NOVA and BP in agreement with Grace Davison to supply new NOVACAT™T Ziegler-Natta polyethylene catalyst
NOVA Chemicals and BP Petrochemicals announced that they have entered into a long-term supply arrangement with the polyolefin catalyst business of Grace Davison for the manufacture of NOVACAT T advanced Ziegler-Natta catalysts. These catalysts, which are designed for gas-phase polyethylene producers, are available globally for a license from both BP’s Innovene® licensing business and NOVA Chemicals.
Both NOVA Chemicals and BP have implemented NOVACAT T commercially. NOVACAT T provides a stable and flexible operating environment and delivers higher throughput, lower use of additives and co-monomers, and quick transitions to reduce off-grade. The robustness of this high-activity catalyst also increases its resistance to impurities, which extends its productivity.
Comments: NOVA has a very active program whereby promising catalysts developed for the solution process are supported on silica and then tested in the gas phase, as NOVA has a large installed base of Unipol® production technology. Through such research and development activities, NOVA in 2001 announced it would offer to license a successful product from this effort, Novacat® T. Soon thereafter, NOVA agreed with BP to license the technology to Innovene licenses. It was anticipated that Grace Davison would be the toll manufacturer for this catalyst. Since its development, NOVACAT T has been successfully implemented at the NOVA gas-phase facilities and BP’s facilities in Grangemouth. The catalyst provides stable activity, excellent flowability downstream of the reactor, and the capability to produce enhanced LLDPE products. For NOVA, the NOVACAT T provides internal operational benefits and increased revenues from licensing opportunities. For BP, it provides an enhancement to its current catalyst offering to Innovene licensees including SDX and ENERGX.
PetroChina selects Basell’s Hostalen technology for new 300 KT HDPE plant
PetroChina Company announced the signing of an agreement to use Basell’s Hostalen technology for a new 300 KT per year high-density polyethylene plant in Jilin, the People’s Republic of China.
This is the first license in China for the bimodal Hostalen HDPE process. Uhde GmbH of Germany was selected as the engineering contractor for the new plant.
PetroChina is the largest integrated oil and gas producer in China and is engaged in refining and the production and sale of chemical products. This is the sixth license for a Basell technology that PetroChina has signed in the past two years. The others are two 200 KT per year Lupotech T process low-density polyethylene (LDPE) plants and three Spheripol process polypropylene plants with a total capacity of 800 KT per year.
Comments: Basell continues to make inroads into the Chinese polyolefins industry via process & catalysts technology licensing programs. One of the key reasons for its success has been the ability to offer a host of different technology platforms ranging from gas-phase PE & PP to slurry-phase PE to high-pressure LDPE.
The Hostalen technology seems well suited for the Chinese market due to its ability to satisfy the demand for bimodal HDPE products including film (i.e., T-shirt bags, packaging, etc.), blow molding (bottles, HIC), and pipe grade resin. China is currently heavily dependent on imported HDPE resins to satisfy its needs and continues to strive to increase its self-sufficiency rates.
London Metal Exchange to launch futures contracts for PP & LLDPE
The London Metal Exchange (LME) announced its plans to launch futures contracts for both polypropylene and linear low-density polyethylene by the end of 2004.
According to LME, if the two initial contracts are successful, the exchange would look to follow them up “at some stage in 2005” with contracts for both low-density and high-density polyethylene and would look at the possibility of a bottle-grade PET contract.
The specifications will be a general-purpose injection molding grade PP (with no additives) and general-purpose film/blending grade LLDPE (with slip and anti-block additives).
Both polymers will be traded on a 24-hour basis but, as with metals, the LME will establish an “official price” once a day. This will take place at 16.00 UK time at the end of open outcry trading in the LME’s ring. This price can then be used by anyone in the industry as a benchmark.
Comments: London Metal Exchange announced its plans to launch plastics futures contracts in Nov. 2003. LME executives were researching all polyolefins and now have decided to first launch PP and LLDPE contracts. The exchange finds similarities between plastics and metals traded such as aluminum.
There is significant volatility in raw material pricing and hence a lack of a solid pricing methodology. Futures are a simple mechanism that has been used in other markets to insulate producers and consumers from the adverse effects of price volatility on their margins.
The factors that make plastics attractive for commodity trading include (1) volumes, (2) quarterly contracts, (3) extensive capacity disruptions, and (4) a large number of buyers. The factors that make them unattractive to commodity exchanges include: (1) lack of product standardization, (2) high TS&D content, (3) differentiated products based on the company name, reputation, and technology and (4) designed applications and reluctance to switch grades. These factors mentioned above made virgin polymers unattractive to e-Commerce and e-commerce was attractive only for recycled plastics. The Chicago Mercantile Exchange attempted a similar approach and failed. Invariably, London Metal Exchange’s approach will have to overcome all of the problems from previous attempts.
