Shanghai phenol, acetone plant to lift Cepsa’s Asia market share
Jonathan Lopez
17-Jun-2014
Interview article by Jonathan Lopez
LONDON (ICIS)–Cepsa expects its new
Shanghai plant to start operating at the end of 2014,
with an annual nameplate capacity of 250,000 tonnes of
phenol and 150,000 tonnes of acetone, which will gain market
share in the Chinese market and avoid the freight costs of
importing from Europe into Asia, said Fernando Iturrieta, the
company’s director of chemicals, on Tuesday.
With this plant in China, Cepsa will have a
network of facilities away from its home country, Spain, in
order to meet demand where the growth is taking place at the
moment, said Iturrieta, as Europe’s economy keeps lagging
behind and growth rates are very poor.
That case is especially true for Spain, which is just
emerging from a long recession after its property bubble
crash in 2008.
On top of that, the Spanish
energy major is hopeful the plant in China
will “cover the supply/demand imbalance for phenol and
acetone” in the country, which is making it necessary to
import considerable volumes of these intermediates.
On the back of that, Cepsa has secured
commercial agreements with the main consumers of these
products in China, one of them German chemical
major Bayer MaterialScience.
Other companies based in the same Shanghai industrial
park are Evonik or Lucite, to which Cepsa expects to sell
its acetone as well. The company claims once the
plant in Shanghai is up and running it will make it the
second largest phenol and acetone producer worldwide.
“We are devoted to the Chinese market.
Despite recent lower-than-expected growth figures, China will
continue to be a growing market and Cepsa wants to be there.
We are very proud of this project in Shanghai, as it is the
first investment of Cepsa in Asia,” said Iturrieta.
“The reason to be in China has to be found
in the fact that we were exporting from Spain to China but we
realised that it was becoming almost unaffordable on the back
of freight costs. Therefore, we decided to have our own
facilities in the country to overcome that problem,” he
added.
Cepsa’s Iturrieta also says in the future
green chemicals could be a good compliment for oil-based
chemicals, although their high costs makes them quite
uncompetitive at the moment. However, he says there is a
growing trend of customers demanding greener chemicals and
the industry will have to respond to it.
“Green chemicals are for sure part of the
future. It’s stupid to deny that. Some of our main customers
are devoted to them and decided to base part of their product
in this green feedstocks. Although they are still much more
expensive than synthetic chemicals, I am sure they are part
of the future and we’ll see them taking more and more share
of the total consumption,” he said.
He recognises, however, that green
chemicals are now very dependent on subsidies (especially in
Europe) although he says as the sector becomes more
competitive it will also become more able to work its way
across the markets without state help.
Cepsa itself is “looking at developments,”
especially regarding its linear alkyl benzene (LAB)
products, trying to compliment synthetic feedstocks with
natural ones, although Iturrieta does not give more details
about the project.
He says Cepsa has been too concentrated in its home
market and now it needs to gain customers and markets
elsewhere as Spain is still emerging out of the recession.
However, that wouldn’t mean, he says, the closure of its
Spanish sites.
“The fact that the Spanish market is not
growing as expected, and also due to growing refinery
capacity in Asia and the Middle East, Cepsa has committed
itself to grow in exploration and production, as well as
chemicals. For that, we need to keep our plants in Spain
efficient, by modernising them and reducing energy
consumption,” concluded Iturrieta.
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