18 October 2013 10:22 [Source: ICB]
The bio-economy is driving innovation at Versalis, which is moving ahead after a long period of inertia. The company has initiated a restructuring of its production base to broaden its portfolio and to target growth in green markets
Italy’s Versalis is undergoing a transformation. It started laying the groundwork last year for a complete overhaul, focusing both on converting and optimising production capacities and repositioning its product portfolio based on the global megatrends that are relevant to Versalis’ core businesses.
CEO Daniele Ferrari says, “One of our efforts is to recover from a long period of immobility. One of the ways to get back on track is to focus on highly innovative products together with large projects in the bio-chemicals market. We are committed to being key players in the bio-economy. This development model originates from a strong demand that takes account of the environmental impact of our entire production cycle in terms of renewable resources and energy efficiency; this also represents an additional opportunity with strong potential for our R&D and competitiveness on a global level.”
He adds the strategy has allowed Versalis to secure international partners. The green process began with the foundation of Matrìca, a joint venture with Novamont, followed by partnerships with Genomatica for the production of bio-based butadiene (BD), Yulex for the production of natural rubber from guayule, as well as a joint research project with Pirelli to use the natural rubber in tyre production.
The Matrìca project will convert the Porto Torres site to one of the largest and most innovative industrial green chemistry complexes in the world, according to Versalis. A total of €500m ($680m) will be invested to create seven new plants with an overall capacity of about 350,000 tonne/year of bio-products. The first two plants will go on stream at the beginning of 2014. The project also benefits from a dedicated research centre which started up in February 2012. Its main activities include optimisation of the agricultural supply chain and developing industrial technologies.
Versalis will also refurbish its basic chemicals production; the partnership with Neville Venture for the overhauling of the Priolo site is a tangible example.
Ferrari says the company has aligned its business approach around seizing new opportunities, including forming strategic partnerships with important international players, for example, Petronas in Malaysia and Lotte Chemical in South Korea. Under these two joint ventures, elastomer plants will be constructed using Versalis’ technology and know-how. The plant in Yeosu, South Korea, is due to start up at the end of 2016, while the facility in Pengerang, Johor, Malaysia, is scheduled for completion at the end of 2017.
Versalis says the innovation debate that is widely gaining ground in every sector proves that industry is urged to break the deadlock of sluggish growth in Europe. The European petrochemical industry is suffering from high energy costs, an ongoing debt crisis, and declining demand. In addition, its ability to compete with strong players from the Middle and Asia has been eroded.
For this reason it is committed not only to restructuring traditional production lines and rationalizing sites, but also to adopting alternative methods. Green chemistry and the bio-economy can, at least partially, lighten the burden from swinging prices and the volatility of fossil-based feedstock and the growing restrictions on emissions.
The chemical industry will continue for decades to be based on fossil-based production. Nevertheless, it has the potential to take better advantage of the opportunities deriving from renewable feedstocks.
Ferrari comments: “Sustainability and resource efficiency are key opportunities for differentiating and improving competitiveness. Bio-based materials provide an opportunity for growth.”
Versalis wants to be among the key players in this growth and it is for this reason that green chemistry constitutes one of its strategic pillars. The company has set a two-pronged development objective. First, focusing on new chemical specialties for the businesses where Versalis is already present, taking advantage of its in-depth knowledge of market trends. Second, producing “building block” products from renewable sources, for example, bio-butadiene, to decouple the traditional production process from a fossil source.
Ferrari says innovation projects play an outstanding role in fostering European competitiveness in economic, social and environmental terms. Innovation can improve the performance and competitiveness of existing industries, and develop new industries, solutions and products/services. Pressure on resources will be reduced by better efficiency from optimised processes and products. The retention and creation of new high-value-added jobs will lead to new know-how and experience-sharing on a global level.
“We have to acknowledge the changes the world is going through, mostly concerning energy saving, climate and resources, demography and the distribution of wealth, and direct the industry where it can boast leadership and value towards new strategies, innovation, high-added value products and efficiency,” says Ferrari.
He adds that the chemical industry must be able to continuously invest in development and innovation, noting that the chemical industry is also instrumental in the development of many other industries and their innovation processes too.
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