Global Supply and Demand of Petrochemical Products relied on LPG as Feedstock

・Global Supply and Demand of Petrochemical Products relied on LPG as Feedstock・Petrochemical products from various Feedstock・Light Olefins Production Process Flow・Steam Cracker Process Flow・Propane Dehydrogenation Process Flow (UOP Oleflex process)・Global Ethylene Supply & Demand・Ethylene Production by Region, Country・World Ethylene Production by Feedstock・2016 Ethylene Production by Feedstock and Region・Global Propylene Supply & Demand・Propylene Production by Region, Country・World Propylene Production by Feedstock・2016 Propylene Production by Feedstock and Region・Global Consumption of Propane & Butane as Petrochemical Feedstock・China Propane & Butane Consumption as Petrochemical Feedstock・Propane & Butane Consumption as Petrochemical Feedstock by Region, Country (1)・Propane & Butane Consumption as Petrochemical Feedstock by Region, Country (2)

1

Mitsubishi Chemical Techno-Research7th March 2017

Petrochemical products from various Feedstock

2

・Light olefins (Ethylene, Propylene, Butylene, Butadiene) and aromatics products are produced by steam cracking process from gas (Ethane, Propane, Butane) and/or naphtha.・Light olefins are produced by CTO/MTO/MTP process from coal.・Propylene are produced from FCC off gas.・Propylene are produced from propane by dehydrogenation process.・Light olefins and aromatics products are converted to various plastics, chemical products, synthetic fiber, etc.

Gasoline

Gas Oil

Heavy Gas Oil

Plastics

Fluid Catalytic

Cracking

Ethane, Propane,

Butane, NGL,

Natural Gasoline

Gas Separator

Purification

Gas Steam

Cracker

Synthetic fiber

Synthetic rubber

Others

Coating, SolventAromatics

Butylene

Butadiene

Coal GasificationSynGas

Methanol

Ethylene

Propylene

Natural Gas NGL Separator MTO/MTP plant

Crude Oil

NaphthaNaphtha Steam

Cracker

Refinery Kerosene

Light Olefins Production Process Flow

3

2016 Global Ethylene Production by Feedstock

(Million Metric Tons)

Propane Butane Ethane Naphtha Gas Oil Coal Other Total

Production 13 7 52 63 5 3 2 146

Share 9% 5% 36% 43% 3% 2% 1% 100%

C4 Olefins

Gas Oil

Butane

Coal SynGas Methanol Ethylene

Methane

Propylene

Natural Gas Ethane

Propane

Naphtha

Crude Oil

MTOMTP

PDH

Steam Cracker

Refinery FCC

from Propane, Butane to Light Olefins via Steam Cracker

from Propane to Propylene via Propane Dehydrogenation

Crude Oil →Naphtha →Steam Cracker →Ethylene/Propylene

Natural Gas →Ethane →Stearm Cracker→ EthyleneMain flow

Steam Cracker Process Flow

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・Ethylene is generated commercially by the pyrolysis (cracking) of paraffinic hydrocarbon feedstocks, including ethane, propane, butane, and the virgin crude oil fraction of naphtha and atmospheric gas oil.・Propylene, Butadiene, Pyrolysis Gasoline are produced as by products.・Cracking furnace outlet temperature : 850 ℃・Ethylene yield : 0.78 (Ethane cracking), 0.31 (Naphtha cracking)

Ethylene

Natural Gas Propylene

Ethane Methane/Hydrogen

Propane

Butanes Crude C4

Field Condensate Butadiene

and Mixed Butylenes

Butane & Lighter

Light Naphtha PyGas

Heavy Naphtha Benzene

Gas Oil Toluenes

Xylenes

Crude Oil C5/C6 Non Aromatics

Fuel Oil Heavy Aromatics

Gas Separation

Unit

Refinery

Steam

Cracker

Fractionation

Units

Propane Dehydrogenation Process Flow (UOP Oleflex process)

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・Propane Dehydrogenation Process (PDH) is a catalytic process that converts propane into propylene・Reaction temperature : 600-660 ℃, Reaction pressure 1.7-2.8 kg/cm2a, Continuous catalyst regeneration・Commercial process technologies : UOP's Oleflex, CB&I/Lummus's CATOFIN, Uhde'sSTAR

