The managing director of Mexican government-owned Pemex PetroquÃmica SA predicts Mexico, a major importer of polyolefins, will be exporting polyethylene to the U.S. within a decade.
``The forecasts say the U.S. will import polyethylene within four or five years,'' Rafael Beverido LomelÃn said in an interview. ``They are exporting it at the moment. But nobody is building grass-roots plants anywhere [in the United States], and we think we can supply the U.S.''
In 2004, Mexico imported 3.7 billion pounds of polyolefins, according to Chemical Market Associates Inc. of Houston.
After five years on the job, Beverido is overseeing Pemex PetroquÃmica's decision to increase the capacity of its ethylene cracker in Coatzacoalcos from the current 1.32 billion pounds per year to 1.98 billion pounds.
``At the moment, we are in the process of assigning the basic engineering for the expansion of the cracker,'' Beverido said. ``The assigning needs to be done this year.'' He added that Pemex will invest about $1 billion in the project. The enlarged cracker should be running by late 2009 or early 2010.
Pemex also is building a PE plant with capacity of 661.3 million pounds per year in the same area, in a joint venture with Mexico City polymer company Grupo Idesa SA de CV and Nova Chemicals Corp. of Pittsburgh.
Indelpro SA de CV of Monterrey, Mexico, a polypropylene joint venture between Europe's Basell BV and Mexico's Grupo Alfa, may buy the propylene for its PP requirements.
``Secondary petrochemicals are open to the private sector in Mexico,'' Beverido said. ``Alfa is building a new polypropylene plant and will build a new one in Coatzacoalcos.'' More private investment in the sector will follow in the years to come, he said.
The Coatzacoalcos projects are scaled-down versions of Pemex's Phoenix Project, which was shelved. Due to be operating by 2009, the $1.9 billion project was to have provided 2.64 billion pounds of ethylene and 1.32 billion pounds of propylene per year, in addition to derivative PE and PP plants.
However, the project came to a shuddering halt after several years' planning, when Pemex and its private-sector partners failed to agree on feedstock prices.
``The first idea was to have a totally new cracker,'' Beverido said. ``It was to be a private-sector and Pemex joint venture. But the raw material for this new cracker had to be natural gasoline and the price for the natural gasoline was the problem.''
Pemex's partners in the original project were, as now, Nova, Idesa and Indelpro. Pemex was to have had a minority interest in the complex and supply feedstocks.
Beverido plans to announce the joint venture's name in August or September.
The cracker uses technology from ABB Lummus Global of Zurich, Switzerland. Pemex will put the supply of the rest of the equipment out to tender, he said.
``The Mexican petrochemical sector for the past 10 years has not moved. Now the sector finds the market is big and growing,'' he added.
Referring to the ongoing dispute over who won July's presidential election in Mexico, the populist Andrés Manuel LÃ³pez Obrador or the pro-business Felipe CalderÃ³n Hinojosa, Beverido said: ``It doesn't matter who the new president will be [in December]. We have to move in the same direction. We have long- range plans and I think we are on the right path.''
He insists there is ``a terrible shortage'' of raw materials for the plastics industry worldwide. ``The main factor is the hurricanes that are creating a big, big problem. At this time no one knows what will happen this coming hurricane season.