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GENERAL INTRODUCTION
- Good morning/afternoon
- Welcome to Wilton International
- Introduce self
- Explain what's ahead
WHAT IS WILTON INTERNATIONAL?
- Large, very important manufacturing site
- 'Blue chip' multi-national occupants
- Includes American, Saudi, Spanish, Singaporean, British, Norwegian owned assets
- Major players in chemical, petrochemical, energy, biofuels, industrial gases markets
- Working in tough global markets
- But quite able to compete in international arena/global marketplace
- Seen massive investment in last 10-15 years
- More than 1.25 billion
- Esp. in new sectors - biofuels, renewable energy
- Seeing some real challenges at moment
- Global recession/credit crunch - difficulty in raising money for investment
- People not buying things means people not making things
- Which means we're not making the plastic and petrochemical based things that go into those goods
- Hence seen some blows this year
- However site has long history of innovation
- Has adapted to new opportunities
- Every reason to be confident about the future - heavy oil upgrader particularly exciting. Will have massive rejuvenating effect and lead to further investment
- 40 plus projects/potential investments in Tees Valley at moment (not all process related but nevertheless)
- Great opportunities in new/emerging markets
- If work as team and get Government support for existing as well as new industries future can be positive
- More jobs created in manufacturing in region than lost in recent years
SCALE - FACTS AND FIGURES
- 2000 acres (or put another way 1,300 football pitches)
- 8 mile perimeter fence
- More than 20 miles of internal roadway (between plants)
- 400 miles of Sembcorp-managed electrical cable circling site
- 150 miles of SembCorp-managed pipelines between the various plants
IMPORTANCE TO ECONOMY
- Huge
- Local and regional economy
- Around 5,000 people work here day to day
- 10,000 vehicles a day on site (cars, lorries, tankers)
- 9 major companies - SABIC, Huntsman, Sembcorp, Ensus, Yara, Artenius, Dow, Croda, UK Wood Recycling
- Around 50-60 support contractor companies (AMEC, Hertel, Aker Kvaerner through to smaller operations)
- Multiplier effect on jobs i.e. up to ten times the number of people who work here depend to a greater or lesser extent on our existence (estimate)
- Process sector accounts for up to a quarter of region's GDP - £8 billion of £32 billion
- NEPIC companies collectively employ c 40,000 people in region
- Traditional industries - Chemicals and power - huge been success stories for this area
- New industries - Biofuels/renewable energy - have potential to be
- Chemicals and power sectors have survived when others (shipbuilding, coal mining, micro electronics) didn't
- Fragmentation has brought challenges
- But some strength in fact that site/area no longer as reliant on fortunes of 'big two' ICI and BS.
HISTORY
- Established by ICI in 1946
- Complemented ICI site at Billingham (est. 1920s)
- Empire eventually extended to N. Tees (est. late 50s on reclaimed land)
- Designed to meet massive post war demand for plastics, fibres and other man made materials
- Many products (e.g. polythene. Terylene) invented during 1930s
- Site developed rapidly throughout '50s, '60s and 70s
- Oil crisis ('73) and UK recessions in early '80s and '90s did have impact
- Things began to change
- By early-mid-1990s ICI began to 'think unthinkable'
- Hanson threat and subsequent divestment of pharmaceuticals business (Zeneca) led to eventual sell off of bulk chemical assets as '90s progressed
- Teesside saw major business sold to former rivals
INVESTMENT
- Has seen more than £1.25 billion of investment in new and improved assets in the past 10 years - money that has been critical to providing a long term future for site and employees
- Available land in demand - 'new' site is emerging
- Undoubtedly one of the UK's most important manufacturing locations 'if not the most'
- Perhaps some of the most valuable 'real estate' in the UK - typical plant costing c£200m to build these days
CHALLENGE OF CHANGE
- Lots of change in past 10/15 years
- Long term ability to adapt
- Companies working in tough international markets
- No 'divine right' to exist
- Managers/workforce willing to adapt/innovate
- Risen to the challenge of change together
- ICI 'culture' right for the time
- Changed through international ownership
- Best of ICI and new company cultures merged
- Resulted in fresh ideas, new opportunities
- Substantial new investment.
- Site has seen less reliance on traditional base 'plastics and petrochemical' although these are still important and at core of what we do
- Emerging businesses - e.g. biofuels, renewable energy, recycling - offer tremendous possibilities
NATURAL ADVANTAGES (why here?)
