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NEW CATALYSTS RENEW POLYOLEFINS Tailored polymer structures expand market for commodity materials Paige Marie Morse C&EN Houston
There is a buzz among the producers of polyolefins, an unexpected excitement that is sweeping through this
more than 100 billion-lb-a-year commodity market. At the center of the fluny is a breakthrough in technology—metallocene or single-site catalysts—that gives producers the power to design precise polymers, a feat that has briefly distracted them from the cost-cutting and price battles typical of a commodity market.
The leader of a company created to exploit this new technology says the industry response is at "a fever pitch." Gregory L. McPike, president and chief executive officer of Univation Technologies, a one-year-old joint venture between Exxon Chemical and Union Carbide, says, "It is amazing that an industry this old has that much vitality in it."
With new catalysts and processes, producers can now exercise greater control over polymerization, consistently creating more uniform polymers to meet the performance properties required by their customers. In truth, news about these catalysts has been heard from the technical ranks for many years. But now—with several production units operating and technology licenses available—the business colleagues of these early researchers have increased the volume. This laboratory curiosity has finally become a commercial reality.
Shoe soles and tubing ate end uses for new
elastomer products afforded by Dow's Inslte
catalysts.
"The industry now has the ability to take a design approach to polymer structure for greater speed and accuracy of development," said Kurt W. Swogger, vice president for polyolefins R&D at Dow Chemical, at the recent Met-Con '98 conference in Houston, sponsored by the consulting firm Catalyst Group, Spring House, Pa. Dow describes its use of this technology as "molecular architecture."
The crucial next step for this technology is to access the mainstream polyolefins market and compete with existing materials on a cost basis. The high performance
Commodity polymers based on single-site catalysts are on the market Producers
Polymer Malm U.S. Europe
Linear low-density polyethylene
High-density polyethylene
Polypropylene
Film
Film
Fibers, nonwovens
Dow, Exxon, Phillips, Mobil
Dow
Exxon, Fina
BASF/Elenac, Borealis, BP Chemicals
Fina
Targor
Source: Phillip Townsend Associates
offered by these new polymers has already led to opportunities in the specialty markets, but penetration at the large-volume commodity level is required if the producers expect to regain their significant R&D costs. The market and technology development decisions of companies in the next several months will fundamentally define whether these products truly revolutionize the polyolefin market or just pass into the smaller specialty arena.
The term metallocene has often been used to describe these new polyolefin catalysts. In the early development, this term was appropriate because most of the catalysts were based on metal compounds that included π-bound cyclopentadienyl (Cp) ring structures. Many more types of catalyst structures are now being explored and used, so the descriptor metallocene
is being replaced by the |S broader term "single-site cat-•§. alyst"—-because the poly-
l e merization is thought to occur at a single site on the
|ω metal catalyst. Exxon's Exxpol and
Phillips' proprietary catalysts—both of which are based on substituted zir-conocene dichloride—are examples of commercial metallocene catalysts. In contrast, Dow's Insite catalysts are single-site catalysts; they have a metal center bound by a single Cp ring that has a bridging group to a het-
eroatom that is also bound to the metal. Much of the new nonmetallocene cata
lyst developments for olefin polymerization are due, in part, to "the patent stranglehold held by Exxon and Dow" in me-tallocenes, says John J. Murphy, program director at the Catalyst Group. In an effort to establish their own intellectual property, many companies have turned to alternative catalyst compounds to create similar tailored polymer structures.
Most major polyolefin producers acknowledge that they spend significant resources keeping track of competitors' activity in this field, and there have been several patent disputes. Many companies arc licensing, or planning
Japan
Mitsui Chemicals, Japan Polyolefin, Sumitomo, Ube
Asahi
Mitsui Chemicals
JULY 6, 1998 C&EN 11
b u s i n e s s
New alliances to address developing technology When C&EN reviewed the developments in polyolefin catalysts three years ago, the company names mentioned were easily recognized by most who work in the chemical industry. Such familiarity is gone. Many companies have created new ventures—with new names—to work in the rapidly expanding field of single-site, often called metallocene, catalysis. Also, many companies have alliances or licensing agreements with competitors to strengthen their position in this area.
"There remain very few polyolefin players without a partner, position, or potential in the supply of metallocene-catalyzed materials," says John J. Murphy, program director at Spring House, Pa-based consulting firm Catalyst Group.
Exxon Chemical and Dow Chemical continue to dominate this technology, and both have been actively forming alliances with several other companies. Hoechst also has a strong patent base in the single-site catalysis area that it has leveraged with alliances.
