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ECONOMY ISSUES
2.1 INTRODUCTION
Ethylene oxide (EO) is a raw material used in manufacture of chemical derivatives for
major consumer goods. It mainly used to produce ethylene glycol which is pre-
product for polyesters. EO is used directly in the gaseous form to produce sterilizing
agent, fumigant and many others application. Due to the commercial success of the
direct oxidation process, the market trend toward larger single-train plant becomes
phenomenal growth of production capacity of ethylene oxide in the world.
According SRI Consulting, USA (North America) is the country that produced 4
million tons of ethylene oxide which is over one fifth of all global production and the
highest production in 2004 followed by Venezuela (2 million tons), Saudi Arabia (1.8
million tons) and China (1.4 million tons). Because of direct oxidation process
become successful due to higher yields and less downtime, the global production
increases from 18 million metric tons in 2007 to 19 million metric tons in 2008 and
2009 (SRI Consulting, 2009).
5%
5%
11%
Other Countries
44% China
USA
17% Saudi Arabia
South Korea
Canada
18%
Global demand for ethylene oxide is forecast to grow at a rate of 5% per year
from 2009 to 2014, and around 3% per year from 2014 to 2019 (SRI Consulting,
2010). Furthermore, global production of ethylene oxide is foreseen to grow and will
be driven mainly by demand especially in Asia Pacific region (Merchant Research and
Consulting ltd). Based on Figure 2.1, it shows that the production increases as in 2015,
production of ethylene oxide in Asia is the highest which is covered about 34% of
global production (IHS Markit, 2016). In Asia, China is the largest producer of
ethylene oxide. Chinas ethylene oxide market will remain relatively domestic, the
supply and demand are currently and expected to be highly dominated and satisfied by
domestic producers and users ( SAI Report, 2010).
Total import of ethylene oxide in Malaysia was 0.57% from 30 million tonnes
of global production in 2016. Since the proposed plant built is unable to fulfill
completely the increasing demand of ethylene oxide in worldwide, thus the production
rate of the proposed plant built is estimated to cover 0.17% of ethylene oxides import
in Malaysia. The annual growth import rate of ethylene oxide in Malaysia is forecast
to grow at a rate 8.9% in 5 years from 2017 to 2022. The production of ethylene oxide
for our plant would be 50 kiloton per year.
237600
226800
250,000 204000
200,000 171000
150,000 113400
Oxirane (ethylene oxide) are the 2584th most traded product and the 321st most
complex product according to the Product Complexity Index (PCI). Malaysia
contribute 0.449% from the global exporters and 0.57% from global importers of
ethylene oxide in 2016. The global top exporters of Oxirane (ethylene oxide) are
Germany (40%), the Netherlands (20%), Belgium-Luxembourg (11%), France (8.8%)
and the United Kingdom (6.9%). The top importers are Italy (23%), Germany (21%),
Belgium-Luxembourg (15%), France (6.8%) and the United Kingdom (6.2%).
2.4 CONCLUSION
The annual production of our plant would be 50 kilotons per year. Since, the total
import of ethylene oxide in Malaysia was 0.57% from 30 million tonnes of global
production in 2016. Thus the production rate of the proposed plant is estimated to
cover 0.17% of ethylene oxides import in Malaysia. Our plant operates for 24 hours
in 350 days annually. So, the basis production rate of our plant is 5952kg/hr.