Four trends to watch in chemicals: South-East Asia, the Middle East, bio-based chemicals and catalysis innovation
Growth in the chemicals and biochemicals industry is being led by China, with the rest of Asia, the Middle East and the United States not far behind. Bio-based technology and innovations in catalysis production are two promising trends to make the chemical industry more sustainable.
Article by James Chater
Growth in the chemicals industry has been slowing, probably thanks to a number of mergers and acquisitions that are decreasing competition (see box). However, activity remains high in some of the world’s fastest-growing regions – South East Asia, the Middle East – as well as in the United States.
Growth in China may be stuttering, while its debt levels are reaching critical levels, but this country is the main engine of growth for most chemical sectors. BASF, which has been highly active in China for several years, has just opened a BioACM plant in Nanjing and is planning to build a specialty amines plant at the same location, as well as a plastic additives plant at its Caojing site in Shanghai. With Sinopec it is planning to expand NPG production in Nanjing.
Akzo Nobel is planning a massive increase in its activities: doubling its organic peroxides production in Ningbo and expansion of its surface chemistry plant in Boxing. Other foreign players active in China include Lanxess (plastics plant in Changzhou), Clariant (CATOFIN catalyst and propane and PDH unit in Pizhou, with Xuzhou HaiDing), Sasol (alkoxylation plant in Nanjing), and technological service providers such as KBR and LyondellBasell.
Rest of Asia
In the rest of South-East Asia, growth is particular strong in India and South Korea. Catalysts India (BASF Catalysts) has opened its new mobile emissions catalysts manufacturing site in Chennai, India. Solvay has announced expansion of its sulfone polymer production in India and the USA. Inox Air Products is building six air separation plants in India.
In S. Korea, Hanwha Total Petrochemical is set to invest more than 300 million USD to expand its integrated refining and petrochemicals platform in Daesan, while Wacker Chemie plans to invest nearly 60 million euros in its production facility in Ulsan. Other important projects are being unveiled in Malaysia (Petronas’ isononanol plant, Japan (SDK’s liquefied CO2 plant, Nippon Shokubai), Indonesia (opening of the Sinar Mas Cepsa oleochemicals plant) and Thailand (PTTGC’s ethylene plant).
The Middle East scene is dominated by Saudi Arabia, which is in the process of diversifying its economy, which is heavily dependent on petroleum. The largest chemical project ever built in one phase is said to be at Jubail, where Sadara has just commissioned the last of 26 new units. Other important projects are taking shape in UAE (Shaheen Chem’s planned complex), Kuwait (expansion of a refining and petrochemical complex at Al-Zour, Honeywell/Equate’s collaboration) and Brunei (Stamicarbon’s new urea plant).
In North America, several new plants are being planned and completed. The economy has been booming and the existence of cheap, abundant feedstock (shale gas) has stimulated petrochemical production. ExxonMobil has just commissioned a new ethane cracker, part of a huge expansion at its Baytown chemical complex. No less ambitious is Inter Pipeline’s decision to build a PDH/PP plant near Edmonton, Canada. Among the more significant projects are Dow’s commitment to invest 2 billion USD in new chemical plant in Louisiana; ExxonMobil’s large-scale two-train polyethylene plant in Mont Belvieu, Texas; and the Total/ Borealis/Nova joint venture (polyethylene project on the Gulf Coast).
In Europe, many expansions and new projects are under way. AkzoNobel and Evonik have started production at their chlorine and potassium hydroxide plant at Ibbenbürren in Germany, while Evonik is to expand its production capacities for hydrogen peroxide. Clariant is providing the technology for cellulosic ethanol plants in Slovakia and Romania. Lanxess is planning to invest nearly 25 million euros in its polyamide and precursors facilities in Antwerp.
AkzoNobel is planning to expand its capacity for chloromethanes in Germany. In Russia, Dorogobuzh JSC’s ammonia plant in the Smolensk region is to be revamped using KBR’s technology.
It is heartening to learn that the EU chemical industry, through its Cefic organization, has declared its continuing commitment to the Paris agreement on global warming despite President Donald Trump’s decision to withdraw from it. However, this is just part of the industry’s attempts to reduce its environmental imprint, especially in the field of energy consumption.
When it comes to technological advances, catalysis continues to dominate the headlines, as several scientific teams vie with each other to discover means to make catalysis more energy-efficient while at the same time trying to ease the pressure on rare metals in demand for use as catalysts. The new technologies concern such industries as hydrogen production, auto and biomass.