Atofina develops new multilayer structure for low permeability fuel tanks
Atofina announced its plans to jointly develop a new multilayer structure specifically for the manufacture of fuel tanks that comply with California’s stringent “partial zero emissions vehicle” (PZEV) regulations. The company will work with fuel systems manufacturer TI Automotive to develop the product.
This six-layer structure includes Finathene™ high-density polyethylene, a recycled layer, Orevac® resin tie layers, Soarnol® ethylene vinyl alcohol copolymer (EVOH), and Orgalloy® polyamide alloy. The benefit of this patented multilayer structure is its very low permeability, which significantly reduces emissions of gasoline fumes, minimizing air pollution.
ATOFINA’s high-density Finathene MS 201 B polyethylene for monolayer and co-extruded plastic tanks is used as the outer layer in this particular structure to impart processing ease as well as impact resistance at low temperatures (down to -40°C) and stress cracking resistance.
The new structure combines two barrier layers, an intermediate layer of Soarnol EVOH and a core layer of Orgalloy polyamide alloy. In addition to excellent barrier properties, Orgalloy FT 104 polyamide alloy is well suited to the conventional extrusion blowing molding of tanks, using standard production tools. In addition, the chemical and thermal stability of Orgalloy FT 104 makes it highly suitable for continuous contact with fuel.
Orevac resin, a polyolefin grafted with maleic anhydride, is the tie layer bonding the three incompatible polymers within the structure without affecting any of their properties. By using this multiplayer structure, ATOFINA’s partner, TI Automotive has successfully developed and patented the PERMBLOK® AS6 plastic fuel tank, the first of its kind to comply with the PZEV regulations.
Comments: Plastics have replaced steel as the material of choice in automotive fuel tank applications. The main driver for this material substitution is to utilize the substantial reduction in weight by switching to plastics, thereby making their cars more fuel-efficient and complying with the stringent environmental regulations concerning hydrocarbon emission.
Plastic fuel tanks are produced via a multi-layer blow molding process which uses both virgin and reground HDPE. The barrier material of ethylene vinyl alcohol (EVOH) is used to achieve the permeability requirements allowing for an important reduction in polluting hydrocarbon emissions from the fuel tank. With more stringent emission requirements pending, most manufacturers see multilayer (5 to 6 layers) tank technology as the answer to the regulations. Typical structures in this market include HDPE (with carbon black) / Regrind HDPE / Tie layer / EVOH / Tie layer / HDPE (virgin).
These tanks are designed to meet California’s stricter evaporative fuel standards and consist of an inner layer of HDPE joined by an adhesive layer and a barrier layer of polyamide or ethylene-vinyl alcohol copolymer. An additional adhesive layer is joined by a layer of “regrind” and an outer layer of HDPE.
Weight reduction is the major advantage offered by the plastic fuel tank. The fuel tanks, still cannot be recycled because of the multi-layered structures.
Degussa to increase APAO capacity
Degussa announced its plans to will increase the production capacity for VESTOPLAST, amorphous poly-alpha-olefin (APAO). In addition to the three existing production lines at the Marl site, the business unit is planning a fourth line to increase the current capacity of 55,000 metric tons to approximately 75,000 metric tons. The investment of a double-digit million euro figure strengthens the global market position of the product group. The new plant is scheduled to go into operation in 2005.
Comments: Degussa is one of the few players in the world which manufactures on purposes APP or APAO. The company has all its manufacturing plants in Europe and imports its product into the United States.
APAO’s major application includes (1) modified bitumen roofing, (2) adhesives and sealants, (3) paper laminations, (4) wire & cable, (5) carpet tiles, and (6) asphalt pavement modification applications. Roofing application is by far the largest market with a demand of over 50% of the total APP/APAO production. Adhesives and sealants have the second largest consumption of APP/APAO. Globally APP/APAO is growing at 2% and competes with styrenic block copolymers in most applications. The demand for on-purpose APAO has increased in recent years due to reduced production of by-product APP created with the latest technology of polypropylene production.
Lyondell and Millennium announce agreement to combine
Lyondell Chemical Company and Millennium Chemicals Inc. announced that their Boards of Directors have approved, and the companies have executed, a definitive agreement for a stock-for-stock business combination of the companies, expected to be tax-free to the shareholders of Millennium and the companies. The transaction will create North America’s third-largest independent, publicly traded chemical producer with combined pro forma 2003 revenues of more than $11 billion and a market capitalization of nearly $4 billion.
