PETROCHEM INDUSTRY EXPANDS NORTH AMERICAN MTBE CAPACITY

Petrochemical manufacturers continue to increase methyl tertiary butyl ether (MTBE) capacity in North America. The action reflects refiners' reformulation of gasoline to help reduce auto emissions. Demand for gasoline blending oxygenates such as MTBE is expected to increase as U.S. refiners reconfigure processing trains to produce fuels meeting requirements of the Clean Air Act amendments of 1990. Recent progress includes plans to build an MTBE plant in Mexico and start-ups of plants on the

Oct. 5, 1992

4 min read

Petrochemical manufacturers continue to increase methyl tertiary butyl ether (MTBE) capacity in North America.

The action reflects refiners' reformulation of gasoline to help reduce auto emissions.

Demand for gasoline blending oxygenates such as MTBE is expected to increase as U.S. refiners reconfigure processing trains to produce fuels meeting requirements of the Clean Air Act amendments of 1990.

Recent progress includes plans to build an MTBE plant in Mexico and start-ups of plants on the U.S. Gulf Coast and in Canada. Among the latest announcements:

Productos Ecologicos SA de CV (Proesa) joint venture partners agreed with Petroleos Mexicanos (Pemex) to build a 13,000 b/cd MTBE plant in Mexico with start-up expected by second half 1995. Proesa partners are Valero Energy Corp. and Promociones Industriales Banamex SA de CV (Pibsa), each with a 35% interest, Grupo Infomin SA de CV 20%, and Dragados Construcciones SA 10%.
M.W. Kellogg Co., Houston, finished building two MTBE plants in Texas with combined design capacities of 27,500 b/cd. Global Octanes is in start-up on a 12,500 b/cd plant at its petrochemical complex in Deer Park and EGP Fuels, a subsidiary of Enron Corp., is in start-up at a 15,000 b/d plant at Morgan's Point. Both sites are on the Houston Ship Channel.
Alberta Envirofuels Inc. (AEI) commissioned a 12,300 b/cd MTBE plant at Edmonton, Alta. The $390 million (Canadian) plant is owned 5050 by Neste Oil and Chevron Corp. Chevron joined the project last year.

PROESA'S PLANT

Proesa's MTBE plant will upgrade butane feedstock bought from Pemex at market based prices. In return, Pemex will buy all or a substantial part of plant production under a long term contract based on a price formula designed to minimize risk to Proesa partners and Pemex.

Site of the plant is yet to be determined. But a Valero official said a site near Campeche Bay likely will be chosen because of feedstock available from Pemex petrochemical operations in the area.

Proesa partners have not scheduled the start of plant construction. But Valero said work would have to begin about 18 months before production start-up in second half 1995. Valero expects to need about 14 months to complete a virtually identical MTBE plant at Corpus Christi, where there are many offsite facilities.

Cost of the 13,000 b/d Corpus Christi plant is pegged at $290 million. Valero estimates the cost of Proesa's plant at $300-350 million.

Valero likely will operate Proesa's MTBE plant.

Bill Greehey, Valero chairman and chief executive officer said the Proesa plant will benefit Mexico's economy and environment.

"This MTBE project is another step in strengthening our relationship with Mexico by assisting in development of their goal of increasing production of clean burning fuels," he said.

Greehey said Valero's partners in the project are well managed, experienced, and financially sound.

Pibsa is the venture capital group of Banamex, Mexico's largest bank; Grupo is a privately held Mexican chemicals, plastics, textiles, and real estate company; and Dragados is Spain's largest construction company.

PLANTS STARTING UP

Global Octanes was scheduled to begin full scale production at its Deer Park plant this month. Kellogg said the plant is the first grassroots MTBE unit to go on line on the Gulf Coast.

EGP expects to start production in October at its Morgan's Point plant. The unit will be the largest MTBE plant on the Gulf Coast.

Kellogg also is on schedule to begin building after yearend an MTBE plant expansion at Port Neches, Tex., for Texaco Chemical Co. Engineering and procurement is under way on that project, with completion expected in 1994. MTBE production will jump to 25,000 b/d from 10,000 b/d.

Construction on AEI's plant in Edmonton began 2 years ago, after Neste concluded that demand for MTBE likely would grow because of steadily stricter regulations on vehicle exhaust emissions in the U.S. and Europe.

In addition, Neste produces MTBE at Porvoo, Finland, Sines, Portugal, and at a joint venture plant in Saudi Arabia. Neste also is a partner in a joint venture plant expected to start up soon in Malaysia.