TCG CEO Clyde F. Payn and TCGR President John J. Murphy’s Insightful Article on “Oil to Chemicals from Heavy Feeds” Featured in Latest AFPM Publication
By JOHN. J. MURPHY and CLYDE F. PAYN, The Catalyst Group
By JOHN. J. MURPHY and CLYDE F. PAYN, The Catalyst Group
SPRING HOUSE, PA – The Catalyst Group (TCG) and The Catalyst Group Resources (TCGR)are pleased to announce two new additions to their Board of Directors (BOD). The BOD was created in early 2019 to deepen and expand the company’s international exposure to existing and new customers through the deployment of leading industry executives. Carlos A. Cabrera and Suleyman Ozmen, both leading, senior-management-level executives are well known subject matter experts in the fields of catalysis and thus are in an excellent position to leverage strategic, commercial development and entrepreneurial opportunities. Their combined track record includes decades of experience from within leading corporations engaging around the world. More specifically:
Carlos A. Cabrera is an independent consultant based in the greater Chicago Area. His fields of Expertise include Energy, Fuels, Chemicals, Leadership, Strategy and General Management. He is a recognized world expert in the Oil and Gas and Petrochemical Industries. Mr. Cabrera has served on several US and foreign based Corporate Boards for both private and public companies. Carlos is the Executive Chairman of Genomatica, a San Diego based Biotechnology firm. Mr. Cabrera is a Distinguished Associate to the World Energy Consultancy FACTS and serves on the Board of Directors of the Gas Technology Institute. He was previously the President/CEO and then Chairman of UOP, the founding President and CEO of the National Institute of Low Carbon and Clean Energy (NICE) based in Beijing, China, and the Executive Chairman of Ivanhoe Energy. He is a member of the Global Advisory Board of the University of the Chicago Booth School of Business. Mr. Cabrera is also a member of the Advisory Board of the Chemical Engineering Department at the Illinois Institute of Technology and a Board member of the Loker Institute at the University of Southern California. Granted nine patents by the U.S. Patent Office, Mr. Cabrera was inducted to the University of Kentucky Engineering Hall of Distinction and honored with the Honeywell Corporation 2008 Senior Leadership Award, among several other distinctions. He holds a Bachelor of Science degree in Chemical Engineering from the University of Kentucky and a master’s degree in Business Administration from the University of Chicago.
Suleyman Ozmen has extended global downstream business experience with leading organizations (IFP, UOP, Amoco Chemicals, BP and Shell Global Solutions) in refining and petrochemical technology commercialization, licensing, intellectual property management, business and joint venture development, and service business. His specific strengths are in leading technology commercialization, concluding major licensing deals, running global sales for license, catalyst and services, and implementing business strategies. Mr. Ozmen is recognized as refining and petrochemicals industries leading licensing expert with an extensive external business network and has led many successful global technology alliances and built many technology business organizations. He has led negotiations to conclude licensing, guarantee, engineering and catalyst supply contracts resulting in more than a billion MM in net revue to UOP, BP/Amoco and Shell GS. He has also led with success licensing, catalyst and service business with profit accountabilities over $100 million a year. Mr. Ozmen managed successful R&D programs for commercialization of new technologies and new catalyst (etherification process, xylene isomerization, propane dehydrogenation, solid bed alkylation for lab). He was a major contributor to management teams in building successful technology organizations.
About The Catalyst Group and The Catalyst Group Resources
The Catalyst Group (TCG), a global boutique consultancy with over 35 years-experience, serves a diverse spectrum of process industries, including refining, chemicals, natural gas, polymers, specialty chemicals, pharmaceuticals and related industries (such as catalyst manufacturers, EPCs, material sciences, pharmaceuticals, and environmental services).The Catalyst Group provides consulting to our clients in two ways: via client directed projects by The Catalyst Group Consulting (TCGC) and via various programs and studies by The Catalyst Group Resources (TCGR).