The transaction is subject to customary conditions including approval by both companies’ shareholders and is expected to close in the third quarter of 2004.
After the close of the transaction, the company will be called “Lyondell Chemical Company” and will be headquartered in Houston, Texas. Dan F. Smith will continue as president and chief executive officer, and Dr. William T. Butler will continue as the independent chairman of the Lyondell Board of Directors. Two independent members of Millennium’s current Board will join the Lyondell Board, effective at the time of the closing.
Comments: This is just plain and simple a good deal for both sides. Lyondell has commanding global positions in many of their key products from ethylene (all Basic 6) to derivatives like styrene and propylene oxide and Millennium has the same in titanium oxide (TIO2) and acetyls. Better yet, acetyls use ethylene and much TIO2 goes in polyethylene. More liquidity and cost savings are also apparent.
Millennium & Lyondell together increase this footprint, and for the future, size does matter. Speculations of Lyondell/Equistar being taken over are now even more remote.
Lyondell (a combination of old Arco and Halcon, Equistar (the new name) and Millenium (the old, US Steel, Norchem Geneology – all these groups have a long history of forming ventures that are combinations permutations of their facilities depending on time, technology and market conditions. This new combination of Millennium with Lyondell is essentially a joining of the odds and ends left over from the Equistar formation.
Dow sells Fulcrum Technology to form a new company, Fulcrum Composites Inc.
The Dow Chemical Company announced the divestiture of its technology and business relating to FULCRUM® thermoplastic composite technology for the production of continuous fiber composites using a thermoplastic matrix to a newly formed company, Fulcrum Composites Inc.
The initial FULCRUM technology was developed at The Dow Chemical Company and is a revolutionary pultrusion process using resins manufactured by Dow. The new company, Fulcrum Composites Inc, acquired all physical and intellectual assets of the FULCRUM technology including the manufacturing facilities at the National Composite Center in Dayton, OH; a broad portfolio of patents, trademarks, and commercial agreements.
Chris Edwards, formerly the Dow Business Manager for FULCRUM technology resigned from Dow to become the new CEO of Fulcrum Composites Inc.
Comments: Composites manufactured using FULCRUM technology offer the strength and stiffness of continuous fiber composites together with the design flexibility of being able to thermoform and over-extrude combined with the toughness of a thermoplastic matrix. They offer significant environmental advantages including total recyclability and zero emissions of volatile organic compounds (VOCs) during manufacture.
The typical applications currently applicable being developed for the composites manufactured using this technology include (1) ski-poles, (2) agricultural equipment, (3) structural reinforcement systems, (4) rigging, and tensile elements, (5) tool handles, (6) refrigerator components, (7) ladder rail, (9) sailboat batons, (10) shovel handles, (11) window profiles, (12) fasteners, (13) concrete panel connectors, (14) hammer handles, (15) electrical utility equipment and (16) fuel measurement devices.
BP moves to twin-track strategy for petrochemicals
BP announced its plan to adopt a twin-track strategy and management approach for its petrochemicals segment. The company will approach aromatics and acetyls differently from olefins and derivatives (O&D).
BP outlined key differences in the following areas:
Investment – organic capital expenditure will reduce from around $1bn per annum between 2000 and 2003 to about $750m from 2006. Discretionary spend will be focused on the ‘advantaged’ PTA, paraxylene, and acetyls products with a bias toward the Asia markets. The exceptions will be the completion of the SECCO ethylene cracker development in China and the ongoing ethylene capacity extension at Chocolate Bayou, Texas.
Portfolio – the company will continue to look at all options for performance improvements in its O&D business, and assets that BP believes have a more natural fit with other industry players will be offered for sale. BP also announced that it intends to sell its Fabrics and Fibers division, as well as it’s specialty business manufacturing and marketing linear alpha olefins and poly alpha olefins (LAO/PAO).
Performance improvements – the company’s priorities will be safe operations and improvements in cash returns across all businesses. It will look for efficiencies from simplification, optimization of its operations, reducing complexity in its product grades and offers, and will look for cost savings through further attention to fixed and variable costs. The pressure on returns is particularly strong in the O&D business.
Comments: BP’s petrochemicals segment reported a profit of $606 million in 2003 accounting for 3% of the total profit. The acetyl products of BP include (1) acetic acid, (2) acetic anhydride, (3) vinyl acetate monomer, (4) ethyl acetate, and (5) acetone. In its aromatics division, BP produces xylene, benzene, toluene, and heavy aromatics.
