Chapter 1 Feasibility Study

PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-1 CHAPTER 1: FEASIBILITY STUDY
CHAPTER 1
FEASIBILITY STUDY
1.1
PROCESS BACKGROUND
2-Ethylhexyl acrylate (2-EHA) known as 2-ethylhexyl propenoate, acrylic ester, with molecular weight of 184.28 g/mol. 2-EHA occur in liquid phase as water white liquid with a colorless, acrylic odor, hundred percent volatile and slightly soluble in cold water and also in hot water. 2-EHA is a stable product and to prevent polymerization, 2-EHA will supply inhibited. The characteristic properties of 2-EHA depend upon the monomer and reaction condition that has been selected. 2-EHA is produced by esterification by reacting of acrylic acid with 2-Ethylhexanol in the presence of sulfuric acid as catalyst.
2-EHA used as a monomer in chemical industry for the production of polymers and copolymers. From the actual figures available for 1999, a total amount of 90,000 tonne/annum is estimated to be available on European Union (EU) market and the total EU production volume was 70,000 tonne/annum (Risk assessment report 2-EHA, 2005).
The actual specifications of the commercial product are assay, 99.5 wt% min; water, 0.05-0.10 wt% max.; acidity (as acrylic acid), 0.009 wt% max.; hydroquinone (inhibitor), 40- 160 ppm and monomethyl ether of hydroquinone (inhibitor), 10-220 ppm and has a purity of more than 99% and also containing several impurities such as 2Ethyl hexanol, acrylic acid, methacrylate and water .
The goal of this project is to design equipments and processes for a large-scale chemical industry for producing 2-Ethylhexyl acrylate with minimum production rate of 100,000 metric tones/year. The maximum fund provided for the project is RM200 million.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-2 CHAPTER 1: FEASIBILITY STUDY Besides, the objective of the design is an environmentally friendly, safe, the most important economically
profitable 2-EHA production plant. The project is divided into five interrelated parts: process design, market analysis, site selection, environmental and plant safety, and plant economics. The process design sections include the thermodynamic system, kinetic data, mass balance, and energy balance and process simulation.
The market analysis section includes the determination of the optimal condition of the plant as well as an investigation of the demand analysis of 2-EHA. The plant safety and environmental consideration section includes an evaluation of all waste stream along with waste treatment, a detail hazardous operation study of PFD based on material safety data sheet of material, intermediate, byproduct and product. The last section is plant economics include a detail economic analysis comprising total capital investment, net present worth and other major economical variables.
The Uses of 2-Ethylhexyl acrylate The main applications of 2-EHA are used in the production of polymers and copolymers. In the production of resins, 2-EHA is used for pressure-sensitive adhesives, latex, paints, textile and leather finishes and coatings for paper. For an adhesive, the basic composition of general purpose tape are 75% 2-EHA, 20% vinyl acetate, 4% acrylic acid and 1% N-methylolacrylamide (Temin, 1990). Acrylic polymers have good water resistance, low temperature flexibility and excellent weathering and sunlight resistance when it is used in latex paint formulations. 2-EHA also used as a co-monomer in solution polymers for industrial metal finishing.
The minor application of 2-EHA is used as a reactive building block to produce polymer coatings, adhesives, sealants and plastics additives such as in latex paints, textiles finishes, paper coating and other surface coating formulations as shown in Figure 1.1. The major consumption of acrylate ester is in manufacture of surface coating follow by adhesive and sealants. In combination with other acrylic monomers, 2-EHA can be polymerized by itself. The water resistance, weather ability, and sunlight resistance of the final product can improve in presence of 2-EHA.
Figure 1.1: U.S. Consumption of Acrylate Ester in year 2006. (Source: DOW 2-Ethylhexyl Acrylate)
Ultraviolet-curable coatings is also one of the application of 2-EHA excluding solvent which supply a glossy, abrasion-resistant finish like on book covers and record albums. Formulation of ultraviolet-cured usually may include 20% trimethylpropane triacrylate, 70% acrylated polyurethane oligomer, 10% 2-EHA diluents monomer and little amounts of photo initiator. A liquid coating or ink is widening on the surface of the substrate and then exposed to ultraviolet light for less than 1 second and is totally cured.
The estimated distribution of uses of acrylic esters are shown in Table 1.1. The major applications of acrylic ester are in manufacture of surface coating follow by textiles. USA is the major consumption of acrylic ester in manufacture of surface coating compare with Japan and Western Europe.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-4 CHAPTER 1: FEASIBILITY STUDY Table 1.1: Estimated distribution of uses of acrylic esters (% of total) (Ohara et al, 1985). Use Surface coating Textiles Acrylic fibers Adhesives Other Japan 34 16 14 20 16 Western Europe 35 18 7 15 25 USA 42 23 6 5 24
The world consumption of commodity acrylate esters in year 2006 are shown in Figure 1.2. United State has a major consumption of acrylate ester follow by Western Europe and other Asia.
Figure 1.2: World Consumption of Commodity Acrylate Ester in year 2006. (Source: http://www.sriconsulting.com) From a volume standpoint, esterification represents one of the most important reactions of the chemical industry. The number of different esters produced for commerce by over 100 manufactures probably exceeds 500. Table 1.2 shows the United State production, sales volume and value of selected ester in year 1979.
Table1.2: 1979 U.S Production, Sales Volume, and Value of Selected Ester (Mcketta, J.J., 1996) Production Million lb Plastisizers: Phthalates Adipates Rimellitates Solvents: Ethyl acetate n-Butyl acetate Propyl acetate Monomers: Ethyl acrylate Butyl acrylate 2-Ethylhexyl acrylate Surface-active agents: Carboxylic esters Pesticides : Octyl-2,4dichlorophenoxyacetate 8 9 7 254 196 133 316 297 68 148 157 58 50 60 26 262 139 51 156 119 51 25 35 15 1290 75 20 1232 64 18 455 35 10 Million lb Sales Million $
1.1.1
AVAILABLE PROCESS
1.1.1.1 Esterification Process Esters are most commonly prepared by the reaction of a carboxylic acid and an alcohol with the elimination of water. The reaction is generally characterized by high yield with few side reactions. Other methods for ester formation utilize carboxylic acid derivatives such as acid anhydride, acid chlorides, nitrile, and amide. Ester can also be produce from unsaturated hydrocarbons and aldehydes.
From a volume standpoint, esterification represents one of the most important reactions of the chemical industry. The numbers of different ester produce for commerce by over 100 manufactures probably exceed 500. These materials cover a broad range of uses and include plasticizers, flavors and fragrances, pesticides, solvents, monomer for resins and high molecular weight polymer.
The acid catalyzed reaction of a carboxylic acid and an alcohol to form an ester and water is a reversible process. In the reaction of acrylic acid (AA) and 2-ethyl hexanol (2-EH), C2H3COOH + C8H17OH C11H20O2 + H2O
The rate of esterification can be represented by k[C2H3COOH][ C8H17OH], where the quantities within the brackets represent the molar concentration of the reacting species, and the rate of hydrolysis by k[C10H20O2][H2O]. Thus, if the concentration are those at equilibrium, then
k[C2H3COOH][ C8H17OH] = k[C11H20O2][H2O] and
k k'
[C11 H 20 O2 ][ H 2 0] [C 2 H 3 COOH ][C8 H 17 OH ]
The constant K is called the equilibrium constant of the reaction. The value of K will depend on the particular carboxylic acid and alcohol and is determine experimentally by allowing the reaction mixture to reach equilibrium and analyzing for reactant and products. The heat of reaction for many esterifications is near zero or at least quite small. For this reaction, the equilibrium constant is essentially independent of temperature. Table 1.3 shows the effect of reactant ratio on conversion to ester for different values of K (Mcketta, J.J., 1996).
Table 1.3: Effect of Reactant Ratio on Theoretical Conversion to Ester for Different Values of K Equilibrium constant, K 5 5 5 1 5 10 Mole ratio of reactants Theoretical conversion(%) to ester at equilibrium 69.1 95.5 97.9
Reaction Mechanism Fischer esterification involves the formation of an ester from a carboxylic acid and an alcohol. The mechanism is an acid promoted acyl substitution, which results in the substitution of an alkoxy group for the hydroxyl portion of the carboxyl group. An alternate method of ester formation involves the use of the carboxylate anion as an SN2 nucleophile upon a primary alkyl halide.
The reaction mechanism for this reaction has several steps:
Proton transfer from acid catalyst to carbonyl oxygen increases electrophilicity of carbonyl carbon. The carbonyl carbon is then attacked by the nucleophilic oxygen atom of the alcohol Proton transfer from the oxonium ion to a second molecule of the alcohol gives an activated complex Protonation of one of the hydroxyl groups of the activated complex gives a new oxonium ion. Loss of water from this oxonium ion and subsequent deprotonation gives the ester. A generic mechanism for an acid Fischer esterification is shown in Figure 1.3.
Figure 1.3: Reaction Mechanism (Source: http://en.wikipedia.org/wiki/Fischer%E2%80%93Speier_esterification)
Side reaction
Side reaction is an unwanted chemical reaction taking place that diminishes the yield of the desired product. Side reaction occur during esterification reaction are:
First side reaction is reaction between diacrylic acid with 2-ethylhexanol
2C2H3COOH + C8H17OH C6H8O4 + C6H16 + H2O Second side reaction is reaction between acetic acid and 2-ethylhexanol C2H4O2 + C8H17OH C10H20O2 + H2O Third side reaction is reaction between propionic acid and 2-ethyl hexanol C3H6O2 + C8H17OH C11H22O2 + H2O For second and third side reaction, this is because the raw material supply contains acetic acid and propionic acid with mole fraction of 0.001 and 0.0004 respectively. Since the fraction is small, we assume no second and third side reaction.
1.1.1.2 General Process Description for Esterification Since the esterification of a carboxylic acid with an alcohol is an equilibrium reaction, it is necessary to displace the equilibrium in order to obtain high conversion. This is done by removing one or both of the products. In practice, this is almost always achieved by azeotropic distillation. The actual operating conditions will depend on the carboxylic acid and alcohol used. Not only must the boiling points and compositions of the binary azeotropes be considered, but also the solubilities of the alcohols and ester in water.
In the production of nonvolatile esters-for which the alcohol is not appreciably soluble in water-the water may be removed as the alcohol-water azeotrope. After condensing the vapors, the water layer is withdrawn from a decanter while the organic layer is returned to the column. The process can be run under pressure or under reduce pressure in order to maintain the desired reaction temperature and reflux of the alcohol. Should be the alcohol be nonvolatile or fairly soluble in water, an inert liquid such as toluene can be used to form a binary azeotrope with water. In either case, the reaction will proceed since water is removed from the reaction mixture. It will also be necessary
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-10 CHAPTER 1: FEASIBILITY STUDY to check for binary and ternary azeotropes involving these inert liquid for the particular system.
Many of the volatile esters form binary azeotropes with water and with the alcohol from which they are derived. In addition they may form ternary azeotropesgenerally the lowest boiling-with the alcohol and water. For these system the ester, water and alcohol of the approximate ternary concentration distill through an efficient column, are condensed, and the aqueous phase-containing some ester and alcohol is removed from the decanter for further separation. The organic phase is returned to the column in a batch operation or removed for further purification in a continuous system. In this case both products of the reaction are removed which allow the esterification reaction to proceed. Separation of the product then becomes a matter of distillation. 1.1.2 ALTERNATIVE METHOD
1.1.2.1 Batchwise Esterification
To reaction NaOH Water 2-ethylhexyl acrylate Extraction column Distillation column Distillation column
To reaction Heavy products
H2SO4
Hydrolysis reactor Waste aqueous liquours
NaOH
Figure 1.4: Batchwise Esterification Process Flow Diagram for Production of 2-EHA (Bessalem et al., 2003)
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-11 CHAPTER 1: FEASIBILITY STUDY Process Description
The batchwise esterification process consists of reaction mixture which is carried out batchwise and then purification section generally carried out continuously. This process preferably operates at temperature 70C to 200C in the presence of and sulfuric acid as a catalyst.
Stirred reactor
The raw material is esterified, batchwise in a stirred reactor at a specific temperature and pressure. The reaction in the stirred reactor is being catalyzed by sulfuric acid. The esterification reaction basically is reversible reaction, thus equilibrium limited. In order to shift the reaction equilibrium is by providing excess of esterifying alcohol; this exhibits the distinguishing feature of forming an azeotrope with water. Neutralization
In the purification stage, neutralizer is used to neutralize the acidic entities in the cruse reaction mixture where organic phase and aqueous phase is separate at separator. The organic phase is conveyed to the extraction column while aqueous phase is pumped to the hydrolysis reactor. Extraction column
The organic phase is washes at extraction column by using water to remove impurities; the washed 2-EHA is then being into the distillation column. The aqueous phase at the bottom is passed through the distillation column for recovery of alcohol. The overall efficiency of extraction of the catalyst is 99.5%. Hydrolysis reactor
The aqueous phase coming out from separator is then pumped into the hydrolysis reactor where reaction take places to convert 2-ethylhexyl hydrogensulfate to 2-
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-12 CHAPTER 1: FEASIBILITY STUDY ethylhexanol. The sulfuric acid is added to obtain a molar ratio of the number of H + at least equal to 1.5. The sodium hydroxide is added to neutralize to pH 8. 1st Distillation column; 2-EH recovery
The 2-EH coming out from hydrolysis reactor together with the aqueous solution from extraction column are being into the distillation column to recover 2-EH. The 2-EH is purified at the top of the column and waste aqueous liquors are discharged out through bottom stream and then being sent to the biological treatment site. 2nd Distillation column: To recycle back AA and 2-EH
The washed 2-EHA from extraction column is then being sent to the distillation column which it possible to remove unreacted AA and 2-EH which recycled back to the esterification reactor. 2-EHA obtained at the bottom of distillation column. 3rd distillation column: purification of 2-EHA
The purification of the 2-EHA is achieved at 99.7% from heavy products discharge at the bottom of the distillation column.
1.1.2.2 Continuous Esterification
2-ethyl hexanol separator 2-ethylhexyl acrylate Distillation column
Distillation column
Distillation column
Sulfuric acid
steam condensate Acrylic acid High residue boiling point
Esterification reactor
Figure 1.5: Continuous Esterification Process Flow Diagram for Production of 2-EHA (Erpenbach et al., 1981)
Process Description
The continuous esterification process consists of reactor heater for esterification reaction and purification stage principally carried out continuously. This process preferably operates at temperature 85C to 140C in the presence of and sulfuric acid as a catalyst. Reactor heater
At the reactor heater, the mixture kept circulating is continuously admixed with acrylic acid. The reaction occurs as shown below:
Azeotrope distillation column
At this stage, the reacting AA and 2-EH in presence of sulfuric acid as catalyst, which purifying the ester obtained at the bottom while at the top, distilling off water azeotropically together with 2-EH. The condenser is used to condensing the azeotrope to separate into alcoholic phase and aqueous phase. Separator
The separator is used to separate the two different layers of alcoholic phase and aqueous phase. The alcoholic phase is recycled back to the reaction zone while aqueous phase is send to the wastewater treatment site. Distillation column The 2nd and 3rd distillation column is provided to purification of 2-EHA. The purification of 2-EHA is achieved at 99.98% where about 96% acrylic acid underwent conversion or 93.6% based on the 2-ethyl hexanol which underwent conversion.
1.1.2.3 Cascade Esterification
TO REACTOR 2
DECANTER
RAW MATERIAL
WATER III PRODUCT I
II
RAW MATERIALS
REACTOR 1
REACTOR 2
DECANTER
IV
RESIDUES AQUESOUS
Figure 1.6: Cascade Esterification Process Flow Diagram for Production of 2-EHA (Iffland et al., 1999)
Process Description
The esterification reaction is carried out in a two stage esterification cascade of two reactors which connected with a distillation column (I). AA and sulfuric acid (catalyst) fed into 1st reactor while 2-EH fed at the top of distillation column (I). The vapor formed in esterification reactor comprising water fed to the distillation column. The condensate formed was separated in separator into two liquid phases. Aqueous an organic phase separated off via respective stream. The bottom product from 1st reactor then fed to 2nd
reactor. The bottom product formed from 2nd reactor comprising 2-EHA, lower boiling starting material and by-products is then fed into the lower part rectification column (II) configured as a enrichment column served for the high boiler separation.
At the top of the column (II), product (VII) was discharged comprising 2-EHA, lower boiling starting material and by-products. This product is then fed into stripping column (III). The bottom product from column (II) was discharged and fed into extraction unit. The sulfuric acid content of organic phase was lowered for the cracking by addition of a part of the water esterification. The water stream containing 30% sulfuric acid was discharged. The organic phase was taken off and fed into the distillation unit (IV) where product still present and vaporized batchwise. The residue which had a high content of sulfuric acid was cracked to form starting material, target product, water and the octenes obtained as by product.
The combined top product was taken off and liquefied and return to the high boiler separation while the viscous residue discharged through the bottom stream of distillation unit. The pure product 2-EHA was taken off in vapor form and passed through the condenser. At this stage, storage stabilizer was injected into the condenser to change process inhibitor to storage stabilizer. 1st Reactor
At the first reactor where the esterification reaction occurs at the optimum condition of 80-130 C and operate under vacuum environment of 200-700 mbar. The preferred residence time of the reaction region is 2-5 hours. 2nd Reactor For the 2nd reactor is the extension of the reaction to achieve high conversion of the product from the raw materials and recycled unreacted raw materials. The optimum condition of the reactor such as temperature (110-130 C) and operate under vacuum environment of 200-700 mbar.
1st Distillation column
The purpose of this equipment is to remove water form from esterification reaction and recover organic phase. The aqueous phase discharge off from this equipment can easily discharge to the sewer because it is not containing hazardous materials and also can reuse for further purposes. The organic phase contains small portion of product, unreacted raw materials and catalyst are recovered for further reaction. 2nd distillation column
The second distillation column also known as rectification/enrichment columns served as high boiler separation. At this stage, the crude mixture of product, unreacted materials and by-product are separated from high boiling residues where it is go to the 3rd distillation column whereas high boiling residues go to the distillation unit. 3rd distillation column
The third distillation column, also known as stripping column where the product is produced at 98% of high purification and the product produce in liquid phase. The unreacted materials are recycled back to the second reactor for further reaction. Distillation unit
At this stage, distillation unit comprising separation and removal residues that cannot utilize further. The high boiling residues from the 2nd distillation column present small portion of target product, unreacted materials and by-product.
1.1.2.4 Equilibrium Limited Reaction

