Latin American Chemicals are vibrant

The continued strong economic growth in the Latin American region is prompting the vigorous development of the chemical industry in the region. According to the International Monetary Fund (IMF), the largest economy in Latin America in 2006—Brazil’s GDP growth rate was 3.6%, and it is expected to reach 4.0% in 2007. The GDP growth rates of Argentina, Chile, Venezuela and Mexico in 2007 will continue to grow at a high rate. Under the strong growth of GDP, especially for the many chemical projects that are in operation, people have reason to remain optimistic about the Latin American chemical industry in 2007.
Robert J. Bauman, Nexant Chemical Systems (NCS) consultant, points out that currently Latin America is operating more chemical projects than in Asia. The main reason for this is the healthy growth of chemical demand in the region. At the same time, the region has cheap and abundant petrochemical materials, especially ethane, which is much lower than the United States. Bauman pointed out: "In these new chemical projects, most of them are planned for the construction of cheap local ethane and other raw materials."
The largest petrochemical project in Latin America in Mexico was to invest in a $1.9 billion Phoenix project by the Mexican national oil companies Pemex, Nova Chemicals, Mexico's Grupo Idesa and Indelpro, which is a combination of ethylene cracking, aromatics and downstream derivatives. Integrated petrochemical complex. However, the project was cancelled in 2005 because the Mexican government did not agree to provide preferential natural gas condensate materials.
However, according to a Pemex manager in charge of the new chemical project, the company has emerged from the shadow of cancellation of the Phoenix project and is currently planning a series of petrochemical capacity expansion projects. The new petrochemical project is expected to be completed and put into production in 2009. Raw materials will use pentane and hexane, which are derived from petroleum, instead of natural gas condensate. To this end, the company has planned to increase the capacity of ethylene crackers in Morelos and Cangrejera by 50% to 900,000 tons per year. The obtained hexane feedstock will supply the company with a planned investment of US$350 million to build a 700,000-ton/year aromatics plant.
The new ethylene production capacity of Morelos ethylene cracker will supply the company's recently completed linear low density polyethylene (LLDPE) plant. Therefore, the expansion of the ethylene cracker is a foregone conclusion. The expansion of the Cangrejera ethylene cracker will also depend on the progress of Pemex, Nova Chemicals, and Grupo Idesa’s joint venture polyethylene plant project. Pemex is currently clearing the barriers to these new projects.
Brazil Petrobras, the Brazilian national oil company, is also trying to stimulate the growth of the petrochemical business by establishing a joint venture company. Most notably, the company plans to jointly invest $8.3 billion in petrochemical projects with Grupo Ultra. The project includes an ethylene cracking capacity of 1.3 million tons per year, and downstream derivatives such as polypropylene, polyethylene, styrene, ethylene glycol and PET. The project is expected to be completed and put into operation in 2012. Grupo Ultra is the parent company of ethylene oxide producer Oxiteno.
In addition, Petrobras is planning to build a 160,000-ton/year acrylic acid complex in Minas Gerais with professional chemicals company Elekeroz. The company is currently in joint venture with Braskem to build a new 300,000-ton/year polypropylene plant in Sao Paulo, Brazil, of which Braskem has a 60% stake and is expected to be completed and put into production in 2009.
Petrobras is not the only company in Brazil that has invested in the chemical business. Petroquímica Uniao, a chemical subsidiary of Brazilian industrial giant Unipar, plans to expand its ethylene cracker in Sao Paulo, Brazil, by 40% by the end of the second quarter of 2008, while building a new 200,000-ton/year polyethylene plant.
Venezuela Venezuela is also emulating the development model of countries such as Saudi Arabia and Iran in the Middle East and relying on sufficient local resources to develop the petrochemical industry. In 2006, Venezuelan national petrochemical company Pequiven has cancelled the plan of ExxonMobil Chemical's new ethylene and polyethylene complex in Jose, Venezuela. Instead, Pequiven signed an agreement with Brazil's Braskem to study 1 million tons of ethylene cracking and downstream derivatives. Consortium project. It is predicted that the two parties will form a joint venture company later this year and carry out engineering research. The project is expected to be completed and put into operation in 2011.
Braskem is also investigating a 400,000-ton/year polypropylene (PP) joint venture project with Pequiven in El Tablazo, Venezuela, which is expected to be completed and put into production in 2009.
In addition, Bauman also pointed out that in the future, Venezuela may also create more than two new ethylene projects. One of them is that Polinter, a subsidiary of Pequiven, may establish a new ethane-based ethylene cracker and downstream derivative device in Venezuela. The other is Paraguana. The refinery provides ethylene cracking of raw materials. Bauman said that the construction of these two projects is only a matter of time.