Polypropylne Expand on Consumer Needs
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1Copyright @ Petrochemical Business, IRPC Public Company Limited
IRPC’s Polypropylene
Expand On Consumer Needs
February 17, 2015
Mr. Jaturong WorawitsurawatthanaVice President, Petrochemical Business
IRPC Public Company Limited
Prepared by
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2Copyright @ Petrochemical Business, IRPC Public Company Limited
Outlne!
Polypropylene "ar#et Outloo#
IRPC Polypropylene
$usness %e&elopment
'ey %r&ers ( It’s
Opportunty
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3Copyright @ Petrochemical Business, IRPC Public Company Limited
Outlne!
Polypropylene "ar#et Outloo#
IRPC Polypropylene
$usness %e&elopment
'ey %r&ers ( It’s
Opportunty
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4Copyright @ Petrochemical Business, IRPC Public Company Limited
Prn)ple o* Petro)+em)al "anu*a)turn
“Break it down and re-fabricate at molecular level”
Macromolecule Micro molecule Ultra-large molecule
(Carbon 1~250)
Mixed Hydrocarbon(Saturated)
(Carbon 1~8)
Monomer(Unsaturated)
(Carbon 20K-1M)
Polymer(Saturated)
CoalOilNatural Gas
Methane
Ethylene
PropyleneButenes, -diene
Benzene
Toluene
Xylenes
Polyethylene
Polypropylene
Polyvinylchloride
Polystyrene
Polyester
Polyamide
Polycarbonate
Etc.
Disintegration
Heat, Catalyst
(Cracking,
Reforming)
Reconstitution
Catalyst
(Polymerization)
“To do all of these, investment and technology are the keys”
Bioplastics;PBS, PLA, Etc.
Bio-based feedBiomass
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5Copyright @ Petrochemical Business, IRPC Public Company Limited
Polypropylene
Propylene Polypropylene
PropyleneCH3-CH = CH2
Appliances
Food Packaging & Disposables
Automotive
Agricultural and Industrial Packaging
Homo Block copo Random copo
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6Copyright @ Petrochemical Business, IRPC Public Company Limited
-orld Propylene %emand s %omnated
by Polypropylene Produ)ton
+26%
Propylene "ar#et ./e 201
3 "llon 4ons
Note: Others means Cumene (phenol and acetone chain), 2-Ethylhexanol, Butanols, Isopropanol, and Other Source : IHS, 2015
Propylene "ar#et ./e 2013
112 "llon 4ons
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-orld Polypropylene .upply ( %emand
Source: IHS, 2015
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8Copyright @ Petrochemical Business, IRPC Public Company Limited
Reonal Polypropylene Net 4rade Patterns
NE Asia
SE Asia & Oceania
Remark: (+) Net Export and (-) Net Import
S. America
W. Europe
Africa
C. Europe
N. America
Indian Subc.
Middle East
CIS & Baltics
Source: IHS, 2015 and IRPC Analysis
Asia is Net Import Polypropylene.
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Polypropylene Capa)ty and %emand %re)ton
Source: IHS, 2015
Chinese Plant Expansion
(Cost competitiveness
from CTP MTP Technology)
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10Copyright @ Petrochemical Business, IRPC Public Company Limited
IRPC Polypropylene Capa)ty .+are
Source: IHS, Market Survey, Mitsubishi Corporation
YearIRPC Nameplate
CapacityWorld
SoutheastAsia
Thailand
2014 475 KTA
69,123 KTA 5,344 KTA 1,970 KTA
2019 775 KTA
87,320 KTA 5,814 KTA 2,270 KTA
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Polypropylene s t+e arest .+are o*4otal Polymers %emand
Source: IHS Forum, June 2014
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-orld Polypropylene %emand by Reon
Source: IHS, 2015
%AAGR
2014-193% 4% 1% 3% 4% 6% 5% 8% 6% 5%
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"atrx o* Polypropylene Consumpton
Source: IHS, 2015 and IRPC Analysis
"antan
Opportunty
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14Copyright @ Petrochemical Business, IRPC Public Company Limited
-orld Polypropylene %emand by 6ppl)aton
Source: IHS, 2015
+27%
"ar#et ./e 2013
75 "llon 4ons
"ar#et ./e 201
53 "llon 4ons
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15Copyright @ Petrochemical Business, IRPC Public Company Limited
Polymers play a )rt)al role n all e)onomes
Source: IHS Forum, June 2014
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16Copyright @ Petrochemical Business, IRPC Public Company Limited
Situation
E&E, Autopart, Construction,Luxurious goods
Food packaging
EconomicUpturn
EconomicDownturn
E)onom) Impa)t to %emand and Pr)e
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Polymer Pr)e and %emand Cy)le
(2010)
Source: World Outlook of the petrochemical industry by Mitsubishi Corporation, 2011
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Outlne!
