FocusPetchems look to Brazil for bioethylene

03 October 2008 20:34  [Source: ICIS news]

By Leela Landress

HOUSTON (ICIS news)--With a growing list of ethanol made from sugarcane projects and joint ventures, petrochemical companies have set their sights on Brazil as the principal investment partner for bioethylene development and green plastics, an ethanol specialist said on Friday.

Experts attributed Brazil’s lure for petrochemical companies to invest in the development of bioethylene and downstream green polyethylene to numerous advantages such as available arable land to more advanced technology.

“You have to realise that Brazil has over 400m acres of available land,” said David Blume, president of the International Institute for Ecological Agriculture David Blume said on Friday. “This is not forest land but savannah grassland and they only now use 2% of it.”

Blume attributed Brazil’s success in bioethanol production and the subsequent bioethylene development to an efficient use of resources.

The Brazilians efficiently produce ethanol from sugarcane because they began the process in the 1980s after the Arab oil embargo crippled world markets, Blume remarked. 

“They tend to have the plant on-site and don’t have to transport chemicals long distances like we do here in the US,” Blume said. “They have more, smaller plants,” Blume stated and added “bigger isn’t necessarily better in this case”.

Due to the limited nature of fossil energy, leading to higher prices and volatility, a technology push and regulatory pull is making renewable energies increasingly attractive, said Richard Jordan, an international patent attorney specialising in biofuels.

“The economic and technical environment is totally different from the US,” Jordan remarked. “The barrier to technology is not as high, the labour is cheap, sugar is easier to convert than corn and Brazil has a lot of available land.”

Projects on the horizon

“Brazil is probably the most efficient solar panel in the world,” Braskem’s Cleantho de Paiva Leite Filho said last month at the Latin American and Caribbean Petrochemicals conference.

Braskem has invested over $160m (€115m) in research and development (R&D), with eight pilot plants focused on improving technology and creating products for value-added markets, the company said. Braskem plans to make plastic via its Green Polymer project.

“In Brazil it [green plastics] is a very competitive route,” Leite remarked. “It won’t be integrated everywhere but in Brazil it is being integrated into the petrochemical complex.”

Braskem is not the only company to see the bioethylene market as a good investment.

Toyota Tsusho Corporation and Braskem agreed to work together in marketing green polyethylene from sugarcane to Asia, Braskem announced last week. The company plans to produce green polyethylene for the first time in the world on an industrial scale by 2011.

Braskem said it will build a high density polyethylene (HDPE) and low density polyethylene (LDPE) 200,000 tonne/year facility at its site in Triunfo, Brazil. The facility will use bioethanol derived from sugarcane as feedstock.

Solvay has invested in bioethanol projects in Brazil and has focused on vertical integration in chemicals and plastics, Christian Jourquin, chairman of Solvay’s executive committee, told investors this week.

($1 = €0.72)

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By: Leela Landress
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