alternative feedstock opportunities in apic …orbichem.com/userfiles/apic...

Alternative Feedstock Opportunities in APIC Member & Surrounding Countries

Dr Charles Fryer

General Matters & Raw Materials Committee Meeting at APIC 2014

Pattaya, 16 May 2014

• Ethylene from ethane in the USA

• Ethylene production economics -- from shale NGLs, naphtha, ethanol

• Methanol to olefins processes

• Propane dehydrogenation

• New bio-routes to chemicals e.g. to adipic acid

• Bio-routes to MEG, PX, PTA and PET

• Conclusions

Source: Tecnon OrbiChem

APIC 2014WHAT WE WILL COVER TODAY

0

5

10

15

20

25

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

$/mmBtu


APIC 2014NATURAL GAS, CRUDE OIL & COAL PRICES

US Nat Gas $/mmBtu

Oil $/mmBtuequivalent

Coal $/mmBtuequivalent

WE Nat Gas $/mmBtuequivalent

0

5

10

15

20

25

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

$/mmBtu


APIC 2014US NATURAL GAS & ETHANE PRICES

US Nat Gas $/mmBtu

US Ethane $/mmBtuequivalent

ktpa

APIC 2014US ETHYLENE CAPACITY BASED ON ETHANE

EthyleneCapacity Using Ethane

Ethane Capacity to Consume

EthaneProduction Capacity

Note:The USA has in

addition 8,700 kptaof ethylene capacity based on light liquid

feeds (propane, butane, naphtha)

Ethane ExportCapability

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

55,000

2012 2013 2014 2015 2016 2017 2018 2019 2020

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

0 100 200 300 400 500 600 700 800 900 1000 1100 1200 1300

50 100 150 200 250 300 350 400 450 500 550 600 650 7000

10 20 30 40 50 60 70 80 90 100 110 120 130 1400

1 2 3 4 5 6 7 8 9 10 11 12 13 140 15 16

Propylene/EthylenePrice Ratio

Middle East – old gasMiddle East – new gas

Naphtha $/ton

Heavy Fuel Oil $/ton

Crude Oil $/bbl

Natural Gas $/mmBtu

ex naphtha

A

B

C

D

Note:This graph enables typical plant cash production costs of ethylene to be estimated from the price of a given hydrocarbon feedstock, plus, in the case of naphtha, the current propylene to ethylene price ratio prevailing in the market in question

0.96

ex ethane priced at heat value

USA – shale gas

Spot Ethylene price NE Asia April 2014

NaphthaEurope-AsiaApril 2013$/ton

APIC 2014CASH PRODUCTION COST OF ETHYLENE: MEDIUM SIZED CRACKER


0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2012

2014

Dollars per Ton


APIC 2014PROPYLENE vs ETHYLENE PRICES - TAIWAN

EthyleneContractTaiwan

PropyleneContractTaiwan

$/ton

APIC 2014CASH PRODUCTION COST OF ETHYLENE: MEDIUM SIZED CRACKER


0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

0 100 200 300 400 500 600 700 800 900 1000 1100 1200 1300

50 100 150 200 250 300 350 400 450 500 550 600 650 7000

10 20 30 40 50 60 70 80 90 100 110 120 130 1400

1 2 3 4 5 6 7 8 9 10 11 12 13 140 15 16


0.8

Middle East – old gasMiddle East – new gas

Naphtha $/ton


Crude Oil $/bbl

Natural Gas $/mmBtu

ex naphtha

A

B

C

D

Note:This graph enables typical plant cash production costs of ethylene to be estimated from the price of a given hydrocarbon feedstock, plus, in the case of naphtha, the current propylene to ethylene price ratio prevailing in the market in question

0.9

1.0

0.7

1.1

1.2

1.3

ex ethane priced at heat value

USA – shale gas

Spot Ethylene price NE Asia April 2014

NaphthaEurope-AsiaApril 2014

$/ton

APIC 2014CASH PRODUCTION COST OF PROPYLENEin a MEDIUM-SIZED NAPHTHA CRACKER


0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

0 100 200 300 400 500 600 700 800 900 1000 1100 1200 130050 100 150 200 250 300 350 400 450 500 550 600 650 7000

10 20 30 40 50 60 70 80 90 100 110 120 130 1400

1 2 3 4 5 6 7 8 9 10 11 12 13 140 15 16


1.2

Naphtha $/ton


Crude Oil $/bbl

Natural Gas $/mmBtu

ex naphtha

A

B

C

D

Note:This graph enables typical plant cash production cost of propylene, from a naphtha cracker, to be estimated according to the price of naphtha, plus the current propylene to ethylene price ratio prevailing in the market in question

1.1

1.0

1.3.

