Benzene Toluene

PHENOL/ACETONE/CUMENE February 2012 Report Contents

Phenol/Acetone/Cumene Table of Contents A Report by Nexant’s CHEMSYSTEMS Process Evaluation/Research Planning (PERP) Program PERP09/10-4 - Published February 2012 www.chemsystems.com

Section Page

1 Summary ...... 1 1.1 COMMERCIAL PRODUCTION TECHNOLOGIES ...... 1 1.1.1 Cumene Consumption ...... 2 1.1.2 Selection of Phenol Technologies by Customers for Grassroots and Retrofitting Projects ...... 4 1.2 ALTERNATIVE AND “DEVELOPING” TECHNOLOGIES ...... 5 1.2.1 SBB to Phenol Process...... 5 1.2.2 Benzene Oxidation (with Nitrous Oxide) to Phenol Process ...... 5 1.3 PROCESS ECONOMICS ...... 6 1.3.1 Sensitivity Analyses ...... 8 1.3.2 Concluding Remarks ...... 8 1.4 COMMERCIAL MARKET ANALYSIS ...... 11 1.4.1 Global Cumene Supply, Demand, and Trade ...... 11 1.4.2 Global Phenol Supply, Demand, and Trade...... 11 2 Introduction ...... 13 2.1 CUMENE ...... 13 2.1.1 Brief History of Cumene Production ...... 14 2.2 PHENOL ...... 15 2.2.1 Brief History of Phenol Production ...... 15 2.3 ACETONE ...... 16 2.3.1 Brief History of Acetone Production ...... 17 3 Commercial Cumene Processes ...... 18 3.1 PROCESS CHEMISTRY ...... 18 3.2 CATALYST COMPARISON ...... 20 3.3 COMMERCIAL ZEOLITE CATALYZED PROCESSES ...... 23

1 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

3.3.1 Badger Licensing ...... 23 3.3.2 Polimeri Europa/Lummus Technology ...... 25 3.3.3 UOP...... 32 4 Cumene to Phenol Process Chemistry ...... 35 4.1 CUMENE OXIDATION TO CUMENE HYDROPEROXIDE ...... 35 4.2 CUMENE HYDROPEROXIDE CLEAVAGE TO PHENOL AND ACETONE ...... 39 5 Phenol Production - A Generic Description ...... 42 5.1 OXIDATION ...... 42 5.2 CHP CONCENTRATION (CUMENE STRIPPING) ...... 44 5.3 CHP CLEAVAGE ...... 44 5.4 NEUTRALIZATION ...... 45 5.5 PRODUCT RECOVERY AND AMS HYDROGENATION ...... 47 5.6 ECONOMIC BENEFIT ...... 49 5.6.1 Cumene Consumption ...... 49 5.6.2 Selection of Phenol Technologies by Customers for Grassroots and Retrofitting Projects ...... 50 6 Commercial Phenol and Acetone Technologies ...... 52 6.1 ILLA INTERNATIONAL ...... 52 6.1.1 Process Features ...... 53 6.1.2 Process Description ...... 53 6.2 KBR ...... 78 6.2.1 Process Features ...... 78 6.2.2 Process Description ...... 79 6.3 MITSUI CHEMICALS (ACETONE RECYCLE PROCESS) ...... 84 6.3.1 Process Chemistry ...... 84 6.3.2 Process Description ...... 85 6.4 POLIMERI EUROPA AND LUMMUS TECHNOLOGY ...... 88 6.4.1 Process Features ...... 88 6.4.2 Process Description ...... 89 6.5 SUNOCO/UOP ...... 94 6.5.1 Process Features ...... 94 6.5.2 Process Description ...... 94 7 Alternative and “Developing” Technologies ...... 98