The Catalyst Group Resources (TCGR), a member of The Catalyst Group, is dedicated to monitoring and analyzing technical and commercial developments in catalysis and is known for its visionary stance in the identification of novel technologies that lead to the development of new markets and industries. Clients who join our programs/studies benefit by being leaders in these new opportunities for their competitive advantage.
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Clariant has opened its next High Throughput Experimentation (HTE) laboratory in Houston, Texas. The location is key as the new facility will be the first of its kind supporting the oil & gas industry, offering new and sophisticated solutions for customers. This lab is part of a global Clariant initiative to expand HTE capabilities to all Clariant business units, including direct support for oil services in North America, the Asia Pacific region, Latin America, Africa and the North Sea.HTE is an innovative approach and methodology where automated instrumentation, specialized software tools and alternative techniques are able to provide optimized formulations in a rapid timeframe. While it has been widely used in other industries for many years, Clariant is the first company to adopt this technology for the oil & gas industry as a standard tool.As a new addition to the existing lab located at Clariant Oil Services Headquarters, Clariant specialist chemists and innovation experts are now able to utilize miniaturization, parallelization, intelligent design and enhanced analytics – all proven to increase efficiency and productivity. The facility will help to meet current and outstanding needs in the oil & gas industry, with special emphasis on pour point depressants, hydrate inhibitors, asphaltene inhibitors, corrosion inhibitors and scale inhibitors. Source: Clariant, 9/6/2019.TCGR Note: High Throughput Experimentation (HTE) has of course been used as a tool by many process licensing and catalyst producers for years to optimize and create new generations of catalyst for a variety of processes within the oil, gas and chemicals industries. What is different, is Clariant’s announcement to apply this to specialty chemical development for inhibitors.
Exxon Mobil CEO Darren Woods is eyeing oil and natural gas deals despite calls to reduce emissions, saying any shift in the world’s energy supply will take decades. “Energy transitions take a long time,” Woods said Wednesday at the Barclays CEO Energy-Power Conference in New York. “In the meantime, the world’s rising demand for energy must be met.”Exxon sees oil demand growing at 0.6% per year over the long term and demand for natural gas increasing 1.3% per year even as policy makers look for ways to wean countries off of fossil fuels. That means significant new investments, including acquisitions, will be needed, Woods said, even though shareholders are calling for Big Oil to reduce spending and return more cash to shareholders.More consolidation is in the offing for independent shale drillers, and Exxon will be watching for potential acquisition targets, he said. “If there is the opportunity to acquire something that bring unique value to Exxon Mobil, we’ll be in a position to transact on that,” Woods said. Source: World Oil, 9/4/2019. TCGR Note: Whether it’s ExxonMobil or Chevron (as seen in its recent unsuccessful bid to buy Anadarko Petroleum), the trend towards more industry consolidation will continue for additional reasons, including reduced conventional fuels, demand as biofuels and more electric and hybrid transportation is adopted.
A large Chinese chemical producer has won regulatory approval to start building a $4.2 billion petrochemical complex in east China to process ethane from the United States, a company official said. Zhejiang Satellite Petrochemical Co Ltd’s plant will be the second China-based petrochemical facility aiming to cash in on cheap and abundant U.S. ethane unlocked by the shale revolution in North America, analysts said.Zhejiang Satellite will start construction in September on a 1.25 million tonnes per year (tpy) ethylene plant in Lianyungang in Jiangsu province, Ding Liping, an investor relations officer, told Reuters. “This is the company’s phase-one investment for a total of 2.5 million tonnes per year ethylene production facilities that will process fully U.S. ethane,” said Ding, adding that construction was expected to take about a year. Source: Hydrocarbon Processing, 8/29/2019. TCGR Note: An important trend. Last week Singapore’s SP Chemicals started a 650,000 mt/yr ethane cracker in Taixing, Jiangsu province. Zhejiang is expected to receive ethane from Energy Transfer Partners LP in the 4th Quarter, 2020 under a 10 year agreement at 3 MIL mt/yr. INEOS is suppling SP Chemicals’ needs.
