USGC - Ethane China - Ethane from US China - Naphtha Europe - Naphtha. • How will the ethylene cost curve evolve? Olefins business prospects • What are the fundamental drivers of risk and opportunities within olefins chains. Spot ethylene prices clawed their way back to 15.5 cpp by early June, but the gains were short-lived and prices slipped back to 12.25 cpp by the end of that month. We also note that the majority of 2020/21 Asia ethylene cracker expansions are based on heavy feeds (mostly naphtha) – see slides 41 and 42 in LINK. The industry cost curve brings microeconomic rigor to pricing analyses, while still requiring some finesse in teasing out the most powerful insights. The 2019 Cost Curve Analysis model for Ethylene - Polyethylene and Propylene - Polypropylene combines Nexant’s global plant capacity database and views on supply and demand with an extensive cost of production database and Nexant’s annual price forecasts developed for three oil scenarios. View Quotes Increasing Complexity In The Ethylene Value Chain Emerging changes in ethylene supply drivers and demand drivers make modeling the ethylene supply/demand balance more complex Asia Chemical Conference / November 2016 8 Ethylene Coal to MEG (skipping EO) Coal to VCM (skipping EDC) Demand Shocks (GDP related) or Demand Shifts (product Ethylene Cash Cost Curve . Naphtha-based production costs have declined in Asia and Europe by 64% and 54% respectively since Jan. 2020. An example of the ethylene plant gate cost curve for 2020 is shown in Figure 1. Further, given the cost curve of delivered ethylene globally, it is likely that some naphtha fed steam crackers may find their ethylene capacity either curtailed or shut down. Its low was found just four months later, at 12 cpp on May 10. Ethylene is the main basic petrochemical used to produce plastics and textiles. Chemicals Pricing Data Subscription Ethylene Ethylene Prices C2H4 technical grade (95% min purity) and polymer grade (PG, 99.9% min purity). The ethylene price is set by the marginal producer, the one with the highest cash cost: usually smaller, older, naphtha-based plants located in Europe or Asia: The PE price is set by the cost of ethylene + cost of polymerization + margin Ethylene Cash Cost - History. Change in N. American Cost of Production . Propylene average cost curves and intervals. There is a knowledge gap with any petrochemical Ethylene Glycol 3 9/12/13 Ethylene Glycol: HOCH 2 CH 2 OH CAS Registry Number: 107-21-1 Synonyms: 1, 2-Ethanediol Glycol EG Monoethylene glycol Ethylene glycol is a colorless, practically odorless, low- Net Ethylene Capacity: 1,125 kMTA U.S. Net Ethylene Capacity: 5,410 kMTA U.S. Gulf Coast Worldwide Capacity: 6,535 kMTA As of January 1, 2019. See fig. 400 . 1200 . Finally, the cost index is used to update the cost of the other processes of ethylene production today. The full line is at the 2020 annual average WTI oil price forecasted in January ($52/bbl). However, low cost supply sources can only cover part of future ethylene demand. 2013 Ethylene Production Cost Curve – Source: Wood Mackenzie, 2012 estimated data using Brent $112/bbl and Henry Hub $3/mbtu Slide 10 Source: ClipperData Crude definitions: Light >32API, Medium 32-34 API, Heavy <24 API. Ethylene (IUPAC name: ethene) is a hydrocarbon which has the formula C 2 H 4 or H 2 C=CH 2.It is a colorless flammable gas with a faint "sweet and musky" odour when pure. The Cash Cost curve dynamics change throughout history: It is intended for the two-class problem, but the extension to more than two classes will be produced later. Sweet <0.5 sulfur, Sour >=0.5 sulfur Ethylene is the main basic petrochemical used to produce plastics and textiles. Ideally suited to commodity products, it is also applicable where real quantifiable differences in value exist—for example, the length of time for ocean transit. 1600 1400 1200 1000 800 600 400 200 0 0 ME E NA E NA E NA N NA LPG ME LPG ME N & LPG ME N EU LPG EU LPG EU N EU N Asia N Asia N NA N Asia LPG & NA LPG Asia LPG Cumulative capacity, million tonnes/year … Naphtha crackers will need to be built to meet demand, with China being the most cost … The attractive position of the LCCP on the global ethylene cost curve places LCCP in a competitive position to successfully weather market volatility; Production of low-cost polyethylene produced from the two new, large polyethylene facilities that make use of world-class "Ethylene is the biggest petrochemical by both volume and value and a key driver of the industry's growth, profitability and investment," the report said. In 2018, 2.92 million metric tons of ethylene oxide was produced in the United States. Find information for Mont Belvieu Ethane (OPIS) Futures Quotes provided by CME Group. Naphtha-based production costs have declined in Asia and Europe by 64% and 54% respectively since Jan. 2020. Ethylene cash costs and capital cost advantages make Chinese ethane- based capacity competitive. The cost analyses presented in the report Ethylene E31A target a 1,200 kta (kilometric tons per annun) United States-based plant. It is the simplest alkene (a hydrocarbon with carbon-carbon double bonds).. There are nine U.S. producers of EO, operating 15 facilities in 11 locations in two states: Texas (59%) expected to be at the bottom of the cost curve followed by North American ethane-based producers. Reflects new Cedar Bayou ethane cracker at 1,725 kMTA (3.8 B lbs per year) capacity. In Texas, Intratec Solutions released a new report examining the costs of production of Ethylene . UOP 5930-13 . 1400 . N. American Feedstock Price Decreasing. Delivered as an interactive spreadsheet, the model offers views of historical, current, and forecast cost Global Cost of Ethylene Curve U.S. cost of ethylene production, at 10-15 ¢/lb, competes with Middle Eastern production Europe and Asia still dependent on higher cost naphtha Ethylene Cash Cost Curve. 