Albemarle Catalysts
Transcript of Albemarle Catalysts
John NicolsVice President, Catalysts
Albemarle Catalysts: Growth Vision & Strategies
Longbow ResearchAlbemarle Bayport Plant Visit September 11, 2007
Albemarle CatalystsAnalyst Road Show, September 2007
Financials
Strong Market FundamentalsGeneralHPCFCCAlternative FuelsPolyolefin Catalysts
Albemarle Strategies For Profitable Growth
Conclusions / Q&A
Acknowledgements
• UOP, LLC Norm Gilsdorf– Presentation at Albemarle SCOPE Symposium, June, 2007
• Hart Energy Consulting Kristine Klavers– Presentation at Albemarle SCOPE Symposium, June, 2007
• Exxon Mobil Ernie Lewis– Presentation at Albemarle SCOPE Symposium, June, 2007
• Borealis David Rolph– Presentation at Albemarle SCOPE Symposium, June, 2007
• Purvin & Gertz Bill Sanderson– Presentation at CMAI World Petrochemical Conf, March 2007
Albemarle CatalystsAnalyst Road Show, September 2007
Financials
Strong Market FundamentalsGeneralHPCFCCAlternative FuelsPolyolefin Catalysts
Albemarle Strategies For Profitable Growth
Conclusions / Q&A
Catalysts: ‘Company Changing’ Segment Step Out Growth
Net SalesDollars in millions
Segment Income (excluding special items)Dollars in millions
738
283
8392
443
839
'02 '03 '04 '05 '06 1H'07
92
35
1312
72
123
'02 '03 '04 '05 '06 1H'07
* Akzo Nobel Refinery Catalyst acquisition Aug. ’04
*
Focused & Driven For Catalysts• Great Acquisition For Albemarle• Great Acquisition For This Catalyst Business• Complementary Strengths Continue To Merge Together• One Company Culture Emerging Where Were Two
Akzo Nobel RefineryCatalyst
Rest of Akzo Nobel
Catalysts Are Core To Albemarle
Fine Chem = 26%
Polymer Add's = 39%
Catalysts = 35%
% of Albemarle’s 2006 SalesOf $2.4 Billion Globally
Albemarle CatalystsAnalyst Road Show, September 2007
Financials
Strong Market FundamentalsGeneralHPCFCCAlternative FuelsPolyolefin Catalysts
Albemarle Strategies For Profitable Growth
Conclusions / Q&A
Refining Polyolefin
2006 Catalyst Revenue Breakdown $839MM
86%
14%
Forecast Oil Consumption
Oil: Consumption 2020
0
20,000
40,000
60,000
80,000
100,000
120,000
1965
1970
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1980
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2000
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2020
Thou
sand
bar
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GLOBAL INSIGHT INC. INTERNATIONAL ENERGY AGENCYDEUTSCHE BANK ALEX.BROWNEXXON MOBIL
Petroleumrefining
Objective
Product slateAllows refiners to produce a desired product mix from crude oil
CleanRemove impurities from crude oil and other petroleum streams/products
HPC pretreatmentHPC post-treatment Resid hydrotreating
Fluidized cat cracking (FCC)HydrocrackingIsomerization
Examples of key processes
Two Basic Functions That Albemarle Catalysts Serve For Refineries
LPGCrude
oil CDU NHT Ref.
NHT Isom.
Alky.Poly.
DHT
TCU
VGO-HT
VDU
LPGGasoline
Fuel oil
Naphtha
Mid
dle
dist
illat
e
Atm
osph
eric
Res
idue
Vacuum Residue
VGO
VB, CokerRDS
FCCHC
RFCC
HPCFCCOtherNon-cat.
Isom.
