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Extracts from Nandini Chemical Journal, Aug 2012

ADIPONITRILE|ETHYLENE PLANTS IN USA|CARBON FIBER PROJECTS
Highlights of Some of the Articles

TALK OF THE MONTH : OVERCOME ENERGY CRISIS BY OVERSEAS INVESTMENT
HIGHLIGHTS OF THE PROCEEDINGS OF LNG INVESTOR’S CONFERENCE AT CHENNAI
ADIPONITRILE – PRODUCT PROFILE
SPOTLIGHT ON SPECIALITY CHEMICAL VINYL FORMAMIDE
ELECTROLYTIC MANGANESE DIOXIDE - INVESTMENT OPPORTUNITY
PROPOSED ETHYLENE PLANTS IN USA
CARBON FIBER PROJECTS OF CYTEC
CARBON FIBER PROJECTS OF CYTEC
HEXABROMOCYCLODODECANE - FLAME RETARDANT FACING RESTRICTIONS
COSTLY DELAY IN KOCHI LNG TERMINAL PROJECT
ENNORE LPG TERMINAL ON STREAM
PRICE TREND OF NATURAL GAS IN USA
TRENDS IN SEAWATER DESALINATION INDUSTRY
DEPENDENCE ON CRUDE OIL IMPORTS ON THE RISE
OVERSEAS OIL EXPLORATION PROJECTS
CONCURRENT DRILLING TO HELP ONGC INCREASE OUTPUT
INDIAN CBM PROJECTS PRICE FIXING EXERCISE
UNDERSEA MINING EXCITING OPPORTUNITIES
ISSUES FACING SOLAR PANEL MAKERS
OTHER FEATURES
OTHER ARTICLES

TALK OF THE MONTH

OVERCOME ENERGY CRISIS BY OVERSEAS INVESTMENT

There is no doubt that Indian energy scenario  have become highly uncertain with  indigenous production of coal , crude oil and natural gas falling far short of the national  requirement. There is no way that the Indian production of these essential fuel can be stepped up to the level of requirement in the coming years.  While there are alternatives such as nuclear power, solar/wind energy and biofuel, the fact is that they would represent even in the best of circumstances only a fraction of Indian requirements for energy.

Under the circumstances, India is likely to emerge as the largest importer of crude oil, coal and natural gas in the next five to six years and thus Indian industry and economy would inevitably become highly vulnerable to the international price cartel and price pressure for its energy source.

The government of India can be faulted for not coming out with the white paper on the grave energy issue facing  India  and how it would propose to tackle them, as the country's economy would further expand and grow. The absence of any publicised  strategy from the government of India has created a sense of panic amongst the Indian industry and services sector, with investors unable to plan their future projects and activities.

While it is now crystal clear that India's import dependence on coal, crude oil and natural gas will increase, the only solution appear to be to take urgent steps to reduce India's vulnerability to the global market conditions,  by India taking stakes by way of investment in the energy producing ventures and companies abroad.  While some initiatives have been taken in this regard , India still has a long way to go.

In this connection, it is appropriate that the government of Gujarat is looking to invest in an export LNG terminal in Canada for importing natural gas from that country.  With the production of shale gas in US increasing, the price of natural gas in North America is falling down rapidly. India will have to shift its sourcing point for natural gas to Northern America instead of the Middle East region , if it were to take advantage of the falling shale gas price in USA. US LNG  prices is now 1/4th of prices in Europe and 1/6th of Japan.

National Petroleum Council of USA has said in a communication to US government that the potential supply of natural gas in North America is far higher than previously  thought and the natural gas resource base is enormous.  It is now believed that the US natural gas reserves can meet the global requirements for several decades.

United States and Canada are among leading natural gas producers  in the world

Country

Production of natural gas per day
(in billion cubic feet )

USA

59

Russia

58

Canada

19

Iran

18

Qatar

17

Norway

16.5

China

16

Saudi Arabia

15.5

Indonesia

15

Algeria

15

Source: BP Statistical Review of World Energy.

