Global Processing

US shows most attractive ROI on producing propylene via PDH

July 30, 2012

HOUSTON — The U.S. shows the most attractive return of investment on producing propylene via propane dehydrogenation (PDH), according to a new report released by Houston publisher and chemical process consulting firm Intratec Solutions LLC.

The tight propylene market contributed to the rise of new and novel lower-cost chemical processes for on-purpose propylene production technologies and PDH technology stands out due to the use of low-cost raw materials.

According to the report, in comparison to Brazil and China, the U.S. Gulf Coast Plant presents the most advantageous operational margins, with an EBITDA margin of 32%, due to the availability of low price propane, obtained from the rise of shale gas, which justifies Dow Chemical’s choice for a new PDH plant in Texas.

The publication “Propylene Production via Propane Dehydrogenation, Q2 2012,” presents the analysis of a plant fully integrated with a petrochemical complex and capable of producing 550 kta of polymer-grade propylene on the U.S. Gulf Coast, evaluating the CAPEX of such industrial unit in $490 million. The internal rate of return is calculated on more than 25% per year in US, as well as in China.