InterviewBraskem America secures propylene, improves operations

27 November 2012 22:22  [Source: ICIS news]

Braskem America secures propylene, improves operationsBy Al Greenwood

HOUSTON (ICIS)--Braskem America, having secured sources of feedstock propylene, will now continue to focus on improving the operations of its acquired polypropylene (PP) plants in the US, the head of the company said on Tuesday.

Braskem acquired Dow Chemical's two PP plants in the US in 2011.

In 2010, Braskem acquired Sunoco's three PP plants.

Since acquiring the plants, one of Braskem's key goals was to secure a reliable source of feedstock propylene, said Fernando Musa, the head of Braskem America.

In particular, Sunoco had shut down the main processing units at a refinery in Pennsylvania, which was a major source of propylene for Braskem's PP plant in Marcus Hook.

Ultimately, Braskem struck a deal with Sunoco to acquire the propylene splitter at the refinery, which secured the supply of feedstock for the Marcus Hook PP plant.

"This was a very important achievement and provided a lot of comfort for our clients," Musa said.

For its other PP plants, Braskem was facing another feedstock challenge caused by the advent of shale gas in the US.

As a result of rising natural gas production, US crackers have shifted to lighter feeds, which lowered the production of propylene.

Recently, several companies have announced plans to build propane dehydrogenation (PDH) plants, which would produce on-purpose propylene.

Braskem has secured a long-term propylene agreement with one of those companies, Enterprise Products, which plans to build a 750,000 tonne/year PDH plant in Texas.

Operations should start in 2015.

The deal with Enterprise should provide Braskem with a competitive, long-term supply of propylene from a strong and reliable producer, Musa said.

With feedstock secured, Braskem America will continue to focus on improving operations at its US plants.

This year, Braskem has focused on integrating the US plants it has acquired from Dow, both in terms of customers and employees, he said. "That has been going well."

Meanwhile, the company will continue to improve the reliability and productivity of its five US plants, Musa said.

Braskem will also continue to invest in research and development to develop and improve its portfolio of products, he said.

At the same time, the company will continue to strengthen its relationship with its customers, by providing them with both better products and services, he said. "This will continue to be a priority for next year."

The company does not plan to significantly increase PP capacity because the market would be unable to absorb the increased supply, he said.

"We do not see today the economic viability for a new polypropylene plant to be built in the US," Musa said.

However, Braskem will continue to evaluate any opportunities in the US outside of the PP market, which had been brought on by the advent of shale gas, Musa said.

By: Al Greenwood
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