CHEMICAL UPDATE

 

DECEMBER 2011

 

McIlvaine Company

 

 

TABLE OF CONTENTS

 

INDUSTRY

EPA Partially Grants Petition to Initiate Reporting Rule for Fracking Chemicals

Automotive Designers Delve Farther Into Plastics' Flexibility

 

COMPANY NEWS

BASF Promotes Growth Agenda

BASF Invests in Intelligent Chemistry for Mining in Australia

Dow and Jilin Connell Sign Letter of Intent Focused on Polyurethanes

Honeywell Purchases Wax Technology, Expanding Specialty Additives Offering

Toray Succeeds in Production of the World's First Fully Renewable, Biobased PET Fiber

 

EXPANSIONS / ACQUISITIONS

Ecolab and Nalco Complete Merger

BASF to Build High Performance Specialty Plastics Plant in Korea

BASF to Expand India Footprint

Israel's Arkal Plastic Building $7 Million Plant in Alabama

Laurel Biocomposite Opens New Pilot Plant

LANXESS Acquires U.S. Biocide Specialist Verichem

 

INDUSTRY

 

EPA Partially Grants Petition to Initiate Reporting Rule for Fracking Chemicals

The U.S. Environmental Protection Agency announced Nov. 23 it will solicit public input on the design and scope of possible reporting requirements for chemicals used in hydraulic fracturing, partially granting a petition by 120 public and environmental health organizations.

 

EPA said it is partially granting the petitioners' request under Section 8(a) and 8(d) of the Toxic Substances Control Act and will initiate a public dialogue on the issue.

 

The rule requested under Sections 8(a) and 8(d) would establish reporting requirements for companies that manufacture and process chemicals used in exploration and processing of natural gas, and would require them to submit to EPA lists and copies of all existing health and safety studies conducted or initiated by or for them, known to them, or “reasonably” ascertainable to them.

 

The agency's action responds to a petition submitted Aug. 4 by a coalition of environmental and public health groups, including Earthjustice, the Sierra Club, and American Rivers.

 

The groups in particular asked the agency to require public disclosure of the identity of the chemicals and their risks to human health and the environment.

 

EPA said its Nov. 23 partial granting of the petition follows a Nov. 2 interim response that told the petitioners it was not granting their request to require toxicity testing of all exploration and production chemicals and identification of all chemical substances and mixtures.

 

That request was denied because the petition does not satisfy the requirements of TSCA to demonstrate the need for additional testing, EPA said.

 

Automotive Designers Delve Farther Into Plastics' Flexibility

Experts charged with lightweighting interior vehicle parts are rethinking what a car interior means and how parts can function in multiple ways to achieve aesthetic and operational goals, Plastics News reports.

 

The topic was part of the Plastics in Lightweight & Electric Vehicles conference, held Nov. 7-9 in Livonia, Mich. “Sustainable” and “conscious consumerism” no longer are trends or buzzwords. They have become part of the thread of culture, especially as governments issue higher standards for emission control and miles per gallon.

 

 In design thinking, customer, consumer and commercial needs are met along with sales targets.

 

The design approach to lightweighting looks at techniques such as biomimicry. For example, to develop a lighter prosthetic leg, designers might consider how bird nests are built in nature. By mimicking the webbing and intricacy of the interior of a nest, designers can achieve lightweighting goals — while also making the leg highly functional.

 

In rethinking a car interior, a lightweight headliner and trim garnish created with 100 percent PET has no cover and can act as an audio system.

 

Design experts can use multiple forms of plastic for one product. For example, a functional film on an overhead console may reduce mass and consolidate parts. Polypropylene thin film produces a good-looking and durable finish to a PP floor console frame, eliminating the need for heavy steel structures. In this way, parts are achieving enhanced performance. Composite plastics enable a thin lightweight seat structure.

 

To apply principles such as these, companies must build an innovative team around its problems.

 

The powertrain and chassis area of vehicles has seen a 40 percent increase in the use of plastics in the past 10 years, said Maurice Sessel, senior vice president of engineering with International Automotive Components North America of Dearborn, Mich.

 

“That will only increase,” he said, noting that the instrument panel alone has a lot of room to cut weight.