- Skilled and experienced workforce (most important)
- Infrastructure - superb (pipelines, electrical distribution network, communications system - roads, rail lines, deep water port (UK's second largest) etc
- Integrated set of assets (what one plant makes another uses - chain from Cracker still important)
- Shared utilities and services (Sembcorp) - results in cost savings
- Easy of access - to basic raw materials (N Sea oil and gas, coal, water, electricity)
- Solid, flat land
- Plenty of available development land in heart of site much interest in
- Supportive political environment - MPs, councils etc
- Excellent working relationships with unions, regulators, local authorities, surrounding communities etc
COMMON BELIEFS/RESPONSES
- Especially on big issues - safety, health, environmental matters; skills training etc
SAFETY
- Top priority
- Shared safety culture
- Regular site safety meetings (individually and collectively)
- Wilton first site in world to be awarded British Safety Council Sword of Honour (2005)
- Tremendous accolade - third party, independent recognition of safety standards operating at every level
- Extremely difficult to achieve - detailed audit. Prior requirement for BSC 5 Star Award
- No room for complacency
- High hazard operations
- Duty to employees, contractors, community to operate safely
PEOPLE/RECRUITMENT
- Ageing workforce issue - needs to be addressed
- Apprenticeships/training - very important even in difficult times
- TVPT - new process apprenticeship
- Existing companies need 300 over next 10 years
- Based on developing good 'all-rounders'
- Graduate and adult apprenticeships - also important
- NEPIC driving much of this
- Training/upskilling of existing staff - equally important
COMMUNITY MATTERS
- Common response essential
- Can't all do own thing
- Liaison panel process - ensures regular dialogue and effective response to issues
- Working with more than 300 other companies in chemical, pharms and biotechnology sectors under umbrella of NEPIC.
SABIC
- Saudi-owned (Saudi Basic Industries Corp)
- In world's top 10 of petrochemical manufacturers
- Largest and most profitable public company in Middle East (based on '05 figures)
- SABIC Europe located in Sittard in Netherlands.
- Purchased petrochemicals assets previously owned by Huntsman here and at North Tees in 2006
- Main plant at Wilton - Olefins 6 Cracker
- Three plants in one - ethylene, butadiene and gasoline treatment units
- Makes ethylene, propylene and butadiene
- Hydrocarbon 'building block' chemical products used by downstream customers
- Converted into other chemical intermediate products that go into virtually every man made product you can think of
- Cracker built in 1979 at a cost of £200 million
- Would today cost more than £1 billion
- Cracker at heart of site/chemical industry on Teesside
- Ethylene capacity of c850,000 tonnes a year
- SABIC also behind the £200 million low density polyethylene (LDPE) plant (originated by Huntsman)
- Takes much of ethylene output of Cracker
- One of lowest cost operating units of its type in world
- Will begin full operation shortly
- Produces around 400,000 tonnes of product a year
- High pressure - 3,000 bar (= pressure at bottom of Atlantic)
- 120 new jobs
- Underpins/sustains more than 750 existing SABIC jobs at Wilton and N Tees
- New business for site and for UK
- Makes UK net exporter of polyethylene
SONHOE
- Proposed £2 billion development
- Heavy crude oil refinery
- Convert c200,000 barrels of heavy crude oil a day into
- Diesel (European shortage)
- Kerosene (jet fuel)
- Naphtha (chemical feedstock)
- Hydrogen (growing hydrogen economy)
- Biggest private development in North East
- Huge importance to site/region/UK
- Site - as important as ICI coming to area
- Will extend lifespan - 50 years
- 400 permanent jobs
- Area - 2,000 construction and 5,000 supply chain jobs
- Massive development dominating entire centre of site
- Spin off tank farm and ports development
- UK - less reliance on foreign oil - Saudi/Russian
- Help to meet the anticipated diesel shortfall
- Boost to hydrogen economy
ARTENIUS UK
- Spanish owned (part of La Seda de Barcelona group) since '06
- Employs c.240 (post closure of T7)
- Manufacture polyester intermediates (PTA - white powder) which go mainly into polyester resins (PET - plastic chip)
PTA
- T8 plant one of most efficient in Europe
- Uprated in 2004 to bring T8 plant capacity to 510,000 tonnes p.a.
- Major emissions reductions in recent years
- T8 profitable but starved of cash following major financial problems involving parent company
- Debts of c.£500 million
- Forced into administration in July 2009
- Plant mothballed
- 137 staff laid off
M5
- Built 1996
- 150,000 tonnes PET capacity p.a.
- World's largest single stream polyester resin plant at one time
- Applications in packaging and carbonated soft drinks - e.g. PET in Coke bottles)
- Still running following T8 administration
- 105 staff remain
HISTORY OF PLANT
- Artenius is part of Spanish company
- Plant originally bought from ICI by DuPont in 1998
- DuPont and Turkish firm Sabanci formed JV - DuPontSA - in 2000.
- Renamed ADVANSA in 2005 when Sabanci took full ownership
ENSUS
WHAT IS IT?
