Capital Expenditures Mount for Carbon Black Producers and Include the Construction of New Plants

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). As 2006 approaches, several large expenditures for new capacity are on the horizon for carbon black producers in the U.S. In addition to expansion of existing plants, some new capacity may come from grassroot plants to compete in this mature market. Over the next few years, a carbon black producer plans to construct two state-of-the-art carbon black production plants in the United States, including a first ever West Coast location for a carbon black plant. The balance of the capital spending in this sector will involve environmental upgrades to remain compliant with EPA regulations.

Since March of 2004, Industrialinfo.com has tracked the progress of United Carbon Corporation (Woodland Hills, California), which plans to construct a grassroot plant in California City, California and a second plant location in the Eastern United States. This second plant location was originally planned for Whiteland, Indiana, although plans appear to be changing with site selection being considered for the New York or Pennsylvania area. Funding for the California project is expected sometime in the next couple of months and over $100 million will be spent to construct each plant location. An estimated 62,000 tons per year of carbon black will be produced utilizing waste tires as a feedstock. Because over 30% of United Carbon’s feedstock comes from scrap tires, a price advantage will be seen over the traditional carbon producer utilizing natural gas. SNC-Lavalin has been selected as the contractor to perform engineering and construction services for the California plant and will also be involved with the second site once it is approved.

For details see related news articles: United Carbon Plans to Construct a Grassroot Carbon Black Plant on the West Coast and United Carbon Corporation Proposes Carbon Plant for Indiana

Calgon Carbon Corporation (NYSE:CBT ) (Boston Massachusetts) has been addressing environmental compliance issues at its Waverly, West Virginia plant in recent years and recently completed the additions of purge and dust filter systems to collect emissions from plant drying operations. A second environmental project originally included the addition of a new tail-gas system with Chemstress (Akron, Ohio) handling the engineering, but decided to add a new 40,000-pound per hour waste heat boiler instead. They will also be performing some modifications to their flares and stacks beginning next year, with completion by the end of 2006. Aker Kvaerner (Elkview, West Virginia) has been selected as the engineering firm for both projects.

Sid Richardson (Fort Worth, Texas) is also getting prepared for future emission reductions at its Addis, Louisiana plant. Technology options are still being evaluated for the reduction of NOx emissions through the doubling of three flare stacks from 100 feet to 200 feet at a cost of several million dollars. It is expected that gaining permit approval will take about a year to obtain before construction can commence the following year in late 2007.

These are just some examples of future spending for the carbon black industry in the coming year. Considering over 1.8 million tons of carbon black is consumed annually in the United States in a vast array of products used everyday to include tires, plastics, toner cartridges, inks and paints, the demand for this product is by no way faltering. It remains inevitable that carbon black producers will continue to spend money on constructing new capacity and also environmental projects to ensure the safety of future production of carbon black.

Carbon Black production plants represent a small portion of the close to 4,000 operational Chemical Processing Industry plants in North America being monitored as part of Industrialinfo.com's North American Plant Database. Click on the image at right to view the distribution of Chemical Processing Plants by market region in North America.

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