Avdo Niksic Nick Managing Director Asia Pacific & India - PowerPoint PPT Presentation

ISSUES AND CHALLENGES FACING THE PLASTICS INDUSTRY, An Exclusive Seminar for MPMA Members 26 th February 2013 Venue: Conference Room, MPMA, Petaling Jaya Raw Materials – Present and Future Regional/World Capacities and Trends Avdo Niksic – Nick Managing Director – Asia Pacific & India ChemOrbis aniksic@chemorbis.com

About ChemOrbis  Platform dedicated to plastics since 2001  Neutral and impartial  Hosting global and refined community  Offering complementary services  Dynamic Market Intelligence  Handy Analysis Tools  Flexible Trading Tools  Ideal Advertising Media  International Events & Conferences  Plastics Industry Almanac Releases

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Global and Refined Community Breakdown by Geography Breakdown by Type Polymer Polymer Trader/Dist. ROW Producer 8% 1% 1% ISC MEA 8% Americas Other 11% 20% 31% Europe Asia 28% 32% Plastic End Product Manufacturer 60% The value proposition of ChemOrbis grows as the size and quality of our community grows.

Coverage Geographical Product  We cover commodity polymers  We cover all key spot markets i.e. PE, PP, PVC, PS, PET, ABS (reacting faster to market  As well as their feedstocks and developments) monomers i.e. crude oil,  China naphtha, ethylene, propylene,  SEA/India VCM, styrene.  Turkey  Also machinery and equipment, molds, professional services like  Egypt logistics, transportation,  Italy customs clearance are  Coverage will soon be supported on our trading expanded to cover Americas, platforms. NWE, Russia, GCC and Africa.

CO is In-depth & Diversified 5000 Sources 250,000 Prices Converter Converter Producer Producer Trader/Distributor Trader/Distributor 32% 37% 46% 56% 7% 22% All types (producers, traders, converters) + All sizes = remarkable crosscheck ability

World’s Polymers Barometers (Italy End Oct 2012) 25,000 20,000 15,000 Turkey Italy China 10,000 5,000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Different market dynamics 100.00 120.00 140.00 60.00 20.00 40.00 80.00 0.00 Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 million Btu) Coal' (dollars per feet) per thousand cubic Wellhead' (dollars Natural Gas per barrel) Crude Oil (e)' (dollars Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13

US PE and PVC exports 2000-2012 1,000 900 800 2000 2001 700 2002 2003 600 2004 2005 500 2006 2007 400 2008 2009 300 2010 2011 200 2012 100 0 PE PVC