While the government of Gujarat has taken the initiative to participate as stake holder in LNG terminal in Canada  by making investment, it is necessary that  the government of India should take the necessary steps to facilitate such investments abroad by appropriate political and trade policy initiatives.

In the case of oil gas exploration, ONGC Videsh Limited  (OVL) has taken some successful initiatives in the recent past.OVL has developed  creditable asset base that comprises  exploration and production in oil/gas fields across the continents. It has operator status in eight projects and joint operator status in another seven..  OVL produces hydrocarbons from 10 assets, namely Shakalin-I (where it invested $2.7 billion) and Imperial in Russia, Al-furat Project in Syria, apart from the projects where oil has been discovered and 14 in the exploration phase in  fields in Vietnam, Colombia,Sudan and Brazil.

While the initiative of OVL has been gratifying , India has to invest in many more overseas   oil and gas exploration ventures and LNG terminals to save itself from the impending energy crisis.

The ball is clearly  in the court of Government of India.

HIGHLIGHTS OF THE PROCEEDINGS OF LNG INVESTOR’S CONFERENCE AT CHENNAI

Chemical Industries Association an apex body representing the cross section of chemical industries, organized LNG Investor’s Conference at Chennai on 20th July 2012

The objective of the conference is to focus national attention on the proposed LNG terminal in Tamil Nadu and discuss about the appropriate investment plans for downstream projects based on LNG and LNG based power projects, so as to utilize the imported LNG in optimum manner for the larger benefits of the country.

Conference was inaugurated by Mr. P.N. Devarajan, former President, Reliance Industries, and key note address was delivered by Mr. V. Damodaran, Executive Director, (Ennore LNG) Indian Oil Corporation.

Mr. P K N Panicker. President of Chemical Industries Association presented the theme of the conference.

Conference was well attended and senior executives from several organizations including GAIL, ONGC, Engineers India, Mecon Ltd., Linde, Chemplast Sanmar, Cetex Petrochemicals . Apollo Tyres, SPIC, Madras Fertilisers, Chennai Petroleum Corporation participated.

The following papers were presented during the conference.

Mr.P.N.Devarajan                                                         Inaugural address
Chairman of Research Council National                  Need for LNG terminals to sustain the national growth
Environmental Engineering Research Institute             
Former President, Reliance Industries                          

Mr.V.Damodaran , Executive Director                      Keynote address:
(Ennore LNG Project)                                              Proposed LNG terminal project at  Ennore in Tamil Nadu
Indian Oil Corporation                                             - Plans and objectives

Mr.Jitendra Prasad,                                                     LNG – A general perspective 
General Manager-Head (RGL) ,  ONGC

GAIL India                                                                     RLNG supplies by GAIL in Tamil Nadu                                                                        

Dr.D M Mohunta, Senior chemical technologist     Efficient use of energy , Energy resource – The role of 
       LNG

Mr.Ravi Raghavan,Editor,Chemical Weekly        Shale gas: Developments & Implications for Petrochemicals

Mr.S.Ilanahai                                                        LNG use in boilers and captive power plants 
Chairman and Managing Director
Cetex Petrochemicals Ltd
Mr.R.Ramakrishnan. General Manager 
(Business Development])
Cetex Petrochemicals Ltd

HIGHLIGHTS OF KEY NOTE ADDRESS

Highlights Of The Key Note Address Delivered By  Mr.V.Damodaran, Executive Director.(Ennore LNG Project) Indian Oil Corporation is given below

The Rs.4,500 crore LNG terminal at Katupalli near Chennai will  come up by 2015 - 16.  IOC, which signed an agreement for the project on March 20, will set up the terminal on 132 acres inside Ennore Port in partnership with TIDCO and CPCL.  TIDCO is expected to take 5-10 per cent of equity stake in the project.

IOC will also float tenders for setting up of piped infrastructure to establish a well networked gas grid.  While the LNG terminal will handle 5 million metric tonnes a year, it can be scaled up to handle up to 10 million metric tonnes.  The terminal will include two storage tanks, each with a capacity of 1,80,000 cubic metres.

Ennore Liquefied Natural Gas terminal has completed the front-end engineering and design process (FEED). 