- UK company (strong ex-ICI background)
- Building UK's first world scale bioethanol plant
- £250m facility
- Operational Q3/Q4 2009
- Right biofuel the right way
RAW MATERIAL
- Wheat
- Uses c1.2m tonnes a year
- Equal to 1,000 acres of growth a day
- i.e. Half this site
- 30,000 tonnes in silos at any given time
END PRODUCTS and PROCESS
- Food and fuel
- Food (animal feed)
- Fuel (bioethanol)
- Process involves fermentation/drying and distillation
- Fermentation - action takes place in 8 fermentors working in pairs. Batch process taking 50 hours. Followed by 10 hrs of cleaning/drying. Can't use antibiotics
- Distillation in columns. Produces 95 per cent alcohol 5 per cent water
- Leaves stillage - like dried crushed Wheatabix
- Process uses established technology (Katzen of USA)
FOOD
- 350,000 tonnes/year high protein animal feed (DDGS)
- Raw material is 'hard' wheat i.e. kind that normally goes into animal feed (i.e. not bread)
- Will still go into animal feed at end of this process but ends up higher in protein
- Massive surplus of all kinds of wheat - 16m tonnes in Europe 3m tonnes in UK
- Wheat supplied by Glencore - massive in grain market.
- Glencore also take away resulting animal feed
- Plenty of wheat in East of England. Cattle who use feedstock generally in west (wetter)
- Europe has massive capacity to grow more
- Not about deforestation
- Not about creating world hunger 'dumping' of wheat adds to by wrecking indigenous markets.
- Not about increasing price of milling wheat for bread etc
FUEL
- An important petrol additive - ethanol (alcohol)
- Capable of supplying 3-400m litres p.a. - a third of UK demand by 2010
- Could ultimately expand to 600 m litres
- 99 per cent alcohol. 200 per cent proof
- No storage on site
- Transferred by 7.5km pipeline to Vopak at Seal Sands
- Pay heavy duty on it (more than petrol. Enough for week's transfer c £1m)
- Every drop produced needs to be accounted for no liquid waste at all
- Major customer 'Shell' 10 year contract
DISTRIBUTION/LOGISTICS
- 220 lorry deliveries a day
- Coming in by road and ship (i.e. by road from Teesport)
JOBS
- 110 direct jobs - 67 on plant, rest at Yarm HQ
- 1,500-2,000 farming jobs sustained
ENVIRONMENT
- Overall carbon footprint of plant - equivalent of reducing harmful exhaust emissions of 300,000 cars/year
FUTURE
- Helping Teesside becoming biofuel capital of UK (Biofuels Corp, D1 Oils, Petroplus etc)
- Ensus looking at further expansion in Europe
YARA
- Norwegian company
- Massive global manufacturer of fertiliser (ammonium nitrate)
- Part owner of GrowHow business (which has plant at Billingham)
- CO2 is normally a by-product of ammonia production
- £27 million investment
- Sources CO2 from Ensus
- Turns it from gas into liquid
- Exports high quality liquid CO2 into UK and Europe
- Plant will make c.700 tonnes a day or c250,000 tonnes/yr
- Largely automated process run from Ensus control room
- Half exported by road into UK markets
- Half via Teesport to Scandinavia and Germany
- Used by food and drinks industry (puts fizzy into pop)
- Also in power industry (coolant in nuclear industry)
- Each bullet capable of holding 900 tonnes of liquid CO2
GDF SUEZ
- Teesside Power Station began commercial operation in 1993
- Originally owned (until 2008) by Teesside Power Limited (TPL)
- Now owned by Gaz de France and Suez
- Plans for major uprate over next three years
- Make it even more efficient with four less GTs (8 currently)
- Was the world's largest combined heat and power plant at time 'dash for gas'
- Former Enron operated facility
- Cost around £800 million to build
- Capable of supplying 1875 MW of electricity
- Around 4 per cent of electricity needs in England and Wales
- Can provide backup steam and electricity to Wilton International
INVISTA
- Sadly announced closure in 2009
- Due to market overcapacity and economic downturn
- Facilities closed May 2009
- Owned by US firm Koch Industries since 2004
- First venture into Europe for Koch
- World's largest integrated producer of nylon and polyester fibres
- DuPont originally acquired business from ICI in 1993 and became part of Du Pont Textiles and Interiors business in 2002
- Manufactured variety of nylon intermediate products on Teesside - nylon polymer, nylon salt, adipic acid etc
- 6 separate manufacturing plant areas made nylon 6:6 polymer and adipic acid (nylon salt)
- Around 300 employees and 100 full time contractors
- Nylon goes into everything from carpets to sports and leisure clothing - brand names Lycra, Tactel, Kevlar, plus Stainmaster etc
- 1995-2002 DuPont invested £290 million on plant improvements (upgrading/new assets)
- Substantially reduced emissions
- COGA unit - wiped out 3 per cent of UK nitrous oxide emissions at a stroke
- KA non-boric project removed a major effluent (boric acid) and uses new process
SEMBCORP - BIOMASS POWER STATION
- £64 million renewable energy investment
- One of biggest investments by Singapore worldwide
- Generates more than 30 MW of electricity
- Enough to power more than 30,000 homes
- Using sustainable forms of wood as fuel source
- Making power in a cleaner, greener, more sustainable way
- First biomass power station of its kind (i.e. using 100 per cent wood as fuel) in UK when built
- Operational autumn 2007
- Created 15 new jobs
- Create/sustained hundreds in other sectors (forestry, farming, wood recycling, distribution)
- Carbon neutral -
- Four separate sources of wood
- Recycled (80,000 tonnes)
- Forestry round wood 'tops of trees etc'(ditto)
- Sawmill offcuts (ditto)
- Specially grown energy crops (aim - 55,000 tonnes) from area 3.5 times size of Wilton (=7,500 acres)
- Saving 200,000 tonnes of carbon dioxide emissions per year compared with a conventional power station
- That's the equivalent of the emissions of 67,000 vehicles on UK roads.