Several of the new ventures cite intel
lectual property issues as a reason for their formation. Numerous patents have been filed in the single-site catalyst area and several disputes have arisen—many industry participants call the technology area a "patent minefield." Through an alliance or joint venture, companies can combine their intellectual property estates to create a stronger force.
"The combination of Exxon and Union Carbide has made the patent estate a lot broader and more difficult to penetrate," says Gregory L. McPike, president and chief executive officer of Univation Technologies, the polyethylene joint venture between Exxon and Union Carbide.
Also, in the announcement of the venture, the companies pointed out that "the joint venture resolves current and likely future legal disputes between Exxon and Union Carbide over ownership of the technology."
The need to respond quickly in this fast-moving technology area is also an important consideration. Often these catalyst technologies provide routes to prod-
Univation Technologies
Dex-Plastomers
Mitsubishi Borealis Ube
Eienac <# PE with Shell BASF
PPT
Targor «*- pp
PE
Exxon
PP
Hoechst
Mitsui gi£^°
Montell
γ Dow 4 Elastomers^ DuPont Dow
with DuPont Elastomers
χ BP Chemicals
« » s Joint venture or alliance • s license
PE = polyethylene PP = polypropylene
Source: Catalyst Group
X.PP
Fina PE
ucts in unfamiliar markets. An alliance can facilitate rapid access to a market, before another competitor moves in.
"Dow was looking for an applications and channel-to-market partner" for its ethylene-propylene-diene monomer technology, says Ashby L Rice, vice president for technology at the joint venture DuPont Dow Elastomers. "DuPont offered a long-standing market leadership position, knowledge of the elastomers industry, and a portfolio of strong brands," adds Cathy Branciaroli, director of global communications for the venture.
The extensive resources of the parent companies, available electronically, if not physically, help these ventures develop new products more rapidly. For example, Targor, the polypropylene joint venture between Hoechst and BASF, has access to the research facilities of these companies and often contracts experimental work from their scientists. Hoechst recently announced that it would withdraw from that venture within the next two years, but Targor will continue to have access to techni
cal expertise through Hoechsts new R&D company, Aventis.
The lines between companies, markets, and technologies are blurring with the myriad agreements among players in the single-site catalyst field. Clarifying the scope of these relationships is a task that takes a lot of effort, say most companies, to ensure minimal overlap. But as this technology progresses and new uses for these catalysts are found, the boundaries are increasingly difficult to define.
Evolue
Phillips
to license, their technology, and intellectual property is a significant part of the product they offer. Defending their patent base is a fundamental part of business.
Disputes also arise because this technology is expected to have a significant impact on the future markets for polyole-fins. As in most emerging technology areas, establishing a strong intellectual property base early is an important part of ensuring future success.
Univation's McPike says that with such a "rich technology area," it is not
surprising to have a "feeding frenzy of competitors."
Single-site catalysts differ from conventional olefin polymerization catalysts in that the metal atom usually is in a constrained environment, which allows single access by monomers to this catalytically active site. Polymers grow by a single mechanism, instead of the multiple routes that occur in Ziegler-Natta systems, thus forming a more uniform and reproducible polymer structure. By determining the route and kinetics of the chain growth, a
polymer can be designed for a particular performance target.
For polyolefins, this technology translates to various performance enhancements including increased strength and toughness, better clarity and gloss, and easier and more consistent handling characteristics.
With the improved performance offered by tailor-made polyolefins, some of the characteristics of high-end engineering polymers can be achieved with potentially inexpensive polyethylene or polypropylene.
12 JULY 6, 1998 C&EN
ΡΕ.
ΡΕ -£S2orners
with union carbide
É
Researcher conducts catalyst R&D In Baytown, Texas, lab.
"Instead of competing with a commodity plastic," says Mark Mack, director of polyethylene processes at Equistar, "these materials, based on polyolefins, can compete in engineering polymer applications or with a metal. That is very exciting." Equistar, a joint venture of the petrochemical operations of Lyondell Petrochemical, Millennium Chemicals, and Occidental Chemical, is the largest U.S. producer of polyethylene (C&EN, June 8, page 22).
Intermaterial competition between the polyolefins is also increasing because of this technology, says Michael Gallagher, marketing and sales director of licensing at Univation. "The lines are blurring between polymers, with polyethylene taking over polypropylene applications, and then polypropylene taking over engineering plastics applications. The [product] growth chain is going in that direction."
