【Haichuan Project Updates】Liaoning Dingjide plans to invest around 9.9 billion yuan in building a POE high-end new materials project
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Liaoning Dingjide Petrochemical Technology plans to invest around 9.868 billion yuan and use more than 1,200 mu of land to build a POE high-end new materials project in two phases (with a total construction period of 5 years). Of this, the total investment for Phase 1 is 5.962 billion yuan, which is primarily used to build a POE production facility with an annual capacity of 200,000 tons, an α-olefin production facility with an annual capacity of 300,000 tons, and a hydrogen production facility using electrolysis at a rate of 400 Nm3/h ； Phase II mainly involves the construction of a 200,000-ton/year POE complex and a 250,000-ton/year carbonate plant. Liaoning Dingjide was established in 2004 and is located in Yingkou, Liaoning, China. Its registered capital is 100.1 million RMB. The company mainly deals in catalysts, electron donors, antioxidants, composite antioxidants, and other additives for polyolefins. The company went public on the A-share market on August 23, raising a total of 730.0627 million yuan, which will be used to fund projects including one for the production of 15,000 tons of alkylphenols and 15,000 tons of antioxidants per year; a new facility for the production of 125 tons of polyolefin catalysts per year; and another project for the production of 300 tons of polyolefin catalysts, 13,000 tons of modifiers, 7,000 tons of premixes, and 6,500 tons of antioxidants per year.
The project company was established on November 9th; in other words, it took Dingjide only 4 months from its listing to setting up a subsidiary and then deciding to launch the billion-yuan POE project. Over the past 4 months, POE projects have sprung up like mushrooms after rain, including Wanhua Chemical (400,000 tons), Dongfang Shenghong (500,000 tons), Satellite Petrochemical (100,000 tons), Zhejiang Petrochemical (400,000 tons), Chengzhi Co., Ltd. (200,000 tons), Jingbo Petrochemical (50,000 tons), Huisheng New Materials (100,000 tons), Maoming Petrochemical (50,000 tons), and Sinopec Tianjin Branch (100,000 tons). In total, this amounts to 1.9 million tons, not including the 400,000 tons from Dingji De as well as other projects that are still in the planning stage; preliminary estimates suggest that the total amount will be at least 2.3 million tons. According to the China Photovoltaic Industry Association, in 2021, POE adhesives and co-extruded EPE (EVA-POE-EVA) adhesives together accounted for 23.1% of the total market share; this corresponds to a demand for POE of around 140,000 tons. It is expected that the demand for photovoltaic POE will exceed 300,000 tons by 2023. As the penetration rate of high-efficiency components increases, demand for POE in the photovoltaic sector is expected to grow further. A research report by CITIC Securities states that since the use of POE adhesive films in double-glass modules not only prevents water vapor from entering the module from the sides but also reduces the PID phenomenon caused by polarization in dual-sided cells, the industry primarily uses POE adhesive films in combination with dual-sided double-glass modules for encapsulation. As the penetration rate of N-type cells and double-glass modules increases, it is conservatively estimated that the total demand for photovoltaic POE/EPE adhesives will be around 1.2 billion square meters in 2023, with a demand for POE particles reaching 460,000 tons; by 2025 this figure is expected to exceed 1 million tons, indicating continued rapid growth in demand. In 2021, the main POE manufacturers were overseas companies such as Dow, ExxonMobil, and LG. Domestic petrochemical companies are actively expanding their POE production capacity. According to CITIC Securities, the planned POE production capacity in China is around 2 million tons, with most companies advancing steadily through pilot-scale production and scale-up processes. Based on the production capacity plans of various companies and the progress of their projects, and taking into account project commissioning and the gradual increase in production capacity, a breakthrough in mass production of domestically produced products is expected in 2024. A research report by Guosheng Securities states that currently, POE particles are entirely monopolized by foreign companies; the main barrier in the production process – metallocene catalysts – is on the verge of being developed domestically. Dingjide has been deeply involved in the development of polyolefin catalysts for many years, and it continues to work on the industrialization of metallocene catalysts; thus, its business prospects are promising. The company currently has a production capacity of 220 tons of polyolefin catalysts. Once the projects funded by the raise are brought online, the company’s production capacity for polyolefin catalysts will increase to 645 tons, and this increased capacity will contribute to strong growth in performance.