Bioref Integ Presentation At Solihull, Uk
- 1. 2/12/09 WP2 Identification and market analysis of most promising added- value products to be co-produced with fuels Tony Bridgwater, Peter Smith Raj Chinthapalli Aston University Tasks 2.1 Identification of products 2.2 Market and price analysis 2.3 Market survey of most interesting added-value co- products 1
- 2. 2/12/09 Task 2.1 This task identified 317 chemicals from recent literature and partners that can be derived from a biorefinery. This will be updated and extended during the remainder of the project In principle any chemical can be derived from biomass through a sequence of transformations and separations There are key chemicals that act as primary sources for families of chemicals and which are, therefore, of greater importance These key chemicals have a well established presence, well established production infrastructure and well established markets Chemical Refined chemicals & industry products ~ 30 000 product family tree Intermediates ~ 300 Basic products ~ 20 Raw materials incl. Biomass ~ 10 2
- 3. 2/12/09 Task 2.2 A literature and web analysis has been made on current market prices and volumes of the materials and chemicals identified in Task 2.1 Price data has been found for 97 of the 317 chemicals Market volume has been found for 57 of the 317 chemicals This will be updated and extended during the remainder of the project Price volume relationship Market, t/y 1.E+08 1.E+07 1.E+06 1.E+05 1.E+04 1.E+03 1.E+02 1.E+01 1.E+00 1.E+02 1.E+03 1.E+04 1.E+05 1.E+06 1.E+07 1.E+08 Price, /t 3
- 4. 2/12/09 Most interesting products Criteria for selection: The most interesting products are those with: Established market High value Low production cost Growth potential Long term future Internationally traded These will tend to be commodity or bulk chemicals Task 2.3 Market survey Products agreed by Work Package leaders as significant are: 1,2 propanediol Kerosene Animal feed Lactic acid CO2 Lignin Diesel Methanol DME Power Epichlorhydrin Protein Ethanol Pyrolysis oil Gasoline Tar 4
- 5. 2/12/09 Market study contents Each product is reviewed in terms of: Summary Technical Data Uses, Manufacturers and Market Location Costs and Prices Market Volume and Future Trends Producers Applications Future Trends References Cost and price e.g. methanol The cost of methanol is composed of three main elements: feed cost (natural gas) capital related costs minor operating costs such as labour. The price of methanol depends on supply or availability and demand but cannot be sustained at a price below the cost of production 5
- 6. 2/12/09 CMAI Weekly methanol market report CMAI Weekly Weekly Methanol SPOT Prices methanol market report NOTE Different timing of peak prices Variation with location Max. US contract price 6
- 7. 2/12/09 JJ&A Global methanol report Location effect 2006 7
- 8. 2/12/09 Source: CMAI Weekly methanol market report Product prices - conclusions Spot or contract prices do not provide a good indication of either short term or long term price trends and do not match each other Price depends on: Oil and gas costs for petrochemicals Competition between producers Supply and demand balance Small supply and demand fluctuations can have a major impact on prices Political drivers can have a major impact on prices and commercial activity Prices cannot be reliably predicted even for 遜 year Fuel prices need to be clearly defined and exclude taxes Fiscal incentives need to be separated out 8
- 9. 2/12/09 Cost and price prediction There are several methods for predicting prices and costs: 1. Learning curves. This is a well established but empirical relationship. 2. Trend extrapolation based on historical data. This requires good data going back say 20 years for a 20 year future prediction 3. Cost estimation based on analogy, empiricism, or process complexity and conversion efficiency. 1 Learning curves Boston Consulting Group in the 1970s analysed chemical prices and found a relationship between cumulative production and price that always followed this pattern Price Price (log umbrella scale) Develop- Shake- ment out Slope: 0.15 0.35 Stability Cumulative production (log scale) 9
- 10. 2/12/09 Ethanol costs Hettinga A, et al. Utrecht Univ. 2 Trend extrapolation Trend extrapolation is based on historical data It requires good data going back say 20 years for a 20 year prediction. The time period and models used will significantly affect the result. 10
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- 13. 2/12/09 Forecasting prices is not easy and very uncertain 3 Analogy or empiricism E.g. Gasoline and crude oil Gasoline price = ~1.6 x crude oil price 13
- 14. 2/12/09 Gasoline and crude oil JJ&A Global methanol report Feed & Product relationship 14
- 15. 2/12/09 Current chemicals Almost all chemicals prices are related to oil and gas price to a greater or lesser extent The higher the product value, the less significant the effect of oil or gas price. For commodity petrochemicals, the effect of oil and gas price is significant. A relationship between crude oil / natural gas and product price is possible for many fuel products and some commodity chemicals. Current Market Sizes Market Millions of Tonnes/Year 700 size 600 500 400 300 200 100 large 0 and l ne re d el l in t ar in Et e n ro o l im ets E B i c id no no in Pu f ee ni Bi dies DM La ydr c small Bi soli gn io- ha ha lig os ll ich gly A Pe h al B et er ic o a ne og ct M ok lo yle An Li op Ep Pr Current Market Sizes Millions of Tonnes/Year 70 60 50 40 30 20 10 0 ed in ke ne ol ga el ne ts n ol P r id E ta ni La ydr ch glyc es an le M Ac li fe si gn io- lig so el D ro di th h al ic B io e ro E ne m ct ur in B lo io ni io le P B B A py Li pi ro E P 15
- 16. 2/12/09 Market growth Market Growth Rates 25 20 %/Year 15 10 5 0 Global Ethanol production, m litres Thank you 16