DieselKero
Crude Oil Refining Crude Oil Refining
Albemarle CatalystsAnalyst Road Show, September 2007
Financials
Strong Market FundamentalsGeneralHPCFCCAlternative FuelsPolyolefin Catalysts
Albemarle Strategies For Profitable Growth
Conclusions / Q&A
Hydroprocessing Catalysts (HPC)Hydroprocessing Catalysts (HPC)
• Nickel-Molybdenum (NiMo) catalysts are preferred for hydrogenation and hydrodenitrogenation (HDN)
• Cobalt-Molybdenum (CoMo) catalysts are preferred for hydrodesulfurization (HDS)
• Tri-metallic (NiCoMo) catalysts are sometimes used to achieve a balance of HDS and HDN
NiMo
CoMo
Porous support + active phase
HPC Volume Fundamentals
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/ KM
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Albemarle’s Hydroprocessing Catalysts: Growth, Differentiation, Advantage
• We Offer:Leading Portfolio of grades for all major applications
Custom tailored “stacks”
Total Catalyst Management
Market growth (t/a)
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forecast
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ConventionalStarsNebula
Activity progression
feed
product
Stackedlayers ofcatalysts
Albemarle CatalystsAnalyst Road Show, September 2007
Financials
Strong Market FundamentalsGeneralHPCFCCAlternative FuelsPolyolefin Catalysts
Albemarle Strategies For Profitable Growth
Conclusions / Q&A
• Accessibility/strength• Active ingredients• Sinter resistance• Low cost/large scale• Endless Differentiations
65 µm
x10
x1,000FillerClay
ZeolitesY, ZSM-5
BinderSilica or Alumina
Pores
FunctionalComponentsCrystalline Silica/Alumina,………..
Fluid Cracking Catalysts (FCC)Fluid Cracking Catalysts (FCC)
Global FCC Supply & Demand (Excluding China)
450,000
500,000
550,000
600,000
650,000
700,000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Met
ric T
ons
per Y
ear
planningEngineeringConstructionBase
Global Capacity = 536kt
Albemarle Estimates
Albemarle’s FCC CatalystsProfit Growth Outlook Bright
• Unique Value Through Differentiated Technology & Customer Servicing
• Improved Value Through Tightening Supply & Demand Fundamentals
Albemarle CatalystsAnalyst Road Show, September 2007
Financials
Strong Market FundamentalsGeneralHPCFCCAlternative FuelsPolyolefin Catalysts
Albemarle Strategies For Profitable Growth
Conclusions / Q&A
Albemarle Alternative Fuels TechnologyDevelopments Across CTL / GTL / Biomass Conversion
Steam Reforming
Coal Gasification
Biomass Gasification
(remote)GAS
COAL
BIO-MASS
FischerTropsch
Upgrading DIESEL
Vegetable Oil Crop
Veg. OilHydroconv. Upgrading
“BIO”DIESEL
Albemarle Catalyst Developments Across
Albemarle CatalystsAnalyst Road Show, September 2007
Financials
Strong Market FundamentalsGeneralHPCFCCAlternative FuelsPolyolefin Catalysts
Albemarle Strategies For Profitable Growth
Conclusions / Q&A
Polyolefins Global MarketGrowing Almost 2 x GDP
0 1 2 3 4 5 6 7 8 9
AAGR, % per year
North America
Latin America
West Europe
East Europe
Japan
China
Other Asia Pacific
Mideast/Africa
Projected PE growth rates by region(2004 to 2009)
CMT Asia Olefin Conference – June 07, 2006
World average = 5%
The Polyolefin Value Chain
Reactor Extruder Compounder Fabricator ConsumerEthylene
Propylene
Catalyst Additives
Single Site Catalysts
•Finished catalysts
• Activators
• MAO
• Organoborons
• Other proprietary systems
• Metallocene manufacture
ZieglerNatta
• Finished catalysts
• Organometallics
Additives
AOX
Flame retardants
Custom Blends containing:
• AOX
• Stearates
• Clarifiers
• Other proprietary ingredients
Albemarle’s offering Supports
PO Value Chain
