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10th China International Polyester & Intermediates Forum
PX, PTA and PIA markets
CEPSA's View as an Integrated Producer
CEPSA Group: CEPSA Química
HISTORY OF FULL INTEGRATION
PTA & PIA MARKET OVERVIEW
CONCLUSIONS
1
2
3
Table of Contents
4
CEPSA Group: CEPSA Química
HISTORY OF FULL INTEGRATION
PTA & PIA MARKET OVERVIEW
CONCLUSIONS
1
2
3
Table of Contents
4
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10th China International Polyester & Intermediates Forum
Company Activity
25,4 million Tons
EXPLORATION & PRODUCTION
PETROCHEMICALSREFINING MARKETINGELECTRICAL
POWER& GAS
Activity in:Algeria, Colombia,Peru, Egypt, Spain
Net Production :60 KBPSD
4 Refineries:Gibraltar-San RoqueLa Rábida, TenerifeASESA (50%)
Distillation Capacity: 540 KBPSD
� Natural Gas� Propane� Butane� Gasoline� Kerosene� Diesel Oil� Lubricants� Asphalt� Bunker� Aviation
Cogeneration Plants:230 Mw
Combined Cycle Plants780 Mw
Medgaz Gas pipeline2 BCM (20% share)
LARGEST PETROCHEMICALCOMPANY IN SPAIN
Compañia Española de Petroleos, S.A. U. leads an industrial group with activities in the energy sector covering the whole chain from exploration and production of hydrocarbons, natural gas and electricity to oil refining and marketing of derivatives and petrochemicals.
Turnover 2012:3,301 M€
Worldwide Locations
Canada CQ Bécancour (CQ 51%) 1
LAB PlantCQ Montréal (CQ 51%) 2
PTA Plant
NetherlandsSales officeTank storage
SpainMadrid HeadquartersGuadarranque Plant - PTA/PIA/PETPalos de la Frontera Plant - Phenol/AcetonePuente Mayorga Plant - LAB/LABSA/NPSales offices (Barcelona, Valencia, Bilbao) China
Caojing (Shanghai) PlantPhenol/Acetone(future activity)
1 Invest-Québec 49% 2 Petroquisa 28%
PortugalSales office
UKSales office
EE.UU.Sales office
Brazil DETEN (CQ 72%)2
Camaçari PlantLAB/LABSA
ItalySales officeTank storageBelgium
Sales Office
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10th China International Polyester & Intermediates Forum
CEPSA Group: CEPSA Química
HISTORY OF FULL INTEGRATION
PTA & PIA MARKET OVERVIEW
CONCLUSIONS
1
2
3
Table of Contents
4
A little bit of history – up to the 70’s
pXylene PTA
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10th China International Polyester & Intermediates Forum
A little bit of history – The 80-90’s
1987 CEPSA acquires 100% of the PTA plant (PTA 90ktm/y + DMT
60ktm/y)
1988 Start-up of PTA-2 (100ktm/y)
1995 Start-up of PTA-3 (250ktm/y)
A little bit of history – End of the 90’s
mXylene PIA
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10th China International Polyester & Intermediates Forum
A little bit of history – The 00’s
A little bit of history – The 10’s
L2Oxidation /Purification
AIR ACETIC ACID
PARAXILENE
CEPSA
AIR ACETIC ACID
METAXILENE / PARAXILENE
CEPSA
PET
POL+SOLIDS
MARKET MEG
PTA 350Kmt
PIPA 220Kmt
PET 175Kmt
PTA
PIPA
PET
ESTER.
L3Oxidation /Purification
NaphthaNaphtha
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10th China International Polyester & Intermediates Forum
A little bit of history – 2013:
CEPSA Group: CEPSA Química
HISTORY OF FULL INTEGRATION
PTA & PIA MARKET OVERVIEW
CONCLUSIONS
1
2
3
Table of Contents
4
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10th China International Polyester & Intermediates Forum
PTATHE FALLEN
You never know what you have until you lose it
Global PTA Supply & Demand
• Moving from tight in 2011 to overwhelming overcapacity by 2013.• The new capacities provide a new economy of scale
(units>2.000.000 Mt/year )• Rationalization expected to come.
THE MARKET HAS
CHANGED
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10th China International Polyester & Intermediates Forum
• Asia has more than 80% of PTA production. • Main applications Fiber and PET, accounts for more than 90%• 7% Market growth. Around 75% of this growth is located in China .
PTA Demand and Production
PTA Applications PTA Production by Region
CHINA
DRIVES
THE PTA
MARKET
• Overcapacity and historically low spreads ( <100 USD/Mt).• Several PTA suppliers are close to red numbers today.• A big cost differential between some old and new plants
PTA Margins in Asia
¿ HOW TO SURVIVE
FROM 2013 ONWARDS ?
INTEGRATION TO BE SEEN AS A WAY TO
SURVIVE
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10th China International Polyester & Intermediates Forum
• Integrated on PX from its own refineries.
• Investment in latest technologies.
• Integration on PET.
• Cepsa reducing its PTA commercial sales
year after year to diversify out of the PTA as
it I turning into a pure PX convertor without
own margin.