0.9

0.8

0.7

Spot Propylene price NE Asia April 2014

NaphthaAsia

April 2014

Note:Propylene/Ethylene Price Ratio was 0.96 in East Asia in April 2014

Dollars per Ton

APIC 2014BIO-ETHYLENE PRODUCTION COSTS 2013

0

500

1,000

1,500

2,000

2,500

3,000

Brazil, SugarCane

India, SugarCane

China, SweetSorghum

USA, Corn(maize)

European UnionSugar Beet

Ethylene Taiwan Contract Price 2013 Average

Ethylene USA Contract Price 2013 Average

Source: International Renewable Energy Agency

APIC 2014

METHANOL TO OLEFINS (MTO)

Source: UOP

OUTPUT FROM a UOP/Hydro MTO PLANTConfigured for 1:1 Ethylene : Propylene Ratio

Propylene

Ethylene

SyngasUnit

MethanolSynthesis

MTOUnit

Higher olefins,by products

DMESynthesis

ktpaINPUTNatural gas (2.1 x 109 m3) 1515Methanol 2358

OUTPUTEthylene 400Propylene 400Butenes 123C5+ hydrocarbons 46Fuel gas 40Other (water, COx, coke) 1349Total 2358

-800

-600

-400

-200

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Dollars per Ton


Margin overfeedstock cost= 3.0 tons Methanol

MethanolImport E Asiax 3

EthyleneImport E Asia

APIC 2014VIABILITY OF ADVANCED MTO (Methanol-to-Olefins)

Dollars per Ton


APIC 2014VIABILITY OF ADVANCED MTO (Methanol-to-Olefins)

Margin overfeedstock cost

EthyleneImport E Asia

-800

-600

-400

-200

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Feedstock = 3.0 tons of imported methanol at cash cost made from $4/mmBtu natural gas, plus $60/ton freight

MTONot Viable

Fixed andother costs

APIC 2014METHANOL-TO-PROPYLENE - LURGI MTP® PROCESS

Source: Lurgi GmbH

3.8 Mio Nm³/d48 Mio mmBtu/a

Natural Gas

SyngasPlant

PropylenePlant (MTP)

Methanol Plant

1.7 Mt/aMethanol

0.47 Mt/aPropylene

12.3 Mio Nm³/d Syngas

936 000 t/aWater

143,000 t/aGasoline

CoalGasification

& Shift Conversion

OR4.3 Mt/a

Coal

-1,000

-600

-200

200

600

1,000

1,400

1,800

2,200

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Dollars per Ton


APIC 2014VIABILITY OF MTP (Methanol-to-Propylene)

Margin overfeedstock cost= 3.5 tons Methanol

MethanolImport E Asiax 3.5

PropyleneImport E Asia

Dollars per Ton


APIC 2014 VIABILITY OF MTP (Methanol-to-Propylene)

Margin overfeedstock cost

PropyleneImport E Asia

-1,000

-600

-200

200

600

1,000

1,400

1,800

2,200

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Dec

Feedstock = 3.5 tons of imported methanol at cash cost made from $4/mmBtu natural gas, plus $60/ton freight

MTPNot Viable

Fixed andother costs

APIC 2014FEEDSTOCK REQUIREMENTS FOR MTP®MAXIMUM PRICES FOR CASH BREAKEVEN


Propylene1 ton$1400/ton

Methanol3.5 tons@$240/ton= $840

Natural Gas2600 m3 = 100 mmBtu@$6.30/mmBtu= $630

or

Coal9.15 tons totall�6.25 t feedstock�2.90 t fuel@$46/ton= $420

+ Freight$60/ton

APIC 2014PROPANE DEHYDROGENATION


Propane1.19 tons

DehydrogenationUnit

Steam2.20 tons

Propylene1.00 tons

Off-gases0.16 tons

Hydrogen0.03 tons

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2012

2014

Dollars per Ton


APIC 2014

TAIWAN PROPYLENE CONTRACT vs.PROPANE EAST ASIA x 1.20


PropanePriceEast Asiax 1.20

Dollars per Ton


0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2012 2014

Difference

PDH Cash break-even

APIC 2014

TAIWAN PROPYLENE CONTRACT vs.PROPANE EAST ASIA x 1.20


PropanePriceEast Asiax 1.20

APIC 2014NEW BIO-ROUTES TO ADIPIC ACID


Alpha-D-Glucose D-Glucose

=

Micro-organism

Glucaric acid

Hydro-deoxygenation

Adipic acid

Verdezyne’sRoute

Rennovia’sRoute

PalmKerneloil

yeast microorganism

APIC 2014TOWARDS 100% BIO-NYLON - ADIPIC ACID


New availability of 1,5-pentanediamine means 100% bio-based PA5,6 may soon be achievable.Several approaches to Bio-adipic acid are being pursued, but low prices in today’s over-supplied market are slowing progress.Verdezyne (supported by BP and DSM)

� Pilot plant in operation in California, USA. Claims production cost 30% lower than benzene-based production. Uses a metabolic (fermentation) methodology.

� Various non-food feedstocks being experimented -- mostly vegetable oils� Bio-based adipic acid has been used to make PA66 polymer, carpet fibre and textile

filament• Rennovia

� Pilot plant in operation in California, USA. Competitive with the benzene process if crude oil is above $50/barrel. Uses chemo-catalytic technology.