- SembCorp has invested c £233m in its assets (including £83m paid for the business) since 2003
HUNTSMAN
- An American company created by the entrepreneur Jon Huntsman.
- Huntsman originally acquired all of ICI Petrochemicals, titanium dioxide and polyurethanes assets for £1.7 billion in 1999
- Huntsman spent more than £500 million across Teesside in 7 years.
- Now own only the aniline and nitrobenzene plants at Wilton
- Nitrobenzene plant built by ICI in 1997
- Cost c.£70 million
- Products are intermediates in manufacture of polyurethane
- Polyurethane converted into everything from building insulation materials to soles of sports shoes to car seat foam cushioning
- Together with Tioxide Pigments business (Greatham and Billingham) these are the only assets now owned by Huntsman on Teesside
- 2008 £7m investment in new reactor technology (first of kind in world) to convert NB and H2 into aniline will uprate plant and make it more efficient (uses less raw materials)
- Major environmental impact - save c120,000 tonnes of CO2 a year (= emissions from 4,000 cars)
DOW
- Downstream customer of SABIC
- Announced closure in July 2009
- Will close end January 2010
- The US company owns and operates the ethylene oxide/ethylene glycol facilities
- Union Carbide of US originally bought these from ICI in a £70 million deal in 1995
- Dow then acquired them following a merger with Union Carbide in 2001
- Ethylene oxide goes into a range of surfactants (soaps, shampoos, washing liquids etc)
- Ethylene glycol in its raw form is antifreeze
- The main upgrade of EO took place in 1996 and a new EG plant was also built
- The combined cost was around £80 million
- Capacity c 300,000 tonnes EO and 240,000 tonnes EG
CRODA
- A UK business (Hull)
- Downstream customer of Dow and SABIC
- Announced closure of business immediately following Dow closure announcement (July 09)
- Purchased the ICI Uniqema business in 2006
- The plants make a wide variety of surfactant products
- Active ingredients in soaps, shampoos, washing up liquids etc (i.e. make them effective)
GREENSTAR WASTE EXCHANGE SERVICES
- Employs c 70 people
- Won 2009 Queens Award for Innovation
- Recycles/reuses plastic - c8k tpa
- Supplies M&S with plastic chip for milk containers
- Believes it is first to convert discarded plastic bottles into food grade plastic
- Also supplies cosmetic companies
ECCO NEWSPRINT
- UK company
- Announced an intention to build a paper mill
- Will convert recycled newspapers and magazines from NE and Scotland into 400,000 tonnes per year of high quality newsprint
- Energy intensive site attracted them
- Will employ c175
- Will support c 2,000 construction jobs
- Create/sustain 1,000 to 1,500 supply chain spin off jobs (collection, distribution etc)
- C £450-500 million investment
- Will be the biggest investment at Wilton since TPL (1993)
- Capacity of 420,000 tonnes a year
- Will add to amount of recycled paper on news stands in UK
- Will prevent more than half a million tonnes of waste paper a year going to landfill
- Prevent imports of newsprint from N America and Europe (currently 60 per cent comes in from abroad)
- Latest technology - reduced water consumption, energy use
- 66 acres of land leased from One Northeast for 125 years
- Planning permission achieved
- Financing being secured - bank and equity funding
UK WOOD RECYCLING
- Major wood recycling operation
- Began operations in 2007
- £4m investment - shredding, separating, storing, distributing facilities.
- Supplying Sembcorp with biomass fuel (c80,000 tonnes of our 300,000 tonne p.a.total)
- Created 40 new jobs
- One of largest wood recyclers in UK
- Of 10m tonnes available for recycling each year, currently only 1.5m tonnes actually recycled
- Around 6m tonnes goes to landfill - increasing greenhouse gases
- Other uses - Cattle, poultry bedding; chipboard
- Heavily contaminated wood rejected
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