Recycle
Product
Inhibitor
Inhibitor
Distillation column Inhibitor Distillation column
2-EH
Decanter
Purge Organic
Inhibitor
Aqueous
Condenser
Decanter
Heavies
Aqueous
Reactor Column
E-2
Reactor heater
Acrylic acid DBSA
Heavies and catalyst
Figure 1.7: Equilibrium Limited Reaction Process Flow Diagram for Production of 2-EHA (Patterson et al., 2004)
Process Description
The above process is a continuous process in which the reactants, catalyst, inhibitor and solvent are added periodically or uninterruptedly and product is removed uninterruptedly from reaction zone. In reaction zone, the process is conventionally conducted at temperature within the range of from 40 degree to 150 degree C, but below a temperature that causes undue degradation of reactants, desire product or any catalyst used. Temperature that are too low result in lower reaction rates and temperature that are too high result in more by-products and have higher corrosion rates.
Reactive distillation column
The first reaction zone, may be a single vessel or may comprise two or more discrete vessels. The reaction occurs at this stage producing desire product and co-product. Overhead stream is to remove co-product (water) from the esterification of acrylic acid and 2ethylhexanol and thus drive the reaction further toward conversion to desire product. The overhead stream subjected to rectification or other separation unit operation such as liquefaction, condensation and liquid phase separation. The polymerization reaction can be controlled by the use of inhibitors. Reactor Heater
For second reaction zone, the conversion is small because the purpose is to crack heavies for example Michael-addition heavies which is to vaporize unreacted reactant and product.
Condenser
Vapor is introduced into condenser from second reaction zone in order to condense all vapor mixture to form two liquid phases. Decanter
Two liquid phases formed from condenser are then being separated by using decanter where aqueous phase is recycle back into reaction zone while organic phase is proceed to the next stage of purification section.
First distillation column
The purpose of this equipment is to separate unreacted reactant with product. At the top, unreacted reactant goes back into the reaction zone for further reaction while at the bottom, the product with high boiling residue go into third distillation column for further purification.
Second distillation column
The third distillation column, the purity of 99.7% of product is achieve at the top of distillation column while high boiling residue is separated and remove through the bottom of distillation column.
1.1.3
PROCESS SELECTION AND METHODS COMPARISON
Based on alternative method available for esterification, Table 1.4 shows the comparison method of production of 2-EHA based on type of process, raw material, size, processing efficiency, controllability and safety.
Table 1.4: Comparison method for production of 2-Ethylhexyl acrylate Process Batchwise Esterification Continuous Esterification Cascade Esterification Equilibrium Limited Reaction Type process of Batch Small volume product Continuous Large volume product Continuous Large volume product Continuous Large volume product
Raw material
Acrylic acid, 2-Ethyl hexanol, Sodium Hydroxide, phenothiazane and hydroquinone (process inhibitor)
Acrylic acid, 2-Ethylhexanol, Acrylic acid, 2-Ethylhexanol, Acrylic acid, 2phenothiazane and hydroquinone(process inhibitor) phenothiazane (process inhibitor), HMME(storage stabilizer) Ethylhexanol, phenothiazane (process inhibitor) and hydroquinone(aqueous inhibitor), HMME ( shipping inhibitor).
Reaction mechanism
Complicated reaction and have intermediate by addition NaOH
Simple reaction, directly produce ester Residence times is 2 to
Simple reaction, directly produce ester Residence times is 2 to
Simple reaction, directly produce ester Residence times is
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-22 CHAPTER 1: FEASIBILITY STUDY Residence times is 4 hours Product purification Product conversion Profit margin Equipment RM 760.54 Esterification reactor hydrolysis reactor decanter/separator 3 distillation columns Extraction column Neutralizer mixer Total = 8 Catalyst Sulfuric acid effective catalyst corrosive to metal less amount required more undesired side reaction Sulfuric acid effective catalyst corrosive to metal less amount required more undesired side reaction Para-toluene Sulfonic acid more undesired side reaction more amount required compare with sulfuric acid Less corrosive DBSA Less impurities and heavies Higher efficiency Homogeneous catalyst Less amount required Less corrosive Utilities Biological treatment plant, Waste water treatment and Waste water treatment and Only high boiling residues RM 766.54 Esterification reactor decanter 3 distillation columns Total = 5 RM 776.017 Esterification reactor 3 distillation column 2 decanter Evaporator Total = 7 802.4275 Esterification reactor 3 distillation column 2 decanter Total = 6 91.0% 93.0% 98.0% 95.0% 99.7% 99.98% 99.8% 99.7% 8 hours 5 hours 2.5 to 3.5 hours
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-23 CHAPTER 1: FEASIBILITY STUDY heavy product treatment high boiling residues treatment Cost Expensive operation to separate the neutralization product and to recover the acrylic acid Higher operating labor cost in standard batch plant due to equipment cleaning and preparation time Size Smaller throughput favor batch operations Economies of scale favor continuous processes for large throughput Processing efficiency Requires strict scheduling and control Generally, become more efficient as throughput increases Controllability Complicated Easier to control For complicated and highly integrated(energy/raw material) plants, the control become Economies of scale favor continuous processes for large throughput Generally, become more efficient as throughput increases Easier to control For complicated and highly integrated(energy/raw material) plants, the control become Economies of scale favor continuous processes for large throughput Generally, become more efficient as throughput increases Easier to control For complicated and highly integrated(energy/raw material) plants, the control become Not involve neutralizer Operating labor will lower for continuous processes high boiling residues treatment Safe energy, cost and capital investment Not involve neutralizer Operating labor will lower for continuous processes Conversion cost lower Safe energy, cost and capital investment Not involve neutralizer Reduce inhibitor and catalyst cost Operating labor will lower for continuous processes Conversion cost lower treatment
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-24 CHAPTER 1: FEASIBILITY STUDY complex and operational flexibility is greatly reduce Safety Worker exposure to chemicals and operator error will be higher Large chemical plant operating continuously have excellent safety record and any safety procedures will established complex and operational flexibility is greatly reduce Large chemical plant operating continuously have excellent safety record and any safety procedures will established complex and operational flexibility is greatly reduce Large chemical plant operating continuously have excellent safety record and any safety procedures will established Free from Dioctylether Aqueous can be Advantages discharged without treatment The removal of all high boiling secondary components and catalyst from esterification product Prevent contamination of pure product with low boiling dissociation product and acrylic acid Minimize the problem associated with conducting the reaction and recovering unreacted reactant and product Enables lower catalyst and inhibitor usage and reduce cost
Disadvantages
Aqueous liquors that discharge are highly polluted The unreacted AA contained in the ester
Acid catalyst is sent with the reaction mixture from the reaction zone to a rectification unit, rather
Acid catalyst is sent with the reaction mixture from the reaction zone to a rectification unit, rather
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-25 CHAPTER 1: FEASIBILITY STUDY to be neutralized. Technically expensive operation to separate the neutralization product and to recovere the AA by acidification with hydrochloric acid with the resultant formation of a salt whereby wastewater preparation is rendered difficult. than be allowed o remain in the reaction zone. than be allowed o remain in the reaction zone. Lead to high corrosion rate Equipment fouling Undesired side reaction
Table 1.4 illustrated above the comparison of all those processes along with their advantageous and disadvantageous. The 4th method which is equilibrium limited reaction was chosen as the best process after all the critical aspects were considered such as product conversion and purification, profit margin, process efficiency, operability, safety, etc. The 4th method is favor for the production of 2-EHA since the conversion of product is high and purity is achieving the customers need.
Using this method, in which feed is sent continuously to a series of equipment, with each piece usually performing a single unit operation. Then, product, by products, and waste leave the process continuously and are sent to storage or for further processing. In this process, it produces high product purification which is 99.7% same with 1st method but lower 2nd method and 3rd method. During this process, operating cost and capital cost is also low. Economies of scale favor continuous processes for large throughput. Generally, become more efficient as throughput increases. Beside that, this method is easy to control, for complicated and highly integrated (energy/raw material) plants, the control become complex and operational flexibility is greatly reduce. Large chemical plants operating continuously have excellent safety record and any safety procedures will establish.
The advantages of this method are removal of all high-boiling component catalyst from esterification product, avoid redissociation of high boiler and target product in liquid phase, prevent contaminant of pure product with low-boiling dissociation product, minimize the problem associated with conducting the reaction and recovering unreacted reactant and product. It also enables lower catalyst and inhibitor usage and reduce cost. In this method, it uses DBSA as a catalyst. A somewhat higher concentration of sulfonic acid may be required in order to achieve the same reaction rate that can be obtained with a given quantity of sulfuric acid.
In this production, may be contained in the liquid reaction media such as antioxidants stabilizers, buffer and polymerization inhibitors phenothiazine is preferred inhibitor. Since, PTZ is not soluble in water; hydroquinone is preferably used as the inhibitor for aqueous streams. The hydromonomethyl ether (HMME) is the preferred
product shipping inhibitor and is used in the product recovery distillation column. Air or oxygen can be used to enhance the effectiveness of the inhibitors.
1.1.4
RAW MATERIAL SELECTION
1.1.4.1 Acrylic acid (AA) Acrylic acid with IUPAC name, prop-2-enoic acid is an organic compound with the formula C2H3COOH. It consists of a vinyl group connected directly to a carboxylic acid terminus and the simplest unsaturated carboxylic acid. AA is colorless liquid that has a characteristic acrid or tart smell. It is miscible with water, alcohols, ethers, and chloroform. Productions of acrylic acid are annually more than one billion kilograms (Basic Acrylic Monomer Manufacturers, Inc., 2006)
AA has typical reactions of a carboxylic acid. It will form the corresponding ester when it reacted with an alcohol. The esters and salts of acrylic acid are collectively called as acrylates or propenoates. Methyl-, butyl-, ethyl-, and 2-ethylhexyl-acrylate are the most common alkyl esters of AA.
Beside that, with reacting at their double bond, acrylic acid and its esters readily combine with themselves or other monomers such as amides, acrylonitrile, vinyl, and styrene. Homopolymers or copolymers will form after reacting them and will are used in the manufacture of various plastics, coatings, adhesives, elastomers, as well as floor polishes, and paints. An essential building block is the one most commonly application of acrylic acid in industrial and AA is a consumer products. Approximately, major manufacturing of AA in the United States is used to produce acrylic esters such as methyl acrylate, butyl acrylate, ethyl acrylate, and 2-EHA. 1.1.4.2 2-Ethylhexanol 2-Ethylhexanol (2-EH) also known as isooctanol is a fatty alcohol which is an organic compound used in the manufacture of a variety of application. 2-EH has a molecular
formula C8H17OH which is a branched and have eight-carbon alcohol; clear, colorless liquid that is nearly insoluble in water, but well soluble in most organic solvents.
There is variety of uses especially when 2-EH is can be readily converted into esters. The minor application of 2-EH is in the manufacture of the diester bis (2ethylhexyl) phthalate (DEHP) also known as plasticizer. However, esters of 2ethylhexanol tend to have emollient properties because it is a fatty alcohol. For example, the sunscreen octocrylene contains a 2-ethylhexyl ester for this purpose and it is also commonly used as a low volatility solvent (2-Ethylhexanol (2-EH) Uses and Market Data, 2009).
2-EH will become combustible liquid after the temperature above 60C. It is a marine pollutant which can affect skin, eyes, respiratory tract and also cause nausea and headache after inhalation, diarrhea and vomiting after ingestion. Long-term exposure can result in defatting of the skin (2-Ethylhexanol (2-EH) Uses and Market Data, 2009).
2-EH is the most significant synthetic alcohol following the lighter alcohol (methanol to butanol). Alcohol component is the major use of 2-ethylhexanol for the producer of ester plasticizers for soft polyvinyl chloride also known as PVC and has been produced for this purpose since the mid-1930s. 1.1.4.3 Dodecylbenzene Sulfonic Acid (DBSA)
Organic compound containing the functional group R SO 2 OH, which consists of a sulfur atom, S, bonded to a carbon atom that may be part of a large aliphatic or aromatic hydrocarbon , R and also bonded to three oxygen atoms, O, one of which has a hydrogen atom, H, attached to it. The hydrogen atom makes the compound acidic, much as the hydrogen of a carboxylic acid makes it acidic. However, while carboxylic acids are weak (with dissociation constants of about 10
-5
), sulfonic acids are

