Upload
others
View
3
Download
0
Embed Size (px)
Citation preview
London
Houston
Singapore
Moscow
Dubai
New York
Portland
Calgary
Santiago
Bogota
Rio de Janeiro
Beijing
Shanghai
Tokyo
Sydney
Astana
Kiev
Cape Town
Riga
San Francisco
Washington
Market Reporting
Consulting
Events
Petrochemicals Outlook: Markets in Transition
Paige Marie MorseDecember 2017
Market Reporting
Consulting
Events
Markets in Transition: 2018 Outlook
Feedstocks: Fundamental changes in cost and selectionNew sources and improving logistics
Development: Regional dynamics are a major factorExisting asset base must adapt
Transition: Dynamics in opposite directionsMajor petrochemicals not moving together
About Argus
Copyright © 2017 Argus Media group. All rights reserved.
Argus continues to invest and grow
Santiago
Rio de Janeiro
Cape Town Sydney
Dubai
Shanghai
Tokyo
BeijingAstana
Calgary
Bogotá
WashingtonNew York
Riga
Kiev
Houston
London Moscow
Singapore
# of employees843 # of journalist employees384
Americas
225
103
Asia
EuropeCIS
364
136
118
150
62
72San Francisco
46%
13%
5%
6%
9%
5%
6%
9% 1%
Editorial SalesMarketing ConferencesTechnology Bus DevelopmentConsulting Corporate ServicesProduct Development
Employees by region
2016 2017
Americas 193 225
Europe 305 364
CIS 113 118
Asia 119 136
Total 730 843
Employees by function
Copyright © 2017 Argus Media group. All rights reserved.
illuminating the markets
• Full range of international petrochemicalservices, including key derivatives.
• A quality one stop shop for pricing, consultingand analysis thru the entire energy space.
• Mitigate risk with an in-depth understanding ofcurrent market and have confidence in thedecisions made using our analysis.
Argus Petrochemical Services
Copyright © 2017 Argus Media Ltd. All rights reserved.
Benzene
Butadiene
Ethylene
Toluene andXylenes
Fuels andOctane
C5 andHydrocarbonResins
Methanol
Polymers
PropyleneChlor-alkali
Copyright © 2017 Argus Media group. All rights reserved.
Energy price evolution
Copyright © 2017 Argus Media group. All rights reserved.
Shifting feedstock relationships
0.45
0.55
0.65
0.75
0.85
0.95
1.05
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
US Europe Asia
— Argus Consulting
C3
/Nap
hth
aR
atio
Propane has been getting cheaper vs Naphtha
Copyright © 2017 Argus Media group. All rights reserved.
• Propane/Naphtharatio has droppedas NGL availabilityhas grown in US
• LPG neededeconomicincentive to findoutlet inpetrochemicals
The Petrochemical Value Chain
Crude Oil Natural Gas
Fee
dst
ock
Pri
mar
yp
etr
och
em
ical
s
Condensate Butanes Propane Ethane Methane
STEAMCRACKING
OlefinsSynthesis Gas
Pygas
Naphtha
Aromatics
Xylene Toluene Benzene Ethylene Propylene Butadiene
Methanol
AmmoniaC5’s
DerivativesPolyethylenePolystyrene
Polypropylene SyntheticRubber
Adhesives
Copyright © 2017 Argus Media group. All rights reserved.
Product Mix varies with Cracker Feedstock
Copyright © 2017 Argus Media group. All rights reserved.
Shift towardsEthane hascritical impacton supply ofotherpetrochemicals
Global olefins prices
Copyright © 2017 Argus Media group. All rights reserved.
Copyright © 2017 Argus Media group. All rights reserved.
Europe moving to lighter feedslate
• Naphtha remainsdominantfeedstock forsteam crackers
• Ethaneinvestments yetto be fullyrealized
Source: Argus LPG Analytics
Copyright © 2017 Argus Media group. All rights reserved.
US Ethane exports: Wide-ranging destinations
US Propane exports: Changing market dynamic
Copyright © 2017 Argus Media group. All rights reserved.
Source: Argus LPG World
LPG prices higher than expected in 2017
Copyright © 2017 Argus Media group. All rights reserved.
• Strongpetrochemicaldemand from Asia
• Exports havecreated tighterlocal market
• Improved logisticsmay allow forlower inventoryneeds
Copyright © 2017 Argus Media group. All rights reserved.
+15mn t 2011-2016+36mn t 2016-2021
Global ethylene capacity growth
-5,000
0
5,000
10,000
15,000
2016 2021
MT
Western EuropeCoal driven
0
5,000
10,000
15,000
2016 2021
MT
Northeast Asia
0
5,000
10,000
15,000
2016 2021
MT
Africa and Middle East
Slowing growth
0
5,000
10,000
15,000
2016 2021
MT
North America
NGL driven0
5,000
10,000
15,000
2016 2021
MT
Central and Eastern Europe
0
5,000
10,000
15,000
2016 2021
MT
Southeast Asia
-5,000
0
5,000
10,000
15,000
2016 2021
MT
Latin America
• Cost advantage drives expansion in Ethylene, and Polyethylene
Copyright © 2017 Argus Media group. All rights reserved.