2 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

7.1 CUMENE ...... 98 7.1.1 Cumene via Alkylation of Benzene with Isopropanol ...... 98 7.2 SEC-BUTYLBENZENE (SBB) ...... 99 7.2.1 Alkylation of Benzene to sec-Butylbenzene ...... 99 7.2.2 Shell Process for Alkylation of Benzene to sec-Butylbenzene (SBB) using trans-2-Butene ...... 101 7.2.3 ExxonMobil Process for Alkylation of Benzene to sec- Butylbenzene (SBB) using Ethylene ...... 101 7.3 PHENOL WITH METHYL ETHYL KETONE (MEK) AND ACETONE CO-PRODUCTS ...... 103 7.3.1 sec-Butylbenzene Oxidation to sec-Butylbenzene Hydroperoxide ...... 103 7.3.2 sec-Butylbenzene Hydroperoxide Cleavage ...... 104 7.3.3 Shell Process for SBB/Cumene to Phenol (with MEK/Acetone Co-Products) ...... 105 7.3.4 ExxonMobil Process for SBB/Cumene to Phenol (with MEK and Acetone Co-Products) ...... 110 7.4 PHENOL VIA BENZENE OXIDATION WITH NITROUS OXIDE (SOLUTIA/BIC PROCESS) ...... 111 7.4.1 On-Purpose Nitrous Oxide from Ammonia ...... 111 7.4.2 Benzene Oxidation to Phenol with Nitrous Oxide ...... 115 7.5 PHENOL VIA OXIDATION OF BENZENE WITH HYDROGEN PEROXIDE OR HYDROGEN/OXYGEN ...... 121 7.5.1 Polimeri Europa ...... 121 7.5.2 General Electric ...... 122 7.6 PHENOL VIA HYDROLYSIS OF BROMOBENZENE ...... 122 7.6.1 Microvast Power Systems ...... 123 8 Process Economics ...... 124 8.1 COSTING BASIS ...... 124 8.1.1 Investment Basis ...... 124 8.1.2 Pricing Basis ...... 124 8.1.3 Cost of Production Basis ...... 126 8.2 COST OF PRODUCING CUMENE VIA PROPYLENE ALKYLATION OF BENZENE ...... 127 8.3 COST OF PRODUCING PHENOL VIA CONVENTIONAL CUMENE BASED PROCESS ...... 131

3 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

8.4 COST OF PRODUCING PHENOL FROM BENZENE AND PROPYLENE WITH ACETONE RECYCLE (MITSUI PROCESS) ...... 137 8.5 SPECULATIVE COST OF PRODUCING PHENOL VIA SEC- BUTYLBENZENE/CUMENE ...... 140

8.5.1 sec-Butylbenzene (SBB) from Benzene and Butenes ...... 140 8.5.2 Phenol from sec Butylbenzene (SBB) and Cumene ...... 141 8.6 SPECULATIVE COST OF PRODUCING PHENOL VIA OXIDATION OF BENZENE WITH NITROUS OXIDE...... 145 8.6.1 Ammonia Oxidation to Nitrous Oxide (Fluid-Bed Reactor) ...... 145

8.6.2 Benzene Oxidation to Phenol Using N2O at its Cost of Production (Moving-Bed Reactor) ...... 145

8.6.3 Benzene Oxidation to Phenol Using Byproduct N2O (Moving- Bed Reactor) ...... 146 8.7 COMPARISON OF COMMERCIAL AND SPECULATIVE PROCESSES TO PRODUCE PHENOL ...... 150 8.8 SENSITIVITY ANALYSES ...... 151 8.8.1 Sensitivity of Production Cost to Historical Variation in Prices of Major Feedstocks and Byproducts ...... 151 8.8.2 Sensitivity of Production Cost to Plant Scale for Alternative and “Developing” Technologies ...... 152 8.9 CONCLUDING REMARKS ...... 155 9 Overview of Commercial Market Applications ...... 158 9.1 CUMENE ...... 158 9.2 PHENOL ...... 158 9.3 ACETONE ...... 158 10 Cumene Regional Market Analysis ...... 159 10.1.1 Global Consumption ...... 159 10.1.2 Global Supply ...... 159 10.1.3 Global Supply, Demand, and Trade ...... 159 10.2 UNITED STATES ...... 160 10.2.1 Consumption ...... 160 10.2.2 Supply ...... 161 10.2.3 Supply, Demand, and Trade...... 161 10.3 WESTERN EUROPE ...... 162 10.3.1 Consumption ...... 162 10.3.2 Supply ...... 162

