Total's mystery partner will open way for MTBE buy

Source: ECN

1991/09/11

TOTAL HAS found the financial partner in the US which it needs to go ahead with the acquisition of Texas Olefins, the second largest US MTBE producer. Total confirmed to ECN early last month it had signed a preliminary agreement to buy the company subject to finding a partner, who is still unnamed (ECN 11 November).

The deal, which looks likely to be concluded early next year, will shoot Total straight into the world's leaders in MTBE, where it currently has several moves underway worldwide. MTBE from Texas Petrochemicals, the US company's subsidiary, will enable Total's gasoline products to meet the requirements of the Clean Air Act.

Total deputy director general for refining, Jean-Claude Vettier, says Texas Olefins is 'a perfect fit' with Total activities and has developed a 'coherent C4 base unique in the world which ensured the company's cash flow'.

Texas Petrochemicals Corp, formed after Texas Olefins purchased Petro-Tex Corp from Tenneco in 1984, is a processor of C4 streams with sales of over $300m/year. Its production in Bay-town, Texas, includes butadiene, butene-1, butene-2, high purity isobutylene, diisobutylene and MTBE. Originally a butadiene and co-products company, in the past five years it has pursued a niche strategy in MTBE and added-value C4s.

TPC inherited three old Houdry process units from Petro-Tex for butane-to-butadiene dehydrogenation, each of 40 000 tonne/year. But contrary to reports, none of these units was ever put into service, instead two were converted to MTBE plants and a third was moth-balled and has been cannibalised.

TPC produces butadiene when the market is tight, but uses a separate unit using the Petro-Tex Oxo-D process, fed with mixed butenes, not butane. This swing capacity is small: most of its butadiene business is toll fractionation of mixed C4 streams using conventional technologies. Therefore, although it has a nominal butadiene fractionation capacity of 590m kg/year, the actual throughput is usually half of that, ECN understands.

In butene-1, TPC has 91m kg/year distillation capacity, although production is lower, at 59-64 000kg/year. Butene-1, which TPC extracts from raffinate-2, is largely used for lldPE comonomer.

TPC also inherited two old, small MTBE units of 2500 and 4500 bbl/day capacity. One of these is believed to feed the 40m kg/year high-purity isobutylene unit at the site. Two of the old Houdry units were converted to make isobutylene from isobutane, one in 1986 and the second in 1990. Both we Catofin technology. Although TPC has a nominal MTBE capacity of 20 000 bbl/day, in practice it could be lower, due to feedstock constraints.