 

There remain opportunities in thin-wall uses. Experts have seen weight reduction of 5-15 percent using blowing agents when structural integrity is not compromised. The technique has been used in non-Class A surfaces.

 

COMPANY NEWS

BASF Promotes Growth Agenda

BASF plans to expand sales by an ambitious 6% per year until 2020 as part of a growth strategy it unveiled for investors on Nov. 29. The German firm, the world’s largest chemical company, sounded a note of optimism that is rare in Europe these days, especially considering foreboding economic forecasts.

 

According to the new strategy, called “We create chemistry,” BASF expects to sell $150 billion in products annually by 2020, compared with $85 billion in 2010. The company plans to expand emerging-market sales to 45% of revenues in 2020 from 33% in 2010.

 

BASF will invest more than one-third of a projected $40 billion in capital expenditures through 2020 in emerging markets. “We already have leading positions and fast-growing businesses in emerging markets, and this is something we will build on,” said Chairman Kurt Bock, who took the helm at BASF in May.

 

Rather than shed businesses, BASF said it will use its diverse portfolio to achieve growth. BASF operates oil and gas businesses and makes traditional chemicals, specialty chemicals, and functional materials. To get closer to downstream customers, BASF acquired specialty chemical firm Ciba in 2009 and personal care ingredients maker Cognis in early 2010.

 

As part of a focus on its automaker customers, BASF said earlier this month that it will create a new global business for battery materials. The business will include cathode materials, electrolyte formulations, and products for next-generation lithium batteries.

 

Finally, Chief Financial Officer Hans-Ulrich Engel said BASF will take actions to boost its share value by continuing its dividend policy and possibly buying back shares. It plans a cost-cutting program that will contribute $1.3 billion to earnings by the end of 2015.

 

BASF’s revenue and earnings targets are aspirational, and executives declined to provide a 2012 forecast, points out Geoff Haire, head of chemical equity research for HSBC Bank. “The new management team is saying the strategy has not been changed, but it has been modified,” Haire tells C&EN. “They presented a road map to build a less cyclical company which will strive to deliver innovative chemicals and maximize value from a highly complex chemical business.”

 

BASF Invests in Intelligent Chemistry for Mining in Australia

BASF has signed a long-term agreement with the Commonwealth Scientific and Industrial Research Organisation (CSIRO) to lease laboratory and office space at the Australian Minerals Research Centre in Perth. Starting in January 2012, BASF will build a global R&D and technology centre, employing six researchers and developers by the end of 2012.

 

In first projects, scientists will be studying mineral processing specific innovation needs such as advanced rheology modifiers for the improvement of the thickening process for valuables and tailings or modification of the crystallization process in alumina production.

 

BASF also agreed to sponsor research undertaken by the Parker Centre starting from July 2012. For five years, BASF will make a substantial financial contribution to participate in collaborative research in the areas of breakthrough technologies and process fundamentals primarily focused on alumina, base metals (particularly cobalt, copper, nickel and zinc), gold and uranium.

 

The Parker Centre is a collaborative research organization focused on hydrometallurgy R&D, involving three research institutions (CSIRO, Curtin University and Murdoch University) and strongly supported by 20 mineral processing companies.

 

“Our vision is to become the leading chemical solutions provider to the mining industry by investing in existing and innovative technologies for mineral processing and metal production of ores. To be successful, we are increasing our R&D spending and strengthening our market focused organization. The agreement with CSIRO is an important step towards building technology and innovation leadership and demonstrates our global commitment to the mining industry,” said Steffen Kudis, Head of BASF’s Oilfield and Mining Chemicals business.

 

With the participation at the Parker Centre in Perth and the agreement with CSIRO, BASF intends to strengthen its R&D capabilities in proximity to industrial research centers and key customers. This creates the opportunity to connect BASF technologies and research and development platforms with opinion leaders in academia and industry and thereby jointly address new developments for mineral processing. “Our research will greatly benefit from the intellectual property generated from the Parker Centre and from our interactions with the participant research groups,” explained Gregor Brodt, Global Development, Oilfield and Mining Chemicals.

