Chemical profile: Linear alkylbenzene

Source: ECN

2009/05/31

Uses
Virtually all linear alkylbenzene (LAB), also known as detergent alkylate, is converted to linear alkylbenzene sulfate (LAS), which is used almost exclusively as a surfactant in detergents and cleaning products.

Supply/demand
Global capacity is forecast by US consultancy Colin A. Houston & Associates (CAHA) to rise from 3.4m tonnes/year to 3.5m tonnes/year by 2010 as new plants start up in Asia, lifting its share of world capacity from 45% in 2008 to 46% in 2010.

Capacity has been reduced by some 200,000 tonnes/year with the closure of South Africa-based Sasol's plants in Porto Torres, Italy, and Baltimore, Maryland, US, in 2007.

Demand in Europe is recovering in the second quarter (Q2) as buyers reenter the market after destocking in Q1 and Q4 2008. But, demand is said to be down by as much as 10% as customers switch to cheaper products that use less active ingredients, and plant operating rates are still reduced and said to be running at 70-80%.

Prices
Prices appear to have bottomed out in Europe, with increases achieved in May. One supplier said prices rose €20-40/tonne, tipping over €1,000/tonne. Another quoted a range of €1,080-1,150/tonne, delivered.

Volatile benzene and kerosene costs have hit margins, which deteriorated further in 2009. Players say margins are starting to recover, but prices need to be above €1,100/tonne to gain minimum return.

Technology
LAB is mainly produced from n-paraffins, from kerosene (typically in the C10-C13 range), and benzene. Conventional technologies are based on hydrofluoric acid (HF) or aluminum chloride alkylation.

HF's share of global capacity will decrease, as proposed new capacity is based on the Detal process from US-based UOP, developed jointly with Spain's CEPSA. Detal abolished the use of liquid HF, reducing capital and investment costs.

Outlook
Global demand growth will remain steady at around 2%/year. In Western Europe, demand will grow at GDP rates, but will be higher in Eastern Europe, particularly in Russia. Strong growth, possibly reaching 10%/year, will be seen in the emerging markets of Asia, Middle East and Africa, India and South America.

Most new capacity will be built in Asia in 2011-2012, adding to existing world oversupply. New projects have also been announced in the Middle East.

A shortage of n-paraffins feedstock will be exacerbated by US-based ExxonMobil's closure of its Texas plant in June, and the market likely will not recover until 2011, when global producer Shell will start up its Pearl gas-to-liquids (GTL) plant in Qatar. Many GTL projects, expected to include n-paraffins, have been cancelled or delayed.

Major global LAB CAPACITY, '000 TONNES/year

Company Location Capacity
Ameriya Petroleum Refining Ameriya, Egypt 50
Bisotun Petrochemical Kermanshah, Iran 55
CEPSA Quimica San Roque, Spain 220
Chemische Fabrik Wibarco Ibbenburen, Germany 66
Chevron Chemical Gonfreville, France 100
Deten Quimica* Camacari, Brazil 220
Emalab Jebel Ali, Dubai 30
Formosan Union Chemical Lin Yuan,Taiwan 90
Fushun Petrochemical Fushun, China 200
Gulf FarabiPetrochemical Jubail, Saudi Arabia 70
Huntsman Performance Products Chocolate Bayou, Texas, US 180
Indian Oil Baroda, India 75
Iran Chemical Industries Investment Esfahan,Iran 75
Isu Chemical Ulsan, South Korea 190
Jin TungPetrochemical Nanjing, China 200
Lukoil Neftochim Burgas Burgas, Bulgaria 5
NipponPetrochemicals Kawasaki, Japan 45
Nirma Baroda, India 110
OHIS Skopje, Macedonia 18
Petresa Canada* Becancour, Canada 120
Qatar Petroleum Mesaieed, Qatar 100
Quimica Venoco Guacara, Venezuela 135
Reliance Industries Ltd. (RIL) Patalganga, India 115
Repsol Ensenada, Argentina 50
Sasol Augusta, Italy 220
Louisiana, US 125
Sinopec Jinling ­Petrochemical Nanjing, China 100
Tamilnadu ­Petroproducts Manali, India 100
Unggul Indah Cahaya Merak, Indonesia 210
United Joint Stock Co. for Petrochemical Industries Damascus,Syria 40
SOURCE: ICIS plants & projects

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Profile last published February 23, 2004