The Catalyst Review - March 2015 - 3

COMMERCIAL NEWS

U.S. Shale Industry Shows Remarkable
Sinopec Maoming
Completes Butadiene Resilience...
Off-gas Hydrogenation U.S. independents are telling their investors that they can maintain production
roughly level, even while running fewer rigs. EOG Resources, for example, plans a 40%
Facility...
capital spending cut this year but expects just a 3% drop in production. Hess is cutting
Sinopec Group reported that it completed
construction of the 40,000 t/a butadiene
off-gas hydrogenation facility at its
Maoming branch in Guangdong province.
This facility is designed to recover off-gas
and heavy C4 cuts from the two existing
butadiene manufacturing lines, and
alkyne, dienes and mono-olefins in the
after-etherification reaction of C4 mixtures
from the MTBE facility, and then process
them into butane, which can be used as
cracking feedstock to replace naphtha.
Construction on the facility was started
on September 24, 2013. Startup was
scheduled for February 2015. Source:
China Chemical Reporter, 3/6/2015, p. 10.

CLG Expands
Technology Portfolio
to Include Full Range
of Bottom-of-theBarrel Conversion
Technologies...
Chevron Lummus Global (CLG), a joint
venture between Chevron and CB&I,
announced an expansion of their
technology portfolio to include Chevron's
slurry residue hydrocracking technology
and CB&I's coking business. The extension
of the business became effective January
1, 2015. Chevron has contributed Vacuum
Resid Slurry Hydrocracking (VRSH™) to
the portfolio, a patented slurry catalyst
technology for high conversion of heavy
feedstocks to transportation fuels. Building
on Chevron's long history of residue
hydroprocessing, it is based on CLG's welldemonstrated LC-FINING™ platform and
will be marketed as CLG Residue Slurry
Hydrocracking (CRSH™). CB&I has added
its delayed and needle coking business,
which is in use by numerous licensees
worldwide. Source: CLG, 3/3/2015.

spending by 14% but expects production growth of about 12%. Achieving the outcomes
projected by U.S. shale producers for this year would represent one of the most
remarkable productivity performances ever achieved. The number of rigs drilling for
gas fell from 1,606 in the summer of 2008 to just 268 last week. Yet U.S. gas production
has continued to rise. EIA data show remarkable improvements in productivity, with
production per rig from new wells rising in the past year by 24% in the Eagle Ford, 29%
in the Bakken and 30% in the Permian basin. Last October, the median break-even oil
price needed for shale projects was estimated at $57 per barrel. Falling costs mean this
year that number will be significantly lower. If crude prices do start to pick up again,
many analysts and executives think U.S. shale producers may be able to step up activity
again and resume production growth even with oil below $75. Although U.S. shale is a
higher-cost source of oil than some of the great fields of the Middle East, it may well
turn out to be more resilient than Saudi Arabia and other OPEC members would like.
Source: Financial Times, 3/16/2015, p. 17.

Albemarle and ASOS to Collaborate on Fluid
Catalytic Cracking (FCC) Catalyst Facility in the
Middle East...
Albemarle Corporation announced that it has entered into discussions with its
Middle Eastern partner Ali & Sons Oilfield Supplies & Services Co. (ASOS) to construct
a manufacturing facility for FCC catalysts and additives in Abu Dhabi, United Arab
Emirates. Abu Dhabi represents the ideal site for the proposed facility because it would
allow Albemarle to meet rapidly growing regional demand for refinery catalyst solutions
and would provide an unmatched security of supply for existing customers in the
Middle East. The facility would manufacture Albemarle's value-added AFX® catalysts,
which promote increased propylene yield from resid feedstocks. this announcement
follows Albemarle's successful delivery of catalysts for the startup of the FCC unit in
Takreer's newly expanded Ruwais refinery. Source: Albemarle, 3/12/2015.

Petrochemicals' Oil Shock...
The oil price decline hasn't quelled the U.S. petrochemical industry's shale revolution;
it has merely slowed the charge. Oil prices are now about half of what they were at
their peak, providing some relief to foreign competitors. Natural gas prices have fallen
too but not by as much. Last summer, oil was four times as expensive as natural gas
on an energy content basis. Now, it is three times as much-still a robust advantage
for U.S. chemical producers to enjoy. In addition to cheaper natural gas, other factors
are mitigating the oil price decline to the benefit of U.S. chemical producers. The
price of ethane, the main ethylene feedstock, has dipped below that of natural gas
on an energy content basis. On top of that, shale has led to a glut of propane and
butane too, making them at times even cheaper to run through chemical plants than
ethane. Mauro Gregorio, Dow Chemical's president of feedstocks and energy, says his
company monitors feedstock prices on a weekly basis and can adjust its production
just as fast. Naushad Jamani, senior vice president of olefins and feedstocks for Nova
Chemicals, is not worried about oil. He says prices would have to drop to $30 per barrel
for oil and natural gas to reach parity. "Natural gas liquids will continue to remain the
preferred feedstock for North America," he says. Source: Chemical & Engineering News,
3/9/2015, p. 27.

The Catalyst Review

March 2015

The Catalyst Review - March 2015

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