Benzene

19 April 1999 00:00  [Source: ICB]

Government regulations will have a major impact on the outlook for benzene over the next couple of years.

Supply/demand



West European production was about 6.8m tonne last year and will reach just over 7m tonne in 1999, according to DeWitt consultants. DeWitt estimates growth rates at 2.7%/year with supply topping 7.4m tonne/year in 2002.

Total demand amounted to 7.2m tonne in 1998 and is forecast to reach just under 8m tonne in 2002. Operating rates of about 86% last year will edge up to 87% in 1999, says DeWitt.

Uses



Over half of benzene production feeds ethylbenzene/styrene demand. The second largest consumer is cumene, followed by cyclohexane, alkylbenzene and aniline/nitrobenzene.

Technology



The traditional method of manufacturing benzene from the distillation of light oils produced in the manufacture of coke has been overtaken by a number of routes. In Europe, the main source of benzene is from pygas coproduced in the steam cracking of naphtha, gas oil and condensates to make olefins. It is also obtained from the catalytic reforming of naphthas, hydrodealkylation of toluene and the selective disproportionation of toluene (to make paraxylene). Benzene is coproduced in the BP/UOP Cyclar process converting propane/butane into aromatics.

Health & safety



Exposure to benzene can cause dizziness, rapid heart rate and unconsciousness. It can irritate the nose and throat and can cause upset stomach and vomiting. Benzene is a carcinogen and has been shown to cause leukaemia. Benzene is flammable.

Pricing



###7559###

Benzene prices are heavily influenced by crude oil, which has fallen to very low levels in 1998 and 1999. However the recovery in global oil prices has lifted benzene spot numbers to levels of $250/tonne fob NWE from as low as $202/tonne early this year. Quarter two contract discussions produced an unusual situation in Europe with two contract levels separately agreed at euro 210/tonne and euro 215/tonne.

WEST EUROPEAN BENZENE CAPACITY



A first deal at E210/tonne between two northwest European players was rapidly followed by a settlement between two major German? players at E215/tonne. The situation remains unclear.



Company Location Capacity


Aral Gelsenkirchen, Germany 170 000


BASF Mannheim, Germany 320 000


Bitmac Llanwern, UK 26 000


Borealis Porvoo, Finland 130 000


BP Amoco Grangemouth, UK 237 000


BSL (Dow) Bohlen, Germany 320 000


Carboquimica Padua, Italy 20 000


Cepsa Algeciras, Spain 250 000


Huelva, Spain 124 000


Conoco Immingham, UK 200 000


Dow Terneuzen, Netherlands 900 000


DSM Geleen, Netherlands 300 000


Elf Atochem Feyzin, France 110 000


Carling, France 300 000


Gonfreville, France 200 000


EniChem Porto Marghera, Italy 110 000


Porto Torres, Italy 215 000


Priolo, Italy 390 000


Sarroch, Italy 45 000


Erdöchemie Cologne, Germany 220 000


Exxon Botlek, Netherlands 480 000


Fina Antwerp


Olefins Antwerp, Belgium 170 000


Gexaro Lavéra, France 200 000


(Atochem/BP)


ICI Wilton, UK 433 000


OMV Burghausen, Germany 120 000


PCK Schwedt, Germany 65 000


Petrogal Oporto, Portugal 60 000


Repsol Petroleo Puertollano, Spain 125 000


Rutgerswerke Zelzate, Belgium 40 000


RWE-DEA Heide, Germany 65 000


Wesseling, Germany 195 000


Shell Berre, France 95 000


Godorf, Germany 510 000


Stanlow, UK 240 000


Teer Erkner, Germany 38 000


Total Gonfreville, France 140 000


Wintershall Lingen, Germany 75 000


Veba Oel Gelsenkirchen, Germany 380 000


Source: DeWitt



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