Polyolefin Manufacturer
Refiner
Albemarle Catalysts Integral To Polyolefins
Metallocene/Single-site
• Unique Polymer Properties
Narrow MW distribution
Comonomer incorporation well controlled
New Stereo-specific polymers
• Higher Catalyst Cost
• Albemarle Offerings:
Leading MAO Producer
Custom Metallocenes
Silica / MAO / Metallocene
Ziegler-Natta
• Generic Polymer Properties
Broad MW distributions
Comonomer incorporation less consistent
Less stereo-specific
• Lower catalyst costs
• Albemarle Offerings:
Leading Organometallic Producer
Custom Finished Catalysts
MgCl2 / TiCl4 / donor ligand / RxAlCl3-x
Albemarle CatalystsAnalyst Road Show, September 2007
Financials
Strong Market FundamentalsGeneralHPCFCCAlternative FuelsPolyolefin Catalysts
Albemarle Strategies For Profitable Growth
Conclusions / Q&A
Albemarle CatalystsVISION: The World’s Leading Catalyst Solution Provider
Strategies To Accomplish:I. Invest To Serve Selected Customers & Segments Where Our
Service & Technology Are Valued
II. Build & Operate Globally Optimized, Low Cost, Environmentally Sound Manufacturing Technologies
III. Leverage External Partner Competences Into Our Global Business Systems
IV. Invest To Develop New, Sustainable Product Technologies And To Enter Attractive New, Sustainable Market Arenas
V. Position For Leadership In World’s Fastest Growing Regions
VI. Acquire For Consolidation & To Extend Catalyst Market Reach
Continue Step – Out GROWTH
External Execution Is Key
SALES & SERVICE
COMMERCIALTECHNOLOGY
BUSINESS MGMT
• Develop Segment & Pricing Strategies• Cross Functional Coordination / Planning• New Product Priorities To R&D • Capital & Resource Deployment
Share of Wallet
Overall Customer Satisfaction Tech Proposal Success Rate
Market Share
Profit & Loss
Rol
esM
etric
s
G r o w t h & Margins G r o w t h & MarginsG r o w t h & Margins
• Develop Account Strategies• Build Broad & Deep Relationships• Negotiate Optimum Value• Maintain Excellent Customer
Information Systems
• Application Technology Excellence • Develop & Maintain Key Technical
Relationships In Industry• Apply Newly Developed Technologies• Product Quality “Cops”• Maintain Excellent Technical
Information Systems
Albemarle CatalystsVISION: The World’s Leading Catalyst Solution Provider
Strategies To Accomplish:I. Invest To Serve Selected Customers & Segments Where Our Service &
Technology Are Valued
II. Build & Operate Globally Optimized, Low Cost, Environmentally Sound Manufacturing Technologies
III. Leverage External Partner Competences Into Our Global Business Systems
IV. Invest To Develop New, Sustainable Product Technologies And To Enter Attractive New Market Arenas
V. Position For Leadership In World’s Fastest Growing Regions
VI. Acquire For Consolidation & To Extend Catalyst Market Reach
Continue Step – Out GROWTH
Nebula:World’s Most Active Hydroprocessing Catalyst
Nebula 20: Industry Breakthrough Penetrating
Nebula 30: 50% More Active
More Tech Enhancements In Development
Number of units using Nebula
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Other HC pretreatULSDKero/nafta
Amorphous
Zeolitic Cracking
Riser Cracking
Resid Cracking
Leading Industry To Increase Propylene YieldsLeading Industry To Increase Propylene Yields
1940 1950 1960 1970 1980 1990 2000 2010 2020
State of theArt ZSM-5Additives
Novel ZSM-5Additives
Maxpropylene catalysts
Max Propylene
• ZSM-5 Additives– K1000– K2000– ZOOM
• Novel Additives– Provantage– Provantage-R
• Max Propylene Catalysts– AFX
Amorphous
Zeolitic Cracking
Riser Cracking
Leading Industry For Heavy Crude ConversionLeading Industry For Heavy Crude Conversion