The process of FEED is billed to be the first logical step in the run-up towards the commissioning of the LNG project.  The project, launched in March 2012, has completed the due diligence process of FEED and would leap ahead to the process of appointing project management consultant  shortly.

‘FEED assessment was done by global engineering and construction group, Foster Wheeler.  FEED includes a host of project planning processes like conceptual design, piping and instrumentation diagram, marine facilities, captive power plant, plant layout, etc. 

Subsequent to FEED is the process of appointment of PMC that would most probably be done by August 2012 through international competitive bidding process. 

Ennore LNG project also awaits Coastal Zone Act permits from central and state governments and the project is likely to get environmental clearance by December this year.  EPC contracts would be split into three major packages.

The works in first package include 1.8 lakh cubic metres LNG storage capacity, development of marine facilities in the second package, re-gasification sent out facilities coupled with construction of plant building and non-plant building in the 3rd package.

The completion time stipulated for gas pipeline project by PNGRB is 36 months and if the work would start this year, it would coincide with the completion and commissioning of terminal by 2015 end.

IOC has signed agreements with leading industries in the region to supply the imported Liquefied Natural Gas.

Some of the industries that have signed up for LNG include Madras Fertilizers Ltd and SPIC, which need the LNG feedstock, over 400 MW of power plants including Tamil Nadu Electricity Board’s Basin Bridge project, and private power generation companies such as Samalpatti Power, Madurai Power and GMR, which are keen on shifting to LNG.

Heads of agreement, a binding contract in financial parlance is signed with major customers like SPIC, Madras Fertilizers, Chennai Petroleum Corporation (CPCL), Saint Gobain, etc.

PPN Power hopes to supplement its fuel supply with LNG from the Ennore Terminal. Saint-Gobain Glass is also keen on sourcing LNG from the project.

IOC is hoping that the Tamil Nadu Government will set up at least 1,000 MW of power generation capacity based on the imported LNG.

The City Gas Distribution projects to provide piped gas to homes will also take off.

The initial capacity is based on the demand estimates of about 6.9 million tonnes in 2016.

Once the project management consultant is finalised , IOC  will float the first tender to identify the EPC contractor to set up LNG storage tanks of 2.66 lakh cubic metres storage capacity, the other major packages include the marine facilities, gasification and related facilities and construction of buildings.

The Tamil Nadu Government has granted over 130 acres in the Port area for the project.

IOC hopes to follow the Petronet LNG model in which all the public sector oil and gas companies have a stake.

Meanwhile, IOC is concerned about the Petroleum and Natural Gas Regulatory Board cancelling the licence to Reliance Gas Transportation Infrastructure to set up the Chennai-Tuticorin LNG pipeline due to lack of progress.

IOC will bid if a new tender is floated, as work has to start on the line this year if it is to be in place on time to transport the imported LNG.

ADIPONITRILE – PRODUCT PROFILE
Appearance Colourless to yellow, odourless liquid
Synonyms Butane-1,4-dicarbonitrile; Hexanedinitrile
CAS No 111-69-3
Molecular Formula C6H8N2
Boiling point deg.C                                                295
Viscosity at 30 deg.C cP                                       5.8
Specific gravity, 20 deg,C 0.965
Solubility in water, wt%, 20 deg,C 9
Solubility in water, wt%, 102 deg,C 50

Specification

 Description

 Value

Adiponitrile content

99.9%

Water content

0.05%

Other organics

0.2%

This article contains the following details:

  •         Applications
  •         Application development
  •         Manufacturing process
  •         Technology adopted by different companies
  •         Technology development efforts
  •         Supply/demand
  •         Producers
  •         Scenario in China
SPOTLIGHT ON SPECIALITY CHEMICAL VINYL FORMAMIDE
Appearance Colourless -slightly yellow,liquid CAS No.                                                         13162-05-5
Synonyms N-VINYLFORMAMIDE; n-ethenyl-formamid; N-ethenyl-Formamide
Molecular Formula C3H5NO
Density at 20 deg.C                           1.017 g/cm3
Boiling point                                        70 deg.C/5 hPa
Solubility in water at 20 deg.C Perfectly miscible

