A top executive at new PET maker Selenis Canada Inc. asked a pointed question at a recent industry event: Why would anyone enter the PET market with a plant in Montreal?
Giovanni Iadeluca explained why his company is taking that step, with plans to ship PET resin from a converted polytrimethyl terephthalate plant by the end of the year.
“The plant was built to make PTT,” Iadeluca said at the Packaging Conference, held Feb. 8-10 in Las Vegas. “But there's a refinery, a paraxylene plant and a purified terephthalic acid plant nearby to supply feedstocks for PET.
“Canada and the [U.S.] Northeast and Midwest corridor provides us with a geographic footprint, and we can be efficient in that supply chain. Our geographic situation will be an advantage.”
ImatosGil Group — a Portuguese investment firm — bought the dormant plant from PTT Poly Canada LP in December. PTT Poly Canada — a joint venture between Shell Chemicals Canada and the government of Quebec — had opened the plant in 2004, but closed it in early 2009 because of global overcapacity and weak demand.
ImatosGil has experience with PET film dating all the way back to 1959, first with Neoplastica, and later under the Selenis name in Portugal, Italy and Greece. ImatosGil also operates PET plants as Selenis in Europe, owns a minority stake in Spanish PET maker La Seda de Barcelona and has invested in PET production in Saudi Arabia.
“PTT is the building block,” said Iadeluca, who will serve as CEO of the new business after holding that same role with the former PTT unit. “We have the good fortune to be starting with a proven, functioning plant that exceeds PET's requirements. This plant is comparable with highest automation in the PET world.”
Work to convert from PTT to PET began this month, and material will be ready to ship in November. The plant will open with about 330 million pounds of annual PET capacity, with the potential to add another 220 million pounds if needed in the future.
The plant will make grades for carbonated soft drink bottles, heat-set uses and general-purpose use, and will employ about 65, according to Iadeluca.
The plant's transition to PET is being made at a time when many market watchers believe there is already too much PET capacity in North America. Wellman Inc. and Invista closed three North American PET plants in late 2008, eliminating almost 1.5 billion pounds of annual capacity, and Eastman Chemical Co. temporarily idled a major PET site in Columbia, S.C., as well. (Eastman has since reopened that plant.)
But at the same time, Indorama Polymers Public Co. Ltd. is in the process of opening a billion-pound-per-year capacity plant in Decatur, Ala.
Selenis Canada officials previously said their plant's geographic location will be able to overcome the market's current imbalance.
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