1940 1950 1960 1970 1980 1990 2000 2010 2020
Max Propylene
Resid Cracking
JadeTechnology
Platform
High SAR Zeolitesfor maximum stability
Ni & V TrapsTopaz Technology Platform for high AAI
• Topaz– Accessibility– New Upgrader
• Novel Additives– Resolve 950– Eliminox
Albemarle CatalystsVISION: The World’s Leading Catalyst Solution Provider
Strategies To Accomplish:I. Invest To Serve Selected Customers & Segments Where Our Service &
Technology Are Valued
II. Build & Operate Globally Optimized, Low Cost, Environmentally Sound Manufacturing Technologies
III. Leverage External Partner Competences Into Our Global Business Systems
IV. Invest To Develop New, Sustainable Product Technologies And To Enter Attractive New Market Arenas
V. Position For Leadership In World’s Fastest Growing RegionsVI. Acquire For Consolidation & To Extend Catalyst Market Reach
Continue Step – Out GROWTH
Position For Leadership In World’s Fastest Growing Regions
• New Dubai Office To Serve Middle East & India
• Continue Build Up Of Infrastructure In China– Sales Offices Today In Beijing, Shanghai & Guangzhou– New R&D Center In Nanjing– Nanjing Organometallic Repackaging
• Build Up To Serve Rest of Asia– ALB Korea in Seoul– Alb Asia Pacific in Singapore– Nippon Ketjen For HPC
Invest To Serve Developing World’s Customers & Needs
Consideration Of More Strategic Options That Make Economic Sense
Leverage External Partner Competences Into Our Global Business Systems
Business Process ALB Controlled Externally ControlledR&D Amsterdam, Houston, Baton Rouge NK, FCCSA, Other R&D Alliances
Sales Clear Lake, Amersfoort, Baton Rouge NK, FCCSA, NAA, UOP Alliance
Manufacturing Amsterdam, Houston, Baton Rouge NK, FCCSA, NAA
Total Catalyst Mgmt REACT Eurecat, NK
Hydrotreat Design UOP Alliance
• Setup To Extract Maximum Benefits:Capital SharingIdea / IP Generation & Global TranslationImproved Global Reach & Service CapabilitiesExpansion Of Albemarle’s Service Offerings
• Requires:Partners’ Continuous AlignmentComplex Coordination Systems
We Know How To Create & Sustain Long Term Partnership Value
Albemarle CatalystsVISION: The World’s Leading Catalyst Solution Provider
Strategies To Accomplish:I. Invest To Serve Selected Customers & Segments Where Our Service &
Technology Are Valued
II. Build & Operate Globally Optimized, Low Cost, Environmentally Sound Manufacturing Technologies
III. Leverage External Partner Competences Into Our Global Business Systems
IV. Invest To Develop New, Sustainable Product Technologies And To Enter Attractive New Market Arenas
V. Position For Leadership In World’s Fastest Growing Regions
VI. Acquire For Consolidation & To Extend Catalyst Market Reach
Continue Step – Out GROWTH
$12 billion catalysts industry
3-5% growth annually
Chemical20%
Environmental27%
Other10%
Refinery21%
Polyolefin22%
ALB Share~ 5%
ALB Share~ 30%
~$500MM/yr
Acquire For Consolidation And To Extend Albemarle’s Catalyst Market Reach
SOURCE: SRI, 2004
Albemarle CatalystsAnalyst Road Show, September 2007
Financials
Strong Market FundamentalsGeneralHPCFCCAlternative FuelsPolyolefin Catalysts
Albemarle Strategies For Profitable Growth
Conclusions / Q&A
Albemarle’s Drive To Become The World’s Leading Catalyst Solution Provider
Lead PO ComponentsSupplier
Lead RefineryCatalyst SolutionProvider
Leading
Catalyst
Solution
ProviderLeverage To Become Broader Solution& Service Provider To Polymers
Alternative Fuels Catalyst Leader
Lead in Asia & Mid East
Synergistic Acquisitions
Best New Technologies
STEP – OUT G R O W T H
Questions?