Long term prospects for petrochemicals and its feedstocks Session : Future of special refined products Ph de Smedt, Manager, Petrochemicals Europe
Petrochemicals Europe – Who we are = the association of petrochemical producers in Europe • An industry programme of Cefic • European producers of base chemicals and derivatives • base chemicals: 20 companies operating ~ 50 steam crackers in EU28 • derivatives ranging from acetyls, methanol, amines, etc…. to solvents • ~ 40 units integrated with refineries • 20% of worldwide ethylene capacity 20/3/2017 PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR 2
What’s Base Chemicals 20/3/2017 3 PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR
Europe – home to petrochemical excellence Source: Petrochemicals Europe 4
A broad variety of products, often essential for sustainable development, are made from C2=,C3=, C4==, BTX ILLUSTRATIVE Plastic bottles Ethylene (C2=) Anti-freeze Insulation Medical materials /diagnosis Propylene (C3=) Coatings Cosmetics Butadiene Car parts (C4==) BTX Tires 5 source: Essenscia; Litsearch
Asia chemicals production outpaces other regions World chemicals sales: geographic breakdown Source: Cefic Chemdata International 2016 * Rest of Europe covers Switzerland, Norway, Turkey, Russia and Ukraine ** North American Free Trade Agreement Page 6 *** Asia excluding China, India, Japan and South Korea
Petrochemicals and polymers account for about half of EU chemicals sales EU chemical industry sales by sectoral breakdown Page 7 Source: Cefic Chemdata International 2016
Estimated global growth of basic chemicals and plastics Global growth % expected to slow due to weaker economic outlook 2016 to 2020 annual volume growth similar to 2010-2015 and greater than the 2000s Growth broadens regionally, but China remains an important driver Source IHS 20/3/2017 PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR 8
Visible New Steam Cracker Projects 5 0 4 10 3 0 1 0 Ethylene production growth areas noticed are Russia, Middle East incl. Iran and still North Amerika. No new steam cracker projects expected in Europe In the next years = number of projects by area 9 (source: Linde evaluation, December 2016). 20/3/2017 PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR
New pathways to basic petrochemicals Ethylene Propylene MTO Reforming: Propylene SMR/ATR Methanol MTP Natural gas Gasoline DME Or BTX MTG syngas Gasoline Diesel Coal Lubes Petcoke Fischer-Tropsch hydrocarbons Residu Reforming: Steamcracking Ethylene LPG gasification biomass Propylene Naphtha Oxygen removal Butadiene Natural oils Steamcracking BTX Dehydration Hydrous Ethylene bioethanol 20/3/2017 PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR 10
World propylene supply trends 10 3 KTa Propylene mostly produced by: Steam cracking (~55%), Fluid catalytic cracking (~35%). %: SC / FCC / O.P. On-Purpose (~10%) 2011 55 / 35 / 10 2025 50 / 30 / 20 • Steam cracking capacity predominantly added from Ethane rather than Naphtha (lower Propylene yield): - Middle East. - US shale gas. • Supplies from refineries remaining stable, or slow growth: - Fuel efficiency. - Biofuels. - Revamps costs. PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR 11
On-purpose propylene sources? 2011 Major process technology routes: 1. PDH – Dehydrogenation 2. OCT – Metathesis 2009 3. HS FCC – High Severity FCC 4. MTO – Methanol to Olefins 5. OCP – Olefin Cracking PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR 12
Other developments Several oil majors have or are developing steam cracking processes • directly from crude oil. There is one running plant (1 Mton of C2=) operating since 2014. Essentially a preflash of crude oil between convection and radiant section of cracker furnaces , send the light fraction to a cracker and the heavy fraction for further treatment to a nearby refinery. Oxidative coupling of methane. Still in research phase. Proven yields • too low for the moment. • Circular economy. Recycling of plastics. This will reduce demand for virgin plastics, but for the first 10-20 years will not fundamentally change the increasing trend for olefins. (Quality loss during recycling limits applicability of recycled material). Circular economy is one of the priorities of Petrochemicals Europe. • 20/3/2017 PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR 13
Where and what feedstock for C2= Units : thousands of tons 20/3/2017 PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR 14
IEA view on global HVC market • IEA carries out energy technology perspective studies to identify ways to reduce GHG emissions. • The graph below shows their scenario for HVC growth under 2 degree temperature increase scenario. (HVC = ethylene, propylene, butadiene,BTX). • Naphtha cracking remains dominant feedstock (growing role of catalytic cracking seen by IEA). Ethanol to ethylene INDCHEDEHYBIO 400 300 Methanol to olefins INDCHEMTOOMET 350 Propane dehydrogenation INDCHEPRDHPRO 250 Mt HVC produced 300 Naphtha catalytic cracking INDCHECTCKNAP CCS (Mt CO2) 200 Propane steam cracking INDCHESTCKPRO 250 Gas oil steam cracking INDCHESTCKGSO 200 150 LPG steam cracking INDCHESTCKLPG 150 Naphtha steam cracking INDCHESTCKNAP 100 Ethane steam cracking INDCHESTCKETH 100 HVC demanded 50 50 CCS (Mt CO2 captured) 0 0 20/3/2017 PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR 15
Focus on Europe 20/3/2017 PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR 16
European industry’s m ajor issue Ethylene Cash Cost of Regional Steam Crackers (US$/ton C2) Source: ICIS Consulting 20/3/2017 PH DE SMEDT : OUTLOOK FOR PETROCHEMICAL SECTOR 17
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