This article discusses the following details

  •         Applications
  •         Storage
  •         Process
  •         Demand driver and growth
  •         Plans of BASF
ELECTROLYTIC MANGANESE DIOXIDE INVESTMENT OPPORTUNITY

General details

Formula MnO2
CAS Number                                        1313-13-9
Appearance Black powder
Odour Odorless
Solubility (water) Insoluble
Stability                                             Stable under normal temperature conditions
pH (10 g in 200 ml H2O) 6.5

Specification

 Description

 Value

Manganese (MnO2)

92%

Sulfate (SO4)

1.15%

Moisture (Free and Bound H2O)

5%

HCl insolubles

0.06%

Other minor constituents

Description

Value

Iron (Fe)

40ppm

Titanium (Ti)

15 ppm

Fired Aluminum Oxide (Al2O3)

300 ppm

Sodium (Na)

2250 ppm

Potassium (K)

250 ppm

Calcium, Magnesium (Ca, Mg)

500* ppm

Heavy Metals(Cu, Co, Cr, Ni,V, Pb, Mo, Sb, As)

8* ppm

* Total PPM

This article discusses the following details :

  •         Applications
  •         Process outline
  •         Process development
  •         Producers
  •         Demand driver and growth
  •         Demand and Indian scenario
  •         Electrolytic manganese dioxide supply demand – Past trends
  •         New technology development by Tosoh
PROPOSED ETHYLENE PLANTS IN USA

U.S. producers have now announced plans for more than 10 million  metric tonnes per year of ethylene capacity over the next several years, a 30% increase from current levels.

This article discusses the above subject in detailed manner.

BAYER’S METHYL ISOCYANATE PLANT IN USA SAFETY ISSUES

Cytec Industries will restart a carbon fiber manufacturing expansion project at its Piedmont, SC facility as well as start a prepreg manufacturing expansion project at the company’s site at Greenville, TX. Both projects will support the growing demand for composite materials in the aerospace industry. Cytec had first announced plans for the expansion project in 2006 and the Piedmont site was selected in 2007 for the project.

* Project plans of Japanese companies

This article discusses the above subject in detailed manner.

This article discusses the above subject in detailed manner.

HEXABROMOCYCLODODECANE - FLAME RETARDANT FACING RESTRICTIONS

HBCD is mainly used as flame retardant for thermoplastic and thermosetting polymer materials and is especially suitable for expandable polystyrene (EPS) and extruded polystyrene (the reference consumption is 2%) and polypropylene (the reference consumption is 2% HBCD and 1% antimony trioxide) and other styrene resins. 

This article discusses the above subject in detailed manner.

COSTLY DELAY IN KOCHI LNG TERMINAL PROJECT

It is disappointing to read that Rs. 4,200 crore LNG terminal project near  Kochi of capacity 5 million metric  tonnes would be further delayed. As per the original schedule, this project should have been commissioned at least two years back. 

Now, it is said  that while the LNG terminal will be ready by August,2012, which itself has been delayed by a few years, the work on the 45 Kilometre first phase of the pipeline by GAIL for transporting the  gas from the terminal to the refinery of Bharath Petroleum Corporation Ltd., FACT  and a few other consumes has not been completed yet.  Therefore, the commissioning of the terminal would be delayed at least till end of 2012.

This article discusses the above subject in detailed manner.

ENNORE LPG TERMINAL ON STREAM

Liquefied petroleum gas bottling plants of oil marketing companies in several parts of the southern region can look forward to improved and timely availability of the product with a 1.2 million tonne LPG terminal near Chennai going on stream.

A project of Indian Oil Petronas Pvt. Ltd. (IPPL), a joint venture of Indian Oil Corporation and the Malaysian government-owned Petronas, the LPG terminal would be a crucial facility to help maintain cylinder supplies to households and commercial establishments in Tamil Nadu, Puducherry and parts of Andhra Pradesh and Karnataka.
This article discusses the above subject in detailed manner.

PRICE TREND OF NATURAL GAS IN USA

Natural gas traded at $3.22 per million Btu (MMBtu) at the Henry Hub in USA in July 2012, a seven-month high, and a jump of 69% from its April low.