Today, the commercial polyolefins made with these catalysts are linear low-density polyethylene (LLDPE), high-density polyethylene (HDPE), and polypropylene. In 1997, close to 500,000 lb of commodity polymers worldwide was made using single-site catalysts, according to Surinder Bahl, a project manager at Houston-based consulting firm Phillip Townsend Associates. The majority was made in the U.S., with small quantities made in Europe and Japan.
Most of these products were not made in facilities dedicated to metallocene, or single-site, catalysts, says Bahl, and production capacities are not clear. "A producer
can easily retrofit a plant because it does not take too much time, effort, or money to make LLDPE in an existing plant with a metallocene catalyst. At this stage, capacities are very difficult to define for metallocene [polymers]." The large size of poly-olefin reactors, typically more than 500 million lb per year, means that little production time is required to prepare adequate quantities for today's demand.
Several companies have begun to point out this flexibility in recent years. Most announcements about new or expanding polyolefin manufacturing facilities note that new units have the capability to make a metallocene or single-site catalyst polymer product.
At Univation, the realization of this need for flexibility has translated into a unique business opportunity. "What Univation offers—which no one else does—is plant retrofit technology," says McPike. "It allows someone with an older gas-phase plant to apply metallocene technology to it. It does not require a new plant."
Univation licenses Carbide's Unipol polyethylene process technology, which is the global leader in third-party licenses for polyethylene technology. With Unipol accounting for 53% of worldwide licenses, according to the company, Univation has access to more than 100 polyethylene reactors.
Phillips Petroleum took advantage of the new flexibility offered by its proprietary single-site catalysts to make LLDPE, a new product for the company, in reactors that usually are used to make HDPE (C&EN, March 10, 1997, page 12). "We saw the metallocene technology as an opportunity to lower the density capabilities of the Phillips process," says Don G. Brady, manager of polymers and materials. "From the beginning, we had a very high interest in using the catalysts to produce LLDPE in the Phillips slurry loop process-
both for use internally and for licensing activities." Brady adds that Phillips started its catalyst licensing efforts this spring.
Single-site catalysts are particularly useful for LLDPE production, which copofy-merizes ethylene with various α-olefin comonomers, because the comonomers are incorporated more uniformly than they are with conventional catalysts. The resultant polymers have a narrow molecular weight distribution and predictable physical and mechanical properties.
Equistar's Mack says his company's catalyst development efforts are focused on LLDPE for this reason. "The comonomer efficiency advantage is twofold. First is the ability of the catalyst to easily incorporate the α-olefin into the ethylene polymerization without reaching a plateau [in incorporation rate]. Also, the catalysts place the comonomer evenly throughout the backbone, not just in the low molecular weight zone," Mack explains.
Equistar has a significant position in the LLDPE market, but it does not yet offer a single-site-made polymer. Mack reports that pilot-plant efforts and a few customer trials are in progress. Equistar is considering licensing its proprietary catalyst technology, which uses a heteroatom substitute in the Cp ring bound to the metal.
Like LLDPE, HDPE made using single-site catalysts is targeted at the film market. Applications include blow-molded bags, agricultural films, and food packaging. Films made with HDPE are stronger and can be used for heavy-duty applications; they can also be made thinner for comparable LLDPE uses. Some converters, or polymer fabricators, blend these products with other polyethylenes to boost overall strength.
Fina uses its proprietary catalysts with licensed Phillips' slurry loop technology for HDPE production at its site in Antwerp, Belgium. Dow also produces a high-
Traditional and single-site catalysts for polyolefins
Catalyst system
Heterogeneous titanium
Heterogeneous chromium
Homogeneous vanadium
Metallocenes
Constrained environment
Source: Montell
Activity
High
High
Low
High
Medium
Catalytic site
Multiple
Multiple
Single, multiple
Single
Single
Polyolefins made
Polyethylene, polypropylene
Polyethylene
Ethylene-propylene rubbers
Polyethylene, polypropylene
Polyethylene, polypropylene
Molecular weight range
Broad
Broad
Narrow, broad
Narrow
Narrow
JULY 6, 1998 C&EN 13
b u s i n e s s
density product the company suggests ™ could be used in pipe and other durable applications.
The development of polypropylene based on single-site catalysts is proceeding more slowly than that for polyethylene, and fewer companies are participating in this market. Tar-gor, the polypropylene joint venture between Hoechst and BASF (C&EN, May 12, 1997, page 18), began commercial production in Europe last fall. Exxon's polypropylene product, made in Baytown, Texas, was launched in 1995. Also, Fina has commercial polypropylene production at its site in La-Porte, Texas, which is being expanded to allow for more metallocene polymer production.