Indian Oil Corp (IOC), the country’s top refiner, plans to invest $27.98 billion in five-seven years to meet energy needs of diverse user groups, Chairman Sanjiv Singh told a shareholders meeting on Wednesday. IOC, through its 11 refineries, controls about a third of India’s 5 million-barrel-per-day (bpd) refining capacity. Singh said the investment was required to help IOC “evolve into a future ready corporation that provides comprehensive energy solutions to diverse user groups”. The company is investing over 200 billion rupees by 2023-24 to expand its petrochemicals capacity and another 100 billion rupees in eight years for expansion of city gas distribution projects in the country, he said. Source: Hydrocarbon Processing, 8/28/2019.
Six petrochemical companies based in Belgium, Germany, and the Netherlands have announced a consortium to investigate how naphtha or gas steam crackers could be operated using renewable electricity instead of fossil fuels. The ‘Cracker of the Future’ consortium—which includes BASF, Borealis, BP, LyondellBasell, Sabic, and Total—aims to significantly reduce carbon emissions from production of base chemicals. The companies have agreed to invest in R&D and knowledge sharing as they assess the possibility of transitioning base chemical production to renewable electricity. Members of the consortium have started exploring and screening technical options. If a potential solution is identified, the parties will determine whether to pursue joint development projects, including R&D activities that could include a demonstrator for proof of concept in the case of base chemicals. Source: Chemical Week, 8/27/2019. TCGR Note: This is an interesting and somewhat exciting development! TCGR has already documented some of these important trends. For more information see TCGR’s multi-client study entitled “Advances in Syngas Production: Catalyst and Process Developments Update – 2018” and also its newly proposed “Power-To-X: Techno-economic, Commercial and Strategic Developments for Production of Energy Carrier Chemicals, Petrochemicals and Sustainable Fuels”.
U.S. petroleum and natural gas production increased by 16% and by 12%, respectively, in 2018, and these totals combined established a new production record. The United States surpassed Russia in 2011 to become the world’s largest producer of natural gas and surpassed Saudi Arabia in 2018 to become the world’s largest producer of petroleum. Last year’s increase in the United States was one of the largest absolute petroleum and natural gas production increases from a single country in history. Source: U.S. Energy Information Agency (EIA), 8/20/2019.
Saudi Aramco and Reliance Industries Limited (RIL) have agreed to a non-binding Letter of Intent (“LOI”) regarding a proposed investment in the Oil to Chemicals (O2C) division comprising the Refining, Petrochemicals and fuels marketing businesses of RIL. Saudi Aramco’s potential 20% stake is based upon an Enterprise Value of US$ 75 billion for the O2C division. This would be one of the largest foreign investments ever made in India. Saudi Aramco and RIL have a long-standing crude oil supply relationship of over 25 years. To date it has supplied approximately 2 billion barrels of crude oil for processing at RIL’s refinery at Jamnagar. The proposed investment would result in Saudi Aramco supplying 500 KBPD of Arabian crude oil to the Jamnagar refinery on a long-term basis. Source: Reliance, 8/12/2019. TCGR Note: A 20% in RIL Oil to Chemicals (O2C) division with an enterprise value of $75 BIL is a major shift in global oil supply and downstream commitment between Aramco and RIL. This has strategic consequences other CAP members should note. For more information in this area, see TCGR’s “Oil-to-Chemicals II: New Approaches from Resid and VGOs”.
BP and Reliance Industries Limited (RIL) announced that they have agreed to form a new joint venture that will include a retail service station network and aviation fuels business across India. Building on Reliance’s existing Indian fuel retailing network and an aviation fuel business, the partners expect the venture to expand rapidly to help meet the country’s fast-growing demand for energy and mobility. The partners have agreed to set up a new joint venture company, held 51% by RIL and 49% by BP, that will assume ownership of RIL’s existing Indian fuel retail network and access its aviation fuel business. Source: BP, 8/6/2019.
TCGR Note: RIL’s current network of over 1,400 sites across India is planned to be expanded to 5,500 sites by 2024. Other agreements exist to expand gas resources. Activities have been expanding since 2011, including lubricants under Castrol.