Friday, November 18, 2011

RSPC Accelerates Its Expansion of PTT Upstream Production Lines

Rongsheng Petrochemical Co., Ltd. (RSPC) accelerates its expansion of polytrimethylene-tereph-thalate (PTT) upstream production lines in 2011-2012, including three parts: Pure Terephthalic Acid (PTA) capacity expansion, paraxylene (PX) and mixed aromatic (MX) production lines' construction respectively, revealing in CCM’s November Issue of Industrial Biotechnology China News.

According to Ms. Quan, the board secretary of RSPC, Yisheng Dahua Petrochemical Co., Ltd. (Yisheng Dahua), RSPC's subsidiary company,  will expand its PTA capacity to 1,750,000t/a at the end of 2011 from 1,200,000t/a. Recently, RSPC's share holding ratio reaches 56%, which means that RSPC's rights and interests of PTA capacity in Yisheng Dahua will increase to 1,092,000t/a from 672,000t/a.

Moreover, Zhejiang Yisheng Petrochemical Co., Ltd. (Zhejiang Yisheng), RSPC's another subsidiary company,  accelerates its third phase of PTA production line construction with capacity of 1,500,000t/a. Thanks to RSPC's share holding ratio of 30% of Zhejiang Yisheng, RSPC will have PTA's capacity expansion to 768,000t/a in November 2011 from 318,000t/a recently. More importantly, in order to raise its own PTA capacity, RSPC plans to take a further step to increase Zhejiang Yisheng's capital.

In addition to PTA capacity expansion, RSPC is trying its best to involve in the PTA's upstream production: construction of PX production line and MX production line. Ms. Quan claims that the PX production line with capacity of 700,000t/a and the MX production line with capacity of 900,000t/a are being planned. The MX production line now is under the basic design process. Although the PX production line is under the pre-planning stage, Ms. Quan is confident with the construction progress of the PX production line. She discloses the specific arrangement of the PX production line will be written in the future announcement.

She explains that these two different production lines will be launched in the near future. MX production line is prepared for PX production because MX is the raw material of PX. On the other hand, Ms. Quan emphasizes that the future strategy of RSPC is to develop PTA's upriver and downriver industry, especially PX production line, so as to guarantee the raw material supply of PTA. Furthermore, its PTT production line with capacity of 90,000t/a is now under construction, and it will be finished in June 2012, ahead of the former schedule which plans to launch the PTT production line in 2013.

Actually, RSPC's PX production line plays an important role in the construction of PTT upstream production lines. Its preparation of PX production line illustrates its purpose. RSPC constructs the production line of MX in order to guarantee raw material supply of PX. It can be predicted that RSPC can produce PX itself in future, meanwhile, the fact of introducing the raw material of PX from other companies will become the past.

Mr. Zhang, the engineer of Sinopec Beijing Research Institute of Chemical, acknowledges that PX capacity expansion in China can fulfill the companies' PX demand in future. He adds that in the past 10 years, although the capacity of PX has doubled, the demand of PX has increased at the same rate. RSPC's PX expansion can not only reduce its PTA production cost efficiently, but it can also get rid of dependence on other PX manufacturers.

Mr. Guo estimates that PX's capacity in China will reach 18.2 million tonnes per year in 2020. Meanwhile, PTA's output will reach 31 million tonnes in 2020. Mr. Guo is the director of China International Engineering Consulting Corporation petrochemical petrochemical, chemical textile Development.

As an insider of Sinopec Group reveals, the consumption of PX was more than 8 million tonnes in 2009. However, the output of PX in China was just 4.8 million tonnes. Recently, Sinopec Group, China National Petroleum Corporation and China National Offshore Oil Corporation occupy 70% of China's PX capacity.

But RSPC's PX production line construction has to face some difficulty. On September 26, 2011, due to the security incident of Dalian Fujia Petrochemical Co., Ltd. (Dalian Fujia), whose raw material of PX leakage damaged Dalian's environment, the Chinese government published the the emergency notification of strengthening the PX (paraxylene) and other sensitive products, safety and environmental protection work, so as to raise the entrance standard of PX industry.

Many PX producers are concerning about the new policy, and it is no exception to RSPC. Although the new policy makes RSPC worry about its new PX production line construction in future, Ms. Quan promises that the company will follow the new policy to build the PX production line.

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Industrial Biotechnology China News, a monthly publication issued by CCM International on 8th of every month, focuses on biofuels, bio-products, bio-based chemicals, bio-materials and industrial biotechnology applications, offers latest investment hotspots, new technology & product, company & market dynamics, and government regulations, aiming to facilitate your insight into China's industrial biotechnology.

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