-2
considered strong acids (with dissociation constants of about 10
). Because sulfonic
acids are so acidic, they generally exist as their salts and thus tend to be quite soluble in water.
Sulfonic acid groups are often introduced into organic molecules such as dyes to stabilize them for use in aqueous dye baths. Sulfonic acid groups also improve the washfastness of wool and silk dyes by enabling the dye to bind more tightly to the fabric. The most important use of sulfonic acid salts (sulfonates) is in the detergent industry. Sodium salts
of long-chain aliphatic or aromatic sulfonic acids are used as detergents. Unlike ordinary soaps , which contain carboxylic acid salts, soaps containing sulfonates do not form a scum in hard water because the calcium and magnesium ions present in the hard water do not form insoluble precipitates with sulfonates as they do with carboxylates. Some sulfonic acid derivatives, e.g., the sulfa drugs, are important as antibiotics.
Dodecylbenzenesulfonic Acid (CH3(CH2)11C6H4SO3H ) is the largest-volume synthetic anionic surfactant having straight chain for biodegradable environmental friendliness. It is mainly used to produce household detergents including laundry powders, laundry liquids, dishwashing liquids and other household cleaners as well as in numerous industrial applications like as a coupling agent and as an emulsifier for agricultural herbicides and in emulsion polymerization. Figure 1.8 and Table 1.5 show the molecular structure and the properties of DBSA.
Figure 1.8: Molecular structure of DBSA
Table 1.5: Properties of DBSA (Science Lab.Com, 2008) Properties Molecular weight Physical state Melting point Boiling point Specific gravity Value 326.49 Brown liquid 10C 315C 1.2
1.1.4. 4 Phenothiazine (PTZ) and Hydroquinone monomethyl ether (HMME) PTZ is an aromatic amine that exhibits broad activity as an inhibitor, antioxidant and shortstopping agent in a variety of diverse applications. The PTZ and HMME are principally utilized as an inhibitor and shortstopping agent in the stabilization of acrylic acids, esters and monomers.
PTZ is a solid material that is supplied in both flake and powder forms. The chemical structure of the PTZ is as follows:
Figure 1.9: PTZ molecular structure (Source: http://www.cytec.com/specialtychemicals/downloads/PTZ%20AB%20general.pdf)
The chemical structure of the HMME is as follows:
Figure 1.10: HMME molecular structure (Source: http://www.chemicalland21.com/specialtychem/perchem/4METHOXYPHENOL.htm) The reaction is generally conducted in the presence of at least one polymerization inhibitor selected in a particular from PTZ and HMME. The stabilizers are used and injected at the top of distillation column purposely for stabilizing acrylic acid, ester or monomers. The experiment of the separation by settling is carried out in a separating funnel. The appearance is recorded of an emulsion at the interphase during the separation by settling.
Table 1.6 Stabilizer of acrylic acid and aqueous-phase stabilizer (Riondel et al., 2005) Stabilizer Aqueous-Phase stabilizer HMME PTZ HQ HQ HQ HQ CuSO4 Fe2(SO4)3 Mn(OAc)2 TEMPO Appearance of a emulsion on neutralization No No No No No No
HMME Hydroquinone methyl ether PTZ Phenothiazine HQ Hydroquinone
Features and Benefits Broad stabilizer activity allows the product to function as either an inhibitor, antioxidant or shortstopping agent in a range of diverse applications Outstanding thermal stability facilitates performance at temperatures of 90 C and above Acid resistant, will perform in low pH environments Operational versatility, functions in both aerobic and anaerobic environments High activity leads to functionality at low concentrations Synergizes with other stabilizer products allowing the formulation of high efficiency systems Low cost, economical product
P-101 RAW AA PUMP
P-102 MIX-101 RAW 2EH MIXER PUMP
R-101 E-101 REACTOR CRUDE MIXTURE PREHEATER
E-102 T-101 E-103 E-104 V-101 VAPOR 2-EH-AA DECANTER DISTILLATION 2-EH-AA CONDENSER COLUMN REBOILER CONDENSER
V-102 REFLUX DRUM
P-103 RECYCLE PUMP
P-104 RECYCLE PUMP
E-106 E-105 E-106 P-105 E-107 E-108 2-EHA 2-EHA 2-EHA PRODUCT PRODUCT RESIDUE CONDENSER REBOILER CONDENSER PUMP COOLER COOLER
121.6 35
S20 S15
121.6 70.21
P-104
S13
121.6 35
41.33 120
S8
41.33 30
S9
41.33 35 V-101
S10
P-103
41.33 35 PURGE 41.33 35
LEGEND
PRESSURE kPa TEMPERATURE (C) STREAM NUMBER
S4
S12
E-102 P-101 2-ETHYLHEXANOL 121.6 35 121.6 57.79 41.33 53.79 41.33 90 R-101 E-104 41.33 120 14 112.6 T-101 E-106 E-103 20 164.7 T-102 V-103 2.4 119.7 V-102
S18
TEE-101
S11
AQUEOUS
S3
S5 J-T VALVE 1
S6
S7
12 70.18
E-101
ACRYLIC ACID P-102 MIX-101

S16
HEATER /COOLER
126 119.7 116 35
S17 J-T VALVE 2
REACTOR
S24 S22 S25
E-107 P-105
S21
2-ETHYLHEXYL ACRYLATE
DECANTER
E-105 40 229.1 35
S23
E-100
HIGH BOILING RESIDUE
DISTILLATION COLUMN
DESIGN PROJECT 1
SUPERVISOR ALLIED SUPERVISOR : : MISS FARAZIEHAN BINTI SENUSI MOHD ISMAIL BIN BAHARUDIN
PRODUCTION OF 2-ETHYLHEXYL ACRYLATE
GROUP MEMBER:
SIZE
FSCM NO
DWG NO
REV
ABDUL JALIL MOHD RASHID MOHD NAIM FIRDAUS B. MOHAMAD NOR ZURINA MD ZAINUDDIN ASAEELAWATI YUSUF RAJA MASHEERA RAJA SARIMAN
2008289248 2008289228 2007287172 2008289242 2008412908
SCALE
1:1
SHEET
Figure 1.11: Process Flow Diagram for Production 2-EHA
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-34 CHAPTER 1: FEASIBILITY STUDY 1.2 MARKET ANALYSIS
Market analysis can be defined as a survey of the demand and supply of a particular product that an industry intends to produce for sale locally, regionally or globally. It is important to determine the profitability of a product in the market. Besides that, it will enable a company to determine related parties such as competitors and suppliers. Specifically, this section is all about the market and the production of 100,000 mt of 2Ethylhexyl Acrylate (2-EHA) as well as the main product whereas involving the reaction of Acrylic acid (AA) and 2-Ethylhexanol (2-EH). This process was helped by the Dodecylbenzenesulfonic acid (DBSA), Hydroquinone monomethyl ether (HMME) and Phenothiazine (PHTHZ) acting as catalyst in this process. Petrochemical growth
Chemicals are very important in industry sector. In fact, a demand for these never falls down but continuous showed increment every year. This is because chemical material is very important to our daily routine application. The chemical type such as organic and inorganic, also specialty chemical always used to make some money to country. Malaysia especially in chemical industry showed gradual growth every year through a chemical company like BASF and Titans.
The Malaysian Industrial Development Agency (MIDA) gives further incentives to develop in the country. These include R&D grants, training grants and low rents. The centre of Malaysia's petrochemical development is on the east coast of the Malaysian peninsula in Terengganu, between Kertih and the Gebeng industrial development zones near Kuantan. The new complex is right at the centre of this area of petrochemical development. Industry
The largest volume of ester produced in the market is 2-EHA because of its wide variety of applications. 2-EHA products are versatile compounds which can be used of major markets in chemical industry. Acrylic esters are used in the production of polymers and copolymers with a wide range of applications. As a plasticizing co-monomer, 2-EHA is
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-35 CHAPTER 1: FEASIBILITY STUDY used in the production of resins for pressure-sensitive adhesives, latex, paints, textile and leather finishes and coatings for paper. 2-EHA can also be used as a co-monomer in solution polymers for industrial metal finishing. The major current use of 2-EHA is in acrylic pressure-sensitive adhesives, of which it is a major component. 2-EHA is also used in ultraviolet-curable coatings without solvents, which provide a glossy, abrasionresistant finish such as on book covers and record albums. Other applications include coatings raw materials and uses in the plastics and textiles industries. In addition, 2-EHA is used as a monomer in construction-industry chemicals like floor coatings, roadmarking substances.
Table 1.7: Estimated uses of 2-EHA (% of total) Application Surface coatings Textiles Acrylic fibres Adhesive Other Japan 34 16 14 20 16 Europe 35 18 7 15 25 USA 42 23 6 5 24 (Sources: BASF report 2009)
Table 1.7 above show the estimation uses of 2-EHA in variety of application in three different place which is Japan, Europe and USA. It was obvious that application on surface coating get a high request from users in these three regions. Unlike acrylic fibres which is lowest demand of application proved thru the low product percentage.
1.2.1
Supply and Demand Of 2-EHA
Global commodity acrylate ester demand reached 2.8 million tonnes in 2005. The market is forecast to grow at rates aligned with average global growth domestic product (GDP). Continued focus on water-based coatings and dispersion systems will positively
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-36 CHAPTER 1: FEASIBILITY STUDY influences 2-EHA demand in developing economies, while substitution in many applications in developed economies has already occurred.
Table 1.8 shows a major global producer or suppliers of 2-EHA. It was identified thru the company name, location and their status either producer or supplier. BASF from Malaysia is not exception to be listed as producer of 2-EHA.
Table 1.8: Global Producer/Suppliers of 2-Ethylhexyl Acrylate Country China China China China China China China US US Germany Malaysia Company Simagchem Corporation Jinan Haohua Industry Co., Ltd Hangzhou Meite Chemical Co., Ltd Sinogreat Enterprise Ltd Yongyi Chemicals Group Co., Ltd Jiangsu Jurong Chemical CO,.Ltd Jinan Huifengda Chemical CO,.Ltd SIGMA-ALDRICH Corporation Rohm & Haas company Chemos GmbH BASF PETRONAS Chemicals Sdn Bhd Status Producer Supplier Producer Producer Producer Producer Producer Supplier Producer Supplier Producer
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-37 CHAPTER 1: FEASIBILITY STUDY 1.2.1.1 Global
Figure 1.12: World consumption of Acylate Esters in 2006 (Source: http://www.sriconsulting.com )
The following pie charts show world consumption of commodity acrylate esters. In terms of regional acrylates East Asia has already overtaken the United States and Western Europe, accounting for around 31% of global demand. By 2015, this share will rise to around 37% as the region will lead future global demand. Demand for commodity acrylates is forecast to grow at 3.7% annually during 20062011. With growing demand for acrylic acid derivatives, led by super absorbent polymers, major producers have debottlenecked and expanded plants and built new facilities at key sites throughout the world. 1.2.1.2 Malaysia
Malaysia has so far been relatively untouched by the general crisis in East Asia. The government imposed a series of exchange controls and anti-import measures, which have given the local economy some shelter from the surrounding storm. Thus, the country has retained good GDP growth, which is fast outpaced by the growth in chemicals industry investment. The Far East is widely expected to see a strong upswing
in chemicals demand as the regional economy recovers from the effects of the Asian crisis. BASF Malaysia
In 1999, BASF Petronas Chemicals Sdn Bhd is putting together a huge petrochemical complex in Kuantan, Malaysia. The complex will include a butanediol facility, an acrylic acid facility, a cracker facility and a formic acid facility. The entire project is said to cost Malaysian Ringgit 2.5 billion. The plant has achieved more than three million man hours without a lost time accident.
Table 1.9: BASF sales 2009 Percentage (%) >15 10-15 5-10 <5 10-15 Product Chemicals including AA and 2-EHA Automotive, construction and utilities Agriculture, Plastics industry and oil industry Electrical, Furniture and paper Other industries (Source: BASF Report 2009)
The table shows the percentage of sales 2009 made by BASF thru direct customers. It was obvious chemicals product such as AA and 2-EHA become a top highest sales around the world. It is not surprised because since 2004, BASF exactly is the worlds leading chemical company. While in 2005, the new verbund site in Nanjing, China begins operation. In 2009, BASFs leading a position in specialty chemicals.
Consumption (tonne/year)
350,000 300,000 250,000 200,000 150,000 100,000 50,000 0 Antwerp, Belgium Freeport, USA Ludwigshafen, Germany Kuantan, Malaysia Nanjing, China
Tonne
Sites
Figure 1.13: BASF Acrylic acid productions (Source: Chemicals-technology.com/BASF acrylic monomers 2010)
The bar chart illustrated an amount AA consumption of BASF companies around the world whereas BASF Malaysia was shared a lowest place with BASF China in produce 160,000 tonne /year of AA. The others BASF in Belgium, USA and Germany was produce amount of AA exceed 200,000 tonne /year. 1.2.1.3 Local demand for 2-EHA
As stated earlier, demand for 2-EHA always got highest request from user around the world. The application of surface coatings, textiles and so on make a chemical company find the ways to build up of 2-EHA plant for meet the demand. Malaysia also not exception to face a unusual demand of 2-EHA. A production of 2-EHA was only controlled by BASF company which is supply the product in local market. The demand
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-40 CHAPTER 1: FEASIBILITY STUDY for 2-EHA has gradual increased each year, so that the plant absolutely will help to cover up the future global demand for 2-EHA.
1.2.1.4 Forecast 2-EHA
Table shows the forecast demand for 2-EHA around the world from 2005 until 2015. America was the first in producing a large amount of 2-EHA. Thus, it obviously state 33.27% capacity will increase in these 10 years or 247,000 metric tonnes requested to produce. The total capacity on 2015 was expect increased two-fold comparing in 2005 which is 495,5000 metric tonnes production.
Table 1.10: Capacity to produce 2-EHA from 2005-2015 Region Year (1000 metric tons)
2005
2006
2007
2008
2009
2012
2015
America
220
230
20
230
230
240
240
Europe
78
80
80
80
80
80
80
Middle East
35
35
35
35
35
35
65
Southeast Asia
32
32
32
32
32
72
72
Northeast Asia
80.5
80.5
80.5
80.5
80.5
80.5
80.5
China
50
80
175
175
185
205
205
TOTAL
495.5
537.5
627.5
632.5
642.5
712.5
742.5
(Source: Technon-Orbi-Com/Acrylic acid and its ester 2009)
World Capacity of 2-EHA

