Background

Ethylene and BTX (Benzene, toluene, xylene) based petrochemicals, nitrogen based petrochemicals (methanol, ammonia, urea), other fertilizers (eg phosphates), pulp and paper, gas processing (e.g. liquefied natural gas plants and liquefied petroleum gas plants), metallurgical and a broad range of industrial plant.  Such projects:   

• Are technically complex but the designs are usually well proven.  New technologieswill have difficulty finding suitable insurance cover and funding
• May contain a sequence of plants each one producing a product which is used as a feedstock for the next project on the same site. Some of the product may also be sold.  This design complexity can complicate the model
• Contain significant equipment and material which may need to be imported
• Produce products usually sold on the open market
• Some product prices may follow a cyclical pattern, for instance, in the pulp and paper industry
• Earn foreign exchange generated from  the sale of the product in international market
• Have a production profile which usually increases rapidly to the design capacity where it stays for the duration of the project
• Have an annual maintenance shutdown which will reduce revenues and variable operating costs for about a month
• Are subject to straightforward taxation calculations..  

How Promoter handles Petrochemical Projects

Promoter can produce models for one or more of each of the following plant in an ethylene complex: ethylene, HDPE/LDPE, LDPE, acetic acid, VAM, hydrogen peroxide, propylene oxide, polyether polyols and butene 1. It carries out a mass balance and determines how much of the product from each plant must be used as feedstock for other downstream units. The balance of the production is exported. 

See the diagram below for the typical configuration of an ethylene and derivatives project. Configurations for other combinations produce simple diagrams. Promoter will display the design configuration in the design tab of the project file.

Promoter can also produce models for methanol, methanol to olefins (MTO) and gas to olefins (GTO).

Typical Project Cash Flows

The revenues are essentially constant in real terms over the life of the project.  However, two competing effects will change the shape.  If the local and more profitable market is increasing in size, then the revenues will increase over time.  However, if the commodity price is reducing in real times, then the revenues will decrease.  In practice, both effects play a part.

The first two or three years will typically show a utilization which is below the ultimate figure, as managers and operators become more familiar with and better able to operate the plant.

At the end of the project's life, the plant may be sold for scrap, providing additional cash flow to the project.