Driving Growth Through Product Innovation · Driving Growth Through Product Innovation Martijn Vogelzang ... -11 kg CO2 from Benefit of saved prod.+waste-CO2 of alternative materials

Driving Growth Through Product Innovation

Martijn Vogelzang

General Manager, Licensing

Basell Service Company B.V.,

a LyondellBasell company

IndianOil Petrochemical Conclave

Delhi, India, 16 March 2012

lyondellbasell.com 2

Outline

• Mega trends affect regional developments

• Growth driven by continuous process and catalyst innovation

• Some examples of how polyolefins serve evolution:

– Properties, application development and sustainability

• Prospects and future

• Fast facts on LyondellBasell


Global megatrends shape our market segments

Our society is challenged with population increases, climate and economic

changes which are creating unprecedented pressure on resource management

Economy

Infrastructure, communication,

transportation

Environment

Climate change, new energy

solutions, resource use

reduction

Society

Population increase, access to

water, food availability &

preservation, health


Global polyolefins market and per capita use

0 10 20 30 40 50

Other

Asia

WE

NA

kg / capita

Source: CMAI 2010

Asia Pacific per capita use of 13 kg is very low when compared to 47 kg and 45 kg in

North America and Western Europe respectively - High potential for future growth

2009 Global PP/PE 2009 Per Capita Use Of PP/PE

North America

19%

Western Europe

16%

Asia

44%

Other

21%

Global demand 2009: 110 Million Metric Tons


R&D is the engine for growth at LyondellBasell

Combined and integrated catalyst, process and product development

Product

Catalyst Process

R&DR&D


Triangle of successful innovation in polyolefins

Combined and integrated catalyst, process and product development

In recent decades polyolefin innovation targeted:

• Improved catalyst performance (improved yield, molecular design)

• Reduction in process energy consumption and investment cost

• Significant widening of molecular design capabilities and polymer

performance,

Resulting in:

• Improved material performance,

• Weight and energy reduction, and

• Improved versatility, durability and safety in use

• Replacement of traditional materials


Polyolefin technology portfolio developments by initial commercialization

2000 1990 1980

Spheripol Catalloy Spherizone

PP and advanced materials

platforms

Avant ZN Phthalate based

Avant catalysts

Hostalen ACP

Spherilene

PE platforms Lupotech T

Avant ZN Diether based

Avant ZN Succinate based

Avant Z

Avant M

Avant C

New

developments

Polybutene-1

2010

2000 1990 1980

2000 1990 1980

Hostalen bimodal

New

developments

Lupotech G

New

developments


Global plastic capacity growth vs. conventional materials

Source: Tecnon Database Source: *Stahl-Zentrum/International Iron and Steel

Institute (IISI)

Million

tons

0

1

2

3

4

5

6

7

8

9

10

1970 1975 1980 1985 1990 1995 2000 2005

Plastics Steel* Paper**

Index: 1970 = 100

0.0

50.0

100.0

150.0

200.0

250.0

1965 1970 1975 1980 1985 1990 1995 2000 2005

EVA

ABS

PS

PVC

PP

PE

PP/PE~0.3

PP/PE~0.4

PP/PE~0.6

PP/PE~0.7


The impact of plastics on energy consumption and CO2 emissions

Production Use End of life

Energ

y

CO

2

CO

2 C

O2

Energ

y

Energ

y

Raw

materials Products Packaging Housing Transportation

• Improved production efficiency

• Production emissions reduction

• Improved product design with plastics

• Lighter, more efficient products with

plastics

• Food preservation

• Reduced landfilling

• Recycling operations

• Energy reclamation

Recycle / Energy

conversion

Source: PlasticsEurope 2009


• Continuous pipe resin technology improvements result in stronger and

thinner piping

• Compared to the 1950s, HDPE pipes now use ~ 50% less material

* Equivalent hydraulic pipe diameter 400 mm

1st Generation 3rd Generation 2nd Generation

Year

PE63

46 mm 38 mm 24 mm

PE80 PE100

1950 1960 1970 1980 1990 2000

Decrease in HDPE pipe wall thickness* Celebrating

50 years of

Hostalen HDPE in

pressure pipes

Hostalen ACP HDPE selected for pipes: continuous

process/product/application development


HDPE pipes have gradually replaced traditional materials: C-footprint HDPE gas pipes

Feedstock Olefins Converters Consumers Recycle

Recover Polyolefins

0,3 kg CO2 from Resource prod. → Oil/naphtha, gas

0,9 kg CO2 from Cracking → Ethylen

0,4 kg CO2 from Polymerisation → HDPE

0,4 kg CO2 from Pipe extrusion → HDPE pipe

-11 kg CO2 from Benefit of saved prod.+waste-CO2 of alternative materials

-0,3 kg CO2 as Net effect of recycling/recovery

Savings

through

replacement

of other

materials

-12,0

-10,0

-8,0

-6,0

-4,0

-2,0

0,0

2,0

kg

CO

2 /

kg

pro

du

ct

Carbon

footprint in

total life-

cycle = -9,3

kg CO2 / kg

product

Source: GUA (Gesellschaft für umfassende Analysen)