Single-site catalysts have an additional level of molecular control with polypropylene, owing to the stereochemistry of the polymer. Specific isomers can be made—isotactic, with all of the methyl groups, on one side, or syndiotactic, with alternating methyl groups—depending on the performance required. Such control over the polymer structure can be very
Univation leads patent filings on single-site catalysts for polyethylene
Other3
47% Univation
Technology 18%
Hoechst 13%
Mitsui 6%
Dow Chemical Phillips BASF Montell 6 %
Petroleum ^% 4° /o
3%
Total cumulative patents = 1,500b
a Includes Fina (2%), Idemitsu (2%), Mitsubishi (2%), Mobil (2%), Tosoh (2%), BP Chemicals (1%), Shell (1%), and other smaller shares, b Patents filed worldwide as of Jan. 1, 1997, related to single-site catalysts for polyethylene. Source: Univation Technologies
powerful, allowing for targeted performance properties from barrier resistance to tack (stickiness) to melting point, but the area has not yet been fully explored.
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" Market observers suggest that single-site polypropylene with improved barrier properties and clarity could replace polyethylene terephthalate in some bottle applications and polystyrene in some packaging.
"Metallocene technology arrived too early for polypropylene," notes Catalyst Group's Murphy. Conventional polypropylene continues to grow at almost twice the rate of polyethylene, which needed the technology to renew its slowed growth. However, the leaders—Exxon along with BASF and Hoechst through Targor—can control their fates: "With the [corporate] alignments in place and the technology well documented and protected, these leaders are certainly in the position to set the pace," says Murphy.
Following a few years of early development that served to prepare the market, these products are now poised to penetrate commodity mar
kets as replacements in some existing polyolefin applications and in new applications. Several analysts are bullish on their prospects and expect rapid growth in the next few years.
Catalyst Group forecasts annual demand for polyethylene made with all single-site catalysts at 26 billion lb in 2005, representing 15% of total polyethylene consumption. About 60% of these polymers will be made with metallocenes and the remainder by other single-site catalysts and noncatalytic advances in process technology. Single-site polypropylene is expected to penetrate the market by 5 to 6% by 2005, representing nearly 4 billion lb of annual demand.
Speaking at MetCon '98, Kenneth Sinclair, principal at consulting firm STA Research, Sunnyvale, Calif., estimates the demand for polyethylene made from single-site catalysts at 3.2 billion lb in 2000 and 110 billion lb in 2015. Sinclair acknowledges that some of that volume will be "cannibalized" from conventional polyethylenes, but most will come from new polyethylene applications made possible by improved performance.
Townsend's Bahl shows similar optimism, predicting a demand of 4.2 billion lb in 2002. Most of the growth will occur in the U.S. because "the suppliers are here, the applications are usually developed here, and converters in the U.S. are very familiar with the term metallocene. Everybody wants to be associated with it."
These estimates assume that producers are able to overcome two critical issues that will have a significant impact
14 JULY 6, 1998 C&EN
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PFANSTIEHL
on the market acceptance of these polymers: price and processibility.
After several years and millions of dollars of investment in R&D and market development efforts, many companies are eager to recover their costs. Price is an obvious tool to do this, but commodity markets seldom tolerate inflated prices.
"If the costs are so high to the customer that [use of the new polymer] doesn't result in an economic advantage," explains Equistar's Mack, "then you won't see a high growth rate in the metallocene area. The polymer needs to be positioned in a way that the customer can take advantage of the performance characteristics."
Also, a new entrant can help keep prices down in some markets. Bahl notes that LLDPE is a new market for Phillips, and, therefore, the company probably will price its material "reasonably" to penetrate the market.
Also, the actual costs for the catalysts are high right now. "One of the major costs associated with metallocene catalysts has been the catalyst cost itself," says Phillips' Brady. "As the volume grows and the technology improves, those costs will come down and be competitive with existing catalyst systems."
Custom catalyst manufacturer Albemarle agrees. The company works under confidentiality agreements with several polymer producers that use single-site catalysts. "It is feasible to get the catalyst costs down—we can see that when the catalyst volumes become large enough," says A. T. Stoll, new-business manager for organometallics and catalysts. "That is not a hope for the distant future—but it is not too fer away."
Patrick G. Simms, Albemarle's business development manager, adds that the industry seems to have moved beyond the catalyst cost issue. "At a recent conference in Germany, attendees said these costs are no longer in question; [lower costs] are happening as we speak."