US steam cracker capacity growth
Copyright © 2017 Argus Media group. All rights reserved.
Most Expansion in China
Asia ethylene capacity additions in 2014-2021 • Improved marginsboost capacityexpansions
• Asian expansions5mn t/yr 2017 and3mn t/yr 2018-20
• China leads addingnew CTO/MTO andsteam crackers
* Prorated annual capacities presented
• Most additions in high demand region (Asia)
• Also driven by feedstock advantage: coal in Asia; propane in NA
Propylene capacity growth
Copyright © 2017 Argus Media group. All rights reserved.
Propylene production by region – 2016 and 2021
Copyright © 2017 Argus Media group. All rights reserved.
• China favors on-purpose productionas demand growsfaster than co-product routes
• US continues torely on refineries,with growing PDH
Source: Argus 2017 Propylene Annual
mnt
On-purpose includes: Propane dehydrogenation (PDH), Coal-to-Olefins (CTO),Methanol-to-Olefins (MTO), and metathesis
On-purpose capacity by region in 2017
Copyright © 2017 Argus Media group. All rights reserved.
• On-purpose capacitygrew fastest in past fiveyears
• PDH capacity grew 24pcin past five years . . .Slowing to 11pc
• PDH now accounts for15pc of Chinesecapacity
• 12 unitsoperating sincefirst in 2013
• Operationsstabilizingbefore recentinspections
• Outages cancreatesignificant pricevolatility
Chinese PDH operations
Copyright © 2017 Argus Media group. All rights reserved.
Source: Argus Propylene and Derivatives
Company Location Capacity (‘000 t/y) Technology Notes
Flint Hills Resources Houston, TX 650 Lummus Operating since 2010
Dow Freeport, TX 750 UOP Oleflex Operating Dec15
Enterprise Mont Belvieu, TX 750 Lummus start-up Fall 2017
Inter Pipeline Alberta, Canada 2 x 500 UOP Oleflex 2021; + 500 PP
Pembina/PIC Alberta, Canada 550 UOP Oleflex 2021; + 550 PP
Formosa Plastics Point Comfort, TX 550 Uhde STAR Unlikely before 2022
Rextac Odessa, TX NA TBA cancelled
C3 Petrochemicals Chocolate Bayou, TX 2 x 500 UOP Oleflex suspended
Sunoco Logistics Pennsylvania NA TBA Under evaluation
Dow TBA NA TBA Under evaluation
Lyondell USGC Up to 1mn t TBA PO planned; Possible PP
PDH units: North American projects
Copyright © 2017 Argus Media group. All rights reserved.
• Utilize domestic feedstock, butdemanding multi-step process
◦ Proceeds through syn gas,methanol intermediate, mixedproducts
• Most integrated to polymer for ease ofshipment to market
• New environmental requirements maydelay planned units
CTO units: Complex process
Copyright © 2017 Argus Media group. All rights reserved.
Source: Argus China Petroleum
• Growing feedstock trade helps to share competitiveness . . .
enabling petrochemicals growth in many regions
• CTO developments important in China . . .
but environmental concerns may impact growth
• Europe has been more resilient than expected . . .
but Ethylene/PE deluge will be significant test
• Cost metrics are shifting with supply sources . . .
challenging previous metrics for regional pricing
Signposts: Emerging disruptions
Copyright © 2017 Argus Media group. All rights reserved.
Stay Connected
@ArgusMedia Argus-media
+Argusmediaplus argusmediavideo
Copyright noticeCopyright © 2016 Argus Media group. All rights reserved. All intellectual property rights in this presentation and the information herein are the exclusive property of Argus and and/or its licensorsand may only be used under licence from Argus. Without limiting the foregoing, by reading this presentation you agree that you will not copy or reproduce any part of its contents (including, but notlimited to, single prices or any other individual items of data) in any form or for any purpose whatsoever without the prior written consent of Argus.
Trademark noticeARGUS, the ARGUS logo, ARGUS MEDIA, ARGUS DIRECT, ARGUS OPEN MARKETS, AOM, FMB, DEWITT, JIM JORDAN & ASSOCIATES, JJ&A, FUNDALYTICS, METAL-PAGES, METALPRICES.COM, Arguspublication titles and Argus index names are trademarks of Argus Media group.
DisclaimerAll data and other information presented (the “Data”) are provided on an “as is” basis. Argus makes no warranties, express or implied, as to the accuracy, adequacy, timeliness, or completeness ofthe Data or fitness for any particular purpose. Argus shall not be liable for any loss or damage arising from any party’s reliance on the Data and disclaims any and all liability related to or arising outof use of the Data to the full extent permissible by law.
Paige Marie Morse, PhDVice President, Propylene and derivatives
Email:
Phone:
Office:
Web:
+1 713 360 7577
Houston
www.argusmedia.com