On-purpose Olefins through CATOFIN -CATADIENE Technologies Global Propylene & Derivatives Summit Sunil Panditrao Technology Manager CB&I
Agenda Cracker Feedstock Trends Commercial Routes to Propylene CATOFIN/CATADIENE Technology CATOFIN PDH Technology CATADIENE Technology Conclusions 1
Price $/MMBtu Diverging Oil and Gas Prices $30 US Oil & Gas Price History $25 $20 $15 $10 $5 $0 Source: EIA US Oil Price US Gas Price 2
...are Lightening Global Cracker Feedstocks Ethane 2005 Gas Oil 5% Others 2% 27% Naphtha 55% Propane 7% Butane 4% 2010 Gas Oil 3% Naphtha 50% Others 2% Ethane 33% Propane 8% Butane 4% Gas Oil 3% Other 3% Ethane 35% 2015 Naphtha 45% Propane 9% Butane 5% 3
Feedstock Determines Product Slate 4
Ethylene Market is Healthy, but Global Ethylene Supply & Demand, Capacity Utilization Global utilization moving towards peak in 2015-2016 Million Metric Tons 250.0 200.0 150.0 100.0 Forecast Operating Rate 100% 95% 90% 85% 80% 75% 70% Regional Ethylene Capacity Trends 200 Million Metric Tons by 2020 Regional Capacity Million Metric Tons 70 60 50 40 30 20 10 0 World Capacity Million Metric Tons 250 00 02 04 06 08 10 12 14 16 18 20 World NAM MDE WEP Asia Other 200 150 100 50 0 3 50.0 0.0 (% AAGR = 07-12/12-22) Demand (2.5/3.8) Total Capacity (3.5/3.6) Forecast Operating Rate 2012, IHS Inc. No portion of this presentation may be reproduced, reused, or otherwise distributed in any form without prior written consent. Asia leading the way in capacity additions 65% 60% 55% 2012, IHS Inc. No portion of this presentation may be reproduced, reused, or otherwise distributed in any form without prior written consent. Charts provided with permission of IHS Chemical 5
Co-product Capacity not Keeping Pace Propylene Production from Steam Crackers Million Metric Tons 65.0 60.0 55.0 50.0 45.0 40.0 35.0 30.0 25.0 20.0 15.0 10.0 5.0 0.0 P/E Ratio 42% Forecast 40% 90 92 94 96 98 00 02 04 06 08 10 12 14 16 22 Americas Europe, CIS, & Baltics Middle East / Africa Total Asia 38% 36% 34% 32% 30% 28% 26% 24% 2 2012, IHS Inc. No portion of this presentation may be reproduced, reused, or otherwise distributed in any form without prior written consent. Charts provided with permission of IHS Chemical Cracker co-product capacity growth relatively flat Refinery FCC units represent the other conventional source of propylene Flat gasoline demand growth a constraint there 6
Co-product Pricing Strengthening 600 Ethylene, Propylene, Butadiene Prices (2000 = 100) 500 400 300 200 100 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Ethylene Propylene Butadiene Average annual prices provided by Global Data 7
Propylene Growth Regions and Usage Patterns Announced Propane Dehydrogenation Production Capacity of Propylene 8
Commercial Routes to Propylene Steam Cracker FCC Traditional Technologies MTO Propane Dehydrogenation PDH Propylene New Technologies Olefins Conversion Technology OCT 9 9
On-Purpose Propylene Filling the Gap 20% of the global propylene market by 2016 Propylene Market View Million MetricTons 35.0 30.0 - Forecast Percent 30.00 25.00 25.0 20.00 20.0 15.0 15.00 10.0 10.00 5.0 5.00 0.0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2022 Propane Dehydro Metathesis Others Olefin Cracking Methanol-to-Olefins HS FCC % Total Production 0.00 2012, IHS Inc. No portion of this presentation may be reproduced, reused, or otherwise distributed in any form without prior written consent. 4 Charts provided with permission of IHS Chemical 10
Price $/ton Favorable Feed/Product Pricing Differential 1600.0 1400.0 Propane/Propylene Differential USGC Source: ICIS 1200.0 1000.0 800.0 600.0 400.0 200.0 0.0 Information provided from ICIS Pricing, a member of the Reed Elsevier plc group 11
Propylene Selectivity Comparison 100 By-product Technologies On-purpose Technologies % Propylene Yield 75 50 25 0 12