800 700
Capacity (1000 mt)
600 500 400 300 200 100 0 2005 2006 2007 2008 2009 2012 2015
Year
Figure 1.14: World capacity of 2-EHA (Source: Technon-Orbi-Com/Acrylic acid and its ester 2009)
The figure 1.13 illustrated the graph with gradual increase on capacity on 495,500,000 metric tonnes in 2005 to 742,500,000 metric tonnes in 2015. The ten years period is sufficient to prove the actual increment of world capacity of 2-EHA. Based on capacity of 2-EHA, it is forecasted that the capacity 2-EHA will keep increasing until 2015.
1.2.3
AN OVERVIEW ON RAW MATERIALS
The production of 2-Ethylhexyl acrylate is dependent on raw materials such as Acrylic acid and 2-Ethylhexanol as the excess reagent and limiting reactant respectively. The reaction between AA and 2-EH in the presence of DBSA, HMME and PHTHZ as catalyst will result in the production of 2-EHA.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-42 CHAPTER 1: FEASIBILITY STUDY Table 1.11 shows 127 of companies around the world have being main suppliers of acrylic acid, 30 companies being 2-Ethylhexanol. Thus, between 2 categories said just know, it was observed Malaysia become a list to be suppliers to Acrylic.The only one company whom related to these was BASF which is situated at Kuantan, Malaysia. Therefore, it was then reveal that BASF was producing 160,000 Crude Acrylic acid tonne /year, 40,000 Glacial Acrylic acid tonne /year. It definitely ensures the BASF as main manufacturer of this Acrylic acid.
Table 1.11: Main AA, 2-EH, 2-EHA Suppliers around the World Material Country Total No. of company Acrylic acid China, India, Pakistan, Turkey, Hong Kong, UAE, Taiwan, Malaysia (5), South Korea, Egypt, Indonesia, Brazil, Belgium, France, Bangladesh, Thailand, Singapore, UK, US, Iran 2-Ethylhexanol China, Hong Kong, Cameroon, USA, Iran, Syria (Source: www.alibaba.com) 1.2.3.1 Acrylic Acid (AA) 30 127
Most of acrylic acid is used as the raw material to produce acrylic ester products including 2-Ethyl Acrylate. This field consumes about 70% of the total volume of acrylic acid. Across the world, there are several great manufactures of acrylic acid. Major producers include BASF, Rohm and Haas, Arkema, DOW Chemical, NSKK and Formosa Plastics.
1400000
Capacity (tonne/year)
1200000 1000000 800000 600000 400000 200000 0 160000
Country
Figure 1.15: Main manufacturer of AA (Source: BASF Report/ Acrylic acid production 2009)
The bar chart listed all the main country that involved on manufacturing of AA around the world. America is the highest one to become AA producer about 1313000 tonne /year while Czech the lowest producer with 55000 tonne /year. Malaysia is seven places to become as manufacturer of AA with 160,000 tonne /year was produced. The total global capacity of AA produced around the world is 4061,000 tonne /year.
Table 1.12 shows a major global producer or suppliers of AA. It was identified thru the company name, which country them situated and their status either producer or supplier. BASF from Malaysia is not spared to be listed as producer of 2-EHA. However, China was lead from other country in making this chemical.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-44 CHAPTER 1: FEASIBILITY STUDY Table 1.12: Producer/Suppliers of Acrylic Acid Country China China USA China China Germany USA Malaysia Company Simagchem Corporation Jinan Haohua Industry Co., Ltd Spectrum Chemical Mfg. Corp Hangzhou Meite Chemical Co., Ltd Kinbester Co., Ltd. Chemos GmbH WEGO Chemical & Mineral Corp. BASF Petronas Chemicals Sdn Bhd Status Producer Supplier Supplier Producer Supplier Supplier Supplier Producer (Source: www.alibaba.com)
Demand for AA
The global crude acrylic acid reached around 3.2 million tonnes by the end of 2005. World demand for crude acrylic acid is forecast to grow at 3.7% annually during 2006 2011, while demand for glacial acrylic acid is forecast to grow at about 4% annually during 20062011.
Figure 1.16: World consumption of crude AA 2006 (Source: http://www.sriconsulting.com)
The pie charts show world consumption of crude acrylic acid. In terms of geographic region, current crude acrylic acid is centered the United States and Western Europe, which account for 36% and 27% of global demand respectively. However, the future major investment in acrylic acid complexes will be made in developing economies. Given strong forecast double digit demand growth in Asia, particularly China, Asia demand for crude acrylic acid will outstrip that in developed economies, moving from only 21% of global demand in 2005 to around 38% in 2015.
Forecast of AA
Table shows forecast demand of AA around the world from 2005 to 2015. Meaning that in 10 years period, there is rise the capacity of AA for entire region whereby China is the major of producing AA. The total world capacity indicates increasing to 33.42% from 2005 to 2015 which is 1937,000 metric tonnes rise.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-46 CHAPTER 1: FEASIBILITY STUDY Table 1.13: Capacity to produce Acrylic acid from 2005-2015 Region Year (1000 metric tons)
2005
2006
2007
2008
2009
2012
2015
North America
1363
1395
1395
1395
1395
1395
1395
Europe
997
1060
1130
1220
1290
1290
1290
Middle East
75
80
80
80
80
160
240
Southeast Asia
278
295
295
295
295
615
615
Northeast Asia
821
821
941
881
921
1001
1001
China
325
660
1025
1065
1125
1255
1255
TOTAL
3859
4311
4866
4936
5106
5716
5796
(Source: Technon-Orbi-Com/Acrylic acid and its ester 2009)
World Capacity of AA
7000 6000
Capacity (1000 mt)
5000 4000 3000 2000 1000 0 2005 2006 2007 2008 2009 2012 2015
Year
Figure 1.17: World capacity of AA (Source: Technon-Orbi-Com/Acrylic acid and its ester 2009)
Figure 1.16 illustrated the graph with gradual increase on capacity on 3859,000,000 metric tonne in 2005 to 5796,000,000 metric tonne in 2015. The ten years period is sufficient to prove the actual increment of world capacity of 2-EHA. Based on capacity of 2-EHA, it is forecasted that the capacity 2-EHA will keep increasing until 2015.
1.2.3.2 2-Ethylhexanol (2-EH)
2-Ethylhexanol (2-EH), or isooctanol, is a fatty alcohol, an organic compound used in the manufacture of a variety of products. It is a branched, eight-carbon alcohol. It is a clear, colorless liquid that is nearly insoluble in water, but well soluble in most organic solvents.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-48 CHAPTER 1: FEASIBILITY STUDY 2-EH can be readily converted into esters that have a variety of uses. The main uses for 2-EH is in the production of plasticisers, coatings, adhesives and other speciality chemicals. The largest market for 2-EH has been the plasticiser di-octyl phthalate (DOP) which is used in the manufacture polyvinyl chloride (PVC) products. Demand for 2-EH
The global recession means that 2-EH is well supplied worldwide. Total production or consumption is estimated to reach a little over 2.8 million tonnes in 2009, giving average utilization rates of just above 80%, according to UK-based consultant state that Tecnon OrbiChem China is a major 2-EH importer of over 250,000 tonne /year.
Exporters include Western Europe of more than 150,000 tonne /year, Middle East of over 70,000 tonne /year and rest of Asia at around 50,000 tonne /year. Demand for 2-EH in China is predicted to grow at 7%/year from 2010-2015, with worldwide growth at over 2% /year in the same period. No growth and possibly some decline is expected in the US, Europe and northeast Asia (Japan, South Korea and Taiwan).
Source: icis.com/news 19 October 2009
Supplier for 2-EH
Table 1.14 shows a major global producer or suppliers of 2-EH. It was identified thru the company name, location and their status either producer or supplier. BASF from Malaysia is not spared to be listed as producer of 2-EH. However, China was in the top rank than other country in making this chemical and become the global supplier.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-49 CHAPTER 1: FEASIBILITY STUDY Table 1.14: Producer/Suppliers of 2-Ethylhexanol Country China US Germany Canada Netherlands India Main Company Jinan Haohua Industry Co., Ltd. Magna-Kron Corp., Klaus F. Meyer GmbH Storchem Inc., Joss Elastomers B.V., Venus Petrochemicals (Bombay) Pvt. Ltd., Status Supplier Supplier Supplier Supplier Supplier Supplier
1.2.3.3 Catalyst
Dodecylbenzenesulfonic acid (DBSA) or synonym name linear alkylbenzene sulfonate is the worlds largest-volume synthetic surfactant and is widely used in household detergents as well as in numerous industrial applications. The products referred to as DBSA include the various salts of sulfonated alkylbenzenes as well as the free acid. DBSA is generally produced in equipment that is also used to produce other sulfonated/sulfated products. Therefore, capacities far exceed demand for DBSA alone.
About 85% of DBSA is used in household detergents, including laundry powders, laundry liquids, dishwashing liquids and other household cleaners. Industrial, institutional and commercial detergents account for most of the other applications of DBSA, but it is also used as an emulsifier for agricultural herbicides and in emulsion polymerization and wetting agent.
DBSA supply/demand
Table 1.15 shows the global capacity and production of DBSA in 1994 to 1995 between five major regions. Western is the biggest DBSA capacity with 1400000 tonne /year while Canada just 63000 tonne /year. However, East region become a biggest producer
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-50 CHAPTER 1: FEASIBILITY STUDY of DBSA which is the production reach to 1140000 tonne /year and Canada also a minor producer of DBSA.
Table 1.15: Global demand of DBSA from 1994-1995 Region Capacity Western Mexican Canada US East 1400 237 63 1038 513 (1000 tonne/year) Production 433 205 33 191 1140
(Source: Chemical Economic Handbook, Feb 1996)
Producer/Suppliers for DBSA
Table 1.16 shows the Malaysia major companies which is being DBSA producer and supplier in 2009 to 2010 whereas these three companies is situated in Kuala Lumpur, Johor and Penang respectively
Table 1.16: Malaysia Producer/Supplier for DBSA from 2009-2010 Region Kg Baharu, Kuala Lumpur Ulu Tiram, Johor Bukit Mertajam, Penang Company Best Chemicals Sdn Bhd Zender Chemicals Sdn Bhd EQX Materials Sdn Bhd Status Producer Producer Supplier
(Sources: www.alibaba.com)
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-51 CHAPTER 1: FEASIBILITY STUDY 1.2.3.4 PHTHZ and HMME
PHTHZ and HMME have a same function which is a reaction inhibitor, antioxidant and short stopping agent in a variety of diverse applications. The product is principally utilized as an inhibitor and short stopping agent in the stabilization of acrylic acids, esters and monomers. In its many applications, the product is extremely active, functions at very low concentrations and will synergize with other stabilizers. Products and chemical processes that utilize PHTHZ will exhibit enhanced and improved performance.
PHTHZ and HMME Producer/Supplier
Table shows the major producer and supplier of PHTHZ and HMME in China and Asian region for this decade. Most companies usually manufacture both PHTHZ and HMME because the same type of function of this stabilizer.
Table 1.17: Asian Producer/Supplier for PHTHZ and HMME Region China China China China Company Shanghai Yancui Import & export Co.,Ltd Nanjing Yedu Trade Co.,Ld Shenyang Yishengrong Chemicals Co.,Ltd Hangzhou Garden Corporation Component PHTHZ & HMME PHTHZ & HMME PHTHZ HMME (Sources: www.alibaba.com)
1.2.4
MARKET PRICE ANALYSIS
A market analysis is a documented investigation of a market that is used to inform a firm's planning activities particularly around decision of inventory, purchase, work force expansion/contraction, facility expansion, purchases of capital equipment, promotional activities, and many other aspects of a company. The goal of a market analysis is to determine the attractiveness of a market and to understand its evolving opportunities and threats as they relate to the strengths and weaknesses of the firm.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-52 CHAPTER 1: FEASIBILITY STUDY 1.2.4.1 Price of 2-EHA
The global price of 2-EHA is RM 11.80 /kg. The prices always increase for the future. According to prices of other chemicals such as AA, 2-EHA and DBSA, it would be expected that the global trend for 2-EHA prices also undergo the same changes as well as other chemicals trade.
Sources: www.icis.com
1.2.4.2 Price of AA
Max Price of Acrylic acid from Feb-Mid may 2010

9000 8000 7987.5 8297.42 7348.5 7643.54
Price (RM)/tonne
7000 6000 5000 4000 3000 2000 1000 0 China Southern Asian Europe US 2300.4 2111.9 4984.2 5391.8
Feb Mid May
Area
Figure 1.18: Price between Feb to Mid May 2010 (Source: www.icis.com)
The bar chart above shows the maximum price of AA from February to mid May of 2010. It clearly observes the prices always showed slightly increase in all region whereas US give a highest price of RM 8297.42 /tonne in mid May and also lowest price of RM 2111.90 /tonne.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-53 CHAPTER 1: FEASIBILITY STUDY 1.2.4.3 Price of 2-EH
Max Price of 2-Ethylhexanol from Feb-Mid May 2010