Here are just some of the breakthroughs occurring:
- At the University of Toronto scientists are turning to nature for inspiration in their quest to use renewable energy to convert CO2 into stored chemical energy. The linked chemical processes used are splitting water into protons and oxygen, and the conversion of CO2 into carbon monoxide, which can then be converted to hydrocarbon via the Fischer-Tropsch process. The new catalyst used in this energysaving process is made of nickel, iron, cobalt and phosphorus, all elements that are low-cost and pose few safety hazards.
- Meanwhile at the University of Catalonia scientists discovered a compound made of cobalt and called a polyoxometalate that can catalyze water-splitting better than iridium.
- Recycling of CO2 and methane (CH4) could become more cost-effective after scientists at the University of Surrey developed a catalyst which is based on nickel strengthened with tin and ceria that transforms CO2 and CH4 into synthetic gas that can be used to produce fuels and chemicals.
- Scientists at UCL, London, have discovered a way to turn shale gas methane into hydrocarbon fuels using a new platinum and copper alloy catalyst. The new catalyst is resistant to coking, therefore requires less energy than other catalysts.
- Splitting water – which is one way of producing hydrogen – is carried out through electrolysis, an energy intensive process. Scientists at Argonne alloyed iridium with osmium before de-alloying the two metals, which left a more stable and active form of iridium better able to serve as a catalyst.
- At the University of Houston, scientists discovered a water-splitting catalyst made of ferrous metaphosphate grown on a conductive nickel foam platform, which it is claimed improves performance and lowers cost.
- Researchers at Tokyo Tech have developed a catalyst consisting of ruthenium nanoparticles supported on niobium pentoxide (Ru/Nb2O5) that produces amines (ammonia derivatives) in a more effective way. Previous catalysts based on nickel, palladium and platinum produced undesirable secondary products, whereas the new catalyst is more selective.
- Ruthenium is also used in a catalyst being developed at Osaka University. The CeO2-supported ruthenium nanoparticle catalyst allows production of raw materials from biomass.
The chemicals and petrochemicals industries probably use a wider range of stainless steels and special alloys than any other industry. The main requirement is resistance to corrosion at high temperatures. An added benefit is that stainless steel is easy to keep clean, an essential requirement in pharmaceutical and food-and-drink applications. Some industries, such as ammonia production, have stimulated the developed of dedicated alloys, especially in the realm of duplex stainless steel.
Standard grades such as 316(L) and 304(L) are used alongside stronger grades such as 6% moly and nickel alloys and superalloys, as well as special metals such as titanium and tantalum. It is probable that as time goes on, duplex grades will play a larger role.
Thus Outokumpu delivers 500 tonnes of its Forta DX 2205 duplex stainless steel for the Jiaxing Petrochemical Co. Ltd’s purified terephthalic acid (PTA) production facility in Zhejiang province, China. And Tecnimont selected AMPO Poyam Valves to supply more than 2000 engineered gate, globe and check valves for Eurochem’s Kingisepp ammonia plant, in materials ranging from duplex stainless steel to stainless steel and carbon steel.
Acquisitions and mergers
The last few years have seen a massive uptick in mergers and acquisitions. DuPont and Dow Chemical made the headlines in 2015, in a merger worth 130 million USD. This triggered a rash of deal-making in 2016: Monsanto and Bayer are proposing to merge, as are Clariant and Huntsman (which has just bought the UK’s IFS Chemicals), while ChemChina plans to merge with the state-sponsored SinoChem business. Other mega-deals include Sherwin-Williams/Valspar and Praxair/Linde.
The trend increased in 2017 and is expected to stay strong in 2018. European companies have been buying US assets (Lanxess/Chemtura, Evonik/Air Products), Japanese companies have been entering Europe Sojitz/Solvadis, Hitachi Chemicals/Isolite), and in China consolidation has been the driving force behind several mergers.
The factors behind these mergers vary from cost-cutting or consolidation to achieving synergies and increased market dominance in profitable sectors, as well as boosting market valuations.
Reading the accident reports on the US Chemical Safety Board (www.csb.gov
) makes you realize the importance of safety procedures (such as, for example, selection of the right materials and their correct installation). For example, in March 2018 an explosion occurred at an aluminium recycling plant in Tennessee, injuring many. It was later established that a broken cylinder fractured, releasing hydrogen that caught fire. Given the challenges posed by safety concerns it is probably not a good idea to scrap the Chemical Safety Board – and yet this is what President Trump is proposing to do.
The healthy state of the petrochemical and chemical industries in general will ensure a steady market for stainless steel and alloys, while the quest for more efficient catalysts will stimulate the market for nickel and other specialist elements.