� Glucose (from biomass) is oxidised to glucaric acid with air and hydrogenated to adipic acid

• BioAmber (supported by Mitsui & Co.)� First to market with bio-succinic acid, made via fermentation of glucose from wheat,

in a 2 ktpa plant in France� BioAmber aims to adapt the bio-Succinic acid process, which employs a metabolic

process, to make adipic acid, working in conjunction with Celexion• Other companies with plans for bio-based adipic acid include DSM and Genomatica

APIC 2014BIO-ROUTES TO ETHYLENE GLYCOL


SyngasCO + H2

EthyleneOxide

Bio-Ethanol Biomass

MEG

Micro-organism

Dimethyloxalate

Ethylene Synthesis

Catalyticconversion

Biomass

Glycerol

Carbonmonoxide

Carbondioxide

Catalyticelectrochemistry

Glucose

Micro-organism

APIC 2014TOWARDS 100% BIO-PET - BIO-MEG


1. Semi-Conventional Route• Bio-Based Ethanol is Dehydrated to Ethylene

� An old process, revived in recent years in Brazil to make polyethylene. Ethanol from sugar, production from biomass is the way of the future.

• Bio-Ethylene is Oxidised to EO, then Hydrated to MEG� India Glycols, capacity 125 ktpa, mostly with local ethanol� Also Greencol Taiwan (130 ktpa) with ethanol from Brazil, and Global Biochem

(China), M&G Chemicals (China) to start production in 2015 on 200 ktpa plant.2. Conversion of Glycerol or Sorbitol

� Archer Daniels Midland is operating a pilot plant, making MEG in addition to MPG3. Conversion of Carbon Monoxide - Sourced from Biomass?

� MEG made from synthesis gas via dimethyl oxalate. Methyl nitrite converts CO to dimethyl oxalate, with release of NO, which is recycled to make fresh methyl nitrite. The dimethyl oxalate is hydrogenated to MEG. Process was invented by Ube Industries and developed in China.

� Eastman Chemical and Davy have developed a proprietary technology for the production of MEG from synthesis gas, different from the oxalate process

4. Conversion of Carbon Dioxide� Liquid Light, a US-based start-up company, uses catalytic electrochemistry followed

by hydrogenation to convert CO2 to MEG. Multiple reactors cell units will be stacked together in a planned pilot plant.

APIC 2014

TOWARDS 100% BIO-PET - PARAXYLENE & PTA


• Bio-Paraxylene, Semi-Conventional� Sugars are converted to mono-oxygenated chemicals (alcohols, ketones)

by reforming in water � Oxygenated chemicals are converted to hydrocarbons by catalytic

condensation/hydrotreating� The hydrocarbons are converted to high aromatic content by

conventional reforming� The aromatics are separated by conventional techniques into benzene,

toluene and xylenes� Xylenes and then Paraxylene are isolated from the aromatics using

existing technology• Bio-Paraxylene made from iso-Butanol

� Isobutanol, made from sugar, can be dehydrated to iso-butene� Gevo has demonstrated a process to dimerise iso-butene and convert the

dimer (2,4,4-trimethylpentene) to paraxylene (bioPX)• PTA (Terephthalic Acid)

� Gevo to make PTA by conventional chemical means from bio-based paraxylene, and then produce 100% bio-based PET working with Toray

APIC 2014

NEW BIO-ROUTE TO PARAXYLENE


D-Glucose

micro-organism dehydration

Iso-butanol

2,4,4-trimethylpentene

Iso-butene

dimerisation

p-Xylene

isomerisation

APIC 2014BIO-PBS FEEDSTOCK REQUIREMENTS

Source: IfBB (Institute for Bioplastics and Biocomposites); Tecnon OrbiChem

Esterification

Corn

Corn Starch

Succinic Acid

Hydrolysis

Filtration

2.00t

1.45t

1.00t

PBS0.72t

H2O

Enzymes Dextrins

Glucose1.25t

Fermentation

H2O

H2O 0.08 t

Polycondensation

H2O 0.08 t

1,4 BDO0.38t

Hydrogenation0.51t

0.49t

APIC 2014CONCLUSIONS

• Over-supply of ethane from shale gas in the USA means that ethylene prices will stay low, giving the US chemical industry a crushing advantage

• Olefin units based on naphtha will look increasingly to propylene as a cash generator

• Methanol-to-olefin plants need low cost natural gas or coal to be viable

• Bio-routes to chemicals are starting to become credible for the production of well known, large volume chemicals, such as:

� Adipic acid

� MEG

� maybe Paraxylene and PTA

� PET

• The need to demonstrate environmental awareness will increasingly force the chemical industry to seek bio-based alternatives to products in the public gaze, such as packaging plastics


…..your source of expert chemical industry knowledge

alternative feedstock opportunities in apic …orbichem.com/userfiles/apic...

Documents