AMERICAS
Nova starts petrochemical utilization of Marcellus shale
NOVA Chemicals has started the consumption of ethane sourced from Marcellus Shale Basin at its Corunna, Ontario cracker. NOVA initiated the consumption of the new feedstock in late December 2013, as a part of the project to revamp its Corunna, Ontario cracker to utilize up to 100% natural gas feedstock.
Comments: Marcellus is the largest shale gas player in N. America with over 50% of all US shale gas reserves. With NOVA 2020 growth strategy in place, more NGL will be used by Nova to gain the advantaged feedstock. This is significant as about 80% of the polyethylene cost comes from feedstock cost. It is also important to take advantage of the feedstock advantage at this early stage as more crackers will come along (over 10 million tons of new cracker capacity before 2017 has been announced) and it is a matter of time before the profit margin will be impacted by the abundant supply of polyethylene in N.A.
Third Point buys stake in Dow Chemical
Hedge fund Third Point LLC has taken a stake in Dow Chemical with an investment of about USD 1.3 billion. Third Point LLC has suggested Dow consider spinning off its petrochemical businesses. A spinoff of petrochemical operations would include performance plastics, performance materials, and feedstock-and-energy units which accounted for over 65% of Dow’s revenue.
Comments: Commodity product companies such as polyolefin producers often try to steer away from commodity products and move towards specialty products or differentiated commodities to increase profit. Specialty products are supposed to have higher margins and less cyclicality. However, cyclicality may not be a bad thing if the timing is right. In the past few years, all the commodity product companies such as Westlake, Formosa, etc. have been able to capture the benefits of cheaper ethylene prices (due to cheaper shale gas availability) as the polymer price remains more or less the same. It is a matter of time before polyethylene prices will be driven down by the abundant supply and the export market will be the battleground.
Otech Corp adds PP-EPDM compounds to automotive line
Otech Corp. has added two polypropylene/EPDM materials to its range of vehicle compounds. One of the new compounds features excellent temperature resistance and can withstand stress, and high-speed conditions. The other material is a wire-reinforced ductile hose material with improved processability, designed for under––hood applications.
Comments: The automotive industry has continued to develop grades with better performance properties, especially for under-the-hood applications for higher heat resistance. Having grades with EPDM and PP will give a cost advantage as most heat-resistant polymers demand higher premiums. The other advantage is that it is in the direction that the automotive industry is heading towards- making parts that are mainly polypropylene based on recyclability.
Odebrecht buys Sabic’s West Virginia site
Odebrecht has closed the acquisition of Sabic’s site in Washington, West Virginia, for about USD 11 million. Odebrecht is exploring the possibility of an ethane cracker and three polyethylene plants in West Virginia.
SBS copolymer is used to toughen roadways in New York City
Kraton Polymers Inc., supplied styrene-butadiene-styrene block copolymer to asphalt producer NuStar Asphalt LLC, to help make road asphalt more durable in a resurfacing project in New York. Besides, ensuring a smoother ride for the vehicles on the road, the enhanced asphalt will also extend the life of New York’s streets and protect the city’s underground utility infrastructure.
Comments: Asphalt without any modification for road pavement behaves as a hard and brittle material at low temperatures and a soft and waxy material at higher temperatures resulting in pavement rutting as a result of trucks and cars usage causing fatigue in the asphalt and progressively destroying its elasticity. The addition of SBS to asphalt provides better performance properties by providing elasticity, tensile strength, and temperature stability in addition to cohesive strength.
EUROPE
Müller Kunststoffe to expand TPE capacity
Müller Kunststoffe, a part of the Hexpol TPE group, plans to increase production capacity for thermoplastic elastomers (TPE) and extend its technical center in Germany. The new TPE line is expected to come on-stream in the first quarter of this year and would increase the capacity by 4.8 KTA. The new line will increase the capacities for Lifoflex and Dryflex TPE compounds. With the new line, Hexpol TPE’s overall capacity will increase to 65 KTA.
Comments: The expansion of both Lifoflex and Dryflex TPE lines is based on styrenic Block copolymer products namely SBS, SEBS, and SEPS. These materials are often compounded with polypropylene to provide strength and stiffness for several applications. These compounds have a wide range of shore A hardness and so can be consumed in a range of applications from grips, where the soft feel is an important property, to harder applications, where the material should provide impact resistance. Over the last decade, due to continued demand for higher product performance, more consumer goods with better properties such as grips are being manufactured which has resulted in a higher demand for these elastomers.
Total evaluates injection stretch molding with HDPE
Total has evaluated using HDPE in an injection stretch blow molding process as a low-cost alternative for bottle producers. Total collaborated with Husky and Sidel to evaluate the technical validation and cost modeling for the HDPE SB 1359 resin for ISBM processing. Bottles produced using the injection stretch blow molding process and the extrusion blow molding processes were compared. Results showed that the injection stretch blow molding process yields at least 15% cost savings.
