Chemical Process Design

Jackie Alcantar

James Pike

Jennifer Pratt

Ross Turbiville

Introduction

• Started in Chicago-1888• U.S. leading producer of

salt• Occupies 47% world

market share• Bought by Rohm and

Haas in 1998• 3 types of salt-solar,

evaporation, rock

Introduction

• Plants in Glendale, AZ and Inagua, Bahamas

• Glendale-Rock salt• Inagua-Solar salt• Inagua plant is the

largest salt production facility in the world-Capacity (1 million short tons/year)

Cost of Labor-Bahamas

• Bahamas has high cost of labor

• Located on remote island• Bahamians resistant to

foreign investment• Lack of experienced

managers• Emigrants cannot fill

vacancies• No minimum wage but

higher wages than other Caribbean islands

Cost of Labor- Glendale, AZ

• Second best state for cost of labor (Business Facilities: The Location Advisor,

2005)• Takes into account

-unionization percentage

-average unemployment

-comparative workers compensation rate

-average hourly earnings

Accessibility to Utilities- Bahamas

• Sunlight energy mainly used in Inagua– Supplemented with

diesel fuel for pumps and electricity

– Diesel fuel is expensive and purchased biweekly

Accessibility to Utilities- Glendale, AZ

• Purchases 218,160 kilowatt-hr/month all year round

• Solar panels recently installed to reduce cost

• 5 wells-530,301,000 gal/year water used

• Natural gas purchased to run the kiln- 26,000 therms average

Cost of Land

• Land is cheaper in Bahamas than Arizona

• Arizona is $10/ft2

• Bahamas is

$1.10-$2.75/ft2

Tax Structure/ Tax Rate

• Tax rate in Bahamas is much less than AZ

• The commodity is transferred at max transfer price

• This decreases taxable income in the US.

Safety Regulations

• Similar standards in both plants

• Monthly plant safety inspections

• Weekly safety meetings• Workers complete

hazard/GMP training• Safety incentive program• Safety accomplishments

publicized• Heat is a problem that is

handled on a daily basis

Environmental Regulations- Glendale, AZ

• Air and groundwater quality control

• Groundwater is limited by Arizona Department of Water Resources

• Water withdrawal mineral extraction permit

• Non-Title V Air-Quality permit required-emissions, monitoring, operational requirements, recordkeeping/reporting

Environmental Regulations- Bahamas

• Few regulations• Animals suffer from salt

pilings• New reservoir system to

promote algal mat growth• Algal mat prevents

seawater seepage• Environmental issues

addressed voluntarily on the island

Import Issues

• Goods flow freely between US and Bahamas

• Duty free is 35% of value to product added in Bahamas

• Goods are easily imported for manufacture as long as they are exported after

Patent Laws

• Trade secrets are used instead of patents

• Employees can not reveal secrets

• This helps maintain competitive advantage

Natural Resources/ Raw Materials

• Bahamas have limitless resources

• Glendale salt is mined from underground

• Salt deposits mined from 800 to 9000 feet

• Glendale’s cost is greater than Bahamas

• Glendale, AZ salt formed in Playa Lake Bed

Climate-Bahamas

• Bahamian climate is sunny and temperatures 75-90F year round

• September is heavy in hurricanes and is the worst month for production

• Rain slows production average 30 inches/year

Climate- Arizona

• Heat increases costs• Worker safety is

ensured by cool environment

• Issue only prominent in summer

• Winter temperatures average in 50s

Conclusion

• Plant in Bahamas is extremely profitable- exports 1.27 million short tons/year

• The Glendale plant appears less profitable – only produces 113,839

short tons/year– Land more expensive– Accurate profitably

cannot be predicted without exact numbers

Questions?