Univation Technologies, a 100% subsidiary of The Dow Chemical, a US petrochemical giant, held negotiations with its strategic partner TAIF Group in Kazan. Steven Stanley, President of the US company, told about the changes that had occurred in the companyís business structure and about the plans to continue cooperation with TAIF Group. After this, he got an unexpected proposal from Albert Shigabutdinov, head of TAIF petrochemical holding, to establish a catalyst production facility in a free economic area called Alabuga (Alabuga SEZ). A correspondent of Realnoe Vremya attended their meeting.
Univation Offers To Reduce Catalyst Consumption Rate
Top managers of Univation Technologies visited their strategic partner TAIF Group, primarily, to update on the changes in the company. The business structure of Univation Technologies went through some changes last year. The Dow Chemical Company, one of the largest global chemical players, closed the transaction on the purchase of the share of ExxonMobil Company in Univation Technologies, LLC in May 2015 and, therefore, became a 100% owner of the latter. Earlier Univation Technologies was a 50/50 joint venture of ExxonMobil and The Dow Chemical. Naturally, any company undergoing structural changes focuses on its internal issues. However according to Steven Stanley, the President of Univation Technologies, the company has managed to avoid sinking into the mire of these processes so the changes in no way affected the customers.
'Notwithstanding the fact that Exxon has ceased to be the companyís shareholder, Univationís activity in the area of license sales and research and development has remained unchanged,' Steven Stanley assured. 'Only pattern of ownership has changed. Investments in the improvement of catalysts have been even boosted'. Undoubtedly, the latter piece of news was of interest to Kazanorgsintez as it is the largest Unipol technology licensee. It should be reminded that in 2004 Univation Technology sold a license to Kazanorgsintez, which is a part of TAIF Group, giving it the right to design and build linear and bimodal polyethylene production facility with the capacity of 440,000 tpa as well as to sell these products to any country worldwide.
The project also envisaged modernization of two out of three active polymerization trains at the HDPE plant. Now the HDPE plant of Kazanorgsintez has three production lines with a capacity of 220, 195 and 75 thousand tons. The total capacity is 490,000 tons per year.
The representatives of Univation Technologies could see these facilities with their own eyes during their visit to the production sites of Kazanorgsintez on August 3. This was the time when Steven Stanley, President, Univation Technologies handed over the certificate marking the production of 1,300k tons of polyethylene since 2007 to Farid Minigulov, General Director, KOS; the abovementioned amount was produced over the years of the companiesí joint work, in the course of which the Tatarstan enterprise issued its first new generation commercial batch of PE-100 grade bimodal HDPE. This polymer production technology was based on a single-reactor configuration, according to the license agreement.
TAIF Interested In Catalyst Factory In Alabuga SEZ
After the visit to Kazanorgsintez, Univation Technologies offered reconstruction of a B reactor of the HDPE plant. But here it is all about the increase of raw material supply. This is the issue TAIFís specialists are actively working on. For this reason, the proposal of Univation Technologies has mainly a long-term nature. In addition, the US company offered to run a pilot test with the improved catalyst in February next year. According to Yury Golubev, Commercial Manager of Univation Technologies in Russia, CIS countries and Eastern Europe, the application of this catalyst in polyethylene production will bring the catalyst consumption rate down by 15-20%.
At the meeting, the US company was the first to mention the sanctions that were extended in spring by Barack Obama, the U.S. President for one more year. So far, the restrictions imposed by the West have not affected the cooperation between the two chemical enterprises. But in case the tension between the countries escalates, Univation Technologies and Kazanorgsintez agreed to increase catalyst inventories. Univation Technologies confirmed its readiness to supply bigger catalyst volumes, if necessary. 'Although we have witnessed the imposition of sanctions against different countries over 50 years, there was no single case of a ban on catalyst sale,' Steven Stanley said confidently.
In the opinion of Albert Shigabutdinov, General Director, TAIF PSC, however, the increase of catalyst supply is not the way to solve the problem. ĎCatalysts and their production are a general concern for us,í Albert Shigabutdinov expressed his anxiety.
The General Director offered a drastic solution that The Dow Chemical and Univation Technologies should build a catalyst plant in Alabuga SEZ. 'It may be quite a profitable project for you. All raw materials necessary for catalyst manufacturing are available in Russia and even at lower price than in the USA,' General Director of TAIF said having made, therefore, a clearly unexpected offer to the USA company, and also explained all the advantages of running business in the SEZ. Dr. Stanley, in turn, told the company already started construction of four catalyst plants Ė all are located in the United States. 'We can start a new construction project in Russia only once the planned units are put into operation,' the President of Univation Technologies told. Albert Shigabutdinov reacted with a hint that an agreement with another company may be reached by that time.
ĎThe construction of a catalyst plant in Tatarstan is a done deal. TAIFís strategic plans till 2020 include expansion of ethylene production, at least, by 600,000 tons up to the overall volume of 1,600k tons per year. Besides, market capacity for polyethylene in Russia will grow up to 14 mln tons per year in the next 10 years. Now, the question is who is going to be the first to decide to build a catalyst plant here. And we are ready to participate in such a project, too' Albert Shigabutdinov explained.
TAIF Groupís managers also told their American partners about their intention to launch a 300,000 tpa polyethylene production plant in Kazanorgsintez for high-voltage cable jackets. For this application, however, a polymer will different specifications is required. 'As Univation Technologies can offer only basic polyethylene, we will not be able to participate. But we are ready to become an intermediary in negotiations on this project with The Dow Chemicals,' Steven Stanley summed up.
Realnoe Vremya online newspaper continuously keeps an eye on the development of the agreement reached between the two holdings and will prepare a material about future projects based on the results of the decisions made.
Univation Technologies has been in the market for over 45 years. It sells licenses for polyethylene production and sales, supplies catalysts, renders services and other products.
The company was founded in 1997 as a JV of ExxonMobil Chemical Company and The Dow Chemical Company. Following the restructuring in 2015, Univation Technologies became a subsidiary of The Dow Chemical Company.
The companyís headquarters is located in Houston (USA). The company has engineering centers in Texas, Western Virginia, and New Jersey and catalyst production units in the USA and China. Its footprint also covers Montreal, Moscow, Beijing, and Shanghai.