Sustainability key for the future of aromatics – Shell

23 November 2011 11:20  [Source: ICIS news]

AMSTERDAM (ICIS)--Uncertain times for the aromatics chain should be met with a renewed focus on sustainability as well as market fundamentals, a senior executive from global oil major Shell said on Wednesday.

Speaking at the 10th European Aromatics & Derivatives Conference in Amsterdam, Shell's general manager of chemicals strategy, Alexander Farina, affirmed a commitment to the petrochemicals sector, citing competitive advantage and strong growth prospects beyond oil and gas in both the West and China.

Farina cited the forecast rise of polyester fibre output for the next ten years – approximately double the expected output of cotton – as an example of chemical production growth to meet a bigger and wealthier global population.

The key to this growth will be sustainability, said Farina. Applications such as food packaging for polystyrene (PS) in the developing world and polyurethane (PU) and expandable polystyrene (EPS) insulation address increasingly significant trends such as food waste and carbon footprint reduction.

Farina highlighted a study arguing that as much as 20% of the world’s energy consumption could be saved through proper and widespread insulation techniques.

In the case of PS, Farina acknowledged that the challenges faced by the styrenics sector in regards to regulation and carcinogenic labelling remain a threat. However, the key to addressing this was for the industry to back further well-grounded scientific assessments of styrene, as well as to become more proactive in highlighting the benefits of plastics, he said.

Farina was also optimistic regarding automotive production in markets such as China and India, where he saw potential for increased sales. Approximately 15% of aromatics production is for the automotive sector.

Volatility for benzene supply would remain a challenge for aromatics players, however, according to Farina. With benzene mainly a by-product of gasoline production and naphtha cracking, the sudden tightening of availability continues to be a major issue in the market.

Farina also cited US styrene exports due to cheap ethylene as well as the shift of phenolic production from the West to the East as further challenges facing the European aromatics market.

Regarding US ethane production, Farina pointed to a new shale gas-based ethylene cracker that is planned for the US Appalachia region. The intention is for Shell to build capacity for the production of derivatives such as polyethylene (PE) and mono ethylene glycol (MEG).

The 10th European Aromatics & Derivatives Conference, organised by ICIS and International eChem, is taking place in Amsterdam on 22–23 November 2011.

For more on benzene and styrene, visit ICIS chemical intelligence

By: Truong Mellor
+44 208 652 3214

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