H2

C2+ Propylene

H2 Off gas

PP Splitter

C3

Propane Propane Recycle

Propylene, Propane, Hydrogen, Off Gas

C4+

Cold Box

PSA

Acetylene

Hydrogenation

Reactor

Catalyst Regeneration

Compressor Dechlorination Drying

Global Ethylene Supply & Demand

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Y-2016・Production Capacity of Ethylene : 170 Million Metric Tons・Global Demand of Ethylene : 150 Million Metric Tons

Y-2025・Production Capacity of Ethylene : 230 Million Metric Tons・Global Demand of Ethylene : 200 Million Metric Tons・Demand growth rate (2016-2025) : 3.6%/year

Ethylene Production by Region, Country

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・United States, Middle East and China are the world's largest ethylene producing regions.・United States, Middle East and China's production share of Ethylene are 18%, 19% and 15% in 2016.・Ethylene production is forecast to grow at an average annual rate of 4.5% in United States, 3.4% in Middle East, 5.7% in China over the next ten years .

2016 Ethylene/Propylene Production by Region, Country

(Million Metric Tons)

Region/Country USAMiddle

EastChina

West

EuropeSEA Japan Others World

Ethylene 26 28 22 19 11 6 34 146

Propylene 14 9 26 13 7 6 24 99

Total 40 37 47 33 18 12 59 245

World Ethylene Production by Feedstock

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・Naphtha and ethane are major sources of Ethylene production・2016 World Ethylene Production = 146 Million Metric Tons・2016 Propane based Ethylene Production = 13 Million Metric Tons (9%)・2016 Butane based Ethylene Production = 7 Million Metric Tons (5%)

2016 Global Ethylene Production by Feedstock

(Million Metric Tons)

Propane Butane Ethane Naphtha Gas Oil Coal Other Total

Production 13 7 52 63 5 3 2 146

Share 9.0% 5.1% 35.8% 43.5% 3.3% 2.1% 1.3% 100%

2016 Ethylene Production by Feedstock and Region

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・The predominant feedstock for Ethylene production within the region of Middle East, United States is Ethane.・The predominant feedstock for Ethylene production within the region of China, West Europe, Japan is Naphtha.・USA, West Europe, Middle East are major Propane & Butane consuming regions as feedstock for Ethylene in world.

2016 Ethylene Production from Butane and Propane

(Million Metric Tons)

Feedstock USAMiddle

East

West

EuropeChina SEA Japan Others World Share

Propane 4.4 3.9 2.4 0.6 0.3 0.1 1.4 13 9%

Butane 2.2 1.2 2.1 0.6 0.1 0.2 1.0 7 5%

Total 6.6 5.1 4.5 1.2 0.5 0.3 2.3 21 14%

Global Propylene Supply & Demand

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Y-2016・Production Capacity of Propylene : 120 Million Metric Tons・Global Demand of Propylene : 100 Million Metric Tons

Y-2025・Production Capacity of Propylene: 160 Million Metric Tons・Global Demand of Propylene : 140 Million Metric Tons・Demand growth rate (2016-2025) : 4.0%/year

Propylene Production by Region, Country

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・China is the world's largest Propylene producing country. ・Propylene production is forecast to grow at an average annual rate of 6.9% in China over the next ten years. ・China, United States, Middle East and West Europe's production share of Propylene are 26%, 14%, 9% and 13% in 2016.・Propylene production is forecast to grow at 2.3%, 4.2% per year in United States and Middle East over the next ten years.

2016 Ethylene/Propylene Production by Region, Country

(Million Metric Tons)

Region/Country USAMiddle

EastChina

West

EuropeSEA Japan Others World

Ethylene 26 28 22 19 11 6 34 146

Propylene 14 9 26 13 7 6 24 99

Total 40 37 47 33 18 12 59 245

World Propylene Production by Feedstock

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・A majority of propylene is manufactured as a by-products from either Steam Crackers or Fluid Catalytic Crackers・Propylene supply from propane dehydrogenation is projected to grow by about 8.9% per year over the next ten years・2016 World Propylene Production = 100 Million Metric Tons・2016 Propylene Production from Propane Dehydrogenation Unit = 9 Million Metric Tons (Share : 9%)

2016 Global Propylene Production by Feedstock

(Million Metric Tons)

Steam

Cracker

Refinery

FCC

Propane

Dehydro.Metathesis

Coal to

OlefinsOthers

Total

Production

Production 49 32 9 4 5 1 99

Share 49% 32% 9% 4% 5% 1% 100%

2016 Propylene Production by Feedstock and Region

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・A majority of propylene is manufactured as a by-products from Steam Crackers and Fluid Catalytic Crackers・Steam Cracker is major supply source of propylene in West Europe, Southeast Asia, Japan・Steam cracker, FCC and Coal to Olefin are 3 major sources of Propylene supply in China・China, United States and Middle East are major Propylene producing region by Propane Dehydrogenation

