With Functional Minerals and Oil & Mining Services, Natural Resources brings two complementary Business Units under one roof. Functional minerals supplies customers with specialty products based on bentonite. This minerals family is comprised of clays that enhance a wide range of products and services. Its unique trait has a high surface area with strong absorption capacity allowing it to bond well with heavy metals and toxic substances. The strategic strength of Functional Minerals, which serves a broad range of industries, comes from a fully integrated value chain, from exploration to bentonite mine operation to processing the material for industrial and customized solutions.
Oil & Mining Services provides innovative chemistry, technology, and service solutions that meet customer needs safely and in compliance with environmental regulations. Oil Services is a world leader in the development, manufacturing, application, and supply of specialty chemicals and services across the whole value chain of oil production. Refinery Services is a leading provider of cold-flow additive applications for middle distillates including diesel, home heating oil, and biofuels. Mining Services is a leading provider of chemicals for flotation, pelletizing, anti-caking/anti-dusting, and filter aids, as well as emulsifiers for explosives used in mining worldwide.
Growth opportunities despite uneven economic development
As Functional Minerals serves customers in a broad range of industries from food to foundry, the overall economic development is its most relevant external driver. While the economic situation in Europe is stable albeit showing little growth, other regions demonstrate more change. Southeast Asia and both Americas are experiencing dynamic growth in contrast to North East Asia’s moderate projections.
In Europe, the partial recovery of the automotive industry, the growing demand for purification products, and the need for innovative solutions in the detergent segment have generated new opportunities for Functional Minerals. In Southeast Asia, continued growth in palm oil production is predicted to trigger higher demand for purification products. Especially sediment processing and feed additives are expected to enhance Clariant’s steady global growth. The areas of metal casting and edible oil refining are also seeing additional growth in emerging markets.
Low but recovering oil and ore prices, and upsides from regulation
For Oil & Mining, fluctuations in oil and mineral ore prices are critically important. Due to sustained low oil prices, the number of drilling rigs around the globe has decreased, particularly in North America. Fewer drill rigs means decreased demand for drilling-related technologies and chemicals. The drop in oil price has also impacted business with refinery customers, and low global mineral pricing presents challenges for our mining solutions business line. There are signals that there may be recovery ahead, however, markets will remain challenging through 2017 with the current forecast that the majority of improvement will be seen in the latter half of the year. Cost control and improved efficiency initiatives coupled with innovation will continue to be key drivers in 2017.
Regulatory developments are also presenting business opportunities. The environmental regulations for chemical additives demand strict environmental control. Oil Services has developed a range of chemical technologies that fulfill these regulatory requirements. For anti-scaling applications in the North Sea region, a special environmental product platform has been developed based on polyaspartates, a raw material that is derived from renewables, which produces enzymatically and biodegrades efficiently. These products have been awarded the EcoTain® label, as they display outstanding sustainability advantages and are best-in-class.