BP holds a dominating position in acetyls and aromatics segments, whereas the growth in the European marketplace is lower where O&D dominates the company’s portfolio. Hence, the company is adopting a twin-track approach to reflect different aspects including (1) growing demand in China, (2) BP’s existing strong position in PTA and acetyls, and (3) lower European growth in olefins & derivatives.
Bayer’s chemical business NewCo to be named “LANXESS”
Bayer AG intends to place a large part of its chemicals business and some activities of Bayer MaterialScience in a new company named “Lanxess”, which will then be floated on the stock market. Since the announcement of the portfolio changes on November 7, 2003, the activities involved in creating and establishing this new company have been performed under the provisional project name of “NewCo”.
The process of establishing the new company is running to schedule. The future management board of Lanxess has been designated and comprises Dr. Axel C. Heitmann (CEO), Matthias Zachert, Dr. Ulrich Koemm, Bruce Olson, and Dr. Martin Wienkenhöver. Shaping the company has largely been completed. This includes all decisions regarding its business and organizational structure, as well as the allocation of personnel. Bayer plans a virtual organization for the activities concerned by July 1, allowing Lanxess to then operate largely as an independent unit and be placed on the stock market by early 2005 at the latest.
Comments: In 2003, under its restructuring program, Bayer Group had decided to combine Bayer Chemicals with certain parts of the polymers business in a new company with the provisional name “NewCo”, and now the company is named “Lanxess”.
Another Unique Service From Chemical Market Resources, Inc. 1120 NASA Parkway, Ste 340, Houston, TX 77058 USA; Tel: 281-333-3313 Email: POE-SNA@CMRHouTex.Com Copyright © 2003 Page 14/28of Issue 7 – Volume 2 Independence from Bayer should provide Lanxess several benefits including (1) efficient utilization of capital resources for the enhancement of its competitiveness, (2) easy to focus management resources on the specific needs of the chemicals business, and activate niche markets utilizing new business models. For more information refer to “Global PO&E – Issue. 24, Vol. 1
ENI to sell its petrochemicals subsidiary and quit chemicals
ENI confirmed its plans to sell its petrochemical operations, Polimeri Europa, and withdraw from the chemicals business.
Polimeri’s styrenic block copolymers unit at Baytown, TX was sold to Lee Chang Yung Chemical Industry (Taipei) in December 2003. ENI plans to sell other businesses of Polimeri including (1) olefins and polyethylene, (2) aromatics, and (3) elastomers. ENI also aims to sell a few and shut the remaining activities of Syndial, another chemical subsidiary of the company, which include caprolactam, acrylonitrile, chloralkali, alpha-methyl styrene, benzene, cumene, ethylene, high-density PE, phenol and rubber.
The sale falls in line with the company’s restructuring and cost-cutting program, to target a minimum annualized savings of EUR390 million from its deteriorating petrochemicals business.
Comments: The petrochemicals division of ENI has been reporting losses in the last 3 years. ENI’s chemical operations comprise Syndial and Polimeri Europa. ENI has put Polimeri Europa for sale since 2002.
In the past, ENI has held talks with SABIC for the sale of Polimeri Europa but failed to sell the subsidiary. The company then put its TPE and five other facilities for sale and was able to sell one of the six units. In 2003, it sold Polimeri Europa’s Baytown unit to Lee Chang Yung. The company changed the name of its chemicals subsidiary to Syndial.
The movements like these from Shell, DSM, and others increasingly brought the actions of chemical companies with oil company parentage. Most oil-parentage chemical companies were started during the high oil prices as a means of downward integration, albeit without proper planning – e.g., Shell Oil’s chemicals division Shell Chemical Company had over 10 different product areas with no synergy.
The new “Oil Company Parents” who entered and/or entered the chemical/petrochemical sector since the 80s, like SABIC, PEMEX, and others should not have these problems because of their careful planning and synergistic planning.
Norsk Hydro discontinues Hydro Polymers divestment process
Norsk Hydro announced its plans to discontinue the process of divesting the Hydro Polymers operation.
Under Hydro ownership, Hydro Polymers can continue focusing on streamlining its operations and completing ongoing investment projects to further strengthen the company’s position in the European vinyl industry.
To further strengthen the business several investment projects are currently ongoing, the main one being the NOK 1 billion expansion of the chlorine plant at Rafnes with production planned to start in 2005.
Comments: Norsk Hydro is involved in three main areas including (1) oil and energy, (2) aluminum, and (3) agriculture. Hydro Polymers, a subsidiary of Norsk Hydro is involved in the manufacture of PVC and caustic soda.
