BDO plans 11 million tons! Project details

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BDO plans 11 million tons! Project details: Author/Source: Nenghua Dynamics; Date: 2022-04-01; Clicks: 5. Recently, the price of BDO’s high-end products has approached 30,000 yuan again. The BDO market remains a supplier-driven market, with profits of over 15,000 yuan per ton, which has attracted substantial capital investment. According to statistics, the BDO production capacity planned by enterprises themselves exceeds 11 million tons. Recent projects include another 100,000-ton natural gas-based BDO production facility and a 100,000-ton spandex production facility built by Xinjiang Jurong New Materials. The planned production capacity of BDO for 2022 is 600,000 tons in total, including 100,000 tons from Xinjiang Meike, 100,000 tons from Xinjiang Guotai, 100,000 tons from Wanhua Chemical in Sichuan, 200,000 tons from Inner Mongolia Dongyuan, and 100,000 tons from Huizhou Yuxin. Experts analyze that of the aforementioned 600,000 tons of additional production capacity, only about 200,000 tons is likely to be put into operation successfully next year; therefore, supply will remain tight in 2022 as well. This situation will ease by 2023-2024. 2023 will be the peak year for BDO’s production capacity, with around 1.3 million tons of capacity coming online. PBAT will be the main driver of growth in the BDO industry. By 2025, the estimated demand for PBAT is around 3 million tons, which corresponds to a demand for BDO of about 1.68 million tons. If demand for PBAT falls short of expectations, then by 2024 and 2025, there will be an overcapacity in BDO production, turning the market from a seller’s market to a buyer’s market. Intensified competition is inevitable, and prices will naturally return to reasonable levels. From a cost perspective alone, the cost of BDO produced by the alkyne-aldehyde method is around 12,000–13,000 yuan. Adding a profit of over 2,000 yuan (with the average profit for chemical companies being 1,000–2,000 yuan per ton), the reasonable price for BDO would be around 15,000–16,000 yuan per ton. If BDO does return to a reasonable price in the future, who will be the ultimate winner? Deng Huichang, deputy secretary-general of the Chemical New Materials Committee of the China Petroleum and Chemical Industry Federation, believes that in the BDO industry chain, enterprises with longer chains and more extended production processes will surely have greater resilience to risks in the future. A long chain refers to having resources at the upstream end and a market at the downstream end, while extending the chain means building upon existing projects. BDO’s upstream resources include coal mines, calcium carbide, maleic anhydride, and power plants, while its downstream products include PTMEG, PBAT, GBL, etc. Relatively speaking, companies that possess upstream resources have greater competitiveness. In the case of downstream products, as the pandemic abroad eases, the BDO-PTMEG-spandex production chain is gradually resuming operations, which reduces demand for spandex in China. Therefore, spandex is likely to experience a downward trend in the future. Thus, the growth in demand for BDO will come mainly from PBAT and GBL – the former being used in biodegradable plastics, while the latter is used in new energy lithium batteries. Both of these materials fall under the category of emerging materials and are considered projects that deserve encouragement for development. Those companies that have only the BDO project are likely to face the risk of closure at the slightest sign of trouble. But if there is calcium carbide, the profit can increase by 1,000 yuan; if there is a coal mine, the profit can increase by 1,500 yuan, which gives the BDO products a greater price advantage. Recent developments in BDO projects: Hainan to invest 2 billion yuan in a major BDO project. Hainan Xingguang Chemical Co., Ltd. is investing 2 billion yuan to build the first phase of a project aimed at developing an entire chain for producing fully biodegradable plastics; the production capacity will be 200,000 tons per year of maleic anhydride, 55,000 tons per year of BDO, and 300 tons per year of maleic anhydride catalysts. Hainan Xingguang Chemical’s BDO process comes from Tianjin Bohua. In November 2021, Hainan Xingguang Chemical Co., Ltd. signed a contract with Tianjin Bohua Engineering Co., Ltd. for the provision of technical licensing, engineering design, and supply of specialized equipment for a plant capable of producing 180,000 tons per year of maleic anhydride through the oxidation of butane, as part of the fully biodegradable plastics industry chain project (Phase I). With a total investment of 7.471 billion yuan, Dongfang Shenghong will build a new degradable materials project (Phase I). Project name: Lianyungang Hongke New Materials Co., Ltd. Degradable Materials Project (Phase I) Project. Construction location: This project is planned to be built at the Lianyungang Petrochemical Base in Xuwei New Area, Lianyungang City, Jiangsu Province, with a total land area of approximately 48.92 hectares. Construction content and scale: This project plans to build a 340,000-ton/year maleic anhydride plant, a 300,000-ton/year BDO plant, a 180,000-ton/year PBAT plant, as well as various supporting facilities. Investment