 A few months ago, it was predicted that the natural gas price would hit zero, when it was thought that the storage would become full in USA and excess production of natural gas would have to be flared.

This article contains the following details :

  • Spot price trend
  • Production
  • Drilling activity
  • Prognosis

TRENDS IN SEAWATER DESALINATION INDUSTRY

The total world capacity of all desalination plants stands at 77.4 million cubic metres per day and that there are now 16,000 desalination plants worldwide in 150 countries.

Seawater desalination is more energy intensive compared to conventional technologies for the treatment of fresh water.  There are also concerns about the potential environmental impact of large scale seawater desalination plants.

This article discusses the above subject in detailed manner.

DEPENDENCE ON CRUDE OIL IMPORTS ON THE RISE

In 2011-12, India depended on foreign crude oil to meet 83.5 per cent of its refinery requirement.

In terms of domestic consumption of petroleum products, the dependence was  at 76 per cent, as per Petroleum Planning and Analysis Cell (PPAC) data.

This article contains the following details:.

  •         Import dependence for crude oil
  •         Export of petroleum products
  •         Import dependence
  •         Based on refinery requirements for crude oil
  •         Based on domestic consumption of petroleum products
OVERSEAS OIL EXPLORATION PROJECTS

ONGC Videsh Ltd (OVL) has developed creditable asset base that comprises producing discovered and exploration fields across the continents.  It has operator status in eight projects and joint-operator status in another seven. 

OVL produces hydrocarbons from 10 assets, namely Sakhalin-I (where it invested $2.7 billion) and Imperial in Russia, Al-Furat Project in Syria, apart from the fields in Vietnam, Colombia, Sudan and Brazil.  There are five more projects where oil has been discovered and 14 in the exploration phase.

Apart from the flagship explorer, other Indian public sector units like GAIL and BPCL are also keen on exploring opportunities in Venezuela for marketing and enhancing trade between the countries.

Engineers India (EIL), another PSU, has also expressed interest in providing design and engineering services in the hydrocarbon sector

As per the plan, OVL will invest an additional $2.2 billion in the Carabobo 1 heavy oil project, where parent ONGC already holds an 11% stake, while IOC and Oil India hold 3.5% stakes each.

This oilfield is expected to produce 400,00 barrels a day of heavy oil.  In parallel, in the San Cristobal oilfield, OVL holds a 40% stake through a $350 million earlier investment.

This article contains the following details

  •         Oil produced By OVL in last three years
  •         Overseas investment target for 2011-12 (in Rs. Crore)
  •         OVL shortlisted for fuel exploration in Afghanistan
CONCURRENT DRILLING TO HELP ONGC INCREASE OUTPUT

State-run Oil and Natural Gas Corporation (ONGC) is bolstering gas production from its C-series field in the West Coast. Besides, the firm is speeding up block appraisal and exploration in the East Coast, which includes the Krishna Godavari (KG) basin.

The move is likely to raise the gas output of the company by over 50% to 100 million standard cubic metre per day (mscmd) by 2016-17, from present 65 mscmd.

The efforts on the East and West coasts, coupled with some other nominated blocks, should increase the gas production by another 35 mscmd, taking our overall production to 100 mscmd by 2016-17.

ONGC’s plans assume significance in the context of declining production of gas from Reliance Industries’ much-touted KG-D6 block, the country's largest offshore energy field, throwing into jeopardy the country’s gas production targets and forcing user industries to import costlier gas. Gas output from RIL's D6 block fell to 32 mscmd in May, way below the targeted figure of 70.39 mscmd. The petroleum ministry has estimated this will further fall to 28 and 20 mscmd in 2012-13 and 2013-14, respectively.

This article discusses the above subject in detailed manner.

INDIAN CBM PROJECTS PRICE FIXING EXERCISE

This article discusses the Indian CBM projects price fixing exercise by the following organizations :

  • Essar Oil
  • Reliance Industries Ltd
UNDERSEA MINING EXCITING OPPORTUNITIES

Fresh finds of craggy deposits rich in gold and silver, copper and cobalt, lead and zinc deep in the sea bed is creating interest, as companies and entrepreneurs race to stake claims to the sulfide-rich areas, which dot the volcanic springs of the seabed. 

