CINCINNATI-Expecting a ``barn-burner year'' for 1997, Quantum Chemical Co. announced May 15 it will increase production capacity 29.9 percent for linear low density polyethylene, and 18.1 percent for high density PE by the end of 1996. At a news conference at Quantum headquarters in Cincinnati, Chairman and President Ronald Yocum said he expects PE demand to outpace supply, and PE production units to run at more than 90 percent of their capacity for the next five years.
Yocum said he based his outlook on an expected 2.4 percent annual growth in the gross domestic product. Also, he said he expects PE demand to continue to grow at a rate of 1.7 times the GDP rate.
Yocum provided details for previously announced expansions that the company plans to deal with that outlook. Quantum is building a gas-phase reactor at its LaPorte, Texas, facility that is to start production by the fourth quarter of 1996.
The reactor will use Unipol production technology thatQuantum licenses from Union Carbide Corp. to produce 480 million pounds of LLDPE a year. Quantum now has a small reactor at La-Porte that uses its proprietary technology to produce 85 million pounds of LLDPE a year. The small reactor will remain in pro-duction, Yocum said.
Separately, Yocum said Quantum has advanced the restart date for an LLDPE reactor at its Morris, Ill., facility. That reactor, which was mothballed in 1992, now will be restarted in the second quarter of next year instead of the third quarter.
It can produce 250 million pounds of LLDPE a year.
Additionally, Quantum is debottlenecking its other reactor at Morris, to increase capacity 33 percent, to 400 million pounds a year. The debottlenecking is to be completed by the third quarter of this year.
When the expansions and restart are complete, Quantum will have the capacity to produce 1.22 billion pounds of LLDPE a year: 650 million pounds at Morris and 565 million pounds at LaPorte. The company now can produce 935 million pounds.
With the expansions and restart, Yocum said Quantum will have converted the majority of its LLDPE production capacity to Union Carbide's Unipol process.
As it puts the new capacity into production, Quantum also intends to convert its LLDPE gas-phase reactor at Port Arthur, Texas, to HDPE production. The reactor is based on the BP Chemical Co. gas phase process, and can produce 300 million pounds of LLDPE a year.
It will be converted by the third quarter of 1996 to produce 300 million pounds of HDPE a year, Yocum said.
With the conversion, Quantum will be able to produce 1.96 billion pounds of HDPE a year, up from 1.66 billion pounds now.
While Quantum is expanding production capacity, Yocum noted his company is continuing a product line management program that has cut its HDPE product offerings from 140 grades to 120; its low density product offerings to 140 grades from 270; and its LLDPE product offerings to 35 grades from about 55.
Those reductions are the result of consolidations of product offerings inherited from the various companies and product line acquisitions that were combined to become Quantum in 1988.
Separately, Yocum said Quantum also is planning to increase production capacity for ethylene by 24 percent by debottlenecking its ethylene units at Morris and at Clinton, Iowa.
The Morris ethylene expansion is to be done by mid-1996; the Clinton expansion by mid-1997. Quantum will add 70 million pounds of annual ethylene capacity at Morris, boosting it to 1.13 billion pounds. It is adding 80 million pounds at Clinton, boosting that site's capacity to 1.04 billion pounds.
Yocum said Quantum expects PE demand to grow 4-5 percent each year through 2000.