4. Daily Chemical Reaction Smoke On The Water – Asia Ethylene Dives, Cost Curve Developments To Gain Incremental Focus Key Points: Asia ethylene prices fall WoW as confidence rises around supply in 3Q20 – this setting suggests disappointments ahead for US derivative prices and profit among integrated and non-integrated exporters, in our view. Complete the short form below to register for the live webinar. It is characterized by a plateau of higher-cost producers in the third and fourth quartiles. The global ethylene cost curve has shifted. Size matters: large plant sizes (in ME and Asia; 800-1300 ktpa) are more cost -effective vs. in EU, US and Japan (500-700 ktpa) This has flattened the ethylene production cost curve as Asian and European ethylene producers have been able to source cheaper feedstock. process composite cooling curve ethylene condensation process temperature, deg f 80 40 0-40-80-120-160 duty, mmbtu/hr 0 10 20 30 40 50 60 70 c2s c2d dmr c2 c2= h2 c1 ethylene 2020-2025 Average. I heard of one ethylene explosion with two fatalities, many people injured and heavy property damage as a result of a leak in a compression fitting in a high pressure (1000-2500 psi) line in a pipe trench releasing a cloud of 200 to 500 lb ethylene, that ignited resulting in an explosion equivalent to 0.12-0.30 ton of TNT. 2011 Curve: 2012 CMAI Conference (Graphical Analysis) 2004 Curve: 2005 World Light Olefins Analysis . 1 for global ethylene cracker cost curve and LINK to article noting China refinery benefits from lower crude oil values. 0 100 200 300 400 500 600 700 800. This has flattened the ethylene production cost curve as Asian and European ethylene producers have been able to source cheaper feedstock. The value of this output is $3.49 billion. For those interested in cost analyses considering other plant capacities and/or locations, Intratec offers a customized analysis as an optional feature. A recent Wood Mackenzie report on the ethylene cost curve demonstrated how the oil price collapse might affect the world petrochemical market. Download : Download high-res image (391KB) Download : Download full-size image; Fig. Delivered as an interactive spreadsheet, the model offers views of historical, current, Size matters: large plant sizes (in ME and Asia; 800-1300 ktpa) are more cost -effective vs. in EU, US and Japan (500-700 ktpa) 140 . The new report presents a techno-economic analysis of Green PG Ethylene production from hydrous ethanol in the USA using a dehydration process similar to the one proposed by BP Chemicals. Ethylene Cost Curve | Multi-year period of relative stability 0 200 400 600 800 1000 1200 1400 1600 1800 0 20 40 60 80 100 120 140 160 180 200) Cumulative Ethylene Capacity (Million tonnes) Jan-17 (55 USD/bbl) Oct-18 (81 USD/bbl) Jan-20 (64 USD/bbl) Source: ICIS Analytics v DEDICATION TO MY PARENTS . And, we find USGC ethylene crackers incentivized to run heavy feeds. Ethylene cost curve: US and ME continue to remain structurally advantaged producers, although crude prices fall has reduced extent of that advantage. World Ethylene Cast Cost Comparison. Steam cracking average cost curves and intervals. 2020-2025 Average. In 2018, Texas ethylene’s highest price was 29 cents per pound (cpp), reached early in the year on Jan. 18. This function plots the Relative Cost Curves (RCC) and calculates the corresponding Area Above the RCC (AAC) value to estimate the classifier performance under unequal misclassification costs. This detailed study presents plant construction cost, Ethylene production cost breakdown, and… vi ACKNOWLEDGMENTS All the praises are due to the God, the one, the Creator, All Mighty, the Most Beneficent and Most Merciful. The increased ethylene supply will force high cost ethylene producers to curtail operations. Ethylene cost curve: US and ME continue to remain structurally advantaged producers, although crude prices fall has reduced extent of that advantage. Cost Advantaged Feedstock Changes N. American Position on Cost Curve . • Who will be the winners and losers and what collateral damage will this create? The 2018 Cost Curve Analysis model for Ethylene and Polyethylene combines Nexant’s global plant capacity database and views on supply and demand with an extensive cost of production database and Nexant’s annual price forecasts developed for three oil scenarios. The lower cost of feedstock, relatively lower capital investment and higher yields towards ethylene render ethane crackers champions of ethylene cost competitiveness. Commercial Ethylene major application in the chemical industry is as a raw material for the production of polymers and other organic chemicals that are mainly utilized in consumable end uses, especially in packaging. The competitiveness of a steam cracker depends on numerous cost factors, such as construction cost, utilities, manpower, but it will depend crucially on the price of its feedstock (e.g., ethane, LPG, naphtha). •Reduced cost structure •Suite of low-risk growth projects •Cycle discipline •Lower Capex •Higher EBITDA-to-CFFO conversion •Greater financial & capital discipline •Streamlined, focused portfolio •Lower volatility vs. peers •Higher ROIC •Higher free cash flow $2B to >$3B EBITDA Upside vs. 2Q18 TTM 3 THE NEW DOW: A COMPELLING INVESTMENT OPPORTUNITY Production of Ethylene Oxide In the U.S., ethylene oxide is produced by catalytic oxidation of ethylene. Average cost-curves and intervals encompassing the maximum and minimum for steam cracking (a) per tonne of ethylene and (b) per tonne of ethylene and propylene. Brings microeconomic rigor to pricing analyses, while still requiring some finesse in teasing out the most …... 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