USA capacity expansions Contract awarded in Capacity of Petro-2 cracker Oct 2012 for the will be expanded by 105,000 tons/year during the Braskem/ Ethylene XXI petchem maintenance that started on June 2015 Grupo Idesa Cracker 1 mil Mexico Start up complex Jan 10. The original shutdown date was Q4, 2012. Expansion Expansion to be completed by H2 Ethylene cracker in January-February Westlake Cracker 565 USA shutdown 60 d February. Baytown is expected Expansion at Lake Charles, LA. 2016 ExxonMobil Cracker 1.5 mil USA Start up to start up in 2016. Delayed Expansion delayed from 2013 2015 Westlake Cracker 545 USA Expansion to 2015 Formosa New cracker at Point The company will add more 2016 Plastics Cracker 800 USA Start up Comfort, TX than 90,000 tons/year of ethylene production capacity Contract awarded in to reach around 300,000 tons/year in line with the Oct 2012 for a new conversion of its Calvert City, 2016 OxyChem Ethylene 544 USA Start up ethane cracker Kentucky steam cracker to ethane feedstock from Company plans Mid- 2014 Westlake Ethylene 285 US Expansion propane expansions and 1 new Restart of idled Restart of idled cracker at St. cracker to increase End 2012 Dow Cracker 390 USA cracker Charles, LA World capacity by 2.3 mil 2016-2017 Dow Cracker scale USA Start up tons/yr by 2017 Plant will shut April 18, 2012 April -June 2012 BASF-Total Cracker 60 USA Expansion 50 d for expansion by 60,000 t/y. Company is assessing where to locate a new Q3 2013 Williams Cracker 272 USA Expansion Debottleneck at Geismar, LA World complex using Debottleneck at Chocolate 2016-2017 Shell Chemical Cracker scale USA Start up Marcellus Shale End 2013 Ineos Cracker 115 USA Expansion Bayou, TX 2014 Westlake Cracker 113 USA Expansion Expansion at Lake Charles, LA World scale ethylene World cracker will be built in Expansion planned at 2017 Dow Chemical Cracker scale USA Start up Texas. 2013-2014 LyondellBasell Cracker 227 USA Expansion Channelview, TX 2014 LyondellBasell Cracker 386 USA Expansion Expansion at Laporte, TX Chevron New ethane cracker at Phillips 1.5 its Cedar Bayou Q1 2017 Chemical Cracker million USA Start up complex in Texas. Ethane cracker The company will build olefin planned for Lake processing facilities with Charles, LA. Feasibility 11,000-12,000 b/d ethane, 1-1.4 study will be ethylene, propane and Q1 2013 - Q2 propylene capacities by Q2 After 2017 Sasol Cracker mil USA Start up completed by 2H 2013 2015 Williams Cracker Canada Start up 2015

Shale Gas: A growing global energy source 1600 1400 1200 Technically Recoverable Shale Gas Resources (tcf) 1000 Proved Natural Gas Reserves 800 600 400 200 0 Source: EIA

World Liquid Fuels Supply and Demand Balance million barrels per day 94 5 Forecast Implied stock change and balance (right axis) 92 4 World supply (left axis) 90 3 World demand (left axis) 88 2 Source: Short-Term Energy Outlook, February 2013 86 1 84 0 82 -1 80 -2 78 -3 2008-Q1 2009-Q1 2010-Q1 2011-Q1 2012-Q1 2013-Q1 2014-Q1

Volume of Crude Oil and Petroleum Products Transported Through World Chokepoints, 2007-2011 2007 2008 2009 2010 2011 Location 4.6 4.5 2.9 2.7 3.4 Bab el_Mandab 2.7 2.7 2.8 2.9 N/A Turkish Straits 3.2 2.8 3.0 3.0 N/A Danish Straits Strait of Hormuz 16.7 17.5 15.7 15.9 17.0 0.7 0.7 0.8 0.7 0.8 Panama Canal 0.1 0.2 0.2 0.1 0.1 Crude Oil Petroleum 0.6 0.6 0.6 0.6 0.6 Products Suez Canal and 4.7 4.6 3.0 3.1 3.8 SUMED Pipeline 1.3 1.2 0.6 0.7 0.8 Suez Crude Oil Suez Petroleum 1.1 1.3 1.3 1.3 1.4 Products 2.4 2.1 1.2 1.1 1.7 SUMED Crude Oil

Middle East Pipelines

Cumulative China Imports 18,000 16,000 14,000 2001 2002 12,000 2003 2004 10,000 2005 2006 2007 8,000 2008 2009 6,000 2010 2011 4,000 2012 2,000 0 1 2 3 4 5 6 7 8 9 10 11 12

Monthly China Imports 1,800 1,600 1,400 2001 2002 1,200 2003 2004 1,000 2005 2006 2007 800 2008 2009 600 2010 2011 400 2012 200 0 1 2 3 4 5 6 7 8 9 10 11 12

China Imports by product 18,000 16,000 14,000 12,000 PVC PS 10,000 PP PET 8,000 PE ABS 6,000 4,000 2,000 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

China versus SEA versus India 60,000 China India SEA 50,000 40,000 30,000 20,000 10,000 0 2006 2007 2008 2009 2010 2011 2012