Welcome Downstream Petrochemical, Chemical & Plastic Processing

The chemical industry comprises the companies that produce industrial chemicals.  It converts raw materials (oil, natural gas, air, water, metals, minerals) into more than 70,000 different products. Polymers and plastics, especially polyethylene, polypropylene, polyvinyl chloride, polyethylene terephthalate, polystyrene and polycarbonate comprise about 80% of the industry’s output worldwide.  Chemicals are used to make a wide variety of consumer goods, as well as inputs to agriculture, manufacturing, construction, and service industries.

The chemical industry manufactures fertilizers and agrochemicals for food production, synthetic fibres for clothing, materials for housing and amenities, and medicines for health. Dyes, pigments, perfumes, flavours, plastics and other speciality chemicals produced by chemical industry make life and leisure more enjoyable. However, the other facet of chemical industry which earns it a bad name is the adverse impact on internal and external environment.

Petrochemicals:

The building blocks of the organic chemical industry, the olefins and the aromatics, are derived from petroleum sources. Monomers such as ethylene, propylene, styrene, vinyl acetate, vinyl chloride for commodity polymers are produced in petrochemical units. Apart from olefins, aromatics like benzene, toluene and xylene and bulk organic chemicals like phenol, acetone and phthalic anhydride are worth mentioning. Intermediates such as dimethyl terephthalate, monoethylene glycol, acrylonitrile and caprolactam, detergent raw materials like linear alkyl benzene and alpha-olefins and various solvents are produced in these units.

The number of chemical plants producing a vast array of chemicals in this sector of chemical industry is indeed very large.  However, because of improper planning and scarcity of raw materials the capacities are much smaller than those internationally accepted for such plants. Development of suitable catalysts for the petrochemical operations is a challenging task since most petrochemical operations use catalysis to get the desired products. 

In view of the expected high growth rate of the petrochemical sector and the dwindling supply of hydrocarbons, it is worthwhile planning for the alternative feedstocks. Natural/associated gas as raw material for the near-future and methanol derived from coal through synthesis gas as raw material for long-range planning need to be studied thoroughly.

In the long run it is clear that world-class plants with back integration to crackers would prove to be a successful strategy.  The fundamentals of the Indian petrochemical industry remain as strong as ever.  Current per capita consumption of plastics is one-sixth of the world average. Further, majority of the current consumption is being met by imports.  This indicates the tremendous potential and at the same time a total short-sightedness of the industry in not planning expansion in line with the market demand.  For mere survival, the industries, therefore must substantially upgrade productivity and quality. Without this approach, it seems clear that the dozen odd ethylene crackers talked about for some years appear now to be commercially nonviable. Further, these are highly capital-intensive. On the otherhand, the downstream operations and particularly conversion are less capital-intensive and more labour-intensive, which ideally suited to meet Indian socioeconomic needs.  For foreign investors, the plus factors include: high rate of return, enormous technical and skilled manpower, assured repatriation, and more or less a very stable Rupee. 

Also the Asia-Pacific market is growing fast, production keeping pace and even generating surplus which is helping to reverse the trade pattern in commodity plastics. Nevertheless, India aspires to be a global player later, and could be a `heaven’ for ambitious MNCs.

Petroleum Processing :

The refining capacity in the country is increasing with the expansion of capacities and setting up of new refineries. Gasoline, diesel and kerosene are well known fuels obtained from the refineries.  Naphtha is obtained as a feedstock for the fertilizer and petrochemical units. In India the aim is to maximize the middle distillates consisting of kerosene and diesel.  The FCC units operated in the refineries are based on imported technology and catalyst.  Therefore processing of highly paraffinic gas oils with high yield is a challenging task.  Similarly, transportation of high-wax content crude from Bombay-High by using suitable pour point depressants and the aromatics recovery from the lighter cuts are also other challenging tasks. Energy conservation through various strategies in refinery operations must have a very high priority.

Commodity and Specialty Polymers and Elastomers:

Small capacities for the production of polystyrene and low density polyethylene were set up in the late 50’s. These were based on industrial alcohol obtained from molasses.  Since then the growth of thermoplastics such as low density polyethylene (LDPE), linear low density polyethylene (LLDPE), polypropylene, polystyrene, PVC and ABS has been very high.  This growth rate for thermoplastics will continue to be high in view of their widespread use in packaging, household goods and utility in housing. Engineering plastics like Teflon, polycarbonate, polyacetal, PET, PBT and polyphenylene amide find extensive use in transport sector and engineering industry.  These plastics will progressively replace metal components in automobiles, bicycles, mopeds and electronics goods.  Specialty materials like polyphenylene sulphide (PPS), polyphenylene oxide (PPO) will find increasing use.