Chexpress - October 4, 2011

North America

Supply Crimp

Exxon Mobil Corp.’s Shute Creek Gas Plant in western Wyoming separates helium from natural gas pumped out of nearby wells and is the world’s largest helium factory, producing more than 20 percent of U.S. helium. Recent maintenance at the plant took longer than expected – about six weeks instead of four. The shutdown has ended and the production of helium has resumed, however the shutdown did cause a significant shortage in helium supply.

Plant Expansion

Air Liquide Industrial U.S. LP has broken ground on a new nitrogen liquefier at its air separation plant Cleburne, Texas. The additional liquefier, scheduled to begin commercial production in the third quarter of 2012, will enable Air Liquide to nearly double its supply of industrial gases from the facility in Cleburne to the Texas and Oklahoma merchant markets.

New Plant

ExxonMobil Chemical will build a facility to manufacturing its metallocene polyalphaolefins (mPAO) synthetic lubricant base stocks at its integrated refining and chemical complex in Baytown, Texas. The facility will have the capacity to produce 50,000 tons/year of high-viscosity (Hi-Vis) SpectraSyn Elite MPAO. Engineering, procurement and construction activities for the new facility have begun, and completion is expected in 2013.

World

Fine

Halliburton Co. must pay Barracuda & Caratinga Leasing Co. $200 million related to a claim Barracuda filed against a former Hallibruton subsidiary, as a result of an arbitration panel ruling. Before KBR Inc. was spun off from Halliburton in 2007, it had a contract with Barracuda & Caratinga for the development of the Barracuda and Caratinga oil fields off the coast of Brazil. Barracuda & Caratinga later claimed that certain sub-sea bolts used in the project were defective and the arbitration panel ruled that KBR is liable for the cost of replacing the bolts. Halliburton is pursing a ruling appeal. When Halliburton and KBR split, Halliburton agreed to pay all of the costs and expenses, cash settlements, or cash arbitration awards related to the replacement of the blots.

Gas Chemicals Center

Gazprom will invest 80 billion rubles in the construction of a gas chemicals center in Bashkortostan, Bashkir. The project has already begun. The first phase, from 2012 to 2013, will be to expand existing production of ethylene to 380,000 tons/year and increasing low pressure polyethylene production to 200,000 tons/year. The second phase, in 2018, will see construction of an installation with 600,000 ton capacity ethylene.

Sale

BASF has signed a contract with EuroChem to sell its fertilizer activities in Antwerp, Belgium. BASF also plans to sell its 50 percent share of the joint venture PEC-Rhin in Ottmarsheim, France to EuroChem. The total transaction value is expected to be approximately EUR 700 million. The divestments are subject to approval by the appropriate antitrust authorities. BASF plans to complete the transactions by the end of the first quarter of 2012.

POM Plant

Celanese Corp. opened its polyoxymethylene (POM) production facility in Frankfurt Hoechst Industrial Park, Germany. With a capacity of 140,000 tons/year, the new manufacturing facility is expected to meet the increased global demand for innovative specialty solutions in polymer-based products.

Air Separation Unit

Air Products will build, own and operate an air separation unit (ASU) and liquefier in the Nanjing Chemicals Industrial park in Nanjing, China. Air Products has won a long-term contract to supply oxygen and nitrogen to Wison (Nanjing) Clean Energy Ltd., Inc.’s coal to syngas gasification facility in Nanjing. Air Products will also operate a liquefier and increase argon production to supply the growing regional merchant liquid industrial gas market. The new operations are to be commercial in 2013. The new ASU will produce more than 1,500 tons/day of gaseous oxygen and more than 1,900 tons/day of gaseous nitrogen. The liquefier will more than tripe Air Products’ current production of liquid oxygen and liquid nitrogen, and argon production will be increased by more than 40 percent for the merchant market in the region.

Expansion

Lanxess is investing EUR 12 million to convert 50 percent of its ethylene propylene diene monomer (EPDM) synthetic rubber production in Geleen, the Netherlands, to Keltan ACE technology. During 2013, the new technology will be implemented at the largest three production lines, which account for half of the total production capacity of 160,000 metric tons/year in Geleen. Compared with conventional production processes, Keltan ACE technology reduces energy requirements for rubber production and it does not require catalyst extraction as a result of high catalyst efficiency. The process also enables the manufacture of new EPDM rubber grades. In addition, Lanxess will setup new headquarters in Geleen for its global EPDM Rubber business. The building for up to 120 employees will be constructed on the chemical industrial site in Chemelot. Construction will start in the spring of 2012 and inauguration is planned for the beginning of 2013.

Joint Venture

Grupo Kuo SAB has agreed to form a joint venture with China’s Jiangsu GPRO Group Co. Ltd. to build a synthetic rubber plant in China. The two companies will jointly invest $60 million in a new plant in Nanjing, with an initial production capacity of 30,000 metric tons/year. Production is expected to begin in early 2014.