amount: The total investment for this project is 7.471 billion yuan, of which 6.797 billion yuan is allocated to construction costs and 336 million yuan to working capital. Project progress: The construction period for this project is 3 years. At present, the preparation of the project feasibility study report has been completed, and it is still in the preliminary approval stage. Invest 5.12 billion yuan! The 600,000-ton BDO project in Xinjiang began construction in April. Seven counties and two cities in the Aksu Region of the Xinjiang Uygur Autonomous Region held simultaneous ceremonies to mark the start of construction on major projects for the first quarter of 2022; the ceremony in Baicheng County was held at the construction site of Xinjiang Zhongtai Jinhui Technology Co., Ltd.’s 600,000-ton per year BDO production facility and its supporting facilities (Phase I). Xinjiang Zhongtai Jinhui Technology Co., Ltd. was established in Baicheng County in July 2021. The first-phase project, which involves a facility capable of producing 600,000 tons of BDO per year along with related supporting facilities, has an total investment of 5.12 billion yuan. This project also includes a facility for producing 300,000 tons of BDO per year, comprising units for producing 120,000 tons of calcium carbide acetylene per year, 3 units for producing 100,000 tons of BDO per year each, 3 units for producing 240,000 tons of formaldehyde from methanol per year each, and a unit for producing hydrogen from natural gas at a rate of 28,000 Nm3/h. In addition, there are various utility systems and auxiliary production facilities required to support these operations. Construction of the project will begin in April 2022, with mechanical completion scheduled for the end of June 2023. Total investment of 10.8 billion yuan! The energy-saving report for Fujian’s 900,000-ton PDH project was approved. On January 3, 2022, the inauguration ceremony of Fujian Haiquan Chemical Co., Ltd., a subsidiary of Fujian Energy Chemical Group, along with the start-of-construction ceremony for various projects, was held at the Gulei Petrochemical Complex in Zhangzhou. The total investment planned for these projects starting up this time is 10.8 billion yuan, with a land area of 990 mu. The construction is scheduled to take place in two phases, and Haiquan Chemical Company is intended to undertake the relocation and development of enterprises from the Quangang chlor-alkali industrial zone, building 5 sub-projects within the Gulei petrochemical complex. The total investment for one of these phases is 7.2 billion yuan. The projects to be constructed include: one vinyl acetate plant with an annual capacity of 200,000 tons, one PO/SM plant using a combined production method with annual capacities of 200,000/450,000 tons, one PPG plant with an annual capacity of 200,000 tons, one BDO plant with an annual capacity of 36,000 tons, and one PBT plant with an annual capacity of 60,000 tons ； The total investment for the second-phase project is 3.6 billion yuan, with the plan to build one propane dehydrogenation unit with an annual capacity of 900,000 tons. Upon completion of the project, it is expected to generate an annual industrial output value of 12.8 billion yuan, while the two phases of the project are expected to yield an annual tax revenue of 1 billion yuan. Environmental impact assessment announcement for Hualu-Hengsheng’s 200,000-ton BDO project On March 16, 2022, the Jingzhou Ecological Environment Bureau released the “First Announcement on the Environmental Impact Assessment of the Green New Energy Materials Project by Hualu-Hengsheng (Jingzhou) Co., Ltd.” Project Name: Green New Energy Materials Project
Project Location: No. 1 Hengsheng Road, Coal, Electricity, Port and Chemical Industry Park, Jiangling Economic Development Zone
Construction Content: This project involves the construction of production lines capable of producing 200,000 tons of BDO, 30,000 tons of PBAT, and 100,000 tons of NMP per year, along with the associated equipment and facilities. The construction of Wudi Shares’ Wuhai BDO integration project, with a total investment of 13 billion yuan, commenced on March 13. The groundbreaking ceremony for the first phase of this project, carried out by Wudi Shares’ subsidiary Inner Mongolia Wudi New Materials Co., Ltd. (abbreviated as Inner Mongolia Wudi), was held in the Low-Carbon Industrial Park of the Wuhai Economic and Technological Development Zone in Inner Mongolia Autonomous Region. This is also the first BDO project to start construction this year. The image shows that 3D Shares plans to build an integrated project for producing 900,000 tons per year of BDO and biodegradable plastics in Wuhai, with an estimated total investment of 13 billion yuan. The company’s BDO integration project produces BDO through the coal-chlor-alkali-acetylene-1,4-butanediol industrial chain, and further expands downstream to produce the biodegradable plastic PBAT and high-end polyether material PTMEG. The project under construction is the first phase, which includes facilities for producing 300,000 tons per year of BDO, 100,000 tons per year of PBAT, 60,000 tons per year of PTMEG, and 600,000 tons per year of formaldehyde. It also includes a related facility for producing 360,000 tons per year of acetylene feedstock (calcium carbide). The