By: Mike Verespej
November 12, 2012
CHICAGO (Nov. 12, 1 p.m. ET — With an investment of more $600 million in just over four years, Octal Petrochemicals Fzc LLC is expecting a big payback from its four proprietary reactors that make PET bottle resin as well as its PET sheet that is made directly from molten PET, using significantly less energy than traditional processes.
“We started up the two new reactors at our Salahah, Oman, plant, in late summer,” said Chief Operating Officer Joe Barenberg in a phone interview after Pack Expo, which was held in Chicago in late October. “They will have the capacity to produce 600,000 tons of pure PET bottle resin. We are now operating near nameplate capacity.”
The addition of the two reactors, at a cost of $250 million, boosts total capacity to 950,000 tons and allows Octal to use its first two reactors — which started up in 2009 — to shift all PET bottle resin to the new reactor and only make DPET [direct PET] sheet in the first two reactors.
“When we started up the first two reactors, we devoted one-half the capacity to sheet and the rest to resin pellets for bottles,” Barenberg said. “But six weeks ago, we began taking the second half of the production capacity of the first two reactors and filling that up with production for DPET sheet.”
“We can now become a true global supplier” that can ship products to the U.S. through the Newark, N.J., port in two weeks and to Asia, South America and Northern Europe in two-to-three weeks, he said.
Octal’s process for making PET bottle resins uses 38 percent less energy to make PET resin than conventional approaches, Barenberg said.
“It is like getting the carbon footprint of [recycled] PET but with a higher quality,” he said.
Similarly, Barenberg expects Octal will be able to make significant inroads in food packaging because its proprietary processes for making PET sheet directly from molten PET that uses substantially less energy than traditionally manufacturing processes for making either resin or sheet.
“We use 67 percent less energy to manufacture DPET sheet,” he said.
The reason: Octal’s process for making PET sheet directly from molten PET eliminates five stages of the conventional sheet-making process, including the two most energy-intensive: pelletizing and the drying, Barenberg explained.
“The melt is never exposed to water and goes straight to the calender stack,” said Barenberg. “The PET melt can arrive at the calender stack heated to the proper temperature, so it does not have to be dried and re-melted from the granular form.”
The other processes eliminated are the SSP, the compacting process, and the extrusion process, he said.
Not only does that reduce energy use, but it eliminates the processes where most of the defects with PET sheet occur—improper drying or hot spots in extrusion, he said.
In conventional PET sheet manufacturing, resin needs to be dried for 4-6 hours in an energy-intensive process before it is fed into an extruder which compresses and heats the resin into a melt before it goes into a die and onto rollers to produce the sheet.
“The Octal DPET process brings the major advantages of a carbon footprint that is 25 percent below that of the traditional PET sheet making process because it eliminates the most energy-intensive and defect-prone processes [and] delivers a spotless sheet” with superior clarity and gloss, said Barenberg.
“Thermoformers have been able to reduce costs by ordering a thinner sheet package” that can run at a cycle time that is 10 percent faster and at temperatures five degrees lower than conventional processes.
“Our biggest market today is general purpose food packaging [clamshells], as major retailers are putting us in contact with their suppliers” that provide their in-house bakery containers or to replace packaging made from PVC, Barenberg said.
“Food packaging is what we targeted when we first entered the market, and we focused on the processing benefits first because DPET is made using a liquid feedstock and we can control the back pressure on the die so we get a very consistent gauge,” Barenberg said.
Most of its sales to date have been in North America and Europe, but he said the company expects to grow its footprint with continued sales in its existing markets and with sales to South America, India, Asia and parts of Africa.
“We expect to grow both in general purpose food packaging and in the form, fill and seal segment,” said Barenberg.
In addition, the company is moving its PET sheet for packaging into consumer products such as toothbrushes and toys and other packaging segments that don’t use PET today.
“At this point, no one is competing with us,” Barenberg said. “Octal owns the patent. We are the only ones with this technology.”
“This technology lends itself to a lot of capacity coming onstream at one time, and we intend to continue to invest and expect in the not-too-distant future to be bumping up against capacity,” he said. “At the rate, we’re moving, that might be 15-to-20 months.”
He also added that smaller 100-ton plants can be built using the same technology and as well as 25 tons reactors. “We will be investing in regional plants with a 25-ton plant likely coming onstream in the U.S. in mid-2013 using scrap from thermoformers that use our product.”