant now owned by Indorama can produce up to 238,135 mt/year of PO and 988,000 mt/year of MTBE.

PO is among the chain of products used to make polyurethanes, which are used to make mattresses, furniture cushions, insulation, paints, foam toys and vehicle interiors. 'It has a well-integrated assets base with an extensive infrastructure and future expansion possibilities,' and is adjacent to many US Gulf Coast feedstock suppliers, Indorama said. The deal is the largest in Indorama Ventures' history, the company said. As a result, there will be 'no effect on 2020 planned production volume,' the presentation said. The unit was expected to be back online by March this year. In a presentation to investors dated Friday, Indorama noted that impact from the TPC blast was 'limited' and that a turnaround on the PO/MTBE unit that had been planned for April 2020 was pushed up to December 2019. However, Huntsman stored MTBE at the TPC site, so the blast affected its operations.

The idled unit was not damaged by the explosion and fire. On December 2, Huntsman said the PO/MTBE unit would be idled indefinitely after a November 27 explosion and fire in a butadiene unit at TPC Group's adjacent complex in Port Neches. Huntsman retained ownership of a diglycolamine (DGA) plant at Port Neches.

Indorama has acquired most of the operations at the Port Neches, Texas, site, including a 235,867 mt/year mixed-feed cracker a 1 million mt/year ethylene oxide (EO)/monoethylene glycol (MEG) unit and a propylene oxide/MTBE plant, which also produces surfactants and amines. The deal includes manufacturing operations in Texas, Australia and India. The deal allows Huntsman to focus on its growing polyurethanes business as well. Receive daily email alerts, subscriber notes & personalize your experience.

Global commodity ventures