Polypropylene "ar#et Outloo#
IRPC Polypropylene
$usness %e&elopment
'ey %r&ers ( It’s
Opportunty
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19Copyright @ Petrochemical Business, IRPC Public Company Limited
LPG
Naphtha
Gasoline
Diesel
Fuel Oil
89
Increasing Crude Run
Variety Properties & FlexibleCrude Type
More Value Added Products
FUEL OIL COMPONENT/
CARBON BLACKFEEDSTOCK
320 KTA
120 KTA
280 KTA
200 KTA*Production Capacity
9alue 6dded Produ)ts *rom 89 Pro:e)t
$440/MT
$407/MT
$912/MT
> $1,050/MT
$42-45/BBL($315-340/MT)
$57/BBL($428/MT)
Petrochemical Business
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20Copyright @ Petrochemical Business, IRPC Public Company Limited
IRPC O&erall Pro)ess
1994POWER PLANT
BITUMINUS
FUEL OIL
BUTADIENE
RAFFINATEPYROLYSISGASOLINE
NAPHTHA 199
ETHYLENE!RA!"ER
TRANSPORTATION FUEL# LPG !USTOMER
B$ 199ETHYLBEN$ENESTYRENE MONO
TOLUENE
MI-YLENE
HA &A9#A10'(
A!N
199PS
1992EPS
1990 ABS)!!M
1993SAN
SM
A!N
1990
PP
PROPYLENE
REFINERY PETRO!HEMI!ALDOWNSTREAMINTERMEDIATEUPSTREAM
A!ETYLENE 2003 A!B
R
E F I N E R Y
P L A N T
ADU 165#000 BPD
150#000 BPD ADU 2 Y2000
Y1996
!RUDE OIL
!ONDENSATE
*A!UUM GAS OIL &*GO(
ASPHALT
LUBE BASE OIL
199LUBE BASE OIL
LONG RESIDUE
&AR(
ETHYLENERI!H GAS
199DEEP !ATALYTI!
!RA!"ING
LS ATB
ETHYLENE
ETHYLENE
1986HDPE
REFORMATE 199BEN$ENETOLUENE YLENE
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.+*tn o* Produ)t Port*olo to;ard 9arety andPremum Produ)t ser&n "ea 4rend
Polypropylene Expanson
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Inlne Pro)ess
Compounding
House
IRPC PP Compoundn Pro:e)t
Outlne Pro)ess
Cost .a&n• Packing & Logistic• 2nd Extruder Production
Compounding
House
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Outlne!