PTA in CQ
Crucial to survive
in a competitive
market
Adding value to
the chain
Diversification
&
Competitiveness
INTEGRATION BECOMES THE ONLY CHANCE TO REMAIN IN PTA
MARKET FOR SMALL SIZE PTA PLANTS LIKE CEPSA QUIMICA
PXTHE SUPPORTER
Keep your friends close and your enemies closer
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10th China International Polyester & Intermediates Forum
• PX units operates between 85 and 90% max in average � operations are linked to refineries, economics against Benzene & Toluene (MSTDP)…
• Utilisation rate below 85% should imply a balanced market but this doesn’t mean that there is enough PX for all new PTA capacities.
A quick view to PX
• Start up of PX plants may be delayed/cancelled or/and rationalization due several different reasons.
• Quite lower real oversupply in PTA.
PX effect on PTA
Not Enough PX for Scheduled PTA capacities
HAVING YOUR OWN PX WILL PROOF TO BE BENEFITIAL
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10th China International Polyester & Intermediates Forum
PETTHE REPLICANT
When your neighbor's house is on fire, carry water to your own
PET Growth
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10th China International Polyester & Intermediates Forum
• PET overcapacity to come. Historical low operating rates.• New plants move from capacities of 200KMt to 1MMt.• Competitiveness will be a determining factor to survive in the future.
PET Global Supply Demand Balance
¿ DOES THIS SOUND
FAMILIAR TO YOU ?
• Asia continues to be the main producing region (50%) but North America and Europe remain important players.
• Lightweighting has had a strong role and remians being relevant.• Recycling trend not to be underestimated
PET Demand and Production
PET demand PET production
NOT EXACTLY
THE SAME
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10th China International Polyester & Intermediates Forum
• Due to the overcapacity, producers will be under margin pressure.• Different grades and specialties of PET. New capacities are bigger, but
economy of scale is not as big as with PTA.• After 2014 there are chances to improve margins thanks to demand
PET margins
SIMILAR DO NOT MEAN TO BE THE
SAME
Why CQ entered into PET
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10th China International Polyester & Intermediates Forum
PIATHE UNKNOWN
It Looked Different on the Model
¿What is PIA?
MetaxylenePIA
Purified Isophthalic Acid
Oxidation
Acetic acid medium
Consumes energy
Solid, white powder, flour flowing (not sugar flowing like PTA), more soluble in water than PTA,…
NaphtaNaphta Mixed XylenesMixed Xylenes MetaxyleneMetaxylene PIAPIA
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10th China International Polyester & Intermediates Forum
PIA Supply / Demand Worldwide
• Important overcapacity in the coming three years after last capacity increases.• We have seen historically that O.R lower than 70% have forced some closures.• Also to reflect that O.R. higher than 90% derives in new investments.• After 2008 crisis impacting mainly NAFTA ad Europe, we have seen a steady recover of
demand that is expected to keep growing during the period.
• PIA plants appear and disappear during the period but always few players in a global market.• Some players are producing in swing PTA/PIA units or former PTA units. Kp, CQ,FCFC.• However, some players have tried to make PIA in the present and in the past also in former PTA
units and haven’t been successful because of different reasons.
PIA Capacities Worldwide
Data in KMt
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10th China International Polyester & Intermediates Forum
PIA Demand Worldwide
• Whilst on PTA demand is mainly in Asia (80%), on PIA, demand is more regularly spread across the regions. Asia remains being the biggest with 60% of share.
• Demand grows at an average of 6% yearly during the period, mainly driven by PET.• 24 Mt lots are delivered to each customer in every delivery. Logistics are complicated as an
average customer consumes 500 Mt/year
PIA Applications PTA Demand Worldwide
Capacity vs Demand: America & EMEA
• America is a quite closed market with a balanced demand/supply situation. Imports are small mainly coming from Korea and Spain due to FTA’s in different countries of the region. It exports a relevant volume mainly into Europe.
• EMEA is a more open market that both imports and exports relevant volumes due to the fact that there is only one producer in the region. Main importers are Korea and USA, followed by Singapore and Japan. During last five years, Europe has suffered a relevant decrease of demand due to the economic crisis, being east Europe and Middle East the growing regions.
Data in KMt
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Capacity vs Demand: Asia
• Asia is the region with the largest amount of free capacity which will be further increased in the coming two years. It will be reducing from that moment onwards.
• Demand in China represents 50% of total local sales. Being mainly supplied by local producers, Korea and Japan. But the start up of a new plant in Taiwan and the European oversupply might change this balance.
• Demand in Asia is expected to be above 500 KMt in 2018 but supply capacity will reach 850 KMt. There will be a HUGE need of exports with most likely destination being EMEA.
Data in KMt
Characteristics of PIA market
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10th China International Polyester & Intermediates Forum
CEPSA Group: CEPSA Química
HISTORY OF FULL INTEGRATION
PTA & PIA MARKET OVERVIEW
CONCLUSIONS
1
2
3
Table of Contents
4
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10th China International Polyester & Intermediates Forum
Conclusions
En CEPSA solo creemos en una innovación, aquella que es útil para ti
谢谢 – THANK YOU -Gracias -