7000 6000 6469.88 6070.5 5575.28 5247.18
Price (RM)/tonne
5000 4000 3000 2000 1000 0 Southern Asian Europe US 2797.36 2425.08
Feb
Mid May
Area
Figure 1.19: Price between Feb to mid May 2010 (Source: www.icis.com)
The bar chart above showed the maximum price have achieved by 2-Ethylhexanol from February until may 2010. It definitely observed the highest price occurred in Southern Asian which is RM 6469.88 /tonne followed by Europe RM 5575.28 /tonne and the lowest price in US by RM 2797.36 /tonne. However, the entire regions always give increasing value during 4 month and will be expected rising in future.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-54 CHAPTER 1: FEASIBILITY STUDY 1.2.4.4 Price of DBSA
DBSA is generally sold in bulk quantities. Prices have been dropping in the past several years, and currently in 2010, the expensive price recorded for the DBSA is RM 4939.81 /tonne in China. In contrast, the lowest average price was recorded as RM 3859.23 /tonne. As been seen, the price of DBSA is always made a changes based on global market price demand. However, for sure the forecast prices for DBSA in next five to ten years expected to get increased because of the ultimate demands for these chemicals needs to industry.
Table 1.18: The latest price of DBSA in Asian region Country China Hong Kong India Average price (RM/tonne) 4939.81 3859.23 4908.94 (Sources: www.alibaba.com) Status Producer Producer Producer
Table 1.18 shows the latest price of DBSA around Asian region in 2010 which is in China, Hong Kong and India. The prices are quite same in China and India but lowest prices are known to be used in Hong Kong that is RM 3859.23 /tonne.
1.2.4.5 Price of PHTHZ and HMME
Demand and production of antioxidants are continually shifting from the USA, Western Europe and Japan to the emerging markets of Asia particularly China and India. This is mainly because wages there are lower and environmental regulations are not as strict. In the emerging countries themselves, domestic demand for consumption products containing antioxidants is growing. While few large suppliers of antioxidants dominate the relatively saturated markets of industrialized countries, the market in Asia is still very
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-55 CHAPTER 1: FEASIBILITY STUDY much fragmented. New Asian suppliers are creating an additional pressure on established manufacturers. Despite sufficient capacities, antioxidant prices are continuing to rise. Prices for raw materials, energy, transportation, wages, intermediate goods and final products all raise the price on the market. However, price increases are somewhat limited by the shift of antioxidant production to Asia. The global market price for PHTHZ is RM 610.20 /kg and for HMME are RM 552.00 /kg.
1.2.5
BREAK EVEN ANALYSIS
1.2.5.1 Introduction
Break even analysis is a technique used to analyze income, cost and profit structures with particular references to the break even point. The break even point is the point at which the product stops costing money to produce and sell, and starts to generate a profit for company. The break even analysis requires an estimation of fixed costs, variable cost and total revenues.
1.2.5.2 Process economics and estimation
A great plant design must always present a specific plant operation with an ultimate goal of obtaining profits from its product sales. It is necessary for any plant design to achieve its goal to yield profits by evaluating different types of cost involved for the plant operation and establishment. Besides direct costs invested in the plant design such as equipment purchasing and installation fees, there are also indirect costs in which must be taken account of, for instance contractor fees and contingencies. In general, the costs involved can be split into two major categories, namely the total capital investment and the total product cost. 1.2.5.3 Total Capital investment
Total Capital investment by definition is the amount of money necessary for the investment of putting the project into operation. The total capital investment to fully
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-56 CHAPTER 1: FEASIBILITY STUDY complete the plant operation is mainly consisting of two parts, which are the fixed capital investment and working/operating (variable) capital investment. However, it also includes start-up costs as part of the total capital investment.
Total Capital Investment = Fixed Capital Investment + Working Capital + Start-up Cost Fixed Capital Investment (FCI)
Apart from focusing only on the price of the raw materials, a large sum of investment to establish a fully operational plant must be made. Fixed capital investment is simply the sum of money required to be invested at the early stage of the construction of a fully operating plant. Purchasing of necessary equipments plus the installation is crucial as it will be the core investment that will determine the compatibility of the plant as well as going to be established.
Fixed capital investment is the costs required to build the process, which is represented by the following equation:-
Fixed Capital Investment = Direct Cost (ISBL + OSBL) + Indirect Cost
Onsite costs (ISBL or inside battery limits) includes:-
a) Purchased equipment cost b) Purchased equipment installation c) Instrumentation and control d) Electrical equipment and controls
Offsite costs (OSBL or outside battery limits) includes:-
a) Buildings: Process buildings, auxiliary buildings, maintenance shops, building services. b) Yard improvements c) Service facilities: Utilities, facilities, non-process equipment and distribution and packaging
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-57 CHAPTER 1: FEASIBILITY STUDY d) Land: Survey and fees, property costs
Indirect Costs which are the expenses not directly involved with material and labor of actual installation, includes:-
a) Engineering and supervision b) Construction expenses c) Contractors fee d) Contingency
Working Capital
Working Capital is the capital required to actually operate the plant, and includes:
a) Raw material for a one-month supply b) Finished products c) Accounts receivable d) Cash on hand e) Accounts payable and taxes payable
Start-up cost
Costs allocated for starting up the plant operation are start-up costs. Some of the examples of start-up costs are process modifications, start-up labor and loss in production. The estimation of total start-up cost of the plant operation is to be 10% of the fixed capital investment.
Start-up Cost are needed to handle the glitches encountered during the beginning of the plant operation, which includes:
a) Process modifications b) Start-up labor c) Loss in production
1.2.5.4 Total Cost (TC)
Direct Production Cost is:
a) Raw materials b) Utilities c) Maintenance and repairs d) Operating supplies e) Operating labors f) Direct supervision g) Laboratory charges h) Patents and royalties
Fixed charges include:
a) Depreciation b) Local taxes c) Insurance d) Rent e) Interest
Plant overhead is general plant upkeep and overhead, payroll overhead, packaging, medical services, safety and protection, restaurants, recreation, salvage laboratories and storage facilities. 1.2.5.5 Gross-Roots Capital Cost (GRC)
Gross-roots capital cost (GRC) is the cost of equipment installation in the plant. It makes-up the major portion of the total fixed capital cost. Bare Module method is used to estimate the cost of equipments used in the plant. To calculate the GRC, contingency and fees (8% of total bare module cost, CTBM), auxiliary facilities (10% of total module cost, CTM) are added to the initial bare module cost (Ulrich, 1984).
1.2.5.6 Break Even Point
The objective of the break even analysis is to determine the quantity at which the product at a price will generate enough revenue to start earning a profit. Break even point is to estimate the volume or capacity for the company to reach the total cost equal to the total revenue and no profit was earned yet. So, it can be defined as:
Total revenue = Total cost (2.5) TR = TC
The breakeven point is determined by using relations for revenue and cost at different values of the variable, Q. The Q may be expressed in units per year, percentage of capacity, hour per month, etc. For example, at some value of variable the revenue and the total cost relations will intersect to identify the break even point. If Q > BEP, there is a predictable profit. But if Q < BEP, there is a loss. Profit is defined as: Profit = Total revenue Total cost (2.6) = TR TC
Break even point can be calculated using the equation below:
BEP = (2.7)
1.2.5.7 Calculation of Break Even Analysis
All calculations are shown in APPENDIX A. Estimation of Grass-roots capital
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-60 CHAPTER 1: FEASIBILITY STUDY Table 1.19: Equipment cost Equipment Tank Reactor Distillation column Mixer Condenser 3 R-101 T-101 T-102 MIX-101 E-102 E-107 E-108 E-101 V-101 Total Bare Module Cost, (CTMB) RM RM RM RM RM RM RM RM RM RM RM Cost 2,101,158.00 13,349,659.37 10,963,226.97 10,963,226.97 489,270.00 868,400.98 868,400.98 868,400.98 868,400.98 639,877.30 41,980,022.53
Heater Decanter
Table 1.20: Total module cost Contingency Fees Total Module Cost CC = 0.15CTBM Cf = 0.03CTBM (CC + CF + CTBM =CBM) RM RM RM 6,297,003.38 1,259,400.68 49,536,426.59
Table 1.21: Grass-roots capital Site development Auxiliary Building Offsite Facilities Auxiliary Facilities CSD = 0.05CTBM CAB = 0.04CTBM COS = 0.21CTBM (0.30CTBM ) RM RM RM RM RM 2,099,001.13 1,679,200.90 8,815,804.73 12,594,006.76 62,130,433.34
Grass-roots Capital, GRC = CBM + Auxilary Cost
Estimation of Total Capital Investment (TCI)
Table 1.22: Direct cost Event Onsite Purchased Equipment Installation Instrumentation and Control (installed) Piping (installed) Electrical and Material (installed) 30 % GRC 15 % GRC 30 % GRC 8 % GRC Offsite Building Yard Improvements Service Facilities Land Total cost 10 % GRC 1 % GRC 5 % GRC 2% GRC RM RM RM RM RM 6,213,043.33 621,304.33 3,106,521.67 1,242,608.67 62,751,737.68 RM RM RM RM 18,639,130.00 9,319,565.00 18,639,130.00 4,970,434.67 Cost
Table 1.23: Indirect cost Event Engineering and supervision Construction Expenses Contractors Fee Contingency Total cost Total = RM 77,973,693.85 5 % GRC 8 % GRC 1.5 % GRC 10 % GRC Cost RM 3,106,521.67 RM 4,970,434.67 RM 931,956.50 RM 6,213,043.33 RM 15,221,956.17
Table 1.24: Total capital investment Fixed Capital Investment (FCI) Working Capital Start Up Cost (FCI = GRC + Total) 12 % FCI 8 % FCI RM RM RM RM 140,104,127.19 16,812,495.26 11,208,330.18 168,124,952.63
Total Capital Investment (TCI)
Estimation raw material cost
Table 1.25: Raw material cost Price for raw materials AA 2-EH PHTHZ HMME DBSA Raw material usage AA 2-EH PHTHZ HMME DBSA Annual sales AA 2-EH PHTHZ HMME DBSA Annual sales for raw materials RM 307,497,514.38 RM 491,912,493.84 RM 164,137.95 RM 25,952,782.32 RM 117,298,454.40 RM 942,825,382.89 /yr /yr /yr /yr /yr /yr RM RM RM RM RM 7.2367 6.414 3.8592 610.2 552 /kg /kg /kg /kg /kg
5285 kg/hr 9539 kg/hr 5.29 kg/hr 5.29 kg/hr 26.43 kg/hr
Estimation product cost
Table 1.26: Product cost Price for product 2-EHA Raw material usage 2-EHA Annual sales for product RM 11.8 /kg 11737 kg/hr RM 1,113,512,664.00
Estimation of utilities cost
Table 1.27: Utilities cost Heat exchanger E-102 E-107 E-108 E-101 Total hot and cold utilities
RM RM RM RM RM
868,400.98 /yr 868,400.98 /yr 868,400.98 /yr 868,400.98 /yr 3,473,603.92 /yr
Estimation of operating labor NOL = number of operators required to run the process unit per shift NON = number of operators needed to provide the shifts P = number of processing steps involving the handling of particulate solids NNP = number of non-particulate processing step handling
Table 1.28: Calculation for NNP Type of Equipment Distillation Column Heater Reactor Condenser Decanter Mixer TOTAL No. of equipment 2 1 1 3 1 1 NNP 2 1 1 3 1 1 9
NOL
= [6.29 + 31.7 P2 + 0.23 NNP] 0.5 = [6.29 + 31.7 (0)2 + 0.23 (9)] 0.5 = 2.89 operators per shift = 3 operators per shift
Pay for 1 operator per month Pay for 1 operator per year, PO
= =
RM 1,500 RM 18,000 /yr
(After considering bonus and allowance)
Source: MIDA Prices
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-65 CHAPTER 1: FEASIBILITY STUDY Table 1.29: Assumptions Plant performed Plant is running Maintenance work Operation days 1 year Minimum 1 operator rest Weeks can be obtained by one operator 3 shifts/day 24 hours/day 30 days/year 335 days/year 48 weeks 2 weeks/year 46 weeks/year
Shifts needed for a plant in a year: = = 1005
1 operator can obtain shifts: = = 230
Operators needed in a plant by considering the working shift, NON: NON = = 4.37 operators
5 operators
Operating labor cost, COL: COL = = = NOL NON PO 3 5 RM 18,000 /yr RM 270,000 /y
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-66 CHAPTER 1: FEASIBILITY STUDY Estimation of total production cost
Table 1.30: Total manufacturing expenses Cost per production (RM/kg)
Manufacturing expenses Direct production cost raw materials Utilities Hot and Cold utilities Miscellaneous Maintenance & Repairs Operating Supplies Operating Labor Direct Supervision & Clerical Labor Laboratory Charges Patents and Royalties Indirect Production Cost Local Taxes Insurance Plant Overhead 1 % FCI 1% FCI 50 % of Operating labor 2 % FCI 0.5% of maintenance & repairs 0.2% of maintenance & repairs 10 % of Operating Labour 15 % of Operating Labour 0.01% FCI
Cost (RM/yr)
942,825,382.89
9.991210588
3,473,603.92
295.95
2,802,082.54 14,010.41 5,604.17 560.42 840.62 14,010.41
238.7392 1.1937 0.4775 0.0477 0.0716 1.1937
1,401,041.27 1,401,041.27 2,802.08 951,940,980.01
119.3696 119.3696 0.2387 786.645988
Total Manufacturing Expenses, AME
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-67 CHAPTER 1: FEASIBILITY STUDY Table 1.31: Total general expenses Cost per production (RM/kg) 358.1089 1193.6962 358.1089 1909.9140
Total Manufacturing Expenses, AME Administration Cost Distribution & Selling Expenses Research & Development 3 % of FCI 10% of FCI 3% of FCI
Cost (RM/yr) 4,203,123.82 14,010,412.72 4,203,123.82 22,416,660.35
Total General Expenses, AGE
Table 1.31: Rate of return Total Production Cost, APC Depreciation, ABD Total Expenses, ATE Revenue from sales Net annual profit, ANP Income taxes Net Annual Profit, ANNP Rate of Return APC = AME + AGE excluding depreciation 10 % FCI ATE = APC + ABD product total revenue - ATE 30% ANP ANP- Income Taxes (ANNP+ AD )/TCI x 100% 14,010,412.72 988,368,053.08 1,113,512,664.00 125,144,610.92 37,543,383.28 87,601,227.64 60.44% 1193.696236 84209.59812 94872 10662.40188 3198.720565 7463.681319 94872 974,357,640.36 83015.90188
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-68 CHAPTER 1: FEASIBILITY STUDY 1.2.5.8 Breakeven Point
Table 1.32: Calculation breakeven point Component FC (RM/year) VC (RM/tonne) Selling Price, SP (RM/year) 2-EHA 140,104,127.19 9462.99 118 107 11,800.00 Price, P (RM/tonne)
Break even point can be calculated as follows:
Breakeven point
: : 59,950.16 tonne /year
Table 1.33: Estimation of total revenue Capacity 0 10000 20000 30000 40000 50000 60000 70000 80000 90000 100000 FC 140,104,127.19 140,104,127.19 140,104,127.19 140,104,127.19 140,104,127.19 140,104,127.19 140,104,127.19 140,104,127.19 140,104,127.19 140,104,127.19 140,104,127.19 VC 0 94,629,898.68 189,259,797.36 283,889,696.04 378,519,594.72 473,149,493.41 567,779,392.09 662,409,290.77 757,039,189.45 851,669,088.13 946,298,986.81 TR 0 118000000 236000000 354000000 472000000 590000000 708000000 826000000 944000000 1062000000 1180000000 TC 140,104,127.19 234,734,025.87 329,363,924.55 423,993,823.23 518,623,721.92 613,253,620.60 707,883,519.28 802,513,417.96 897,143,316.64 991,773,215.32 1,086,403,114.00
Break Even Graph