Hydro Polymers has production facilities in Scandinavia and the UK and is a major player European market of polyvinyl chloride (PVC), vinyl chloride monomer (VCM), and caustic soda used primarily in the Nordic pulp and paper industry.
Hydro Polymers has a 50% owned joint venture with Borealis of Noretyl which has an ethylene cracker providing feedstock products used in the production of VCM, polyethylene, and polypropylene. In China, the company has 31.8% ownership of Suzhou Huasu Plastics which produces PVC resin. In Qatar, Hydropolymer has a 29.7% share in the Qatar Vinyl Company producing feedstock chemicals caustic soda, ethylene dichloride (EDC), and vinyl chloride monomer (VCM). In Portugal, it has a 26% share in CIRES manufacturers of both emulsion and suspension PVC resins for the European market.
BASF to move North American headquarters and close EPS facility
BASF announced its plans to move its North American headquarters to Florham Park, NJ from Mount Olive, NJ. The company plans to sell its headquarters in Mount Olive, NJ, given the company only uses about 30 percent of the complex. The move is expected to be complete by the end of the third quarter.
The company also announced its plans to close an expanded polystyrene plant in South Brunswick, NJ by the end of 2004. The company plans to transfer about 200 million pounds of production to a joint venture plant in Altamira, Mexico. South Brunswick was a single-product, single-plant site, whereas Altamira is a multi-plant site that can spread costs over a number of different operations. Both announcements are part of a $250 million North American cost reduction.
Comments: The EPS facility in South Brunswick, NJ uses suspension technology to produce polystyrene through water emulsion. The process has several disadvantages including (1) heavy environmental load and (2) issues containing styrene monomer emulsion. In general, suspension plants have higher operating costs. Mexico plant has a newer line and it is more efficient. They have both bulk polymerization and suspension polymerization and labor costs are much lower.
P&G and Kaneka finalize commercialization of biodegradable plastic, Nodax H
Procter & Gamble (P&G) Chemicals and Kaneka announced the finalizing of a joint agreement to commercialize Nodax H, a biodegradable polyhydroxyalkanoate polymer.
The companies plan to combine resources to complete the development work, including a cost-effective fermentation production process, and improve the processing of the PHBH polymer. The companies will construct a 30,000 MT/year-50,000 MT/year commercial plant depending on the successful completion of development milestones. The companies are considering locations in China, Germany, Italy, Malaysia, the Netherlands, Taiwan, and the UK. Kaneka will work with potential end customers in Asia, and P&G with those in Europe and the Americas.
Comments: Polyhydroxyalkanoates(PHAs) are a group of biologically produced polyesters by fermentation using corn or beet sugar (glucose) as the feedstock. The polymers are grown inside microbes such as Ralstonia eutropha which contain about 70% PHA. The cells are then broken open to harvest the product and the PHA is separated from the biomass.
In 1925, polyhydroxybutyrate (PHB) became the first known PHA, and in the 1970s several other PHAs including (1) polyhydroxyalkanoate, (2) copolymers of 3-hydroxybutyrate and 3-hydroxy valerate (PHBV) were identified. By the 1990s, almost 100 microbial PHAs were known.
Metabolix is another company involved in the manufacture of PHA using the Biopol® process. The Biopol process was commercialized by Imperial Chemical Industries (ICI). The process was then bought by Monsanto in 1996. In 2001, Metabolix purchased the Biopol process from Monsanto.
The company has developed organisms that produce PHA. This has resulted in the elimination of chemical synthesis since the organisms directly produce the actual plastics and not the monomers.
Kaneka holds patents composition of matter and processing patents for the material, poly(3-hydroyxbutyrate-co-3-hydroxyhexanoate) (PHBH). P&G holds patents covering processing and applications.
Proctor & Gamble is the largest consumer product company in the world and is interested in expanding their role in raw materials. Their other recent foray into elastomeric polypropylene with Equistar failed because of a lack of synergy.
Ticona to expand acetal copolymers
Ticona, a subsidiary of Celanese announced its plans to increase production of acetal copolymer at Bishop, TX by roughly 20%, to 102,000 MT/year, by the end of 2004.
Ticona also has a stake in a 60,000-m.t./year joint venture polyacetal facility being built in Shanghai. Its partners in that joint venture include Korea Engineering Plastics; Mitsubishi Gas Chemical; and Polyplastics, a joint venture between Daicel and Ticona. The Shanghai plant is expected to be operational in the second quarter of 2005.
Comments: Ticona produces and markets polyacetal resins under the trade names Celcon®, Hostaform®, and Kematal®. Kematal is an acetal copolymer product. The other North American producers of acetal polymers include DuPont and Ultraform (a joint venture between Degussa and BASF).