2016 Propylene Production by Propane Dehydrogenation

(Million Metric Tons)

Feedstock China USAMiddle

East

West

EuropeJapan SEA Others World Share

Propane Dehydro 3.1 1.3 1.4 0.6 0.0 0.6 1.9 9 9%

Global Consumption of Propane & Butane as Petrochemical Feedstock

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Y-2016・Consumption of Propane for Steam Cracker : 31 Million Metric Tons・Consumption of Propane for Propane Dehydrogenation : 10 Million Metric Tons・Consumption of Butane for Steam Cracker : 18 Million Metric Tons・Total consumption of Propane & Butane for Petrochemical products : 59 Million Metric TonsY-2025・Consumption of Propane for Steam Cracker : 35 Million Metric Tons・Consumption of Propane for Propane Dehydrogenation : 22 Million Metric Tons・Consumption of Butane for Steam Cracker : 24 Million Metric Tons・Total consumption of Propane & Butane for Petrochemical products : 81 Million Metric Tons

Global Consumption of Propane & Butane as Petrochemical Feedstock

Million Metric Tons

2011 2015 2016 2017 2018 2019 2020 2025

Propane Steam Cracker 26 32 31 32 32 32 33 35

Propane Dehydro. 4 8 10 13 15 16 18 22

Butane Steam Cracker 14 18 18 17 17 17 18 24

Propane+Butane Total 44 57 59 62 64 65 68 81

China Propane & Butane Consumption as Petrochemical Feedstock

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・Propane & Butane consumption for Petrochemical Products are expected to increase from 6 to 13 metric million tons per year between 2016 and 2025 in China.・Propane consumption for Propane dehydrogenation is expected to grow annually by 12% in China over the next ten years・Propane & Butane consumption for Steam Cracker is forecast to be stable in China

China Propane & Butane Consumption

Million Metric Tons Growth

2011 2015 2016 2017 2018 2019 2020 2025 2016-2025

Propane Steam Cracker 1 1 1 3 4 4 5 1 0%

Propane Dehydro. 0 2 4 5 7 7 8 10 12%

Butane Steam Cracker 1 1 1 1 1 2 2 2 4%

Propane+Butane Total 2 5 6 10 12 13 14 13 8%

Propane & Butane Consumption as Petrochemical Feedstock by Region, Country (1)

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・2016 World Propane & Butane Consumption as Petrochemical Feedstock = 59 Million Metric Tons

・2025 World Propane & Butane Consumption as Petrochemical Feedstock = 81 Million Metric Tons

・United States, Middle East, China, West Europe are the world's largest Propane & Butane consuming regions for Petrochemical feedstock

・Propane & Butane consumption for Petrochemical feedstock is forecast to grow at an average rate of 8% in China over the next ten years

Propane & Butane Consumption as Petrochemical Feedstock by Region, Country (2)

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・USA, Middle East , West Europe, China are major Propane & Butane consuming region as Petrochemical Feedstock in world.・Propane & Butane consumption is forecast to stagnate in USA, to grow in Middle East and China in the next ten years・Propane & Butane consumption is forecast to decrease West Europe and Japan in the next ten years

2016 Propan & Butane consumption as Petrochemical Feedstock by region

(Million Metric Tons)

Feedstock USAMiddle

EastChina

West

EuropeSEA Japan Others World Share

Propane Steam Cracker 10 9 1 6 0.8 0.2 3 31 52%

Propane Dehydro. 1 2 4 1 0.8 0.0 2 10 17%

Butane Steam Cracker 5 3 1 5 0.4 0.5 2 18 31%

Propane+Butane Total 17 14 6 12 1.9 0.8 8 59 100%

2025 Propan & Butane consumption as Petrochemical Feedstock by region

(Million Metric Tons)

Feedstock USAMiddle

EastChina

West

EuropeSEA Japan Others World Share

Propane Steam Cracker 8 11 1 4 1.2 0.2 8 35 43%

Propane Dehydro. 5 2 10 1 1.1 0.0 4 22 27%

Butane Steam Cracker 4 5 2 4 0.7 0.5 7 24 30%

Propane+Butane Total 18 19 13 9 3.0 0.7 19 81 100%