1,400,000,000.00 1,200,000,000.00 1,000,000,000.00 Cost (RM) 800,000,000.00 600,000,000.00 400,000,000.00 200,000,000.00 TC TR FC
Quantity (tonne)
Figure 1.20: Breakeven graph
Figure 1.19 illustrated the graph capacity versus fixed cost, total cost and total revenue. It was obvious there have intersection between lines TR with TC. The intersection shows when the cost TR and TC get same, the breakeven point which is quantity identified as 59,950.16 tonne, There is actually the minimum production the plant should run per year in order to achieve constant profit. It also told that all capital investment early cost has been entirely recover at this point
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-70 CHAPTER 1: FEASIBILITY STUDY Calculation of Payback Period, PBP
In order to estimate the payback period of profit from the total investment of the plant, the discounted and nondiscounted cash flow needs to be calculated respectively. It is important to know when the plant minimum and maximum profit will be getting back after a few year operations.
Table 1.34: Plant assumption Years of construction Plant operation life Working capital Total capital investment, TCI Total annual sales Total expenses, ATE Bank loans 3 years 12 years RM 16,812,495.26 RM 168,124,952.63 RM 1,113,512,664 /year RM 84,209.60 /year 1st year = 10% of TCI 2nd year = 45% of TCI 3rd year = 45% of TCI
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-71 CHAPTER 1: FEASIBILITY STUDY Table 1.35: Calculation of nondiscounted cash flow
ACI = AS + (ATEADD) ANCI = AI + ADD + AA + ANNP ANCI 0 (16,812,495.26) (75,656,228.68) (75,656,228.68) 890,810,131.20 1,113,512,664.00 1,113,512,664.00 1,113,512,664.00 1,113,512,664.00 1,113,512,664.00 1,113,512,664.00 1,113,512,664.00 1,113,512,664.00 1,113,512,664.00 1,113,512,664.00 16,812,495.26 1,113,512,664.00 14,010,412.72 14,010,412.72 14,010,412.72 14,010,412.72 14,010,412.72 14,010,412.72 14,010,412.72 14,010,412.72 14,010,412.72 14,010,412.72 14,010,412.72 14,010,412.72 (974,357,640.36) (974,357,640.36) (974,357,640.36) (974,357,640.36) (974,357,640.36) (974,357,640.36) (974,357,640.36) (974,357,640.36) (974,357,640.36) (974,357,640.36) (974,357,640.36) (974,357,640.36) (83,547,509.16) 139,155,023.64 139,155,023.64 139,155,023.64 139,155,023.64 139,155,023.64 139,155,023.64 139,155,023.64 139,155,023.64 139,155,023.64 139,155,023.64 139,155,023.64 0 0 0 0 0 0 0 0 0 0 0 0 (97,557,921.88) 125,144,610.92 125,144,610.92 125,144,610.92 125,144,610.92 125,144,610.92 125,144,610.92 125,144,610.92 125,144,610.92 125,144,610.92 125,144,610.92 125,144,610.92 (29,267,376.56) 37,543,383.28 37,543,383.28 37,543,383.28 37,543,383.28 37,543,383.28 37,543,383.28 37,543,383.28 37,543,383.28 37,543,383.28 37,543,383.28 37,543,383.28 (68,290,545.32) 87,601,227.64 87,601,227.64 87,601,227.64 87,601,227.64 87,601,227.64 87,601,227.64 87,601,227.64 87,601,227.64 87,601,227.64 87,601,227.64 87,601,227.64 (16,812,495.26) (75,656,228.68) (75,656,228.68) (54,280,132.60) 101,611,640.36 101,611,640.36 101,611,640.36 101,611,640.36 101,611,640.36 101,611,640.36 101,611,640.36 101,611,640.36 101,611,640.36 101,611,640.36 118,424,135.62 (16,812,495.26) (92,468,723.95) (168,124,952.63) (222,405,085.23) (120,793,444.87) (19,181,804.51) 82,429,835.86 184,041,476.22 285,653,116.58 387,264,756.94 488,876,397.30 590,488,037.66 692,099,678.02 793,711,318.39 912,135,454.01
Year 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Al
AS
ABD
ATE-ABD
AA
ANP = ACI - ABD
AIT = 30%ANP
ANNP = ANP - AIT
Table cash flow shows all cost on plant during 15 years operation including 3 year of construction the plant. ANCI shows the plant begin to get profit on year 7 which is amount RM 82,429,835.86. This is the profit after considered all total capital investment of the plant.
Nondiscounted Cash flow profile for i=0%

1E+09 80000000 60000000 40000000 20000000 0 0 -2E+08 -4E+08 Time (Year) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
pay back period = 2
NPV
Cumulative Annual Cash Flow (RM)
Figure 1.21: Nondiscounted cumulative cash flow graphs
Figure 1.20 illustrated graph nondiscounted cumulative cash flow versus plant life of year. From the graph, new land purchased required at time equal zero. After that, construction phase start with fixed capital investment cost used to installing equipments and facilities on plant. Construction work finish at end of year 3 and the plant start at year 4 generate finish product for sales to cover up the early investment cost. At year six, the cash flow become positive value which is meant the profit begins to earn. Payback period to get the profit is 2 year after plant operation. The plant finally shut down at year 15 with equipment then sold by its salvage and working capital definitely has been recovered.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-73 CHAPTER 1: FEASIBILITY STUDY Table 1.36: Calculation of Discounted cash flow
ANCI = AI + ADD + AA + ANNP fd 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 0 (16,812,495.26) (75,656,228.68) (75,656,228.68) (54,280,132.60) 101611640.4 101611640.4 101611640.4 101611640.4 101611640.4 101611640.4 101611640.4 101611640.4 101611640.4 101611640.4 118424135.6 0.91 0.83 0.75 0.68 0.62 0.56 0.51 0.47 0.42 0.39 0.35 0.32 0.29 0.26 0.24 (15,284,086.60) (62,525,808.83) (56,841,644.39) (37,074,060.92) 63,092,834.17 57,357,121.97 52,142,838.16 47,402,580.14 43,093,254.68 39,175,686.07 35,614,260.06 32,376,600.06 29,433,272.78 26,757,520.71 28,349,796.52 fdANCI I = 0.1 ANCI 0 (15,284,086.60) (77,809,895.43) (134,651,539.82) (171,725,600.75) (108,632,766.57) (51,275,644.60) 867,193.56 48,269,773.70 91,363,028.38 130,538,714.45 166,152,974.51 198,529,574.57 227,962,847.35 254,720,368.05 283,070,164.58 0.87 0.76 0.66 0.57 0.50 0.43 0.38 0.33 0.28 0.25 0.21 0.19 0.16 0.14 0.12 (14,619,561.10) (57,206,978.21) (49,745,198.44) (31,034,841.98) 50,518,943.62 43,929,516.19 38,199,579.30 33,217,025.48 28,884,369.98 25,116,843.46 21,840,733.44 18,991,942.13 16,514,732.28 14,360,636.77 14,553,673.18 fd fdANCI I = 0.15 ANCI 0 (14,619,561.10) (71,826,539.31) (121,571,737.75) (152,606,579.74) (102,087,636.11) (58,158,119.92) (19,958,540.62) 13,258,484.86 42,142,854.84 67,259,698.30 89,100,431.74 108,092,373.87 124,607,106.15 138,967,742.92 153,521,416.10 0.83 0.69 0.58 0.48 0.40 0.33 0.28 0.23 0.19 0.16 0.13 0.11 0.09 0.08 0.06 (14,010,412.72) (52,539,047.70) (43,782,539.75) (26,176,761.48) 40,835,439.32 34,029,532.76 28,357,943.97 23,631,619.98 19,693,016.65 16,410,847.20 13,675,706.00 11,396,421.67 9,497,018.06 7,914,181.72 7,686,374.36 fd fdANCI I = 0.20 ANCI 0 (14,010,412.72) (66,549,460.42) (110,332,000.16) (136,508,761.64) (95,673,322.32) (61,643,789.56) (33,285,845.59) (9,654,225.61) 10,038,791.03 26,449,638.24 40,125,344.24 51,521,765.91 61,018,783.97 68,932,965.69 76,619,340.05
Year
Table shows discounted cash flow calculation on plant with 3 difference taxes rate which is 10%, 15% and 20% respectively. The profit earn observed also in different year 7, 8 and 9 with difference value RM 867,193.56, RM 13,258,484.86 and RM 10,038,791.03 respectively.
Discounted Cash flow profile