What is CATOFIN /CATADIENE Technology? Proven technology platform licensed by CB&I for singlestage, fixed bed dehydrogenation of paraffins CATOFIN for propane and isobutane dehydrogenation Propane to Propylene (C 3 CATOFIN) Isobutane to Isobutylene (ic 4 CATOFIN) CATADIENE for n-butane dehydrogenation n-butane to Butadiene and Butylenes Catalyst supplied by Clariant 13
Why CATOFIN Propane Dehydrogenation (PDH)? CATOFIN technology is a high selectivity process for propylene production propane propylene + hydrogen < 1.15 ton propane required per ton propylene Fixed bed reactor system Largest single train capacities (up to 850 kta) Highest reliability (> 97%) 14 CATOFIN units licensed to date Several operating units are integrated with polypropylene Total propylene capacity: > 7000 kta 14
CATOFIN Process Flowsheet Charge Heater Air Heater Air Reactor on Purge Reactor on Stream Reactor on Reheat Waste Heat Boiler (WHB) Fresh Propane Steam Byproduct Recovery/Fuel gas Cooler Low Temp. Section Propylene Product Cooler Flash Drum Product Compressor Propane Recycle 15
Flowsheet Options for CATOFIN Plant Low CAPEX design Optimal for areas of the world where low-cost energy is available Heat-pumped product splitter Common waste heat boiler for hot exhaust streams Low OPEX design Patented Low-energy Scheme Optimization of energy use around product compressor and reboilers Optimization of air heating Best application for high energy cost regions 16
Continuous CATOFIN Improvements Latest CATOFIN catalyst breakthrough in commercial operation 2 3% increase in olefin selectivity 5 10% energy savings Up to $30 million profit boost over conventional catalyst units Improves return on investment 17
What About Butadiene? New butadiene extraction opportunities limited due to tightening raw C 4 supply from liquids crackers Few liquids crackers remain without BD extraction from crude C 4 s Butadiene a key profit driver for Asian crackers Recent pricing exceeded $US 4,000 per ton Supply limitations continue to be forecasted on back of strong demand for synthetic rubbers 3500 3000 2500 2000 1500 1000 500 Asian Ethylene, Propylene, Butadiene Prices (US$/t) 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Ethylene Propylene Butadiene Average annual prices provided by Global Data 18
Price $/ton Butadiene/Butane Pricing 5500 5000 4500 Butane mix BD USGC BD NE Asia Source: ICIS 4000 3500 3000 2500 2000 1500 1000 500 0 10/10/06 2/22/08 7/6/09 11/18/10 4/1/12 8/14/13 Information provided from ICIS Pricing, a member of the Reed Elsevier plc group 19
Commercial Routes to Butadiene Steam Cracker By-product Technologies Butylene Oxidative Dehydrogenation Butadiene Butane Dehydrogenation On-purpose Technologies 20
Butadiene Block Flow Scheme CATADIENE one-step dehydrogenation of butane to butadiene n-butane + Heat n-butenes + Butadiene + Hydrogen Butene recovery for OCT or Alkylation feed n-butene / n-butane Recycle n-butane CATADIENE Butadiene n-butenes n-butane Butadiene Extraction Butadiene 21
CATADIENE On-purpose BD Technology Only on-purpose technology available for production of 1,3 butadiene and/or n-butenes by dehydrogenation of n-butane First CATADIENE dehydrogenation unit started up in 1944 to meet demand for synthetic rubber during World War II 19 more units built in 1950s to 1980s Most plants discontinued in 1970s/1980s due to abundance of butadiene as co-product from naphtha crackers Three plants remain in operation in Russia Decade Units Built Olefins Capacity KMTA Pre 1960 9 600 1960s 4 200 1970s 5 400 1980s 1 180 After 1990 0 0 Units currently operating 3 270 22
Conclusions Proven higher selectivity of the process with the implementation of HGM Large design capacities are possible to take advantage of the economy of scale CATOFIN technology improved flowsheets meet local utility constraints at various locations around the world CATOFIN productivity and profitability maximized with latest improvements CATADIENE proven technology for on-purpose butadiene production 23
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