Dow is among companies planning to build crackers, industrial plants typically costing $1.5 billion apiece that process hydrocarbons into ethylene and other synthetic materials. The new crackers will be the first to be built in the U.S. since 2001 and the largest wave of additional capacity, John Stekla, a director at Chemical Market Associates Inc., a Houston-based consultant, said in an interview, Bloomberg reports.

New drilling methods are opening up vast shale formations from Texas to West Virginia. U.S. chemical investments stemming from shale gas may top $16 billion, creating 17,000 jobs directly and another 400,000 indirectly, according to the American Chemistry Council, a Washington-based industry group.

Dow will spend about $4 billion to construct a cracker near the Gulf Coast by 2017, reopen another in Louisiana, and build two propylene plants, Liveris said in a July 8 telephone interview from Dow’s Midland, Michigan, headquarters. That investment will supply ingredients for Dow plants making high- margin products such as paint additives and automotive plastics.

Occidental Chemical Co., Chevron Phillips Chemical Co. and Formosa Plastics Corp. have said in the past nine months they too may build crackers on the Gulf Coast, while LyondellBasell Industries NV (LYB) may invest in one. Royal Dutch Shell Plc (RDSA) said in June it plans to build a cracker in Appalachia, the region’s first in half a century.

Shuttered crackers also are being reopened by companies such as Eastman Chemical Co. (EMN), and others are being expanded.

Colorado Likely to Require Fracking Chemical Disclosures

Colorado is following Texas’ lead in passing legislation to disclose the chemicals used in hydraulic fracturing.

Gov. John Hickenlooper has said that the state likely will have a rule by year’s end calling for oil and gas companies to reveal the ingredients in fracking fluid. The industry also will have to cooperate with two state agencies to collect samples of groundwater in active drilling areas before and after the drilling process, he said.

The state already requires companies to maintain a list of ingredients used in oil well drilling.

Texas’ law, which the Texas Legislature approved in June, requires oil and gas companies to post lists of all chemicals used in fracking on fracfocus.org. There are some exemptions allowed, but landowners or a state agency can appeal an exemption. Texas was the first state to require this disclosure, followed by Wyoming.

Tulane Researchers Find Bacteria For Cellulose to Butanol

Scientists in Louisiana say they've found bacteria that can use recycled paper or any cellulose to produce butanol, a biofuel substitute for gasoline.

The new bacterium, dubbed "TU-103," is the first bacterial strain from nature that can produce butanol directly from cellulose, a Tulane University release said Thursday.

"Cellulose is found in all green plants, and is the most abundant organic material on earth, and converting it into butanol is the dream of many," said Tulane researcher Harshad Velankar.

"In the United States alone, at least 323 million tons of cellulosic materials that could be used to produce butanol are thrown out each year," he said.

As a biofuel, butanol has advantages over ethanol, the researchers said, because it can fuel existing motor vehicles without any engine modifications and can be transported through existing fuel pipelines.

It is also less corrosive and can produce more energy than ethanol, they said.

"In addition to possible savings on the price per gallon, as a fuel, bio-butanol produced from cellulose would dramatically reduce carbon dioxide and smog emissions in comparison to gasoline, and have a positive impact on landfill waste," research leader David Mullin said.

EXPANSIONS

BASF to Invest in World Scale Acrylic Acid Complex in Brazil

· Largest investment in BASF’s history in South America

· Start of production planned for 2014

· Braskem S.A. to be strategic partner for raw materials and utilities

· Start of 2-ethyl-hexyl acrylate production in Guaratinguetá, São Paulo, Brazil

BASF will invest in a world-scale production site for acrylic acid, butyl acrylate and superabsorbent polymers (SAP) in Camaçari, Bahia, Brazil. It will be the first acrylic acid and superabsorbents plant in South America. With an investment volume of more than €500 million, it is the largest investment in BASF’s century-long history in South America.

In addition, BASF will start to produce 2-ethyl-hexyl acrylate, an important raw material for the adhesives and special coatings industries, in its existing chemical complex in Guaratinguetá, São Paulo . This will be the first plant for this product in South America.

With the new acrylic acid complex, BASF aims to ensure the supply for important products as: superabsorbents for diapers, acrylic resins for coatings, textiles and adhesives and products for civil construction.

The Camaçari location is being chosen based on the availability of raw materials (propylene) and utilities provided by Braskem S.A., the major chemical company in Brazil and the strategic supplier for BASF in this project.