 

“Mining has become a central focus for BASF globally, and particularly in Australia and New Zealand,” said Neil Fitzmaurice, Head of the recently established Asia Pacific Industry Target Group Mining. “We have built relationships with leading mining houses and industry-recognized academia, a sound market understanding, an attractive portfolio and the capability to translate market needs into chemical solutions. Our Asia Pacific Industry Target Group Mining looks to develop an even more comprehensive offering with the overall portfolio of BASF, also for market segments beyond mineral processing, metal production and construction. In this way we want to continue to provide major operational, environmental and economic benefits for the mining industry.”

 

Dow and Jilin Connell Sign Letter of Intent Focused on Polyurethanes

Dow Polyurethanes, a business group of The Dow Chemical Company and a leading producer of methylene diphenyl diisocyanate (MDI), recently announced the signing of a Letter of Intent (LOI) with Jilin Connell Chemical Industry Co., Ltd., a subsidiary of Jilin Connell Group, aimed at providing U.S. Gulf Coast aniline supply for growth in their polyurethanes business. Jilin Connell Group, a privately-held company, was formed in 1991. Its subsidiary, Jilin Connell Chemical Company (Jilin Connell), is the top merchant aniline producer and distributor in China and has announced expansion plans that would position it as the largest in the world.

 

Dow operates the largest single-train crude MDI plant in the world today from its Freeport, Texas site; therefore, competitive U.S. aniline supply is critical to meet our customers' needs in a variety of markets and applications, including energy efficient rigid and spray foam insulation solutions for appliances, building and construction; lifestyle-enhancing molded and viscoelastic foams for furniture, bedding and automotive applications; and other adhesive and coating systems for footwear, fibers, etc. The LOI with Jilin Connell concerns the exploration of opportunities for future technical and commercial collaboration in the industrial production of aniline. Discussions include plant location options such as the possibility of Jilin Connell building a fence line plant at Dow's site in Freeport.

 

"Dow's core Polyurethanes franchise enables success in downstream specialty markets and applications, and our integration strength allows us to more effectively provide market-driven customer solutions," commented Joe Harlan, president of the Performance Materials division. This project also represents another example of Dow's commitment to the U.S. manufacturing sector, in addition to Dow's interest in leveraging its engagement in China to promote foreign direct investment (FDI) and job creation by Chinese companies in the U.S. "Dow is a leader in FDI involvement and working with global partners to enter the American economy," continued Harlan. "We are committed to partnering with innovative companies that advance Dow's strategy and help create and preserve U.S. manufacturing jobs."

 

Honeywell Purchases Wax Technology, Expanding Specialty Additives Offering  

Honeywell (NYSE: HON) announced recently that it has purchased Evonik Industries’ portfolio of manufacturing technology, including patents, for the production of polyethylene waxes used in a variety of applications, from paints and coatings to adhesives and inks.

 

The technology features Ziegler-Natta catalysts, which have been used to produce polymers such as polyethylene since 1956. Today, the majority of plastics and chemicals manufactured around the world are produced using this technology.

 

The technology will supplement Honeywell’s existing extensive line of wax additives, which help improve the performance of a variety of products around the world. Honeywell waxes make paints and coatings more durable; help pipe manufacturers extrude PVC faster and reduce energy usage; and improve the stickiness of labels and cardboard box adhesives.

 

“This technology purchase expands Honeywell’s ability to develop new additives that can solve a variety of challenges for our customers in the paints, plastics, coatings, adhesives and inks industries,” said Lincoln Germain, global business director for Honeywell’s Specialty Additives business. “Ziegler-Natta-based technology is a great complement to Honeywell’s already broad set of manufacturing technologies for polyethylene additives.”

 

Toray Succeeds in Production of the World's First Fully Renewable, Biobased PET Fiber

Toray Industries, Inc. has succeeded in producing laboratory-scale samples of the world’s first fully renewable biobased PET fiber by using fully renewable biobased PET derived from biobased para-xylene from Gevo, Inc., a leading company in renewable chemicals and advanced biofuels.

 

Gevo has succeeded in converting isobutanol, produced from biomass by employing its own highly effective production method that uses synthetic biology, to synthesize para-xylene employing conventional chemical process used in commercial operations.

 

Toray used terephthalic acid synthesized from Gevo’s biobased para-xylene and commercially available renewable mono ethylene glycol (MEG) as raw materials, and successfully produced the PET samples by applying a new technology and PET polymerization in June this year. This biobased PET has exhibited properties equivalent to petro-based PET in laboratory conditions.