40000000 Cummulative annual cash flow (RM) 30000000 20000000 10000000 0 1 -1E+08 -2E+08 Time (year) 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
I = 0.1 I = 0.15 I = 0.2
Figure 1.22: Discounted cumulative cash flow graphs
Figure 1.21 illustrated graph Discounted cash flow versus plant operation life. It obviously shows three type of graph which is considered taxes rates 10%, 15% and 20%. This showed the minimum profit that plant could earn. The highest rate will influence the decrease of profit and value at end project. The profit also shows less than nondiscounted graph with pay back period is slow to achieve.
1.2.6
Conclusion
The overall market analysis can be summarizing as below:
Table 1.37: Overall plant values Selling price for 2-EHA Total capital investment Total cost Annual sales 2-EHA Maximum profit (Nondiscounted) Minimum profit (Discounted) Rate of return profit RM 11,800 /tonne RM 168,124,952.63 RM 234,734,025.87 RM 1,113,512,664 /year RM 82, 429,835.86 at year 7 RM 10,038,791.03 at year 9 60.44%
Therefore, RM 200 million given budget to build up the plant has lots of saving and the plant absolutely should be operating well. The 2-EHA plant is worthy to be constructing based on profit before and after the taxes and its year of payback period. In conclusion, it is wise to consider all aspect in order to have a good view of economic analysis even it is using estimation value.
1.3
SITE LOCATION
The site location and plant layout is an important factor that must be considered before starting up a plant. This is because a suitable site must be found for a new project, and the site and equipment layout planned in order to determine the successful of a business. Provision must be made for the ancillary buildings and services needed for plant operation; and for the environmentally acceptable disposal of effluent. Besides, the strategic location also affect the performance of production and economic of plant. For example, location which is near with the raw material will reduce the cost for transportation. 1.3.1 SELECTION CRITERIA The location of the plant can have a crucial effect on the profitability of a project, and the scope for future expansion. A good location is required to optimize the production of the plant. According to Coulson & Richardsons (2000), many factors must be considered when selecting a suitable site, below is the factors that must be consider:
a) Location, with respect to the marketing area. b) Raw material supply. c) Transport facility. d) Availability of labor. e) Availability of utilities: water, fuel, power. f) Availability of suitable land.
g) Environmental impact and effluent disposal. h) Local community considerations. i) j) Climate. Political and strategic considerations.
1.3.1.1 Marketing area The plant should be located close to the primary market if the cost of transport a significant fraction of the sales price. In an international market, there may be an advantage to be gained by locating the plant within an area with preferential tariff
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-77 CHAPTER 1: FEASIBILITY STUDY agreements. In addition, Malaysia's market-oriented economy, supportive government policies and a large local business
community that is ready to do business with international corporations have made Malaysia a highly competitive manufacturing and export base. 1.3.1.2 Raw Materials The availability and price of suitable raw materials will often determine the site location. Beside that, the quality of raw material must be maintained to produce a good product. Therefore, best plant located is close to the source of the major raw material; where this is also close to the marketing area. So the transportation cost can reduce. 1.3.1.3 Transportation The transport of materials and products to and from the plant will be an overriding consideration in site selection. If practicable, a site should be selected that is close to at least two major forms of transport: road, railway station and sea port. Road transport is being increasingly used, and is suitable for long distance transport of bulk chemicals. Air transport is convenient and efficient for the movement personnel and essential equipment and supplies, and the proximity of the site to a major air port should be considered. For example, Peninsular Malaysia's network of well-maintained highways is a boon to industries. These highways link major growth centers to seaports and airports throughout the peninsular and provide an efficient means of transportation for goods. So, the site selected should have a good transportation lines to smoothen the production. 1.3.1.4 Availability of labor There are many job categories that have offer in a plant such as labor will be needed for construction of the plant and its operation. Skilled construction workers will usually be brought in from outside the site area, but there should be an adequate pool of unskilled labor availability locally, and labor suitable for training to operate the plant. Skilled tradesmen will be needed for plant maintenance. Local trade union customs and restrictive practices will have to be considered when assessing the availability and
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-78 CHAPTER 1: FEASIBILITY STUDY suitability of the local labor for recruitment and training. To fulfill all these demands, Malaysia has produced many quality workforces, educated and productive in all sectors.
1.3.1.5 Utilities Power and steam requirements are high in most of the chemical plants, and fuel is required to supply these utilities .Power and fuel can be combined as one major factor in the choice of a plant site. Chemical processes invariably require large quantities of water for cooling and general process use, and the plant must be located near a source of water of suitable quality. Process water may be drawn from a river, from wells, or purchased from a local authority. At some sites, the cooling water required can be taken from a river or lake, or from the sea; at other locations cooling towers will be needed. Electrical power will be needed at all sites to run operations unit and generate heat. The major supplier of electricity in Malaysia is the Tenaga National Bhd and its tariff is uniform for all states. The telecommunications is also needed to market the product. These all facilities are continuously being developed by state government as well as private developers to meet demand.
1.3.1.6 Environmental impact and effluent disposal Before selecting a plant site, the regional history of natural events of this type should be examined and the consequences of such occurrences considered for safety. Protection from losses by fire is another important factor for selecting a plant location. In case of a major fire, assistance from the fire departments should be available. Fire hazards in the surrounding area of plant site must not be overlooked. In addition, industrial processes will produce waste products, and full consideration must be given to the difficulties and cost of disposal. The disposal of toxic and harmful effluents will be covered by local regulations, and the appropriate authorities must be consulted during the initial site survey to determine the standards that must be met. An environmental impact assessment should be made for each new project.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-79 CHAPTER 1: FEASIBILITY STUDY 1.3.1.7 Local community considerations The proposed plant must be fit in with and be acceptable to the local community because the nature and facilities of community can have effect on the location of the plant. Full consideration must be given to the safe location of the plant so that it does not impose a significant additional risk to the community. On a new site, the local community must be able to provide adequate facilities for the plant personnel: schools, banks, housing, and recreational and cultural facilities.
1.3.1.8 Land Sufficient suitable land must be available for the proposed plant and for future expansion. The land should ideally be flat, well drained and have suitable load-bearing characteristics. A full site evaluation would be made to determine the need for piling or other special foundations. The important price of land is to reduce the cost and must be suitable with the return of plant later on. Site location should provide storage and handling infrastructures. The prices also vary according to the facilities available in the location.
1.3.1.9 Climate A suitable is really necessary for the plant to operate with smooth condition. Some natural obstacles such as flood, thunderstorm and others may cause bad effect to the plant. Winds are generally light according to (Ministry of Science, Technology and Innovation (MOSTI)). This climate is more suitable for chemical plant. Some characteristics of peninsular Malaysia climate have been identified, which are very suitable for the operation of the plant:
i.
Wind Generally light wind. The predominant wind direction is from North from November to March. From May to September, the predominant wind is from the South. During inter monsoon month of April to October, the wind direction is variable with speeds below 8 m/sec. On the average wind is calm about 40% of the time.
ii.
Rainfall Annual rainfall is about 2500mm. Most rainfall falls on March and September. For the east coast of Peninsular Malaysia, rain falls heavily during the monsoon season, which is from the end of September to early January.
iii.
Temperature Daily temperature is from 25oC to 31oC. The maximum mean temperature is about 32oC, while the minimum temperature is about 21oC.
iv.
Relative Humidity The level of humidity is high at night and early morning. This relative value drops to minimum around midday.
1.3.1.10Political and strategic considerations Political stability is an important consideration in selecting plant. Capital grants, tax concessions, and other inducements are often given by governments to direct new investment to preferred locations; such as areas of high unemployment. The overriding of such grants can be the overriding considerations in site selection. Malaysia has experienced a long period of political and economic stability. These criteria make those country great attractions to foreign investors. Government policies that maintain a business environment with opportunities for growth and profits have made Malaysia an attractive manufacturing and export base in the region. In addition, a well-developed financial and banking sector has enhanced Malaysia's position as a dynamic export base in Asia. Sophisticated financial facilities are available through domestic and foreign commercial banks and their nationwide network of branches. There are also representative offices of several foreign banks that wish to establish a presence in the region. The market in Malaysia is extremely busy at the moment: during 2004 it was estimated that the approved projects in the chemical and petrochemical sectors alone would result in career opportunities for around 3,500 extra people; and this trend has continued throughout 2005 and into 2006 (Nes Global).
1.3.2 SITE LOCATION SUGGESTED Production of 2-Ethylhexyl Acrylate is classified as a petrochemical project. The plant must therefore be sited in a special zone provided by the government. The important criterion to setup plant is a location of plant. Beside that, the plant must in a strategic location that near with facilities, utilities, labor and transportation. The locations in Malaysia that have potential are: Teluk Kalong Industrial Estate, Kemaman, Terengganu Tanjung Langsat, Johor Pulau Indah, Port Klang 1.3.2.1 Detail on Suggested Location
Tanjung Langsat a) Raw material The raw materials for 2-Ethylhexyl Acrylate have to be import from overseas and malaysia. This is because there are no suppliers in Johor. Tanjung Langsat is located in the heart of South East Asia that has an easy access to the rest of the world due to its closeness to the international shipping lane and its connectivity with other modes of transport.
b) Price of land According to Malaysian Development Authority (MIDA), there is 404.685 hectares land available in Tanjung Langsat with price of land about RM14 20 per m2.
c) Labor Have a lot of job opportunity that can attract many people to come because there are many facilities were provided for workers. Besides that, Tanjung Langsat is near with Indonesia where the country of workman. The training institute such as UTM Skudai, UiTM, Politeknik and institute Latihan Perindustrian can provide trainer or skilled labor for our plant.
d) Utilities In Tanjung Langsat, the electricity will be supply by the Tenaga Nasional Berhad and there are different tariff that depends on class it categorized. For water, it will be supply by Jabatan Bekalan Air Johor with rate 0-20m3 RM2.22 for industrial.
e) Transportation Designation of Senai Airport as air cargo hub provides the Port with sea-air link for high value and perishable products. In addition, this location also near to Pasir Gudang Port (8 km), Tanjung Pelepas Port and Tanjung Langsat port. Beside that, Tanjung Langsat
Port (TLP) is the third port in Johor, Malaysia and is an important terminal in Southeast Asia; it handles bulk cargo such as liquefied petroleum gas (LPG) and hazardous chemicals. TLP is located 12 nautical miles (22 km) from international ship routes, 5 km from the Johor Port and 30 km from Johor Bahru. We can use North-South Highway from Bukit Kayu Hitam to Singapore as a main road. In addition, Johor also has the railway station which is links to west and east coast region.
f)
Political and strategic consideration From the political view, with the strategic location, it can attract many investor from outside together make some investment. So it will increase the economic of Johor.
g) Facilities & Infrastructure Peninsular Gas Utilisation (PGU) project A co-generation plant Tank farms are being developed for bulk storage of petrochemical liquid A 12km pipeline corridor, which facilitates feedstock, links the Pasir Gudang and Tanjung Langsat sites and data transfers. Johor Port (Pasir Gudang Port)
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-83 CHAPTER 1: FEASIBILITY STUDY With a 1,000-metre berth and a hazardous cargo jetty Three hazardous liquid bulk terminals to handle LPG, chemicals and petrochemicals Tanjong Pelepas Port, a world-class container port Tanjung Langsat Port Located adjacent to the 4,000 acres of industrial land in Tanjung Langsat. Equipped with a twin-berth jetty consisting of outer (30,000 DWT) and inner (7,000 DWT) berths
Figure 1.23: Location of Tanjung Langsat, Johor (Source: www.wikimapia.com) This is a map for available land in Tanjung Langsat, Johor. with Steel Bharu Sdn. Bhd( is for available land, it near
) that is the second largest in Asia. Beside that, the ) and Langsat Terminal One ( ).
location also near with Titan Tanjung Langsat (
Telok Kalong a) Raw Material Telok Kalong is near to Gebeng, which can supply raw material (acrylic acid) to our company. Therefore, the cost transportation can reduce.
b) Price of land The land price is about 1.8 44.99 per m2 and the available land is 125.10 hectares. Terengganus industrial land is among the cheapest in Malaysia, compared to other states.
c) Labor The centre of Malaysia's petrochemical development is on the east coast of the Malaysian peninsular in Terengganu and Pahang. Terengganu boasts a highly competitive and reasonable wage structure that compares favourably to highercost locations within Malaysia and Asia. Malaysia is also well-known for its commitment to labour welfare and corporate social responsibility. Therefore the young citizens in Pahang, Kelatan and Terengganu will focus to fill the vacancies in our plant.
d) Utilities Water falls under the jurisdiction of the state, and is treated and distributed by the Terengganu Water Company (SATU) with tariff 70m3 RM1.15 for industrial. At the moment, potable water is supplied for both industrial and domestic use. The electricity will be supply by the Tenaga Nasional Berhad.
e) Transportation Transportation facilities around Telok Kalong Industrial area are well developed to cater the import export activities. As an industrial estate in Terengganu, therefore the transportation facilities have been providing such as Kuala Terengganu Airport, Kemaman Airport and Kerteh Airport. The location is also
near to the Kemaman Port, Kerteh Minor Port, and Kuantan Port. Besides, Karak Highway and East-West Highway connected the Telok Kalong with other place.
The major consideration to select the best site location is port facilities. This is because water transportation is important to export our product and importing the raw materials. Kemaman Port is vision as Malaysias future deepwater port and gateway to Asia Pacific. It is an all weather port facing South China Sea. For authorization aspect, the Terengganu state government provides incentives to encourage and attract investors.
f)
Political and strategic consideration Terengganu as an ideal base for investors wanting to keep a ceiling on their costs while operating in the dynamic regional economy of Asia.
g) Facilities & Infrastructure Gas processing plants Peninsular Gas Utilization (PGU) project Centralised utility facilities Supply of utilities such as power, industrial gases, demineralised water and steam Training centre TATI or Terengganu Advanced Technical Institute TSTC or Terengganu Safety Training Centre TPTTC or Terengganu Plastic Technology Training Centre University Technology MARA Petronas Training Institute University Putra Malaysia Pusat Latihan Sirim
Kertih Port Centralised tankage facilities Mainly bulk liquid port
Kuantan Port
Centralised tankage facilities Container and bulk liquid port Railway linking Kertih, Gebeng and Kuantan Port
Figure 1.24: Location of Teluk Kalong, Terengganu (Source: www.wikimapia.com) Figure 1.23 is a map of location in Teluk Kalong, Terengganu. is a location for our ). Beside that, it
plant (available land) and it is near with Konsortium Kemaman Port ( also near with others Chemical Plant and others industries (
) such as Nitrate Acid
Plant, Kemaman Bitumen Company Sdn. Bhd (KBC) and Malay-sino Chemical Industries Sdn. Bhd. From this figure, it also shows the location is near with Terengganu Safety Training Centre ( ).
Pulau Indah, Port Klang
a) Raw Material There are factors that can be compared among all the locations selected. It is decided that the source of raw materials play the most important role in selecting the most suitable location for our plant. This is because the supplement of raw materials will also have a great impact on cost of transportation. Since our raw material will be imported from overseas that is from China so we need to setup a plant that near to the port or airport and also have good road facilities to supply the product. As known, North Port and West Port are two international airports. Our raw material will be imported using ship and usually uploads the product that the ship carried at international airport.
b) Price of land Land price in Port Klang Free Zone is cheap and reasonable compared the others state. It is only about RM 25.00 to RM 45.99 per m2.
c) Labor The capacity of resident in Port Klang is high. This is because, this town was become the centered of the job vacancies in Klang and Shah Alam. Besides, student from University or college can do their internship in our plant.
d) Utilities Water is distributed by the SYABAS with tariff 0-35m3 RM2.07 for industrial and the electricity will be supply by the Tenaga Nasional Berhad.
e) Transportation Selangor has all the modes of transportation such as land, water and air. Through land, there are roads connecting major towns in Selangor and other states. Through water and air, there are seaports and airport. Beside, PKFZ's (Port Klang Free Zone) strategic location in Port Klang, excellent connectivity,
state-of-the-art facilities, efficient services and attractive incentives all make perfect business sense. For air transportation, Port Klang Free Zone area is served by 2 major airports, both located in Selangor. The 2 airports are Subang Airport and Kuala Lumpur International Airport. Besides, Selangor also served by 2 trunk roads run parallel to coastline traverse from north to south PLUS highway.
f)
Political and strategic consideration This site located off the coast of Selangor at Westport, the biggest port in the region and a bustling zone of business opportunities for investors. Covering a sprawling 2,154.64 hectares (5,324.11 acre), this environment friendly park is more than an industrial development. It is also a residential development featuring a resort lifestyle and enhanced commercial and institutional centre that brings potential customers practically to our plant. In addition, Malaysia's premier portside development offers investors all the essential components to success in international markets.
g) Facilities & Infrastructure Training centre University Technology MARA Politeknik Shah Alam UNISEL
West Port Centralised tankage facilities Westports' large docking facility wM bring transport costs down as it can accept vessels of higher tonnage Can berth vessels up to 14,000 TEUs (20 foot equivalent units). In addition to its sound infrastructure, state of the art information technology (IT) and comprehensive sea connectivity, Westports has extensive road and rail linkages from Pulau Indah that extends to all parts of Peninsular Malaysia
North Port Centralised tankage facilities
Container and bulk liquid port
Figure 1.25: Location of Pulau Indah, Port Klang (Source: www.wikimapia.com) Figure 3.3 show the available land in Pulau Indah, Port Klang. The location ( ) is in Westports Malaysia and near with Northports ( ).
1.3.2.2 The summarized of the comparison of suggested locations From factors that we consider to choose the location for our plant, the land prices in Teluk Kalong, Terengganu is cheaper than other locations that is RM4.95 per m2. Beside that, the area available for each location are sufficient for our plant and near with ports (important transport). The plant should be placed in an area where sufficient labor supply is available and each location have it. This is because the training institute is near and the student can do their internship or work in our plant after graduated such as in Teluk Kalong which is near with Terengganu Safety Training centre (TSTC) about 3.6 km.
From the maps, it show that each site location are strategic because near with others industries and chemical plant. Therefore the locations are already develop and it
give advantages for our plant because easy to attract investor and have special incentives that offered by state government such as investment tax allowance of 60% of qualifying capital
expenditure. The each area locations are secluded and separated from most residential area so the safety of resident is assured and give low impact on the environment.
The important in site location is cost. Therefore the plant shall be build up near with raw material. The raw material for our plant will buying at BASF, Gebeng or imported from China. So the distance with raw material can reduce the cost transportation. From this factor, it shows that Teluk Kalong, Terengganu is near with raw material than other locations.
Table 1.38: Comparison of Suggested Location for 2-EHA Plant Factors Tanjung Langsat, Johor Distance from town Area available Land prices (RM/m2) Developer JCORP (Johor Corporation) SSIC Berhad (Selangor State Investment Centre) PMINT (Perbadanan Memajukan Iktisad Negeri Terengganu) Residential area Pasir Gudang Kempas Meru, Klang Shah Alam Kertih Paka Kemaman Electricity supply Tenaga Nasional Berhad Tenaga Nasional Berhad Tenaga Nasional Berhad 14 - 20 25.00 44.99 4.95 - 44.99 42 km from Johor town 404.685 hec Pulau Indah, Port Klang 10 km from Shah Alam 1000 hec Telok Kalong, Kemaman 9.6 km from Kemaman town 125.10 hec
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-91 CHAPTER 1: FEASIBILITY STUDY Electricity tariffs Peninsular Malaysia Rates Unit
(RM) Tariff D Low Voltage For overall monthly consumption between 0-200 kWh per month For all kW sen/kwh 32.50 The minimum monthly charge is RM7.20
For overall monthly consumption more than 200 kWh per month: For all kWh sen/kwh 34.80 The minimum monthly charge is RM7.20 Tariff E1 Medium Voltage General For each kilowatt of maximum demand per month RM/kw 23.40 For all kW sen/kwh 26.60 The minimum monthly charge is RM600.00 Tariff E2 Medium Voltage Peak/Off-Peak For each kilowatt of maximum demand per month during peak period RM/kw 29.30 For all kWh during peak period sen/kwh 28.10
For all kWh during off-peak period
sen/kwh 17.30
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-92 CHAPTER 1: FEASIBILITY STUDY The minimum monthly charge is RM600.00 Tariff E3 High Voltage Peak/Off-Peak For each kilowatt of maximum demand per month during peak period RM/kW 29.60 For all kWh during peak period sen/kWh 26.60 For all kWh during off-peak period sen/kWh 16.00 The minimum monthly charge is RM600.00
Water supply Water Tariffs
Jabatan Bekalan Air SYABAS Johor (JBA) Industrial/Commercial 0-20m - RM2.22 More than 20 m RM2.96 Industrial/Commercial 0 - 35 m - RM2.07 More than 35 m RM2.28
Terengganu Water Company (SATU) Industrial RM 1.15 Subject to RM50.00 minimum charge
Minimum charge-RM Minimum charge 18.48 RM36.00 Commercial First 70 m3 - RM 0.95 More than 70 m3 RM 1.15 Minimum RM15.00 charge -
Airport
Changi Airport, Senai
Subang Airport
Kuala Terengganu
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-93 CHAPTER 1: FEASIBILITY STUDY Airport Airport Kerteh Airport Kemaman Airport Port Johor Port/Pasir Gudang Port Tanjung Pelepas Port Tanjung Langsat Port Road facilities North-South Highway from Bukit Kayu Hitam to Singapore Type of industries Training institute Petrochemical Chemical University Technology Malaysia, Skudai University Technologi MARA Politeknik Pasir Gudang Institute Latihan Perindustrian (Pasir Gudang) Kolej University Tun Hussein Onn Petrochemical Chemical University Technology MARA Politeknik Shah Alam UNISEL Petrochemical Chemical University Technology MARA Petronas Training Institute University Putra Malaysia Terengganu Safety Training Centre (TSTC) Terengganu Plastic Technology Training Centre (TPTTC) Pusat Latihan Sirim PLUS Highway Karak Highway East-West Highway North Port West Port Kemaman Port Kuantan Port
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-94 CHAPTER 1: FEASIBILITY STUDY Table 1.39: Raw Material Supplier for Each Location Raw material supplier Acrylic Acid Tanjung Langsat, Johor BASF Petronas Chemicals Sdn Bhd, Malaysia Qingdao OnBillion Industrial Co., Ltd. China Tianjin Xinyuantehui Chemical Co., Ltd., China Pulau Indah, Port Klang BASF Petronas Chemicals Sdn Bhd, Malaysia Qingdao OnBillion Industrial Co., Ltd. China Tianjin Xinyuantehui Chemical Co., Ltd., China Teluk Kalong, Terengganu BASF Petronas Chemicals Sdn Bhd, Malaysia Qingdao OnBillion Industrial Co., Ltd. China Tianjin Xinyuantehui Chemical Co., Ltd., China
2-Ethylhexanol
Haihang Industry Co., Ltd., China Trust & We Co., Ltd, China
Table 1.40: Packages of Incentives Offered by State Governments Tanjung Langsat, Johor Pulau Indah, Port Klang The principal incentives in the manufacturing sector are contained in the Promotion of Investment Act, 1986 and the Income Tax Act, 1967 General Incentives: Pioneer Status - A company granted Pioneer Status enjoys 5-year partial exemption from the payment of income tax. It will pay tax on 30% of its statutory income, with the Teluk Kalong, Terengganu Special Land Premium -Land premium of RM5.00 per meter squares to eligible projects -For medium & high technology industries -For first 2 hectares only Discounts on Land
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-95 CHAPTER 1: FEASIBILITY STUDY Pioneer Status -Investment Tax Allowance (ITA) -Reinvestment Allowance (RA) Incentives For Export Export Credit Refinancing (ECR) Scheme -Abatement Incentives For Exports -Double Deduction Of Export Credit Insurance Premiums. -Industrial Buildings Allowance (IBA) Incentives For Research And development Incentives For Training Tariff Protection -The incentives are designed to grant relief from taxes in various forms Exception from Import duty on Direct raw materials/ Components -Manufacture of goods for export and the domestic market exemption period commencing from its Production Day (defined as the day its production level reaches 30% of its capacity). Investment Tax Allowance (ITA) - As an alternative to Pioneer Status, a company may apply for Investment Tax Allowance (ITA). - A company granted ITA gets an allowance of 60% of qualifying capital expenditure (such as factory, plant, machinery or other equipment used for the approved project) incurred within 5 years from the date on which the first qualifying capital expenditure is incurred. - Companies can offset this allowance against 70% of their statutory income for each year of assessment. - Any unutilised Premium -Discounts from 10%25% according to districts -More than 50 workers in first year intake Differed Payment for Land Premium -Allowed for 1 year after 20% down payment of deposit. Negotiable for periods more than a year Pioneer Status -Tax exemption limit is increased from 70%80% of statutory income for 5 years Investment Tax Allowance -ITA is increased from 60%-80% of qualifying capital expenditure Import Duty Exception on Raw Materials -Full import duty exception is given on raw material, components and parts not available locally used in manufacture of finished products for domestic market
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-96 CHAPTER 1: FEASIBILITY STUDY allowance can be carried forward to subsequent years until fully utilised. The remaining 30% of statutory income will be taxed at the prevailing company tax rate.
Table 1.41: Port facilities Kemaman Port Dedicated Liquid Bulking Terminal under construction: - Length of 240 meters at depth of 14 meters. - Ship capacity up to 40,000 DW. - Handling capacity 15,000 tons per day. - Pipe side 8"-12" (50 in number). Viewed as Malaysia's future Deepwater Port and Gateway to Asia Pacific. It is an all weather port facing South China Sea. The draft at East Wharf is initially 13 meters draft. - Upgraded to 17 meters in October 1996. Currently handles dry general and liquid cargo on average two to three million tons/year. Current capacity estimated at 6.84 million tons/year (Tango crane). Consists of three sections: - East wharf (684 m). - Supply Base (650 m). - Petroleum Export Terminal.
Pasir Gudang Port Haulers: - Kontena Nasional Sdn.Bhd.
PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-97 CHAPTER 1: FEASIBILITY STUDY - MISC Haulage Sdn.Bhd. - Shapadu Kontena Berhad. - Multimodal Freight Transportation Sdn.Bhd. - Konsortium Perkapalan Berhad. Managed by Johor Port Sdn.Bhd.. The port has direct access to the main shipping routes of the world. Facilities: Six berths with maximum depth of 13 meters to cater for containers, general and dry Bulk cargoes. A special jetty for handling liquid cargo mainly vegetable oil and hazardous cargo jetty for handling fuel oil and chemicals. Transports: - Johor Port Transport Sdn. Bhd. - Southport Port Services Sdn.Bhd. - Usaha Enterprise (Edar) Sdn.Bhd. - Maha Miro Enterprise Trading Sdn. Bhd. All transport operators provides transport services for the shippers in the free zone, which covers 1,000 acres.
West Port As such, investors interested in setting up their base at PKFZ will enjoy 100 per cent foreign equity with free zone tax benefits and unrestricted reparations of profits and capital. PKFZ will also serve as a one stop centre to help start up operations and interface with government agencies. Terminal -Infrastructure & Equipment Berth length -11 berths (16 meter depth) 3200 meters Terminal capacity - 280 acres out of total built up area of 1350 acres 7.2 million TEU capacity per year
1.3.2.3 The weightage study
1 Poor
2 Low
3 Average
4 High
5 Excellent
Table 1.42: Comparison of location in term of weightage study Factor Weightage Tanjung Langsat Distance from town Area available Land price Raw material supplier (distance) Residential area Electrical supply Water supply Airport Port Road facilities Training institute Climate Political view Total 5 5 5 5 5 5 5 5 5 5 65 3 3 4 3 3 5 4 4 4 5 47 4 3 4 4 3 5 3 3 4 5 50 5 4 4 5 4 4 4 5 4 5 57 5 5 5 2 4 3 4 5 3 5 4 4 Pulau Indah Teluk Kalong
1.3.3 SITE LOCATION SELECTED From the overall comparisons and weightage study between the 3 potential sites for the proposed plant project, we have decided to choose Teluk Kalongt in Terengganu as the site for our plant. The price of land in Teluk Kalong is cheap and reasonable price with many lands available for future expansion. This industrial park which has ready-built industrial land and factories can allocate medium and heavy industries, chemical and petrochemical industries. The area is secluded and separated from most residential area. It is also close to primary market and raw material source. Therefore the supplement of raw materials will also have a great impact on cost of transportation. The more attractive incentives offered by the Johor State Government. These include:
Low land premium Pioneer status Investment Tax Allowance (80% of expenditure) Partial exemption of income tax (15% income) 5 years tax exemption Infrastructure allowance Import duty exemption Export, R&D and manpower training
Beside that, transportation facilities around Telok Kalong Industrial area are well developed to cater the import export activities. The nearest seaport to Telok Kalong Industrial area is Kemaman Port. This port is vision as Malaysias future deepwater port and gateway to Asia Pacific. It is an all weather port facing South China Sea. Furthermore, literacy level among the work force is high and can be easily trained. Training, half skill and full skill institutions set up for the purpose of accommodating manpower for industries are available in Terengganu. These institutions are includes;
1. University Technology MARA 2. University College of Terengganu 3. Terengganu Advanced Technical Institute ( TATI ) 4. Terengganu Safety Training Center ( TSTC )
5. Terengganu Plastic Technology Training Center 6. Petronas Training Institute 7. Industrial Training Institute
The labor costs or salary around Telok Kalong Industrial area and the surroundings are quite reasonable and cheap due to the cost of living in Terengganu which is quite low compared to other states in Malaysia.
Product storage
Raw material storage
Raw material storage
Water Tank
Fire Station
Exit
M O T O R C Y C L E P A R K
Smoking area
Car Park Workers And visitors
Sport Center
Office 610 sq. ft.
Security Post
Future Expansion
Plant Area Maintenance Building
Main entrance/ Exit Security Post Assembly Point
R&D Control Room Safety Office Changing Room Administration and HR Building
Entrance Waste Water Treatment
Car Park High level management clinic
Cooling Tower
Fuel Storage
Boiler House
Compressor House
Canteen Smoking area
Designed meeting locations, Figure 1.26: Plant Layout
Emergency escape routes)