project is scheduled to be ready for operation by June 2023. The cooperation project for producing 300,000 tons of BDO in Inner Mongolia was officially signed. On March 10, Inner Mongolia Guangju New Materials Co., Ltd. and Inner Mongolia Dongjing Bio-Environmental Protection Technology Co., Ltd. formally signed an agreement regarding the cooperation project to produce 300,000 tons of BDO per year. Established on April 9, 2015, Inner Mongolia Dongjing Bio-Environmental Protection Technology Co., Ltd. is a wholly-owned subsidiary of Inner Mongolia Dongyuan Technology Co., Ltd. Inner Mongolia Dongyuan Technology Co., Ltd. was established in December 2008 with a registered capital of 200 million yuan; it is the first chemical enterprise in Inner Mongolia to adopt Invista’s technology based on the alkyne-aldehyde method for the production of BDO. The construction of a project in Xinjiang to produce 100,000 tons of BDO annually along with 120,000 tons of PBAT began on March 1. The inauguration ceremony for this project, carried out by Xinjiang Shuguang Lihua, was held on March 1 in the Shuangfeng Industrial Park in Tiemenguan City, the Second Division of Xinjiang. Project location: Tiemenguan Economic and Technological Development Zone, Xinjiang. Project scale and duration: The project’s scale is an annual production of 100,000 tons of BDO along with 120,000 tons of PBAT, and the construction period is approximately 26 months. Investment estimate: The total approved investment for the project is 3,568,879,700 yuan, of which 3,349,962,700 yuan is allocated to construction costs. The project covers the entire production process of producing acetylene from natural gas, synthesizing 1,4-butanediol (BDO) from acetylene and formaldehyde, and manufacturing biodegradable plastic PBAT from 1,4-butanediol (BDO), terephthalic acid (PTA), and adipic acid (AA). Based on this project, Donghua Technology will achieve integration across the entire industry chain and value chain in the field of biodegradable plastics, covering key aspects such as research and development, design, manufacturing, and industrial investment. The environmental impact assessment for Phase IV BDO project of Xinjiang Meike is set to be approved. Announcement by the Environmental Impact Assessment and Emission Management Department of the Ecology and Environment Department of the Xinjiang Uyghur Autonomous Region regarding the decision to approve the environmental impact assessment documents for this construction project, scheduled for February 25, 2022. Project overview: Construction of a total of three process units, namely a hydrogen production unit with a capacity of 15,000 Nm3/h, a formaldehyde production unit with a capacity of 360,000 tons per year, and a 1,4-butanediol production unit with a capacity of 100,000 tons per year. Utilities and auxiliary facilities: circulating water station, desalination station, refrigeration station, sewage pretreatment station, 110kV main substation, flare system, fire protection system, hazardous waste temporary storage area, Class B warehouse, intermediate tank area, etc. Some facilities are to be upgraded, including those for liquid storage and transportation, as well as the calcium carbide crushing plant. Wuheng Chemical accelerates the launch of its BDO project. The second phase of Wuheng Chemical (Ningxia) Co., Ltd.’s project related to the upstream supply chain for biodegradable materials was approved on February 11, and its environmental impact assessment was accepted on February 17. The project will involve an investment of 352 million yuan to build a new BDO production facility with a capacity of 70,000 tons. The project under registration and environmental assessment is the second phase of the project. In a previous project, Wuheng Chemical announced on January 12 the public notice regarding the environmental impact assessment and approval process. It plans to invest 650 million yuan to build a new facility capable of producing 70,000 tons of BDO per year, utilizing the acetylene-aldehyde process based on the calcium carbide route. The project is scheduled to start on March 1, 2022, and be completed by June 30, 2023. Inner Mongolia Huaheng Energy’s production capacity includes 312,000 tons of BDO and 60,000 tons of PBAT. The integrated production project for PTMEG and PBAT by Inner Mongolia Huaheng Energy Technology Co., Ltd. involves an investment of 10.5 billion yuan; the project will be built in the Low-Carbon Industry Park of Wuhai Economic Development Zone in Inner Mongolia Autonomous Region. Construction contents: 3 BDO units with a capacity of 104,000 tons/year each; 4 PTMEG units with a capacity of 46,000 tons/year each; a PBAT unit with a capacity of 60,000 tons/year; a natural gas-based hydrogen production unit with a capacity of 28,000 Nm³/h; 3 formaldehyde units with a capacity of 240,000 tons/year each, along with a supporting calcium carbide production unit with a capacity of 360,000 tons/year; 3 high-pressure pulverized coal boilers with a capacity of 220 t/h each (2 in operation and 1 on standby); utilities, auxiliary facilities, and environmental protection works. Once the project is operational, it will provide employment for 2,000 people, and indirectly help to create jobs for another 5,000 people in the surrounding area. It will also contribute to the development