Toray has also succeeded in the production of a fiber using this fully renewable biobased PET for the first time in the world.

 

PET has one of the highest production volumes among petrochemical products in the world. Around 40 million tons of polyester fiber, for which PET is the source, is produced worldwide annually. Polyester fibers are widely used in our daily life as well as in industry, and it is one of the core products manufactured and sold by Toray.

 

The success of this trial, albeit under laboratory conditions, is proof that polyester fiber can be industrially produced from fully renewable biomass feedstock alone. This is a significant step that would contribute to the realization of a sustainable, low-carbon society.

 

Toray is planning to exhibit this laboratory-scale fully biobased PET fiber samples at Eco-Products 2011, which will be held at The Tokyo Big Sight in December 2011.

 

EXPANSIONS / ACQUISITIONS

 

Ecolab and Nalco Complete Merger

Ecolab Inc and Nalco Holding Co have merged, creating an US$11 billion global water, hygiene and energy services company.

 

The merger combines Nalco’s strength in water and energy services with Ecolab’s strong position in the food and beverage, healthcare and institutional markets.

 

Nalco, with sales of US$4.25 billion and more than 12 000 employees, is now an Ecolab company.

 

BASF to Build High Performance Specialty Plastics Plant in Korea

BASF will build a new plant to produce Ultrason® polyethersulfone (PESU), one of BASF’s high-performance thermoplastics, at the company’s site in Yeosu, Korea.  The annual capacity of the new plant is 6,000 metric tons. Construction of this specialty plastics plant will start in early 2012 and production is expected to begin by early 2014. About 50 new jobs will be created once the plant is operational.

 

"Overall in Asia Pacific, we are investing approximately €2.3 billion from 2011 to 2015 in order to achieve our goal to produce 70% of our sales in the region. By establishing local production of our high performance specialty plastics in Korea, we can support the growth of key local industries," said Dr. Albert Heuser, President, Market and Business Development, Asia Pacific, BASF.

 

Ultrason is sold to customers in the electronics industry, as well as the automotive and aerospace industries for the production of heat-resistant light weight components and to the water treatment industry for manufacturing of water treatment membranes.

 

At present this specialty plastic is only produced at BASF’s Ludwigshafen site in Germany.  “BASF is committed to strengthening its market position in the engineering plastics business,” said Dr. Wolfgang Hapke, President of BASF’s Performance Polymers Division. “This new plant will significantly enhance our engineering plastics position in the rapidly growing Asian market and reaffirm our dedication to being our customers’ supplier of choice for high performance materials.”

 

The Yeosu site was selected because of its highly trained and qualified workforce. Further, as it is a well-established, major BASF production site, the necessary infrastructure for the complex production structure of an Ultrason plant is already in place.

 

Ultrason is the trade name for the BASF product range of polyethersulfone (Ultrason® E), polysulfone (Ultrason® S), and polyphenylsulfone (Ultrason® P). The product can withstand temperatures up to 220 degrees centigrade without altering its properties and possesses outstanding chemical stability.

 

In addition to its use in the electronics, automotive and aerospace industry, other Ultrason applications include membranes for medical devices, hot water and food contact parts for example in espresso machines, microwave-proof dishes or baby bottles. Ultrason is also used in the production of carbon fiber composite materials.

 

The Korean electronics industry is a major target market for Ultrason. The location also benefits from the proximity to other major markets such as China and Japan.

 

BASF to Expand India Footprint

Terming India and China as a major growth market, the leading Germany-based chemical giant BASF plans to invest around Euro 2.3 billion in the region in the coming 10 years, the hundustatimes reports.

 

According to the BASF-India website, the company’s first venture into India was in 1890 to explore textile colours. Officials said the company’s long association with India is set to expand in the next few years.

 

The BASF in India report 2010 quoted Dr Martin Brudermuller, vice-chairman of the board of directors, BASF, Asia Pacific, as saying that in 2010 sales in India, for the first time, had crossed the €1 billion mark. Brudermuller said the company focus was on the R&D centers in Mumbai and Mangalore to achieve the objective of providing more innovation from Asia for Asia. Both centers were crucial to the global technology platform of the company in making India a hub for research and development in the region.

 

Two new manufacturing plants in Thane and Mangalore were also expected to boost both local and international sales.