Evolution of PP usage in automotive: bumper

Bumper Technical Data:

- Weight: kg 5.5

- Resisting to a 4 km/h crash @ -30°C

Bumper Technical Data:

- Weight kg 3.5

Resisting to a 7 km/h crash @ -30°C

Zero Gap, Good aesthetics

1979 Fiat Ritmo

2006 Fiat Grande Punto

Improved Processability:

design of more complex

structures…

Mechanical properties:

Reduction of thickness &

weight (40%), enhanced safety


C-Footprint: PP automotive bumpers

Feedstock Olefins Converters Consumers Recycle

Recover Polyolefins

0,3 kg CO2 from Resource prod. → Oil/naphtha, gas

0,9 kg CO2 from Cracking → Propylen

0,5 kg CO2 from Polymerisation → PP

2,2 kg CO2 from Injection moulding → PP injection moulding

-8,7 kg CO2 from Benefit of substitution of heavier materials (saved prod.+waste-CO2 + saved fuel)

0,2 kg CO2 as Net effect of recycling/recovery

-10,0

-8,0

-6,0

-4,0

-2,0

0,0

2,0

4,0

kg

CO

2 /

kg

pro

du

ct

Carbon

footprint in

total life-cycle

= -4,6 kg CO2

/ kg product

Source: GUA (Gesellschaft für umfassende Analysen)


Advances in transportation: From metal to PE plastic fuel tanks and to new car concept – battery train

Spherizone

Hostalen PP

Electric car

Battery train

Year Pen

etr

ati

on

/rep

lacem

en

t ra

te

(%

to

t. M

ark

et)

0

10

20

30

40

50

60

70

80

90

100

1980 1990 2000 2010

Metal

fuel tank

HDPE Plastic

Fuel tank

EU NAFTA Asia Japan China

Lupolen

2030

?


GLASS

JARS:

36% IS

PACKAGING

PLASTIC

POUCHES:

3.56%

IS PACKAGING

• Plastic packaging weight is significantly lower than glass or metal

alternatives

• On average, packaging contributes only 1% to 3% of the packaged product

weight :

– 200 g cheese uses 2g of plastic film

– 1.5 liter drink bottle uses 35g of packaging

Our polymers save transportation weight and fuel


o Packaging Benefits with Polyolefins: Transparency

Ease of use: Resealable, light, can be frozen

High flexibility/possibilities in term of shapes

Crush, tear and drop resistant

Microwave heating

Safer (no sharp edges when open)

Lower density than metal

More labeling/customization possibilities/ possibilities

Squeezable: Adapts to product needs

Cost reduction

• Lower production costs/transport energy footprint

• Recycling, energy reclamation

Tin Can Replacement by Rigid Polyolefin Packaging


39 Mill t/a

144 Mill t/a A

ltern

ati

ve m

ate

rials

x 3,7

Total mass

for same funct. units

4.940 Mill

GJ/a

7.230 Mill

GJ/a

+46%

Alt

ern

ati

ve m

ate

rials

(i

ncl.

No

n-s

ub

st.

pla

sti

cs

)

Energy consumption

in total life cycle

All

pla

sti

c p

rod

ucts

Subst.

Plastics

46

,4 M

ill.

t in

cl. N

on

-su

bstitu

tab

le p

lastic p

rod

ucts

240 Mill t/a

360 Mill t/a

+50%

GHG emissions

in total life cycle

Alt

ern

ati

ve m

ate

rials

(i

ncl.

No

n-s

ub

st.

pla

sti

cs

)

All

pla

sti

c p

rod

ucts

Environmental benefits of plastics vs. alternative materials

Source Denkstatt 2009 (EU27+2)


CO2-Balance Plastics Market

"Carbon balance"

2007 2020Av. changes

until 2020

of EU27+2 plastics market Mt CO2-equ. Mt CO2-equ. Mt CO2-equ.

Production 160 180

production increase (2% p.a.) 47

increased material efficiency -21

20% PE from renewable resources? -6

Effects of recycling/recovery/disposal -1 -6 to +18 -5 to +19

Exemplary use effects:

substitution of less efficient materials -43 to -81 -56 to -104 -18

fuel savings -17 -34 -17

insulation -540 to -1.100 -1.200 to -1.800 -700

prevented food losses -100 to -200 -150 to -300 -75

wind power rotors & solar panels -60 -250 to -500 -310

Total carbon balance -600 to -1.300 -1.500 to -2.500

Ratio (Use+Recovery) vs. Production -5 to -9 -9 to -15

Saves over 9 tons throughout the lifecycle

1 ton

at Production

2007

1 ton

at Production

2020

Saves over 15 tons throughout the lifecycle

Source: Plastics Europe


Conclusions

• Megatrends require novel technologies and new approaches to

development

• New polyolefins offer options for sustainable developments

• Innovation is a joint effort and requires a strong customer culture

• Technology is key to driving growth!!