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PRODUCTION OF 100,000 TONNE PER ANNUM OF 2-ETHYLHEXYL ACRYLATE 1-1 CHAPTER 1: FEASIBILITY STUDY

k[C2H3COOH][ C8H17OH] = k[C11H20O2][H2O] and

[C11 H 20 O2 ][ H 2 0] [C 2 H 3 COOH ][C8 H 17 OH ]

The reaction mechanism for this reaction has several steps:

Figure 1.3: Reaction Mechanism (Source: http://en.wikipedia.org/wiki/Fischer%E2%80%93Speier_esterification)

First side reaction is reaction between diacrylic acid with 2-ethylhexanol

1.1.2.1 Batchwise Esterification

To reaction Heavy products

Hydrolysis reactor Waste aqueous liquours

1.1.2.2 Continuous Esterification

2-ethyl hexanol separator 2-ethylhexyl acrylate Distillation column

steam condensate Acrylic acid High residue boiling point

Azeotrope distillation column

1.1.2.3 Cascade Esterification

WATER III PRODUCT I

1st Distillation column

1.1.2.4 Equilibrium Limited Reaction

Distillation column Inhibitor Distillation column

Acrylic acid DBSA

Heavies and catalyst

Reactive distillation column

First distillation column

Second distillation column

PROCESS SELECTION AND METHODS COMPARISON

Complicated reaction and have intermediate by addition NaOH

Simple reaction, directly produce ester Residence times is 2 to

Simple reaction, directly produce ester Residence times is 2 to

Simple reaction, directly produce ester Residence times is

RAW MATERIAL SELECTION

), sulfonic acids are

considered strong acids (with dissociation constants of about 10

Figure 1.8: Molecular structure of DBSA

Figure 1.9: PTZ molecular structure (Source: http://www.cytec.com/specialtychemicals/downloads/PTZ%20AB%20general.pdf)

The chemical structure of the HMME is as follows:

HMME Hydroquinone methyl ether PTZ Phenothiazine HQ Hydroquinone

P-101 RAW AA PUMP

P-102 MIX-101 RAW 2EH MIXER PUMP

R-101 E-101 REACTOR CRUDE MIXTURE PREHEATER

V-102 REFLUX DRUM

P-103 RECYCLE PUMP

P-104 RECYCLE PUMP

41.33 35 PURGE 41.33 35

ACRYLIC ACID P-102 MIX-101

S17 J-T VALVE 2

HIGH BOILING RESIDUE

PRODUCTION OF 2-ETHYLHEXYL ACRYLATE

2008289248 2008289228 2007287172 2008289242 2008412908

Figure 1.11: Process Flow Diagram for Production 2-EHA

Supply and Demand Of 2-EHA

Figure 1.12: World consumption of Acylate Esters in 2006 (Source: http://www.sriconsulting.com )

1.2.1.4 Forecast 2-EHA

(Source: Technon-Orbi-Com/Acrylic acid and its ester 2009)

World Capacity of 2-EHA

Capacity (1000 mt)

AN OVERVIEW ON RAW MATERIALS

1200000 1000000 800000 600000 400000 200000 0 160000

Figure 1.16: World consumption of crude AA 2006 (Source: http://www.sriconsulting.com)

(Source: Technon-Orbi-Com/Acrylic acid and its ester 2009)

Capacity (1000 mt)

1.2.3.2 2-Ethylhexanol (2-EH)

Source: icis.com/news 19 October 2009

Supplier for 2-EH

(Source: Chemical Economic Handbook, Feb 1996)

Producer/Suppliers for DBSA