 

The company stated that it will increase its headcount in the region from 5000 to 15,000. It has also outlined a strategy to double the number of employees in the research and development by 2020, especially in India and China.

 

``We have set up recruitment dedicated centres in India and China to help us hire the talents we need,’’ Brudermuller said.

 

The board of directors of BASF India Ltd last month approved the proposal to develop and refine yield enhancing traits in rice on behalf of BASF Plant Science Company GmbH.

 

Currently, the BASF employs more than 1800 people across nine production sites and 21 sales offices across India. Fourteen out of 15 global divisions of the company are operating in the country.

 

Israel's Arkal Plastic Building $7 Million Plant in Alabama

Israel’s Arkal Plastic Products is extending its global manufacturing footprint with the first U.S. plant for its Arkal Automotive unit.

 

Arkal Automotive USA Inc. will go into a 32,000-square-foot building now under construction in Auburn, Ala., the company and local economic development officials said in a Nov. 29 news release.

 

Arkal Automotive has a molding facility in London, Ontario, supplying functional long-glass reinforced plastic parts to automakers in the Detroit and Ontario manufacturing region. It also has a sales office in Farmington Hills, Mich. The Auburn plant will focus on car manufacturers in and near Alabama.

 

Arkal, based in Kibbutz Bet Zera, is investing $7.2 million at the new site. It expects to hire 25 people when it launches production.

 

Arkal Automotive makes a variety of structural and functional parts, including battery trays, brackets and front end supports. It also has manufacturing in Israel, Spain, Poland, France and China.

 

Laurel Biocomposite Opens New Pilot Plant

US-based Laurel Biocomposite has shipped the first Bio-Res pellets from its new pilot plant, opened in Nebraska recently.

 

The Bio-Res pellets are made from corn-based distillers’ grain, a by-product of ethanol plants. To make Bio-Res, Laurel feeds the grain into tanks, which transfers the material into a displacement pump, which, in turn, discharges it to a decanter. The material is then milled and palletised.

 

The pellets are made of 60-80% bio-material and are designed to be mixed with PE, PP, polylactic acid and PHA.

 

Injection moulded parts made of Bio-Res show a 10% increase in stiffness and tensile modulus, says Laurel.

 

Laurel’s first customer is using Bio-Res pellets to develop adhesive applications for home products.

 

LANXESS Acquires U.S. Biocide Specialist Verichem

LANXESS is strengthening its portfolio of biocides with the acquisition of Verichem Inc. based in Pittsburgh, Pennsylvania. As a result, the German specialty chemicals company will significantly bolster its position in the U.S. material protection market and broaden its global biocide manufacturing network. Both parties have agreed not to disclose financial details.

 

LANXESS will gain access to a complementary portfolio of biocides, as well as active ingredients registered with the U.S. Environmental Protection Agency (EPA). They are used to protect coatings, adhesives, construction materials, as well as pulp and paper. The biocides prevent the deterioration and discoloring of materials caused by microorganisms.

 

Verichem is a privately owned company currently employing around 20 people. It recorded sales of roughly USD 10 million in 2010. Verichem's production site is located close to LANXESS' U.S. headquarters in Pittsburgh.

 

"This transaction underlines LANXESS' standing as a key supplier of high-tech solutions for the megatrend urbanization," said Rainier van Roessel, Member of the LANXESS Board of Management. "In addition, this is the second acquisition we have made in the USA within a few weeks, thus strengthening our commitment to the North American market."

 

The transaction will close with immediate effect. Verichem will be integrated into the LANXESS business unit Material Protection Products (MPP).

 

MPP is already one of the world's leading suppliers of biocides. It has recently strengthened its position as a supplier to the construction industry after acquiring the material protection business of Syngenta.

 

MPP also offers stabilizing agents for beverages and is the world's leading manufacturer of phenolic active ingredients for disinfection. Its production sites are located in Krefeld-Uerdingen and Dormagen (Germany), Jhagadia (India) and Wuxi (China). The business unit is headed by Torsten Derr and currently employs around 300 people.

 

 

 

McIlvaine Company

Northfield, IL 60093-2743

Tel:  847-784-0012; Fax:  847-784-0061

E-mail:  editor@mcilvainecompany.com

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