Polypropylene "ar#et Outloo#
IRPC Polypropylene
$usness %e&elopment
'ey %r&ers ( It’s
Opportunty
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9alue Creaton 4+rou+ .upply C+an
Source : PTIT as of 2014
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POPULATIONCLIMATE CHANGE ECONOMIC
GLOBAL FLOW
EDUCATION
DEVELOPMENT & POVERTYSECURITYTECHNOLOGY
NATURAL RESOURCES
HEALTH
>lobal 4rend ? -orld $usness Opportuntes
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Opportuntes *or Polypropylene
Pa)#an ( Prntn
Non;o&ens ( arn
Ele)tron) ( Ele)tr)al
6utomot&e
Compoundn
>lobal produ)ton
>lobal pur)+asn
In&estment s+*t to 6.E6N
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P6C'6>IN>
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Million Baht: 572,372Ktons Volume: 4,679
ThailandTotal Production of Plastic Conversion
Source: PTIT Data, Modified by PITH, 2014
Plastic Packaging
Paper38%
RigidPlastic
21%FlexiblePlastic
13%
Metal16%
Glass
6%
Other6%
Global PackagingConsumption
Source: PIRA International, 2009
Total Plastic 34%
Million Baht: 187,079 (32.7%)Ktons: 2,219 (47.4%)
Pa)#an "ar#et Outloo#
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-orld Rd Plast) Pa)#an Consumptonby "ateral
KTA
Source: Rigid Packaging Solutions by Farmamak, 2013
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30Copyright @ Petrochemical Business, IRPC Public Company Limited
Polypropylene n Pa)#an
Bag
PE, PP , PET,PVC, Nylon
Bottle/CapPE, PP , PS, PET,PVC
Container/Closure
PE, PP , PS, SAN,PET, PVC
Box/Pallet/Drum
PE, PP , PET
Sack/Yarn
PP
Cup/Lid
PP , PS
TrayPE, PP , PS, PVC,PET
FilmPE, PP , PVC
Blister/Skin
PE, PVC, Ionomer
Foam
PS, EPS, PP
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Multilayer packaging
Plastic pouches
Flexible packaging
Microwaveable packaging
Frozen / Chilled ready meal
Convenient closures
No Carcinogen in baby bottleand food containers
Pa)#an 'ey %r&ers and 4rends
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NON-O9EN. ( 6RN
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Polypropylene Non;o&ens "ar#et
The Global Nonwovens Market is over $20 Billion by 2011and US$30.61 Billion by 2020
Source: Edison Investment Research and Pira International
Increaseto 40%by 2015
PolyesterRayonWood
PP 30%
Other
70%
Hygiene35%
Industry65%
Industry35%
Hygiene65%
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34Copyright @ Petrochemical Business, IRPC Public Company Limited
-orld Non;o&ens %emand
Source: The Freedonia Group
0.0
0.5
1.0
1.5
2.0
2.5
3.03.5
4.0
4.5
NorthAmerica
WesternEurope
Asia Pacific Central &South
America
EasternEurope
Africa/MiddleEast
Millions MT2005 2010 2015F
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35Copyright @ Petrochemical Business, IRPC Public Company Limited
-orld;de Non;o&ens Produ)ton
0.0
0.5
1.0
1.5
2.0
2.5
3.0
NAFTA Europe China Other AsiaPacific
Japan MiddleEast
Rest ofWorld
2006 2011 2016FMillions MT
Source: INDA Estimates & Rory Holmes, INDA-CAB Conference 2012 (www.inda.org)
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8+ $rt+ Rate and oner &n %r&e %emand
Source: Mitsubishi Corporation, 2013
Age
Growing Old
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Non;o&ens ( arn 'ey %r&ers and 4rends
PP Nonwoven growth inhygiene market.
Industrial and agriculturalsectors growth in developingcountries.
Consumption increasing inAsia-Pacific, Latin Americanand other emerging markets.
Older traditional productssubstitution and consumerbehavior change
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EEC4RONIC @ EEC4RIC6( 6PPI6NCE.
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39Copyright @ Petrochemical Business, IRPC Public Company Limited Source: Plastics Foresight
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40Copyright @ Petrochemical Business, IRPC Public Company Limited
EE ( 6pplan)es "ar#et Outloo#
EE & Appliances
Million Baht: 118,240 (20.7%)Ktons: 739 (15.8%)
Million Baht: 572,372Ktons Volume: 4,679
Thailand
Total Production of Plastic Conversion
Source: PTIT Data, Modified by PITH, 2014
Source: Mitsubishi Cor poration andJournal of Cleaner Production, 2014
Plastics componentaverage weightabout 7 kg/unit
Plastics componentaverage weightabout 8 kg/unit
Plastics componentaverage weight
about 3 kg/unit
EE ( 6 l ' % d 4 d
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EE ( 6pplan)es 'ey %r&ers and 4rends
