HOUSTON - The owners and users of metallocene catalyst technologies may never recover their investments in that field, and had better move quickly to start recovering their expenses before new developments surpass their technologies, according to an industry consultant. ``You have to ask: After 15 years of research and an investment of nearly $4 billion, why aren't we rocketing down the road to the commercialization of resins made with these technologies,'' Michael Jeffries said June 12 during his keynote address for MetCon'96, a metallocene conference held June 12-13 in Houston. It was sponsored by the Catalyst Group of Spring House, Pa.
Jeffries formerly was a manager in Exxon Chemical Co.'s Exxpol venture, the business unit responsible for commercializing Exxon's metallocene catalyst technology. He is currently a consultant with NxNW Consulting.
Exxon and Dow Chemical Co. each claim to be the leader in the development and commercialization of the technology.
Jeffries delivered a stinging keynote address, and said at the podium he expected that his comments would be considered controversial.
Competition between Exxon and Dow has prevented the widespread use of the technology, Jeffries said.
``The technology is in place, but it is not being licensed. I think that is because of the way we are handling the intellectual properties. No single company is in a strong enough position to enforce a licensing agenda early in the game, and we are in a patent gridlock with everyone afraid to make a move,'' Jeffries said.
``Why can't we find a solution and get on with it?'' he asked.
Later, Jeffries answered his own question, saying that executives at Exxon and Dow apparently let emotional investments in the technologies hamper re-sourcefulness that could lead to the widespread licensing and use of the technologies.
``We have lost the opportunity to accelerate the uses of these technologies; the ability to control licensing through a single company. The leadership is gone.
``Union Carbide's Unipol proc-ess was a good example of technology licensing, but that won't happen with metallocene technology,'' Jeffries said, indicating that it was time the leading companies acknowledge that fact.
In June 19 telephone interviews, Ed Gambrel, global vice president for Dow's Insite Technology, and a spokeswoman from Exxon disagreed strongly with Jeffries' position, saying they see the commercialization of their separate technologies proceeding on schedule and, in several cases, faster than scheduled.
When the investments and interests on investments in metallocene catalyst technologies are totaled, including those by Union Carbide, Mobil Chemical Co., British Petroleum Ltd., and others, the sum may reach $10 billion by the year 2000, Jeffries said. He believes the suppliers will find if difficult to recover that hefty sum.
Gambrel said the amount Jeffries cited was far beyond the total amount polyolefin companies invest in research and development for all of their products combined.
``Those numbers are not in the same universe with reality,'' Gambrel said.
Jeffries said he believes the leaders in the industry will have to join forces to begin to recover those investments.
``It may take the top four, or five, or six companies that own the intellectual property rights to this technology to join together and to establish several deals to get this technology going.
``Even if they do, only 20 cents to $2 per pound might be recovered on this technology over the next 20 years, and that is not an exciting return,'' Jeffries said.
``A 50 percent penetration rate into gas-phase reactors is very probable, and there may be the potential for tens of billions of pounds of polyolefins to be made with this technology, but such estimates are extremely difficult to do, other than very roughly,'' Jeffries said.
However, he said before such penetration is made, the owners of the technologies have to set realistic prices for it.
``Over-investment [in the technology] is not the problem of the buyers and, right now, the sellers want more for the technology than it is worth.
``The value of this technology is at its peak or just past its peak now,'' he said, acknowledging that competing technologies, such as DuPont Co.'s announced development of polyolefin catalyst systems based on simpler nickel formulations, are coming fast to market.
Gambrel disagreed. ``Metallo-cenes have not reached their peak, and it remains to be seen how soon DuPont's nickel technology might collide with metallocene catalyst,'' he said.
Jeffries noted that the leaders in the technology have formed limited partnerships and joint ventures designed to move the technologies into the market.
``Development and licensing will be spurred on by what has been spent, but we can expect to see licenses granted only in a narrow range of areas.
``Broader positions will be tied up in patent and development lawsuits,'' he said, adding that licensees of the technology are likely to become embroiled in those difficult suits.
Even with the proliferation of narrow licenses, Jeffries said the outlook for advancing the technology is not good.
``Narrow licenses will be affected by commercial and emotional forces [that will combine] to limit their applications. And, by their nature, narrow licenses restrict flexibility,'' Jeffries said.