Good morning. I'm interested in how engineers actually use plant cost indexes like CEPCI in practice—curious how widely it's actually used vs. how it's talked about in textbooks. If you work with plant cost estimation or capital project budgeting, I'd love to hear how you actually use it, or if you don't, why not. Just reply to this email!
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| 3:2:1 Crack | $36.24/bbl | +60.6% |
Making room for domestic BDO
A couple of weeks ago The European Commission introduced anti-dumping duties on imports of 1,4-butanediol (BDO) originating from the US, Saudi Arabia, and China, because overcapacity in China (and they just keep building more) plus low energy costs in the petrostates were making it impossible for the four BDO plants in the EU to compete. Following that decision, BASF immediately announced plans to expand its BDO production at its enormous site in Ludwigshafen, Germany. Lobbying at its finest! (That’s not a knock on lobbying.) [LINK]
More ethylene, chlor-alkali, and VCM
It was just a couple of months ago that Westlake announced plans to shutter some of its chlor-alkali plants along the US Gulf Coast, so it surprised me to see Shintech (Shin-Etsu's US subsidiary) announce a $3.4 billion expansion at its Plaquemine, Louisiana complex—a 625 KTA ethylene plant, a 310 KTA caustic soda plant, and a 500 KTA vinyl chloride monomer (VCM) plant, all targeting completion by 2030. The two moves aren't contradictory, though, they're two sides of the same rationalization. Westlake's assets have been pieced together through acquisitions over the years, while Shintech's Plaquemine complex was purpose-built and recently expanded by a single owner with deep pockets and a long time horizon. Shintech also benefits from a much larger captive market: Shin-Etsu is the world's largest PVC producer, so the VCM rolling off these new plants already has a home. [LINK]
Cyclo-olefin polymers and semiconductors
Tokyo-based specialty chemical company, Zeon, is building a second cyclo-olefin polymer (COP) plant in Japan to expand its capacity by 30%, likely in the low single-digit KTA range. This is a niche ultra-transparent material with near-zero water absorption—initially valuable for precision optics like smartphone lenses, but now the growth is tied to replacing glass in prefilled syringes and diagnostic chips, and its purity and low dielectric properties make it well suited for wafer transport containers. It’s a quiet bet that healthcare and chipmaking will keep pulling demand for a material most people have never heard of. [LINK]
The Reboiler:
- South Korea approved the Lotte-HD Hyundai Daesan merger, which includes shuttering Lotte's 1.1 million mt/y cracker.
- INEOS secured €300M in French government grants to decarbonize its Lavera cracker.
- AGC Vinythai commissioned an expanded chlor-alkali plant in Thailand, adding 220 KTA of caustic soda and doubling PVC capacity to 700 KTA.
- Fibrant is closing its 135 KTA caprolactam plant in the Netherlands — high costs, Asian competition.
- Indorama Ventures shut down a PTA plant in Rayong, Thailand.
- Nextchem launched a new PTMEG process technology for spandex production.
- UBE invested in Immaterial, a Cambridge spin-out doing COâ‚‚ capture with monolithic metal-organic frameworks.
- UBE also backed CheomdanLab, a Korean startup upcycling semiconductor silicon waste into silicon nitride for EV bearings.
- De Nora and Tuleva signed a deal to build a major US electrochemical lithium hydroxide plant targeting 11 KTA.
- Clariant is partnering with Vertimass to scale zeolite catalysts for converting bio-alcohols into drop-in jet and diesel fuels.
- Carbon Direct and C2X are building a Louisiana plant to convert forestry residue into biomethanol, with Microsoft committed to 3.6M mt of carbon removal credits over 12 years.