Chexpress - August 8, 2011

North America

Dropping out of Joint Venture

BASF Corp. and Total Petrochemicals USA Inc. have said that Shell Chemical LP is dropping out of Sabina Petrochemicals LLC, a joint venture that owns a chemical plant in Port Arthur, Texas. Shell’s exit leaves BASF operating the plant with a 60 percent share with Total with a 40 percent share. Terms of Shell’s exit were not disclosed. The plant extracts chemicals to make rubber and plastics as well as alkylate.

New Plant

Olin Chlor Alkali Products has broken ground on a new manufacturing facility in Charleston, Tennessee valued at $160 million that will allow the company to produce chlorine, caustic soda and other products without mercury. The new facility will expand the plant’s production of potassium hydroxide.

Injury

A tanker truck loaded with 6,000 gallons of hydrogen exploded and burned at the Duferco Farrell Corp. plant in Farrell, Pennsylvania. The driver was burned, another work was injured and there was a threat to an even larger storage tank. The truck from Air Liquide was at the plant offloading its hydrogen into a storage tank when the explosion occurred. The tanker then burned, endangering a storage tank that contained 12,000 to 14,000 gallons of hydrogen. Plant workers were evacuated without incident and overnight production shifts were canceled. The plant has since reopened and is operating normally.

Consolidation

BASF will consolidate the production of polyacrylamide (PAM) beads into its Bradford, Great Britain facility where the company operates a backward integrated production plant with worldwide supply capability. Investments will be made to increase and upgrade the bead capacity at the Bradford site to ensure a consistent supply of PAM beads to BASF’s customers globally. As a result, BASF intends to close down its PAM bead production unit in Suffolk, Virginia, effective January 2012. Other production activities are not affected by the shift in production. About 50 BASF employees will be affected.

World

New PET Facility

BP has entered into agreements with JBF RAK LLC under which JBF RAK LLC is to build a new 390,000 ton/year polyethylene terephthalate (PET) production unit in Geel, Belgium. The agreement is subject to required approvals. JBF RAK LLC will have the rights to build and operate this PET unit on BP’s existing petrochemicals complex in Geel, adjacent to BP’s purified terephthalic acid (PTA) facility. BP will in return supply PTA directly to the new PET manufacturing unit, which is scheduled to start up in 2014.

PDH Unit

UOP LLC has been selected by Zhejiang Julong Petrochemical Co. Ltd. (ZJLPC) to provide key technology for a new unit to produce propylene at its facility in Pinghu City, China. UOP will provide engineering design, technology licensing, catalysts, absorbents, equipment, staff training and technical service for the project. The unit is expected to start up in 2013 and to produce 450,000 tons of propylene/year.

Inspection after Fires

Formosa Petrochemicals Corporation has closed down part of its Mailiao refinery complex in Taiwan for the first of a series of inspections after seven accidents over the past year have raised concerns over safety. The company must hire an internationally recognized inspector to study the causes of the incidents that threaten workers’ health and the public.

Production Increase

BASF will substantially expand the production plant for the insulation material Styrodur C at its Ludwigshafen, Germany site. This will increase the production capacity of the extruded polystyrene rigid foam panels (XPS) from the current 1.3 million m3 cubed by an additional 220,000 m3. In the extended plant, the new XPS stypes Styrodur Neo and Styrodur HT will be manufactured along with standard products. Operation is expected to begin at the end of 2011.

Renewable Polymers

Amyris, Inc. has signed a collaboration agreement with Kuraray Co., Ltd. to develop innovative polymers from Biofene, a renewable hydrocarbon building block made using Amyris’ technology. Under the agreement, Kuraray will use Biofene to replace petroleum-derived feedstock in the production of specified classes of high-performing polymers. After successful completion of the technical development program for the first polymer, Amyris and Kuraray will enter into a supply agreement for Kuraray’s exclusive use of Biofene in the manufacturing and commercialization of these polymer products.

Contract Won

Essar Projects (EPL) has secured an engineering, procurement and construction contract worth $320 million from Jurong Aromatics Corporation. The contract will be a part of the $2.4-billion aromatics complex in Jurong Island, Singapore. EPL will construct storage tanks, jetties with loading and unloading arms, and pipeline systems for the aromatics complex. The project will be executed by a subsidiary company of EPL in Singapore and is scheduled to be completed by December 2013.

Acquisition

Braskem has acquired the Polypropylene Business from The Dow Chemical Company for $323 million. This transaction is an important step in Braskem’s growth strategy in the Americas and consolidates its polypropylene leadership in the U.S. In addition, the two companies will continue to evaluate future collaborations on growth opportunities in connection with their strategies. The deal’s assets include two manufacturing plants in the U.S. and two in Germany with a total annual polypropylene production capacity of 2.3 billion pounds. The plants are located in Freeport, Texas; Seadrift, Texas; Wesseling, Germany; and Schkopau, Germany. The transaction is expected to close by the third quarter 2011 pending regulatory approvals.