Ethylene Producers in Europe Face Pressure to Eliminate Older Capacity

---

Researched by Industrial Info Resources (Sugar Land, Texas)--Over the past decade, producers of ethylene in North America have permanently closed numerous ethylene production units, some of which were considered to be "world scale" in size when originally built several decades ago. Many of these closures came in response to environmental mandates linked to NOx emission reduction requirements and the extreme cost of compliance for very old and antiquated technology. As the demand for polymers and downstream markets for ethylene began to shrink over the past decade, additional capacity was taken offline in North America, even after conversions to reduce emissions or utilize alternate feedstock options.

Ethylene producers in Europe face similar obstacles in the coming years as many of the operating units in the region are based on very old technology and are small by any measure. Some of the world's smallest operating ethylene units are in the United Kingdom, Switzerland and Germany, with individual units as small as 80 million pounds per year. As part of its Ethylene Tracking Database, Industrial Info has identified more than 56 ethylene units currently operating across Europe, of which more than half produce less than 1 billion pounds per year of product, the psychological benchmark to be considered a world-scale unit by many in the industry.

The economic troubles that have plagued the world over the past year or more have only added pressure to these producers to seriously evaluate the viability of these units and their ability to remain productive and attractive assets as the olefins market continues to change. Esso Petroleum Company Limited (Southampton, England) plans to idle its 335 million-pound-per-year steam cracker at the Fawley Refinery in Southampton later this year. It is expected that this could be the first of several units, big and small, to be indefinitely idled or closed entirely in the region over the coming one to two years.

Industrial Info has identified more than 43 future planned maintenance turnarounds at ethylene units across Europe. Approximately 18 of these turnarounds are to take place in 2010 or 2011. Depending on the rate of new capacity being brought online in Asia and the Middle East over the next 12 months, the number of planned turnarounds could increase in an effort to not overburden the market with capacity in the short term.

View Plant Profile - 1033164

Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy related markets. For more than 26 years, Industrial Info has provided plant and project spending opportunity databases, market forecasts, high resolution maps, and daily industry news.