Functionality
Easy to use – andconnected
Aesthetics and Design
Energy efficiency
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P l l 6 t bl
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Polypropylene n 6utomoble
Source: Association of Plastics Manufacturers in Europe
Bumpers
PP , ABS, PC 10 kg
SeatsPUR, PP , PVC, ABS, PA13 kg
DashboardPP , ABS, PA, PC, PE
15 kg Fuel systems
PE, POM, PA, PP 7 kg
Body (inc. body panels)PP , PPE, UP
6 kg
Under the bonnetcomponentsPA, PP , PBT
9 kg
Interior trimPP , ABS, PET, POM, PVC
20 kg
Electrical componentsPP , PE, PBT, PA, PVC
7 kg
Exterior trimABS, PA, PBT, PA, PVC
4 kg
Lighting
PP , PC, ABS, PMMA, UP 5 kg
UpholsteryPVC, PUR, PP , PE
8 kg
Other reservoirsPP , PE, PA
1 kg
About 105 kg of petrochemical-derived plastics
6 t t " # t O tl #
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44Copyright @ Petrochemical Business, IRPC Public Company Limited
6utomot&e "ar#et Outloo#
Vehicles
Million Baht: 81,638 (14.3%)Ktons: 363 (7.7%)
Million Baht: 572,372Ktons Volume: 4,679
ThailandTotal Production of Plastic Conversion
Source: PTIT Data, Modified by PITH, 2014
Source: Mitsubishi Corporation
Automobile
.nA)ant 4ranston n t+e Reon
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.nA)ant 4ranston n t+e Reon
Source: Ernst &Young’s Global Automotive Center
6utomot&e 'ey %r&ers and 4rends
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High growth of automotiveproduction in Asia
Further growth of PP demandin China and Southeast Asia
Low cost / Light weight PPsupports city car production
Developing bio-plastic basedon PP of Japanese car maker
6utomot&e 'ey %r&ers and 4rends
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CO"PON%IN>
-+ere s sed Compounded Plast)sB
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-+ere s sed Compounded Plast)sB
Industries Served:• Construction• Auto• Wire and Cable
• Durables• Consumer Products• Industrial Applications• Aerospace
• Electrical & Electronics• Health Care
Replacing:
• Metals• Wood• Natural Rubber• Expensive Engineered Plastics
Source: TASNEE (Saudi Arabia), 2 nd GPCA, Plastics Summit
Note: TPO, Thermoplastic PolyolefinTPV, Thermoplastic VulcanizatesAdd concentrate ex: Carbon black, Pigment, Masterbatch
PP Cateores .t**ness &s Ot+er Polymers
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PP Cateores .t**ness &sD Ot+er Polymers
Source: TASNEE (Saudi Arabia), 2 nd GPCA, Plastics Summit
>lobal %emand o* Polypropylene Compound
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>lobal %emand o* Polypropylene Compound
Largest sectorwith 55%
Source: TASNEE (Saudi Arabia), 2 nd GPCA, Plastics Summit
"a:or >lobal PP Compound Produ)ers
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"a:or >lobal PP Compound Produ)ers
Source: TASNEE (Saudi Arabia), 2 nd GPCA, Plastics Summit
.trate) Intat&es? Roadmap to .u))ess
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52Copyright @ Petrochemical Business, IRPC Public Company Limited
• DELTA Initiative Implementation• Assets Management (Bankai/EIZ)
Para-Xylene(PX)
Acrylic Acid(AA)
• Specialty focus and Movingaway from heavy-assetcompany
• CHP I: Electricity +220MW, Steam +420T/hr• PRP +100KTA of Propylene• EURO IV: Gasoline 15KBD, Diesel 10KBD, Jet 15KBD• TDAE +28KTA, 150BS +25KTA• Lube Blending +60m.Ltrs./year• EBSM +60KTA, ABS/SAN +60KTA
Completed Project during 2011-13
2013 Crude Run 181 KBD Nelson Complexity Index Portfolio of Revenue:
Petroleum/Petrochemical & Others
2
2015: UHV Completion
Crude Run 215 KBD Nelson Complexity Index More stable portfolio of Revenue:
Petroleum/Petrochemical & Others
76% / 24%
59% / 41%6.6
8.684%
100%
1
3
STS 2014:
StrengtheningCore Business
Super AbsorbentPolymer(SAP)
Quick Win Initiatives
New investments through JV
2013
2014
2015
2017
PP Derivatives • PP Expansion 160 KTA
• PP Compounding 140 KTA
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53Copyright @ Petrochemical Business, IRPC Public Company Limited
486N' OThe presentation is presented in good faith and is based on current situations and assumptions. Known and
unknown risks, uncertainties and other factors could lead to material differences from this presentation.
We encourage you to have your own consideration when making decision at your own risk.
IRPC Public Company Limited assumes no liability to update or to conform them to future events or developments.
ueston