No new China PDH projects coming on stream in 2017-2018

Source: ICIS News

2017/06/06

Focus article by Monica Wang

SINGAPORE (ICIS)--China will take a breather in adding propylene capacity via the propane dehydrogenation (PDH) route this year and next year, according to data compiled by the China editorial team at ICIS.

High capital requirements have caused delays in implementing phase II PDH projects of a number of Chinese producers, according to industry sources.

Consequently, China’s imports of feedstock propane are not expected to grow from around 4.65m tonnes in 2016. The volume of feedstock imported is based on an 85% average operating rate of existing PDH units.

China currently derives 4.61m tonnes of propylene from PDH plants, the first of which started operation in September 2013. These plants account for less than 10% of the country’s overall propylene production.

An additional 6.35m tonne/year of propylene capacity from PDH units is currently in the pipeline, with the next plant due to come on stream in 2019. (Please see table below)

Tianjin Bohai Chemical Industry Group, the producer that put into operation China's first PDH plant, decided to give up a plan to bring on stream a second 600,000 tonne/year PDH unit in mid-2018. Instead, the company would build a 500,000 tonne/year coal-to-olefin unit, according to a company source.

Industry sources said that the supply and demand gap for propylene in China - estimated at 2m tonnes for 2017 - is currently not big enough to require urgent investments in PDH plants.

Last year, the country imported 2.9m tonnes/year of propylene, according to official data.

China's existing PDH units are currently running at a lower average run rate of 80%, with healthy operating margins pegged at about yuan (CNY) 1,500/tonne on average, industry sources said.

Any increase in demand may be covered by raising the utilisation rates of the plants, they said.

China PDH Projects

Company name

Location

Propylene capacity in thousand tonnes

Start-up date

Progress

Tianjin Bohai Chemical Industry (Group)

Tianjin

600

12 Sept,2013

In operation

Tianjin

600

mid-2018

Cancelled

Ningbo Haiyue New Material Co

Ningbo, Zhejiang

600

Aug 2014

In operation

Zhejiang Satellite Energy Co

Pinghu, Zhejiang

450

Aug 2014

In operation

450

2019

Under construction

Sanyuan Petrochemical

Shaoxing, Zhejiang

450

Aug 2014

In operation

Yantai Wanhua Group

Yantai, Shandong

750

Aug 2015

In operation

Zhangjiagang Yangtze River Petrochemical

Zhangjiagang, Jiangsu

600

May 2015

In operation

Zhangjiagang, Jiangsu

600

N/A

Planned

Haiwei Group

Hengshui, Hebei

500

Sept 2016

In operation

Huanghua, Hebei

500

N/A

Planned

Fujian Meide Petrochemical

Fuqing, Fujian

660

2019

Under Construction

660

N/A

Planned

Oriental Energy

Ningbo, Zhejiang

660

H2 Oct 2016

In operation

660

N/A

Planned

Caofeidian,

660

N/A

Planned

Tangshan, Hebei

660

N/A

Planned

Shenzhen Juzhengyuan

Humen, Dongguan

900

2019-2020

Foundation laid in August 2016

PDH C3 capacity (in tonnes/year)

In operation

Under construction

In planning stage

Total 

4.61m

2.01m

4.34m

Source: China editorial team at ICIS

($1 = CNY6.80)

ICN