The construction of the new acrylic acid complex will start in 2011 employing about 1,000 individuals during construction. Production is expected to begin in the fourth quarter of 2014, generating 230 direct and 600 indirect jobs. The production for 2-ethyl-hexyl acrylate in Guaratinguetá is expected to start in 2015 on the basis of Acrylic Acid produced in Camaçari.

DuPont Opens Innovation Center in Thailand

The first DuPont Innovation Center in the ASEAN (Association of Southeast Asian Nations) region opened recently in Bangkok, Thailand, and will focus on collaborative solutions for the food and agriculture, oil and gas, renewable energy and construction industries. The center is the third in Asia Pacific to begin collaborations with local customers and partners following the June opening of the Innovation Centers in Korea and Taiwan.

“The ASEAN population has grown to become the third largest after China and India, generating greater need for food, energy and protection,” said Dr Somchai, Thailand managing director. “DuPont Thailand is committed to collaborating with our partners and customers to find innovative solutions to meet the rising needs in the country and the ASEAN region. This is the driving force behind establishing this Innovation Center.”

The DuPont Innovation Center in Thailand is the first center of the ASEAN Innovation Center network and is part of the global plan to create a worldwide network of innovation centers connecting Asia, Europe and Latin America. The goal of this forward-looking initiative is to develop new solutions together with our partners to address global needs.

Dow Boosting Additive Capacity at Scotland Facility

Dow Plastics Additives (DPA), a business unit of Dow Chemical, is constructing additional plant to expand its capacity to manufacture methyl-methacrylate butadiene styrene (MBS)-based additives at its Grangemouth, Scotland facility.

The additives in question are Paraloid BTA impact modifiers for PVC used in rigid packaging applications, and Paraloid EXL additives for engineering resins used in consumer durables and transport applications.

The expansion, which will increase Dow’s capacity for MBS-based additives by 10,000 tonnes per annum and serve customers globally, is expected to become fully operational during the fourth quarter of 2011.

Dow Expands Production of Solar Films

Dow Chemical Co. is adding capacity for its Enlight-brand polyolefin encapsulant films in Map Ta Phut, Thailand, and Schkopau, Germany.

The films are used in solar panels. According to Dow, the company will build two new manufacturing plants next year that will more than triple the company’s capacity to make the specialty films.

“Converting solar energy into an efficient source of electricity is an area of expertise Dow will continue to develop,” says Brij Sinha, global market manager for photovoltaics, said in a news release. He said demand for photovoltaic modules has been growing at about 30 percent annually.

Dow started making the films at its Findlay, Ohio, plant in December 2010.

Henkel Builds New Adhesives Factory in China

Henkel recently held a ground breaking ceremony to commemorate the start of construction for its 150,000 square-meter adhesives factory in Shanghai Chemical Industry Park. The new facility will be the main adhesives manufacturing base in China and the Asia-Pacific region. Upon completion, the new Henkel factory will be the largest adhesives factory in the world with an estimated annual production of 428,000 tons.

The construction of the new adhesives factory is part of the company’s overall strategy to expand its capacities in the growth regions. Currently, Henkel realizes 42 percent of its total sales within the emerging markets, and 53 percent of its employees are now working in those markets. The new state-of-the-art adhesives facility, which is scheduled to begin production at the end of 2012, will enable Henkel to cope with the rapidly growing demand in China and the Asia-Pacific region for its industry leading adhesives. The new factory will require a total fixed asset investment of 50 million euros. Henkel also plans to hire 600 employees to operate the new facility.

“This investment is in line with our priority to expand our business in the emerging markets,” explained Kasper Rorsted, Henkel’s Chief Executive Officer, during the groundbreaking ceremony, “China has been an important growth engine for Henkel, and we are confident that the plant will greatly enhance Henkel’s growth potential in the country.”

The new adhesives factory is also a result of the company’s efforts to further optimize its overall manufacturing activities by concentrating on fewer high-performance factories that will generate more significant cost, productivity and efficiency advantages. As part of this initiative, Henkel’s current adhesives production facilities in China will be consolidated into the new factory, significantly expanding capacities for existing and new technologies. These efforts have also been aligned to make operations more environmentally compatible as the new adhesives factory will set a high industry standard for its high operational efficiency, low energy and water consumption as well as low carbon emissions.

Israel Chemicals Eyes Expansion in India

Fertilizer and specialty chemicals maker Israel Chemicals (ICL) said recently it plans to build two more soluble fertilizer plants in northern and eastern India to meet growing demand.