Several analysts note that in recent months the initially high single-site polymer prices had been moving very close to what the market would bear. However, with polyolefin prices falling worldwide recently because of the Asian financial crisis (C&EN, June 22, page 19), the gap between these products and conventional resins has widened again.
Processing problems have become a major issue for these polymers as they move into large, existing commodity markets. The industry infrastructure of converters is already in place, and most
Albemarle makes slngle-slte-catalyst precu
have invested heavily in equipment to handle existing polyolefins. Not surprisingly, narrow molecular weight polymers have very different melt and flow properties from polymers with a broad molecular weight distribution. Although the narrower range may provide some performance advantages, the processing of such polymers can be difficult.
"Customers are reluctant to embrace new materials," says Brady, "because it means they will have to learn how to process them and change the way they run their processing machines.
"The customers for polyethylene are large film companies," he continues. "They want to produce a lot of film and push the polyethylene through the machines rapidly. They do not want to adjust the machines or shut down a line because of [processing problems]."
In contrast, the emerging markets in Asia and South America may be more tolerant of these processing differences, points out Bahl. Their newer processing equipment has greater flexibility and pumps with more power to move viscous materials.
Companies are using various technologies to address the processing problems. Dow, for example, emphasizes its ability to make LLDPE with long-chain branching with its Insite catalysts. The company says this branching "makes [its LLDPE] easier to process than other copolymers having a narrow molecular weight distribution."
Borealis and Fina, for example, use two reactors to make bimodal polymers, which contain polymer chains with two different molecular weight distributions.
ors In Baton Rouge, La.
The low molecular weight chains provide some plasticizing of the longer chains and enhance the melt and flow characteristics of the polymers.
Another more subtle issue that catalyst and polymer producers are beginning to address is how to focus their product development efforts. With the new capability to make highly specialized products, effective communication with customers is especially important to ensure that the new product meets the required performance targets.
"There is a great importance now on market focus," says Dow's Swogger, admitting that this requirement surprised him. "The challenge is to match the technical capability to the market need."
Joint ventures and alliances can help focus marketing efforts and provide specific expertise. Through DuPont Dow Elastomers, Dow gained access to the elastomers market, where it previously had a small, fragmented presence.
"Dow developed the technology to make rubber, but had no application expertise or market channel to the rubber industry," says Ashby L. Rice, vice president for technology at DuPont Dow Elastomers. "DuPont, on the other hand, had an ethylene-propylene-diene monomer business that was looking for a technology revitalization."
Exxon has a similar relationship with Dutch chemicals producer DSM, through a venture called Dex-Plastomers. The company sells polymers made with me-tallocenes to traditional elastomer markets such as wire and cable, polymer modification, and foams.
Both of these ventures are targeting
JULY 6, 1998 C&EN 15
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business specialty markets where these products can be sold at higher prices and profit margins are generally better than commodity markets. However, the volumes are much lower.
Equistar's Mack acknowledges that a small-volume market is not adequate. "In order to win in single-site catalysts, you will need to identify larger markets and move away from a specialty orientation to large-volume commodity-like markets."
He uses the term "commodity-like," not commodity, on purpose. The markets for polymers made with single-site catalysts "are large-volume commoditylike markets—big, but with so much possible differentiation, they are not really commodity markets."
Market size is certainly a key issue for these new catalysts and polymers, with so many large companies vying for position. However, in a commodity market, the presence of many players can be an advantage, particularly in the early development of a product.
"A lot of customers are resistant to buy from [only] one source of supply," says Univation's McPike. "They need a guarantee that more than one polymer producer will use [the technology]. That is starting to happen now."
One possible glitch in the apparently bright future for single-site catalysts is the current reduction in polymer demand due to the Asian economic crisis. But producers do not seem concerned, and some even see possible advantages.
"When you have a slowdown and reactor capacity is idle," says Mack, "often researchers are given the green light to run in the commercial area. That accelerates commercialization."
Phillips' Brady adds that the delay of some Asian projects "is healthy for the polyethylene industry because we were headed for large overcapacity. Health in the industry provides money for companies to support R&D and product development."
And healthy is how the single-site-catalyst technology looks now, ready to move into the mainstream markets and capture a lot of business. Major polyolefin producers have significant challenges because of the diversity of products possible with these catalysts—a big change after years of selling large quantities of the same material— but many seem well prepared. And the opportunities are great.
"The advantage of single-site catalysts is that you don't have to make the same product," says Sinclair. "If you can do that, and your customers can appreciate that, you can both make a lot of money. "Λ
16 JULY 6, 1998 C&EN
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