4 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

10.3.3 Supply, Demand, and Trade...... 164 10.4 ASIA PACIFIC ...... 164 10.4.1 Consumption ...... 164 10.4.2 Supply ...... 165 10.4.3 Supply, Demand, and Trade...... 167 11 Phenol Regional Market Analysis ...... 168 11.1.1 Global Consumption ...... 168 11.1.2 Global Supply ...... 170 11.1.3 Global Supply, Demand, and Trade ...... 170 11.2 UNITED STATES ...... 171 11.2.1 Consumption ...... 171 11.2.2 Supply ...... 173 11.2.3 Supply, Demand, and Trade...... 174 11.3 WESTERN EUROPE ...... 175 11.3.1 Consumption ...... 175 11.3.2 Supply ...... 177 11.3.3 Supply, Demand, and Trade...... 180 11.4 ASIA PACIFIC ...... 181 11.4.1 Consumption ...... 181 11.4.2 Supply ...... 184 11.4.3 Supply, Demand, and Trade...... 187 12 Acetone Regional Market Analysis ...... 188 12.1 UNITED STATES ...... 188 12.1.1 Demand ...... 188 12.1.2 Supply ...... 188 12.1.3 Supply, Demand, and Trade...... 189 12.2 WESTERN EUROPE ...... 191 12.2.1 Demand ...... 191 12.2.2 Supply ...... 191 12.2.3 Supply, Demand, and Trade...... 192 12.3 ASIA PACIFIC ...... 193 12.3.1 Demand ...... 193 12.3.2 Supply ...... 194 12.3.3 Supply, Demand, and Trade...... 196

5 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

13 References ...... 198 14 Glossary ...... 203

Appendix Page

A Definition of Capital Cost Terms Used in Process Economics ...... A-1 B Definition of Operating Cost Terms Used in Process Economics...... B-1 C PERP Program Title Index ...... C-1

6 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

Figure Page

1.1 Phenol Value Chain ...... 1 1.2 Phenol Production Cost Summary ...... 7 2.1 Phenol Value Chain ...... 13 3.1 Overview of Cumene Process Chemistry ...... 18 3.2 Transalkylation Chemistry ...... 19 3.3 Badger Cumene Technology Process ...... 24 3.4 Polimeri/Lummus Cumene Process ...... 31 3.5 UOP Q-MaxTM Process ...... 34 4.1 Overview of Cumene to Phenol Process Chemistry ...... 36 5.1 Cumene Oxidation and Cleavage ...... 46 5.2 Phenol/Acetone Recovery and AMS Hydrogenation ...... 48 6.1 ILLA Phenol/Acetone Process ...... 55 6.2 ILLA Cumene Oxidation Process ...... 57 6.3 ILLA HP Cleavage Process ...... 65 6.4 Heat Generation and Heat Removal in One-Step Homogeneous CHP Cleavage ...... 68 6.5 ILLA's Off-Gas Adsorptive Treatment ...... 70 6.6 ILLA Two-Step Catalytic Phenol Treatment Process ...... 72 6.7 KBR Improvements in the Phenol Process ...... 79 6.8 KBR Phenol Process ...... 80 6.9 Mitsui Acetone Recycle Chemistry ...... 85 6.10 Mitsui Acetone Recycle Process ...... 87 6.11 Polimeri/Lummus Phenol Process ...... 90 6.12 Sunoco/UOP Phenol Process ...... 95 7.1 sec-Butylbenzene Production Process ...... 102 7.2 Cumene/SBB to Phenol Oxidation and Cleavage ...... 106 7.3 Cumene/SBB to Phenol Recovery and Hydrogenation ...... 107 7.4 On-Purpose Nitrous Oxide Production using Fluid Bed Reactor (Solutia/BIC) Process ...... 114 7.5 Benzene to Phenol (Solutia/BIC) Process...... 120 8.1 Phenol Production Cost Summary ...... 150 8.2 Cost of Production Sensitivity to Variation in Major Feedstock and Byproduct Prices ...... 152 8.3 Variation in Cost of Production with Plant Scale ...... 153