Comments: The converting industry has continued to find innovative ways to cut costs. They have achieved this by reducing energy costs, lowering resin consumption, and by increasing output with faster and more efficient machinery. With their new system, it seems Total, Sidel, and Husky are able to achieve significant financial savings.
MIDDLE EAST & AFRICA
Sasol debottlenecks South Africa polyethylene plant
Sasol has inaugurated an ethylene purification unit at the Sasol Polymers plant in Sasolburg, South Africa. The new unit will enable Sasol to produce an additional 47 KTA of polyethylene. Sasol is expected to produce about 23 KT of the additional capacity within the next six months and the plant is expected to reach full capacity by 2017.
Comments: Sasol has both LDPE (both tube and autoclave) and LLDPE (Unipol) productions. The debottlenecking project will alleviate the domestic growing demand for polyethylene. Sasol is currently embarking on two mega projects (totaling $16-21 billion) in Westlake, LA area: an ethane cracker and a GTL facility) to take advantage of the economical shale gas availability in N.
A.
ASIA PACIFIC
Vung Ro Petroleum chooses Ineos PP technology
Vietnam’s Vung Ro Petroleum has selected Innovene polypropylene technology for a 900 KTA plant. The plant will be built at the Hoa Tam industrial zone in the Dong Hoa district of Vietnam. The facility would produce PP homopolymers, random and impact copolymers. Vung Ro is building a USD 4 billion refinery and petrochemical complex which is scheduled to stream in 2018.
Comments: Vietnam is considered a high-potential growth area with a strong labor force but low-cost labor. With a population of about 90 million and a healthy GDP annual growth rate of about 6%, many companies have started investing in Vietnam in a wide range of businesses. The Innovene PP technology is a plug-flow horizontal stirred reactor and is supposed to produce high-quality homogenous impact copolymers suitable for automotive and appliance applications. There will be more news pertaining to Vietnam in the petrochemical area in the months ahead.
Two petrochemical plants in China select Honeywell UOP technology
China’s Shandong Huachao Chemical Co and Zibo Qiziang Tengda Chemical Co. Ltd. have selected UOP’s process technology for their plants. Shandong Huachao Chemical Co will use UOP C(4) Oleflex ™ process to produce isobutylene. Zibo Qixiang Tengda Chemical Co. Ltd. will use the UOP Butamer ™ process to convert normal butane to isobutane and UOP’s C(3) /C(4) Oleflex process to convert isobutane to isobutylene and propane to propylene. The Shandong Huachao facility will process 200 KTA of isobutane and the Zibo Qixiang Tengda facility will process 400 KTA of propane and butane feedstock. Both companies are located in the Shandong Province on China’s east coast.
Comments: China’s growth has spurred an increased demand for high-value petrochemicals such as isobutylene which is used in fuels and synthetic rubber. The Shandong Huachao project will be the sixth C4 Oleflex unit in China, and the Zibo Qixiang Tengda project is the third combined C3/C4 Oleflex license that UOP has been awarded. The UOP Oleflex process converts propane to propylene and isobutane to isobutylene using catalytic dehydrogenation. In the last three years, UOP has licensed technology to produce over 8,000 KTA KTAsthese key petrochemicals globally, including more than 5,400 KTA in China. To date, UOP has commissioned 77 Butamer units to convert normal butane to isobutane and two Butamer units to convert isobutane to normal butane.
Indian Oil to expand petrochemical business
Indian Oil plans to undertake projects to expand its petrochemical business. A final investment decision on a polypropylene investment at Paradip is expected in the coming months. The PP project will include two 350 KTA lines based on LyondellBasell’s Spheripol technology and is expected to come on-son stream by the end of 2016. Indian Oil is also planning an ethylene project, based on the Lummus process, with a capacity of 250-300 KTA. The project is expected to be completed in 2018. Indian Oil is also studying several projects based on ethylene. Besides these, Indian Oil is also investing at its Koyali, Gujarat site in acrylic acid and esters.
Comments: These are rather aggressive plans to beef up India Oil’s presence in the petrochemical arena. India certainly can use more of its polyolefins considering its population of 1.2 billion. When materialized Indian oil will be a major player in India’s petrochemical industry along with RaliRelianceIL and Haldia. Currently in, India the PP supply is sufficient for domestic use but PE is still in shortage and relies on imported resins.
China’s first PDH plant starts production
Tianjin Bohua Petrochemical has started production at its propane dehydrogenation unit in Tianjin, China. The 600 KT unit is the first of its kind in China and uses Clariant’s Catofin process and catalyst, licensed by CB&I. The Bohua unit has exceeded nameplate capacity in the first month of operation.
Comments: With the increasing demand for polypropylene and other downstream propylene products, producers in China announced several propane dehydrogenation projects in 2010-2011. About 4,600 KTA of propylene capacity is expected to come on-stream in China in 2013-2014. The feedstock for these plants has to be imported as China does not have sufficient propane supply. So far, Clariant’s CATOFIN technology has 34 licenses worldwide and is in operation in 12 units.
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