The major applications of polyacetals include (1) industrial (gears, cams, bearings, pulleys, levers, and others), (2) automotive, (3) consumer goods, (4) plumbing, (5) electrical/electronics, and others.
Polyacetals mainly compete with nylon and polyester in industrial applications. The main advantage that polyacetals have over nylon include: (1) fatigue resistance and (2) better mechanical properties. In automotive applications, acetals are used in conjunction with nylons for moving window crank parts requiring no lubrication. The total demand for polyacetal resins in North America in 2003 was about 550 million pounds. The demand is expected to grow at about 4% per annum for the next five years.
Alcan Composites to shut down composite board plant
Alcan Composites announced its plans to shut down its Richmond facility. The closure which entailed the elimination of 28 jobs had become inevitable due to the unsustainable competitive position of the Richmond plant.
The Richmond plant produces composite boards of expandable polystyrene sandwiched between paper layers. The merger of the Montreal-based parent company Alcan Inc., with Alusuisse-Lonza, marked the entry of the company into foam boards. End-use applications of these board products include displays, graphic arts, furniture, and construction. The production will move to its Uniwood/Fome-Cor Division of Nevamar Co. LLC., acquired facilities in Glasgow, KY, and Statesville, NC.
Comments: Alcan Inc. formerly acquired the Uniwood/Fome-Cor Division of Nevamar in September 2003. Uniwood/Fome-Cor is one of the largest U.S.-based manufacturers of foam-based display boards. Uniwood/Fome-Cor has its head offices and production facilities in Statesville, North Carolina, and another production site in Glasgow, Kentucky. Uniwood’s expertise is in treating and laminating paper to a polystyrene foam core, the company has been a pioneer in the US decorative composites industry since the 1950s. These foam boards are used as surface material principally in applications such as point-of-purchase displays and signage applications, as well as for certain furniture backing and construction applications.
Alcan Composites offers aluminum composite material and foamboards under the trade names Sintra®/Forex®, Dibond®, Kapa®, and FoamX®.
Uniwood/Fome-Cor offers foam boards under the trade names Gatorfoam® and Fome-Cor®.
Chinese Companies to construct coal-based methanol complex
Chinese firms Heilongjiang Hegang Mining (Harbin, China) and Dalian Huafeng Enterprise Group (Dalian, China) announced their plans to jointly construct a 1.2-million MT/year coal-based methanol plant. The complex will be completed in two phases, with the first 600,000 MT/year of capacity due for completion in two years for Rm2.5 billion ($302 million). The second phase will require an investment of Rm 1.5 billion.
Comments: In the scheme of things, this facility project sized at about 3,500 metric tons per day is only 50% of the current world scale and only 25% of the new giant methanol technologies available from leaders like Starchem.
The China project has a capital of $.75/gal compared to $.50/gal on Starchem. Nonetheless, it looks like the Chinese project will be globally competitive. The issue in a project like this is the use of gasifier technology. There is no agreement on which one is the most reliable. The leading contender today appears to be Shell, not Chevron/Texaco or E Gas. There are several Chevron/Texaco projects already in China but have had operational difficulties which leaves Shell as the major demonstrated technology. Other vendors may disagree with these conclusions but a recent Chinese delegation to Houston is the source of these comments.
Coal-based methanol essentially represents a safe and convenient mode of transporting CH2: Methylene radical (methanol is just a combination of CH2: and H2O). Methylene radical is the basic unit for energy-related hydrocarbons because of the unsaturation and optimum C to H ratio.
Coal-based methanol an alternative to oil and natural gas comes in and out of the limelight depending upon the oil prices and politico-economic conditions. The last time the United States had the highest interest in coal-based methanol was during the 1973 oil crisis.
The recent events related to future needs for propylene and the limits on ethylene crackers have added dimensions to this problem.
Our upcoming conference on GTL technologies will address the issues related to coal-based methanol including others.
Lucite International ready to commercialize novel MMA technology
Lucite International announced that it is ready to commercialize the technology to produce methyl methacrylate (MMA) from ethylene, methanol, and carbon dioxide. According to the company, the process lowers manufacturing costs by 40%, compared with existing technologies based on acetone or isobutylene.
The company claims that the reaction proceeds via a methyl propionate intermediate, operates at mild conditions, has high process yields, and does not involve any toxic or corrosive chemicals. The only waste products are water and heavy esters; the esters are used as fuel in the process, it says.
Lucite will decide on the location for the new plant and the facility will be onstream by 2008.