7 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

8.4 Fluctuation of Acetone and Methyl Ethyl Ketone Prices ...... 154 11.1 Global Phenol Consumption by Sector, 2010 ...... 170 11.2 North American Phenol Consumption, 2010 ...... 173 11.3 West European Phenol Consumption, 2010 ...... 177 11.4 Asia Pacific Phenol Consumption, 2010 ...... 184 12.1 U.S. Acetone Consumption by End-Use, 2010...... 188 12.2 U.S. Acetone Supply/Demand and Trade ...... 190 12.3 West European Acetone Consumption by End-Use, 2010 ...... 191 12.4 West European Acetone Supply, Demand, and Trade ...... 193 12.5 Asia Pacific Acetone Consumption by End-Use, 2010 ...... 194 12.6 Asia Pacific Acetone Supply/Demand, and Trade ...... 197

8 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

Table Page

1.1 Summary of Economics of Phenol Production Processes ...... 7 1.2 Global Cumene Supply, Demand, and Trade ...... 11 1.3 Global Phenol Supply, Demand, and Trade...... 12 2.1 Typical Properties of Cumene ...... 14 2.2 Typical Properties of Phenol ...... 15 2.3 Highlights in the Development of Phenol Production Technology ...... 15 2.4 Typical Properties of Acetone ...... 17 3.1 Typical Propylene Feedstock Specifications ...... 20 3.2 Benzene Feedstock Specifications Required for Cumene Production Purposes ...... 20 3.3 Catalyst Comparison - Typical Operating Conditions & Cumene Specifications ...... 22 3.4 Polimeri/Lummus Cumene Product Quality ...... 30 3.5 UOP Q-MaxTM Cumene Product Quality...... 33 6.1 Comparison of Oxidation Technologies ...... 58 6.2 Main Characteristics of ILLA’s Two-Step CHP Cleavage Process ...... 61 6.3 ILLA Phenol Product Quality ...... 74 6.4 ILLA Acetone Product Quality ...... 75 6.5 ILLA AMS Product Quality ...... 75 6.6 KBR Phenol Product Quality ...... 83 6.7 Propylene Product Quality for Mitsui Acetone Recycle Process ...... 86 6.8 Polimeri/Lummus Phenol Product Quality ...... 92 6.9 Polimeri/Lummus Acetone Product Quality ...... 93

7.1 On-Purpose Nitrous Oxide (N2O) Process Scheme Summary ...... 113 7.2 Effect of Catalyst Water Vapor Treatment on Benzene Conversion ...... 116 7.3 Various Operating Conditions for Benzene Oxidation with Nitrous Oxide (N2O) to Phenol...... 118 8.1 Prices used in Cost of Production Tables ...... 125 8.2 Cost of Production Estimate for: Cumene ...... 128 8.3 Cost of Production Estimate for: Cumene ...... 129 8.4 Cost of Production Estimate for: Cumene ...... 130 8.5 Material Balance for Cumene to Phenol Process ...... 131 8.6 Cost of Production Estimate for: Phenol (with Acetone Byproduct) ...... 134 8.7 Cost of Production Estimate for: Phenol (with Acetone Byproduct) ...... 135

