Product profile: Cyclohexane

09 September 2002 00:00  [Source: ICB]

Rising demand from refineries for hydrogen will limit its availability for cyclohexane plants. This could result in European production being replaced by cheaper Saudi product
Uses

Cyclohexane's major use is in the production of nylon intermediates such as adipic acid, caprolactam and hexamethylenediamine. Adipic acid, used mainly to make nylon 6,6 fibre, accounts for about 60% of cyclohexane consumption. Over 70% of global caprolactam, used in nylon 6, is made from cyclohexane via the intermediate cyclohexanone. Other minor uses are as a solvent, a reaction diluent and in chemical synthesis.

Supply/demand

Production in western Europe last year was 918 000 tonne, a drop of 14% on 200l, says DeWitt consultancy. Demand has improved so far in 2002 and has been healthy for the first half of this year, although inventory rebuilding has been a factor. Quarter two showed a strong recovery from nylon intermediates with sales peaking in June/July. Demand into the distribution market for solvents has also been strong and is up on last year. Operating problems at most plants across Europe in the first half tightened supply and stocks have been low at producers and consumers. Availability of hydrogen feedstock has also been short.

Production is virtually back to normal now and the market is said to be tightly balanced. Demand continues to be good, albeit more relaxed, and although the market is expected to slow, particularly in quarter four, sources do not expect a long market for the remainder of this year.

Chevron Phillips Chemical's (CPChem) complex in Guayama, Puerto Rico, which includes a 410 000 tonne/year cyclohexane plant, has remained closed since March 2001 due to poor economics. This has helped to balance overall supply, although it has affected the US more than Europe. Small volumes of European material have been exported to the US where operating problems have also kept supply very short.

Pricing
 
The European contract price is a direct reflection of benzene feedstock costs and is based on an industry-wide formula, although supply and demand also exert some influence. The European third quarter contract price is E508/tonne, with the delta over benzene rising by E20/tonne to E105/tonne reflecting the stronger hydrogen values seen in recent months. The delta had stayed unchanged at E85/tonne for one year from quarter three 2001, when it fell by E5/tonne on the previous quarter triggered by weaker demand and the lower cost of hydrogen.

Technology

Most commercial production is based on the catalytic hydrogenation of benzene. The reaction can be carried out using liquid or vapour-phase methods in the presence of a highly dispersed catalyst or in a catalytic fixed bed. Processes differ mainly in the means of removing the heat of reaction. Minimum reactor temperatures are preferred for maximum benzene conversion and minimum cyclohexane cracking.

Most cyclohexane plants use reformer offgas which yields benzene and large amounts of hydrogen by-product. Hydrogen and benzene costs are critical for cyclohexane manufacturing economics with plants often located near large refineries where low cost raw materials are available.

Health and safety

Cyclohexane is a colourless, non-corrosive liquid with a mild ethereal odour. It is flammable and immiscible with water. Its vapour readily forms explosive mixtures in air and flashback is a hazard. It can irritate the skin, eyes, nose and throat and, in high concentrations, it can cause dizziness, unconsciousness and respiratory failure.

Outlook

Demand growth is expected to continue its recovery in 2003. DeWitt forecasts an annual growth of 1.3% over the next five years in western Europe. New capacity will come online in Al Jubail, Saudi Arabia, next year, with the startup of Saudi Chevron Phillips' 60 000 tonne/year expansion to 280 000 tonne/ year in the first quarter. Czech company Unipetrol plans to build a new unit, possibly at its Spolana subsidiary in Neratovice. Startup is set for quarter three 2004.

Hydrogen availability is a future problem for producers, particularly those linked with refineries where more hydrogen will be required for desulphurisation of gasoline and diesel to meet lower sulphur standards. It is unlikely producers will invest in new hydrogen units as they are expensive to build and cyclohexane economics are too poor to justify the capital expenditure. DeWitt believes it is likely that more west European cyclohexane production will be substituted by low cost imports from Saudi Arabia.

European cyclohexane capacity, '000 tonne/year
Company Location Capacity

AtoFina

Carling, France 80

Azot Cherkassy

Cherkassy, Ukraine 60

Cepsa

Huelva, Spain 150

Chemko AS

Strazske, Slovakia 90

Erdol-Raffinerie-Emsland

Lingen, Germany 260

ExxonMobil

Botlek, Netherlands 270

Fibrex

Savinesti, Romania 45

Fina Antwerp Olefins

Antwerp, Belgium 110

Grodno Azot

Grodno, Belarus 80

Huntsman Petrochemicals

Wilton, UK 300

JSC Kuibyshevazot

Togliatti, Russia 120

Kemerovo Azot

Kemerovo, Russia 155

Lukoil Neftochim

Burgas, Bulgaria 50

PKN Orlen

Plock, Poland 120

Rivneazot

Rivne, Ukraine 30

Ruhr Oel

Gelsenkirchen, Germany 140

Shchekinoazot

Shchekino, Russia 65

SSME Azot

Severodonetsk, Ukraine 50

ZA Pulawy, Poland

Pulawy, Poland 60

ZA Tarnowie - Moscicach

Tarnow, Poland 35
SOURCE: ECN/CNI




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