LyondellBasell is…

– One of the world’s largest olefins, polyolefins, chemicals and refining companies with revenues in the range of $50 billion

– The global leader in polyolefins technology, production and marketing

– A pioneer in propylene oxide and derivatives

– A producer of fuels and refined products, including biofuels

– Dedicated to ongoing research and development programs that meet the ever-changing requirements of our customers, including the creation of new catalysts, processes and products

– Participation in 16 significant manufacturing joint ventures, 11 of which are outside of Western Europe and the United States, primarily in regions that have cost-advantaged raw materials or high-growth rates

20

lyondellbasell.com

World-Class Scale with Leading Market Positions

21

O&P Americas40%

O&P EAI18%

Intermediates & Derivatives

20%

Refining & Oxyfuels

18%

Technology4%

$5.3 billion

Notes: Sales segment distribution excludes Other and Intersegment sales.

Source: Capital IQ and LYB.

2010 Revenues

2011 Sales 2011 EBITDA

$51 billion

($ in billions)

Channelview, Texas

0

20

40

60

80

$100

BASF Dow LYB SABIC DuPont

O&P Americas20%

O&P EAI29%

Intermediates & Derivatives

13%

Refining & Oxyfuels

37%

Technology1%

lyondellbasell.com

World-Class Scale with Leading Market Positions

Chemicals

Ethylene #5

Propylene #4

Propylene Oxide #2

Polymers

Polyolefins (PE + PP) #1

Polypropylene #1

Polyethylene #4

Polypropylene Compounds #1

Refining & Oxyfuels

Oxyfuels #1

Technology and R&D

Polyolefins Licensing #3

Polypropylene Catalysts #1

Products

Note: Positions based on LyondellBasell wholly owned capacity and pro rata share

of JV capacities as of December 31, 2010, except for Polypropylene

Catalysts position which is as of December 31, 2008.

Global

Position

Tarragona, Spain

22


Global reach

• 58 plants in

18 countries

• More than

14,000 employees

worldwide

• Sales in

more than

100 countries

lyondellbasell.com


Comprehensive portfolio of technologies for license

lyondellbasell.com

0 2,000 4,000 6,000 8,000 10,000 12,000

Enichem

CP Chem

NPC Iran

Reliance

Braskem

Formosa

Ineos

TOTAL

CNPC

IPIC Group

SABIC

Dow

ExxonMobil

SINOPEC

LyondellBasell

HDPE LLDPE LDPE PP

LyondellBasell Is the Leading Polyolefins Producer

Capacity

Ranking (1) U.S. W. Europe

Olefins #1 #7

PE #3 #1

PP #1 #1

Source: CMAI 2010, LyondellBasell

1. Capacity ranking includes LyondellBasell wholly owned capacity and proportional share of JV capacity as of December 31, 2010.

KT

Most of these top

producers operate one

or more of

LyondellBasell licensed

processes

25


LyondellBasell is the Largest Polyolefin Licensor

Data taken from Townsend Polypropylene Report 2008

Total PP Capacity: 72.1 mio t/a

LyondellBasell share: 40%

Total PE Capacity: 112.5 mio t/a

LyondellBasell share: 19%

26


Trademarks

• Avant, Adsyl, Adstif, Catalloy, Spheripol, Spherizone, Hostalen,Lupotech,Spherilene, Metocene, Moplen, Lupolen, Stretchene, Clyrell, Softell, Superflex, Prodflex, Trans4M, Glacido and Vacido are trademarks owned and/or used by LyondellBasell group companies. Spheripol, Spherizone, Hostalen, Avant, Hifax, Moplen, Clyrell, Softell & Adsyl, are registered in the United States Patent and Trademark Office.

© LyondellBasell Industries Holdings, B.V. 2011


Disclaimer

• All information (“Information”) contained herein is provided without compensation and is intended to be general in nature. You should not rely on it in making any decision. LyondellBasell accepts no responsibility for results obtained by the application of this Information, and disclaims liability for all damages, including without limitation, direct, indirect, incidental, consequential, special, exemplary or punitive damages, alleged to have been caused by or in connection with the use of this Information. LyondellBasell disclaims all warranties, including, but not limited to, the implied warranties of merchantability and fitness for a particular purpose, that might arise in connection with this information.

• Before using a product sold by one of the LyondellBasell family of companies, users should make their own independent determination that the product is suitable for the intended use and can be used safely and legally. SELLER MAKES NO WARRANTY; EXPRESS OR IMPLIED (INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE) OTHER THAN AS SEPARATELY AGREED BETWEEN THE PARTIES IN WRITING. This product(s) may not be used in the manufacture of any US FDA Class III Medical Device or Health Canada Class IV Medical Device and may not be used in the manufacture of any US FDA Class II Medical Device or Health Canada Class II or Class III Medical Device without the prior written approval by Seller of each specific product or application. Users should review the applicable Material Safety Data Sheet before handling the product.

• LyondellBasell does not sell PB-1 for use in pipe applications intended for use in North America, and requires its customers not to sell products made from PB-1 into pipe applications for North America.

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Driving Growth Through Product Innovation · Driving Growth Through Product Innovation Martijn Vogelzang ... -11 kg CO2 from Benefit of saved prod.+waste-CO2 of alternative materials