of the regional economy as well as related industries in the vicinity. The 200,000-ton per year BDO production project of Inner Mongolia Dongjing Biology, as well as its 200,000-ton per year 1,4-butanediol production project carried out by Inner Mongolia Dongjing Biology Environmental Protection Technology Co., Ltd., involve a total investment of 2.94 billion yuan; the construction sites for these projects are located in the Wuda Industrial Park. Construction scale and content: A plant with an annual production capacity of 200,000 tons of 1,4-butanediol, along with associated auxiliary facilities. To date, a total of 1.58 billion yuan has been invested. Once the project is put into operation, it is expected to generate an annual output value of 6 billion yuan, annual profits and taxes of 1.23 billion yuan, and create 800 job opportunities. Inner Mongolia Dongjing Bio-Environmental Protection Technology Co., Ltd. was established on April 9, 2015, and is a wholly-owned subsidiary of Inner Mongolia Dongyuan Technology Co., Ltd. Construction of this project began on May 20, 2021, with completion scheduled for June 2022. With a total investment of 4.2 billion yuan, Ordos plans to build a BDO production facility with an annual capacity of 240,000 tons. On January 27, 2022, the Development and Reform Commission of Ejin Horo Banner in Inner Mongolia issued a notice confirming the approval of this project. The new material production projects undertaken by Ordos Shen Nian New Materials Co., Ltd., a subsidiary of Inner Mongolia Sanwei New Energy (Group) Co., Ltd., – namely those with an annual capacity of 2×120,000 tons for BDO and 2×60,000 tons for PTMEG – meet the industry policies and market entry requirements, and thus were approved for implementation. Project owner: Ordos Shen Niu Jianyuan New Materials Co., Ltd. Location of construction: Qipanjing Industrial Park in Etoke Banner, Ordos City – within Jianyuan’s 5 million tons per year coal coking comprehensive utilization park. Total investment: 4,244,160,000 yuan, of which 1,332,270,000 yuan comes from own funds, 2,911,890,000 yuan from bank loans, and 0 yuan from other sources. Planned construction period: from June 2022 to August 2026. Scale and scope of the project: The total construction scale involves 2 facilities capable of producing 120,000 tons per year of BDO, and 2 facilities capable of producing 60,000 tons per year of PTMEG – new materials projects. Phase 1 of the project involves an annual production capacity of 120,000 tons of BDO. The process route employed is the acetylene-aldehyde method for BDO production (which includes acetylene generation, formaldehyde production, BDO synthesis, and incineration of waste liquids and gases) ； As well as the accompanying utility systems and auxiliary production facilities such as solid storage and transportation systems, primary water stations, circulating water stations, reclaimed water stations, and sewage treatment plants. Phase 2 construction of a plant with an annual production capacity of 120,000 tons of BDO and 2×60,000 tons per year of PTMEG ； The 2×200,000 tons/year formalin synthesis (55% wt) unit associated with the BDO plant, along with supporting utilities such as solid storage and transportation systems and circulating water stations, as well as other auxiliary production facilities. With an investment of 1 billion yuan, a 55,000-ton BDO production project in Shandong was launched. On February 14th, the launch meeting for the project to produce 55,000 tons per year of BDO (1,4-butanediol) using the maleic anhydride method, carried out by Shandong Rui’an Biotechnology Co., Ltd., with EPC contracting by Beijing Petrochemical Engineering Co., Ltd., was held in Xi’an. This project was invested and constructed by Shandong Rui’an Biotechnology Co., Ltd., a subsidiary of Jiangsu Rui’an Applied Biotechnology Co., Ltd. It utilizes the New Materials Industry Park in Jining City, Shandong Province as a base to build a BDO production facility, thereby providing raw materials for the PBAT products manufactured there. The production of BDO (1,4-butanediol) via the maleic anhydride method utilizes Zhejiang Sinopec’s advanced process technology, with commissioning scheduled for October 2023. On January 21, the 55,000-ton/year BDO project undertaken by Shandong Ruian Biotechnology Co., Ltd., with a total investment of 1 billion yuan, was successfully registered. The project is expected to break ground in July or August 2022 and be completed in 2024. Company name: Shandong Rui’an Biotechnology Co., Ltd. Project name: 55,000 tons/year BDO project. Nature of construction: New construction. Location of construction: Jinxian County, Jining City, Shandong Province. Scale and scope of construction: The project is located within the Jining New Materials Industry Park (Jinxian), covering an area of 248 mu. It involves the construction of BDO (1,4-butanediol) production facilities, hydrogen production units, a central control room, a comprehensive building, as well as other auxiliary facilities. A total of 122 units, including compressors, heat exchangers, filters, pumps, reactors, towers, containers, and other complete sets of equipment, will be purchased for this project. Upon completion, it will have a production capacity of 55,000 tons of BDO per year. Total investment (10,000 yuan): 101080.05