Two-and-a-half-month ban to impact financial performance in 3rd and 4th quarters
STAMFORD, Connecticut, Oct. 11, 2018 /PRNewswire/ -- Rain Carbon Inc., a leading global producer of carbon-based products, today announced that the company will resume shipments of petroleum coke to its Vizag calcining facility in Visakhapatnam, India. This follows an October 9 ruling by the Supreme Court of India that exempts calciners from the nation's recent ban on the importation of petroleum coke for use as fuel, which was enacted as part of the country's effort to reduce industrial emissions.
Rain Carbon uses green petroleum coke (GPC) as its primary feedstock in the production of calcined petroleum coke (CPC), which is an essential raw material in the anodes required during the electrolytic process of aluminum production. The company also imports CPC for blending at its Vizag facility. Under the Supreme Court's ruling, India's calcining industry will be permitted to import up to 1.4 million metric tons of GPC annually; the ruling also permits India's aluminum industry to use up to 500,000 tons of imported CPC per year.
"We thank the honorable Supreme Court of India for its expeditious and positive ruling on our petition, which will enable our Vizag facility to continue to support India's growing aluminum industry, which relies on our CPC in their production processes," said Rain Carbon President Gerry Sweeney. "As an industry leader in environmental best practices, Rain Carbon understands and supports India's desire to reduce emissions and industrial pollution."
The industrial processes at Rain Carbon's calcining facilities in India and the United States "are designed to reduce emissions," Sweeney explained. "At our Vizag plant, for example, our scrubbers remove in excess of 98% of the sulfur dioxide before exhaust gases are released into the atmosphere. In addition, our co-generation facility at the plant transforms waste heat from our calcining process into clean electricity that is sold to industrial customers over the local power grid, displacing an equivalent amount of fossil fuel-fired electricity."
Sweeney said the two-and-a-half month import ban will have a negative impact on the third- and fourth-quarter financial performance of Rain Carbon and its parent company, Rain Industries Ltd.
"Although we had sufficient GPC inventory in India to run the calcining operations at our Vizag plant, the lack of low-cost petroleum coke for blending resulted in an increase in raw material costs in the third quarter, and that will continue into the fourth quarter, since the next delivery of low-cost petroleum coke will not arrive for several weeks," Sweeney said.
The import ban in India also had a cascading effect on production at other Rain Carbon facilities. "Since we could not import CPC from our U.S. plants for blending at Vizag, we had to reduce production in the United States due to the reduction in shipments scheduled for India," Sweeney said. "During the next few weeks, we expect our CPC production in India and the United States to normalize. Nonetheless, the impact of the import ban on sales will be seen in our third- and fourth-quarter results."
About Rain Carbon Inc.
Rain Carbon Inc. is a leading vertically integrated global producer of carbon-based and advanced material products that are essential raw materials for staples of everyday life. We operate in two business segments: Carbon and Advanced Materials. Our Carbon business segment converts the by-products of oil refining and steel production into high-value, carbon-based products that are critical raw materials for the aluminum, graphite electrode, carbon black, wood preservation, titanium dioxide, refractory and several other global industries. Our Advanced Materials business segment extends the value chain of our carbon processing through the innovative downstream transformation of a portion of our carbon output, petrochemicals and other raw materials into high-value, eco-friendly and advanced-material products that are critical raw materials for the specialty chemicals, coatings, construction, automotive, petroleum and several other global industries. For more information, visit www.raincarbon.com.
The information contained in this announcement contains forward-looking statements, estimates and projections. These statements involve elements of subjective judgment and analysis and are based upon the best judgment of Rain Carbon Inc. as of the date of this announcement. These statements are subject to change without notice and are based on a number of assumptions and entail known and unknown risks and uncertainties, as there are a variety of factors that may cause actual results and developments to differ materially from any future results and developments expressed or implied by such forward-looking statements. Therefore, you should not rely on these forward-looking statements. Neither Rain Carbon Inc. nor any other person gives any undertaking to update these forward-looking statements for events or circumstances that occur subsequent to the date of this announcement or to update or keep current any of the information contained herein, except to the extent required by law.
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