ICL said its joint venture, Zuari Rotem Specialty Fertilizers, has had success from an existing 32,000 metric tonne plant in Maharashtra.

ICL said the Indian markets' demand for soluble fertilisers has been growing the past several years, a reflection of the region's growing adoption of advanced technologies that combine fertilization and irrigation, such as through drip irrigation.

ACQUISITIONS

PPG to Acquire Colombian Coatings Company Colpisa

PPG Industries (NYSE: PPG) announced recently that it and its subsidiary, PPG Colombia, have entered into an agreement to purchase the coatings businesses of Colpisa Colombiana de Pinturas, a privately-owned Colombian coatings company, and its affiliates, including Colpisa Ecuador. The transaction is expected to close no later than the end of the first quarter 2012, subject to regulatory approvals and customary closing conditions. Financial terms were not disclosed.

Colpisa, based in Itagüί, near Medellin, was founded in 1973 and manufactures and distributes coatings for automotive OEM and refinish, industrial and architectural coatings customers in Colombia and Ecuador. Colpisa operates a coatings manufacturing facility in Colombia and employs about 400 people. The company has been a technology licensee of PPG automotive OEM coatings since 1996 and a distributor of PPG automotive refinish products since 2004.

“By acquiring Colpisa, PPG builds on a successful relationship and gains the opportunity to expand our coatings presence in Colombia to directly serve and grow with automotive manufacturers,” said Tim Knavish, PPG vice president, automotive OEM coatings, Americas. “PPG intends to build upon Colpisa’s strong manufacturing and distribution practices as the Colombian economy expands and more automobiles are built and sold in the region.”

According to Knavish, PPG would become the only major global coatings supplier with a direct automotive OEM manufacturing presence in Colombia. PPG currently has no manufacturing sites in Colombia or Ecuador, but does supply protective and marine coatings to the region, in addition to its technology and distribution relationship with Colpisa.

“As an automotive refinish coatings leader, we are pleased to add Colpisa’s automotive refinish business to our global portfolio,” said John Outcalt, PPG vice president, global automotive refinish. “This acquisition is further evidence of PPG’s commitment to grow our coatings presence in Latin America.”

According to Outcalt, by acquiring Colpisa, PPG will become one of the leading providers of a full line of automotive refinish products in Colombia with the ability to grow and serve local customers through an established distribution network.

Cargill to Buy Dutch Nutritional Feed Additive Firm Provimi

Agribusiness giant Cargill will buy the Dutch animal nutrition firm Provimi for $2.1 billion. On Aug. 15, Cargill made the binding offer to Provimi’s owner, the private equity company Permira.

Provimi sells nutritional additives for farm animal feeds. The company had $2.3 billion in 2010 sales and employs 7,000 people in 23 countries in Asia, Europe, Africa, and Latin America. Minneapolis-based Cargill, also privately held, reported sales of $119.5 billion. Cargill buys and processes grain, and it has an animal nutrition and feed business that includes feed ingredients.

In late June, media speculation that Provimi was for sale prompted Dutch chemical firm DSM to confirm that it had joined with another Netherlands-based company, animal nutrition firm Nutreco, to try to acquire Provimi. DSM sells carotenoids, feed enzymes, and vitamins to the animal feed market. It has estimated that the nutritional additives segment is worth just under $11 billion annually, with a growth rate of 2–4%.

Cargill, for its part, has been expanding its animal feed presence in Europe. In July, it acquired Italian animal nutrition company Raggio di Sole Mangimi. According to Sam Hamadeh, CEO of PrivCo Media, which analyzes financial information about private firms, Cargill has quietly spent an estimated $6.5 billion in the past 12 months acquiring firms to diversify its business. The purchases include six branded food companies in Brazil, Central America, and India. The cash came from Cargill’s $11.5 billion sale of its shares in fertilizer firm Mosaic.

Cargill’s strengths in supply chain management, risk mitigation, and logistics will help Provimi’s subsidiaries around the world run their operations more efficiently, says John Mannhaupt, business analyst at animal health research firm Brakke Consulting. “But the reason both DSM and Cargill were interested in Provimi is that it has done a better job of downstream branding and creating value-added products,” Mannhaupt points out.

Cargill’s growing European base will help the U.S. firm reach agriculture customers in emerging markets such as China, India, and Russia, Mannhaupt adds.

McIlvaine Company

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