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Annexure 3 : Process Petrochemicals are derived from chemical compounds, mainly hydrocarbons obtained during the production of petroleum. The feedstocks (natural gas or naphtha) are chemically reacted in a cracker. The process of cracking (i.e. breaking larger molecules in smaller ones) produces base chemicals which are also known as 'Building Blocks'. There are two types of plants producing base chemicals, olefin plants and aromatic reformers. Olefin cracker produces base chemicals ethylene, propylene and butadiene. Aromatic reformers produce benzene, toluene and xylenes. For the olefin cracker, feedstock preferred is varying on the product mix required. Naphtha is generally used for a wider range of output products. If polyolefins output is to be maximized, natural gas is preferred as it yields a higher proportion of ethylene. Aromatic reformers require feed stock which contain high aromatic contents. Therefore, naphtha, which is rich in aromatics compared to natural gas is preferred in aromatic reformers. Other factors taken into consideration while selecting the feedstocks are energy cost, availability, price, and grade of feed stock. Feedstock (naphtha and gas) prices have a positive correlation with prices of crude oil. Amongst the olefins, ethylene is one of the most important building blocks. Most of the plant capacities are measured in terms of ethylene output. Ethylene is used to manufacture polymers, which constitute 70% of the demand of petrochemicals. Ethylene is the basic building block for PE, PVC and ethylene glycol's. Capacity of ethylene in India, by FY2000, is expected to be at 2.4mn tpa. (HPC is assumed to come on stream by FY2000). Benzene and toluene are the basic aromatic chemicals. They are manufactured in three different ways. Both of them can be manufactured either in reformers, refineries or in steel plants. Benzene is widely used in caprolactum, lab, styrene, etc. Toluene is used in solvents and thinners, pesticides and drugs, chemicals and chlorinated derivatives and other sectors. The base chemicals are further reacted in downstream units to get intermediates. Intermediates are then processed in processors and chemical units to get the end products. Other sector reports Previous chapter Next chapter

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