Samsung-Total Petrochemicals Joint Venture Targets $840 Million in Profits by 2015

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Researched by Industrial Info Resources (Sugar Land, Texas)--Samsung Total Petrochemicals (Daesan, South Korea) is targeting sales and operating profits of $840 million by 2015 for its petrochemicals complex, which consists of 15 plants in the Chungcheong province of South Korea. Over the last two years, the firm undertook massive expansion activities to ramp up the production capabilities of various chemical manufacturing and processing units in the complex to retain cost competitiveness in global trading markets. The firm is now targeting a production capacity of 1 million tons per year by 2010 for each of its main products including naphtha, polypropylene, para-xylene and styrene monomer.

The firm named the plans "Global Project," intending it as a development strategy for a significant overhaul in the operations and production capacities of several units in the petrochemicals complex. Global Project has been implemented over the last two years with an investment of $55 million. Large-scale expansions included increases in the production of ethylene from 630,000 tons per year to 830,000 tons per year, increased production of propylene from 320,000 tons per year to 550,000 tons per year, increased production of polypropylene from 270,000 tons per year to 580,000 toes per year, and of styrene monomer from 670,000 tons per year to 870,000 tons per year. Samsung Total has also been focusing on energy efficiency and the use of next-generation technology to enhance cost competitiveness and compatibility of its products in the global market. The company views this as a vital strategy, especially in the face of a likely influx of new products from China and the Middle East by the end of this year.

Samsung Total is the first company in the world to use waste heat instead of steam in a process known as the "multi-effect system" during the expansion of the styrene monomer plant in the complex. Styrene monomer is commonly manufactured through catalytic dehydrogenation of ethyl benzene, in which a gaseous mixture of ethyl benzene and steam is passed over a solid catalyst bed in the ratio of 1:15 by volume. Samsung Total modified the process for greater energy efficiency by using ethyl benzene in the liquid phase instead of as a gas and by using waste heat instead of steam in the distillation stage for purification.

Samsung Total Petrochemicals was set up as a general chemicals organization in August 2003 through a joint venture agreement between the Samsung Group (Seoul, South Korea) and Total S.A. (NYSE:TOT) (Paris, France). The organization manufactures and exports 5 million tons per year of chemicals to more than 130 countries. The firm's petrochemicals complex produces 2.2 million tons per year of olefins that include benzene, ethylene and propylene, 1.6 million tons per year of chemicals such as ethylene oxide, ethylene glycol, para-xylene and styrene monomer, 1 million tons per year of synthetic resins that include polyethylene and polypropylene, and 380,000 tons per year of petroleum products including fuel oil and liquefied petroleum gas.

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