Comments: Acetone cyanohydrin (ACHCN) is the most significant commercial process technology used in the manufacture of methyl methacrylate (MMA). In this process, acetone & hydrogen cyanide are reacted to produce acetone cyanohydrin. Hydrogen cyanide is a hazardous chemical to deal with has prompted most manufacturers of MMA to pursue alternative manufacturing technology.
The alternate technologies include (1) the ethylene route, (2) the propylene route, and (3) the isobutylene route. Ethylene-based technologies are characterized by a combination of an ethylene carbonylation or hydroformylation step with a condensation reaction resulting in a carbonyl compound. Propylene-based technologies involve a carbonylation of propylene or an allyl derivative followed by a dehydrogenation step to obtain the methacrylic acid.
Lucite International and Kvaerner have developed a new technology called Alpha, to produce methyl methacrylate (MMA) from ethylene in two reaction steps. The process is claimed to avoid the environmental problems of the conventional acetone-cyanohydrin route, which involve handling highly toxic hydrogen cyanide and disposing of large amounts of ammonium bisulfate by-product. In addition, the Alpha technology uses only commodity feedstocks-ethylene is reacted with methanol and carbon monoxide to form methyl propionate, which is then reacted with formaldehyde to yield MMA and water. Lucite has a fully integrated pilot plant of the process at Teesside, England.
Crompton pleads guilty to price fixing of rubber chemicals in the US and Canada & pays $57 million in fine
Crompton Corporation entered an agreement to plead guilty to participating in a conspiracy to suppress and eliminate competition by manipulating the price of certain rubber chemicals sold in the United States during the period 1995 to 2001. The company will be required to pay $50 million in fines. This recommendation to the court was an outcome of the antitrust investigation of the company by the Department of Justice (DOJ). A similar agreement was reached by the company with the Attorney General of Canada, where Crompton pleaded guilty to conspiring to narrow competition unduly in the sale of rubber chemicals in Canada. In this case, a fine of U.S. $7 million has been jointly recommended to the court by the Attorney General and the company. The company is also being investigated by the European Commission for similar reasons.
Crompton is cooperating and has assured conditional amnesty with competition authorities in the US, Canada, and the European Union that have opened an investigation into possible collusive behavior by manufacturers of urethane and urethane chemicals. The company’s internal investigation resulted in strengthening its training and compliance programs and taking appropriate personnel actions. Crompton has also rewritten its code of business conduct and ethics to be more comprehensive.
Comments: No Comments – Just watch the events unfold!
International Specialty Products to increase emulsion styrene butadiene rubber capacity
International Specialty Products (ISP) announced its plans to increase the capacity for hot-polymerized emulsion styrene butadiene rubber (ESBR) at Port Neches, TX by 50% by the end of 2004.
According to the company, it has made substantial capital investments to raise overall manufacturing standards, improve hot and cold emulsion product quality, and increase its cost position.
Comments: B In 2003, ISP bought the emulsion SBR facility located in Port Neches, TX from Ameripol Synpol.
The North American producers of emulsion-SBR include (1) ISP, (2) DSM, and (3) Goodyear Tire & Rubber. The main difference between emulsion & solution SBR is in the linearity and molecular weight distribution of the molecular chain and microstructure.
BASF considers switching oxo-alcohols production from propylene-based to C4-based products at Pasadena, TX
BASF announced its plans to switch its oxo-alcohols production at Pasadena, TX from propylene-based to C4-based products. BASF currently produces 2-ethyl hexanol (2-EH) using propylene at the facility.
Upon conversion to C4-based oxo alcohols, the company will have the capability to produce oxo-alcohols such as isononyl alcohol and/or 2-propyl heptanol.
According to the company, it would also allow to reduce the production costs compared to BASF’s C7, C9, and C11 linear plasticizers. The company plans to continue 2-EH production for DOP from a propylene-based oxo-alcohols complex at Freeport, TX.
Comments: BASF acquired the Pasadena, TX facility as a result of the acquisition of Sunoco’s plasticizers business. The facility also produces phthalic anhydride. The switch to C4-based oxo-alcohols will enable BASF to produce C9 diisononyl phthalate (DINP) and C10 dipropyl heptyl phthalate (DPHP) plasticizers. The addition of C9 and C10-based plasticizers will enhance BASF’s product portfolio of plasticizers ranging from linear phthalates, DOP, DINP, DPHP, and specialty plasticizers. Sterling Chemical Toll produces linear phthalates for BASF at Texas City, and Sunoco Toll produces plasticizers for BASF at its facility in Neville Island, PA.