The prospectors motivated by dwindling resources on land as well as record prices for gold and other metals are busy hauling up samples and assessing deposits valued at trillions of dollars.  The US, Russia, China, Japan and South Korea lead this race to the bottom.

Nations and private companies are claiming, mapping and preparing to mine large tracts of the ocean floor that are rich in precious metals such as the following:

Territorial waters, 200 nautical miles from shore

Territorial claims beyond 200 nautical miles

Disputed maritime borders

Areas claimed or reserved for deep-sea mining

Many nations are staking claims, including France and South Korea, which are yet to release public claim maps.

This article further discusses following :

  •         Russian claims
  •         Chinese Claims
  •         Clarion-Clipperton Fracture Zone
  •         Nautilus Minerals
  •         Mineral deposits in Indian Ocean
ISSUES FACING SOLAR PANEL MAKERS

Reductions in solar power tariff were possible till recently because of the availability of cheap, imported solar panels.

However, with the Jawaharlal Nehru National Solar Mission (JNNSM) increasingly restricting the use of imported panels, in a bid to strengthen local production, any reduction in tariff from now on may, at best, be moderate.

Indian players lack the required capacity and economies of scale to compete with their global counterparts on pricing. Since the prices of solar panels play a major role in the cost of power generated, it is imperative for local players to become more competitive on costs.

This article discusses the above subject in detailed manner.

OTHER FEATURES

PLANT CLOSURES

The article discusses the plans for closure of selected units by the following players

  •        Mitsui Chemicals, closes Chiba PPG Plant
  •         Mitsubishi Chemical to Close Kashima Cracker
  •         Closure of  Colorants unit
  •         Albemarle  to exit phosphorous flame retardants

 

ANTI DUMPING PAGE

The antidumping measures introduced in  the various countries in the last few weeks on the following products are discussed:

  •         Epichlorohydrin
  •         Toluidine
  •         Sulfamethoxazole
  •         Soda ash
  •         Polysilicon

NEWS ROUND UP - INTERNATIONAL

The recent developments on the following products/events are discussed:

  •         Nylon-12
  •         Butadiene extraction plant in Belgium
  •         Chitosan biopolymer
  •         Methanol Plant in New Zealand
  •         Carbon Nanotubes
  •         Isobutanol
  •         Methanol Plant at Clear Lake, TX
  •         Titanium dioxide
  •         Rare Earths
  •         Polyvinyl Alcohol
  •         Explosion at nitric acid plant
  •         L-Lysine 

TECHNOLOGY DEVELOPMENTS

The recent developments on the following technology efforts are highlighted

  •         Biobased PET
  •         An eco-friendly organic LED developed
  •         Coal gasification and environmental research
  •        Photovoltaics from any semiconductor
  •         Technology offers from BARC
  •         Ultra-high-molecular-weight polyethylene plant

CHINA NEWS

The recent developments on the following products/events are updated :

  •         BPA Technology
  •         Titanium dioxide project
  •         Catalyst Plant in Tianjin
  •         Tetrachloroethylene
  •         Asahi expands in China
  •         New styrene unit
  •         n-Propanol alcohol 

PHARMA PAGE

The recent developments on the following products/events are highlighted

  •         Delay in the arrival of new drugs in India
  •         GlaxoSmithKline to buy Human Genome
  •         Pfizer to cut jobs at Ireland API plants

ENERGY PAGE

The recent developments on the following products/events are discussed:

  •         Renewable energy from  waste water
  •         Plans for offshore wind energy in India
  •         Solar photovoltaic installations in India cross 1 GW milestone

ENVIRONMENTAL PAGE

The recent developments on the following products/events are discussed:

  •        AP pollution board orders closure of units
  •         Standard for Ammonia
OTHER ARTICLES
  • Price trends in China (July  2012)
  • Tenders
  • Chemicals imported at the Chennai port during the month of  May 2012
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