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First quarter profit surges - BRASKEM S.A.
13 May '11
5 min read
This unscheduled shutdown also affected the production and supply of cracker byproducts, with the same trend observed in aromatics, while BTX sales volume remained stable and butadiene sales volume contracted by 4%. The average prices of aromatics and butadiene, compared to 4Q10, increased by around 20% and 15%, respectively.
As a result of the shutdown, the average utilization rates at the Company's petrochemical complexes in 1Q11 stood at 80%, with the South and Southeast complexes operating at utilization rates above 90%. Ethylene production was 739 ktons, down 7% from the previous quarter.
In relation to 1Q10, total ethylene and propylene sales fell by 10%, impacted by the 7% drop in production. Due to the same factors mentioned before, BTX and butadiene sales decreased by 19% and 17%, respectively. However, ethylene and propylene prices increased by 28% on average, while aromatics prices increased 23% and butadiene prices around 40%.
Project Pipeline:
Mexico Project – Ethylene XXI
The integrated project in Mexico in which Braskem and IDESA are participating jointly with interests of 65% and 35%, respectively, calls for the production of polyethylene resins using ethane as feedstock and is based on an ethane supply agreement with PEMEX-Gás for the supply of 66,000 barrels/day for 20 years, with a price reference at the Mont Belvieu ethane (USG). The fixed investment is estimated at roughly US$2.5 billion, which will be financed under a project-finance model (70% debt/30% equity). The conclusion of works and the startup of units are expected for January 2015.
In November 2010, Braskem announced a strategic partnership with Ineos for the use of its technology at two of the three polyethylene plants, which have combined high density polyethylene (HDPE) production capacity of 750 kton/year. In February 2011, Braskem announced a strategic partnership with Lyondell Basell for the use of Lupotech T technology at the low density polyethylene (LDPE) plant, which has capacity of 300 kton/year. In April 2011, Technip was selected as the technology supplier for the ethylene cracker with annual production capacity of 1 million tons.
In 2010, the Mexican market consumed around 1.88 million tons of polyethylene, with imports accounting for 68% of the total supply. Therefore, this project is extremely attractive and of great importance to the development of the local petrochemical industry.
Sumitomo bank is the project's financial advisor and the Company received formal statements from different financial institutions interested in supporting the project, whose value exceeds US$5.0 billion.
The next steps in 2011 for this project include: (i) the progress of the engineering works and development of the environmental impact study; and (ii) the structuring of the project finance, with construction expected to begin in 2012.
Click here for more details
As a result of the shutdown, the average utilization rates at the Company's petrochemical complexes in 1Q11 stood at 80%, with the South and Southeast complexes operating at utilization rates above 90%. Ethylene production was 739 ktons, down 7% from the previous quarter.
In relation to 1Q10, total ethylene and propylene sales fell by 10%, impacted by the 7% drop in production. Due to the same factors mentioned before, BTX and butadiene sales decreased by 19% and 17%, respectively. However, ethylene and propylene prices increased by 28% on average, while aromatics prices increased 23% and butadiene prices around 40%.
Project Pipeline:
Mexico Project – Ethylene XXI
The integrated project in Mexico in which Braskem and IDESA are participating jointly with interests of 65% and 35%, respectively, calls for the production of polyethylene resins using ethane as feedstock and is based on an ethane supply agreement with PEMEX-Gás for the supply of 66,000 barrels/day for 20 years, with a price reference at the Mont Belvieu ethane (USG). The fixed investment is estimated at roughly US$2.5 billion, which will be financed under a project-finance model (70% debt/30% equity). The conclusion of works and the startup of units are expected for January 2015.
In November 2010, Braskem announced a strategic partnership with Ineos for the use of its technology at two of the three polyethylene plants, which have combined high density polyethylene (HDPE) production capacity of 750 kton/year. In February 2011, Braskem announced a strategic partnership with Lyondell Basell for the use of Lupotech T technology at the low density polyethylene (LDPE) plant, which has capacity of 300 kton/year. In April 2011, Technip was selected as the technology supplier for the ethylene cracker with annual production capacity of 1 million tons.
In 2010, the Mexican market consumed around 1.88 million tons of polyethylene, with imports accounting for 68% of the total supply. Therefore, this project is extremely attractive and of great importance to the development of the local petrochemical industry.
Sumitomo bank is the project's financial advisor and the Company received formal statements from different financial institutions interested in supporting the project, whose value exceeds US$5.0 billion.
The next steps in 2011 for this project include: (i) the progress of the engineering works and development of the environmental impact study; and (ii) the structuring of the project finance, with construction expected to begin in 2012.
Click here for more details
BRASKEM S.A.
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