Fire at BP Amoco’s Houston refinery
A huge fire was sparked by several explosions at the BP Amoco Texas City refinery, the largest of BP’s four refineries, with a capacity to refine 435,000 barrels of crude oil per day. The fire was detected to have started in a furnace and was reported to be fueled by naphtha. A decontamination area was set up as a precaution against the release of any dangerous chemicals into the atmosphere. Neighboring plants were evacuated and a shelter-in-place was put in effect.
Comments: BP fire impacted U.S. refinery operations and gasoline prices temporarily. The Texas City/La Marque facility is less than five miles from our offices.
Lego to eliminate 170 jobs under its restructuring program
Lego announced its plans to cut 170 jobs in the next few weeks, primarily in Denmark, and another 330 jobs by 2006, from its current workforce of 8000. This elimination would be a part of the restructuring and cost-reducing program adopted by the firm to deal with the 25% slide in sales and $164.7 million loss in 2003. With the program focusing on non-production aspects, the top management was condensed from 14 to nine.
The firm is to spin off its electronic game ventures and focus on story-based offshoots like Star Wars and Lego Harry Potter, besides their core businesses. Lego aims to regain its market share and sales in 2004 by speeding up development lead times, forging closer links with retailers, and promoting its brand names. The firm is also to simplify its global infrastructure with regional hubs in Enfield, Baar, Switzerland, and Tokyo.
Comments: Danish toy maker, Lego has been reporting loss over the last two years. The company has been losing market share in construction toys to Mega Bloks. Mega Bloks, the biggest rival of Lego, reported an increase in sales by 16% and profit by 43% to US $28.8 million in 2003.
PVC is the choice material for Lego because of its colorability.
Women drop the appeal of Dow Corning silicone breast implant settlement plan
A major obstacle to Dow Corning Corp.’s plan to settle with women who claim silicone breast implants made them sick appeared resolved following a decision by a group of Nevada women to drop their appeal.
Dow Corning was forced into bankruptcy in 1995 after thousands of women filed claims that implants made by the company damaged their health.
Dow Corning said it would pay plaintiffs $1,000-$200,000, depending on their medical condition. The Nevada suit was the last major tort case that was preventing the breast implant recipients from receiving their payments. The women argued that because the state’s Supreme Court had upheld a jury verdict against Dow Chemical in 1999, they should retain the right to sue Dow Corning’s shareholders.
Comments: Silicone became the main material used in breast implants for plastic surgery or reconstruction after breast cancer surgery in 1960. In the 1990s, the US news media published reports about serious health problems linked to the implants. In the next two years, thousands of people with implants filed suit against Dow Corning Corp. In Jan. 1992, the federal Food and Drug Administration banned all but limited use, under careful studies, of silicone breast implants. This led Dow Corning to file for bankruptcy in 1995. In June 1999, thousands of lawsuits were consolidated against Dow Corning as part of the bankruptcy case.
Also, a report from the Institute of Medicine, reviewing about 3,000 implant studies, concluded that there was insufficient evidence to prove that silicone breast implants cause serious diseases. But it also found that one in four women needs repeated surgeries to fix or remove implants and that implants can block mammogram pictures, a serious issue for breast cancer patients.
Popcorn worker in Missouri awarded $20 million US in lung damage lawsuit
A factory worker who claimed his lungs were ruined as a result of mixing flavoring oils used in microwave popcorn was awarded $20 million US by a jury in Missouri.
International Flavors & Fragrances and its subsidiary Bush Boake Allen were ordered to pay $18 million to Eric Peoples and $2 million to his wife for compensatory personal injury damages of $20 million.
Eric Peoples was the first of 30 former workers at the Gilster-Mary Lee Corp. plant in Jasper to have his suit heard against the two makers of the butter flavoring.
Comments: This case has far-reaching consequences for the future of the chemical industry.
The chemical and plastics industries are busy developing new products without mentally assessing the long-term impacts for the sake of immediate profits and stockholder value maximization. The Tris (Thalidomide Babies) case, Asbestos, Silicone implants, and Dioxine, are some of the classic examples of the long-term consequences to the chemical companies. Yes, the companies can wipe the slate clean in some cases (like Occidental – by changing its name from Hooker to Occidental), but it is always better to plan for the whole life cycle of the product so we would not be caught again.
The major concern – plastic bags – The advanced nations have a fairly decent method of gathering and disposing of used plastic bags. The developing countries, imitating plastic bag usage have no plans or ideas on how to dispose of garbage plastic bags. It is still the responsibility of the plastics industry to address these issues while we are ahead.
Need dare devils that can pick up the polyethylene bags left scattered on the rainforest canopies, by Greenpeace timber industry protesters – Any volunteers?
Contact us at ADI Chemical Market Resources to learn how we can help.