9 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

8.8 Cost of Production Estimate for: Phenol (with Acetone Byproduct) ...... 136 8.9 Cost of Production Estimate for: Phenol ...... 138 8.10 Cost of Production Estimate for: Phenol ...... 139 8.11 Cost of Production Estimate for: sec-Butylbenzene ...... 143 8.12 Cost of Production Estimate for: Phenol (with MEK and Acetone Byproducts) ...... 144 8.13 Cost of Production Estimate for: Nitrous Oxide (100% basis as 46 wt. % solution) ...... 147 8.14 Cost of Production Estimate for: Phenol ...... 148 8.15 Cost of Production Estimate for: Phenol ...... 149 8.16 Summary of Economics of Phenol Production Processes ...... 150 10.1 Global Cumene Consumption by Region ...... 159 10.2 Global Cumene Supply,Demand, and Trade ...... 160 10.3 North America Cumene Consumption...... 160 10.4 Cumene Capacity in North America ...... 161 10.5 North American Cumene Supply, Demand, and Trade ...... 162 10.6 West European Cumene Consumption ...... 162 10.7 Cumene Capacity in Western Europe ...... 163 10.8 West European Cumene Supply, Demand, and Trade ...... 164 10.9 Asia Pacific Cumene Consumption ...... 165 10.10 Cumene Capacity in Asia Pacific ...... 166 10.11 Asia Pacific Cumene Supply, Demand, and Trade ...... 167 11.1 Global Phenol Consumption ...... 169 11.2 Global Phenol Supply, Demand, and Trade...... 171 11.3 North American Phenol Consumption ...... 172 11.4 Phenol Capacity in North America ...... 174 11.5 North American Phenol Supply, Demand, and Trade ...... 175 11.6 West European Phenol Consumption ...... 177 11.7 Phenol Capacity in Western Europe ...... 179 11.8 West European Phenol Supply, Demand, and Trade ...... 180 11.9 Asia Pacific Phenol Consumption ...... 183 11.10 Phenol Capacity in Asia Pacific ...... 186 11.11 Asia Pacific Phenol Supply, Demand, and Trade ...... 187 12.1 U.S. Acetone Capacity, 2010 ...... 189

10 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

12.2 U.S. Acetone Supply/Demand and Trade ...... 190 12.3 West European Acetone Capacity, 2010 ...... 192 12.4 West European Acetone Supply, Demand, and Trade ...... 193 12.5 Asia Pacific Acetone Capacity, 2010 ...... 195 12.6 Asia Pacific Acetone Supply, Demand, and Trade ...... 196

11 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105 PHENOL/ACETONE/CUMENE February 2012 Report Contents

CHEMSYSTEMS PERP PROGRAM

www.chemsystems.com

The ChemSystems Process Evaluation/Research Planning (PERP) program is recognized globally as the industry standard source for information relevant to the chemical process and refining industries. PERP reports are available as a subscription program or on a single report basis.

Contact Details:

London: Dr. Alexander Coker, Manager, PERP Program Phone: + 44-(20)-7950-1570, e-mail: [email protected]

New York: Heidi Junker Coleman, Global Multi-Client Programs Support Manager Phone: + 1-914-609-0381, e-mail: [email protected]

Shanghai: Dr. Y. Larry Song, General Manager, Nexant China Phone: +86 21 6182 6791, e-mail: [email protected]

Nexant, Inc. (www.nexant.com) is a leading management consultancy to the global energy, chemical, and related industries. For over 38 years, ChemSystems has helped clients increase business value through assistance in all aspects of business strategy, including business intelligence, project feasibility and implementation, operational improvement, portfolio planning, and growth through M&A activities. Nexant has its main offices in San Francisco (California), White Plains (New York), and London (UK), and satellite offices worldwide.

12 CHEMSYSTEMS PERP PROGRAM www.chemsystems.com PERP09/10-4, Phenol/Acetone/Cumene A00101.0010.4105