How Catalysis Creates Value

The Business Area Catalysis offers a wide range of value-adding catalysts for customers in the petrochemical, chemicals, plastics, and refining industries. Catalysis also addresses global challenges of raw material scarcity, energy efficiency, and environmental degradation by improving chemical process efficiency, enabling the use of alternative feedstocks, and developing environmentally compatible catalytic solutions.

1. Addressing local needs with innovative products

The Business Area Catalysis, consisting of the Business Unit Catalysts, is a global catalyst supplier with a long history of innovation and expertise. Creating high-performance catalysts is at the heart of the Business Area’s mission, along with Clariant’s values of Performance, People, and Planet. Catalysis’ innovative products deliver significant value to customers by enabling higher production throughput while lowering energy consumption and reducing hazardous emissions. Clariant’s catalysts and technologies also enable the use of alternative feedstock, such as natural gas, coal, and biomass, for chemical and fuel production.

The Business Unit Catalysts runs a global network of 14 production sites (excluding 50:50 or minority joint ventures).

Catalysis runs a global network of 14 production sites, with 1 970 employees. The Business Area serves customers across all regions and focuses on providing regionally adapted solutions. In China for example, Catalysis is at the forefront in supporting industrial producers with advanced catalyst innovations and expertise. Chinese customers benefit from Clariant’s broad portfolio of catalysts and adsorbents for all major application fields. By combining global and local resources, the Business Area cooperates closely with Chinese customers to solve key challenges regarding productivity, feedstock, energy efficiency, and environmental protection.

For example, with its longstanding experience in methanol production, Catalysis can offer a broad range of catalysts that work for different sizes and operating conditions of production plants. The latest catalyst generation, MegaMax® 800, was developed in close collaboration with one of Clariant’s global Licensing Partners to meet the increasing demands of the highly integrated large-scale methanol plants in China. In addition, to support the current construction of many existing medium-scale methanol plants, Catalysis launched MegaMax® 700C, a methanol synthesis catalyst that yields higher activity and less byproducts compared to products from Chinese competitors. The catalyst is produced locally, in Clariant’s Panjin plant, and offers all the benefits of the MegaMax® series: high activity and physical strength, high selectivity, and significant savings in feedstock and energy consumption.

Business Unit Catalysts has seven sales offices worldwide, two of which were opened in China in 2017.

2. Market recovery and continued demand for sustainable solutions

In 2017, the global business environment improved slightly, mainly due to higher chemicals prices and stable feedstock cost. The higher demand for polypropylene and propylene derivatives, particularly in China, spurred a strong increase in on-purpose propylene production projects. Other beneficial factors were reduced overcapacity in the ammonia market, low energy costs and overall strong downstream demand.

400

EnviCat® VOC operates at a temperature up to 400°C lower compared to conventional methods.

To reach above-industry growth targets, Catalysis follows the latest market and technology trends closely, as well as new environmental regulations, which often present new business opportunities. For example, regulations regarding the emission of harmful volatile organic compounds (VOC) – which arise during many industrial processes in the chemicals, food, printing, and energy production sectors – are becoming increasingly stringent. In large, high-growth economies in particular, the conventional off-gas purification methods are not suitable for meeting future regulations. Clariant’s EnviCat® VOC catalyst effectively removes volatile organic compounds and carbon monoxide from off-gas at a temperature that is up to 400°C lower compared to what is required for the conventional thermal oxidization method. The catalyst thus reduces fuel consumption and stress on equipment, resulting in significant economic, operational, and safety advantages. As EnviCat® VOC can be flexibly adapted to the customers’ requirements, meeting more stringent emission standards has now become easier than ever.

As population growth, purchasing power, and wealth continue to increase in emerging countries, the demand for resources such as energy, food, and land is also rising. This pressure on global resources makes environmental issues such as climate change, loss of biodiversity, water supply challenges, and waste production even more pressing. Solving those global challenges requires the involvement and support of the chemical industry, particularly catalyst producers. By improving efficiency in chemical processes, increasing the use of alternative feedstocks, and developing environmentally compatible catalytic solutions, the Business Area Catalysis directly addresses the global challenges of increasing energy use, raw material scarcity, and environmental degradation.

»To create value for Chinese customers, we are becoming a ›China Insider‹ while leveraging our access to global knowledge and resources.«
Thomas WengerHead of Business Unit Catalysts China

Idea to Market

2.1. Speeding up the innovation process

300

More than 300 R&D experts work for the Catalysts Business Unit.

For Catalysis to maintain its market position as a leading developer and producer of catalysts and adsorbents for industrial processes, innovation is essential. The Business Area thus invests significantly in R&D, operating 11 R&D and technical centers globally, and employing over 300 R&D experts (including joint ventures) to develop customized solutions that maximize customer value creation. Catalysis is one of the four Technology Platforms of Clariant, which has built up expertise over decades and participates in many scientific collaborations. A successful example is MuniCat, a long-term alliance between the Technical University of Munich and Clariant in the field of investigation and application of vanguard catalyst systems. For more information on MuniCat, see chapter Boosting Innovations.

74 innovation projects passed to the next stage in 2017.

By systematically observing, evaluating, and implementing technological innovations, Catalysis not only consistently improves the performance of existing products and processes, but also creates new applications for new markets. Being at the forefront requires prioritizing the most promising applications and accelerating the time-to-market, based on a profound expertise in catalyst formulation and process technologies. In 2017, the innovation management was particularly focused on accelerating the time-to-market. Catalysis started tracking all innovation projects on the time it took to move from scouting to scoping to the commercialization phase. This speed monitoring supports a strong, dynamic project pipeline and stops projects early that are not developing as expected. At the end of 2017, the Business Unit Catalysts boasted a pipeline of more than 110 innovation projects. During regular project portfolio reviews the resource allocation is challenged and, where necessary, adjusted to the current market and technology environment. The increased focus on speed has materialized already: Compared to 2016, when 40 projects passed the gate to the next stage, 74 projects advanced in 2017. Overall, a total of 53 innovation projects were started.

Thanks to the new ReforMax® LDP catalysts 20% lower pressure drop in the reactor was realized.

For example, in 2017 Catalysis launched ReforMax® 330 LDP Plus and ReforMax® 210 LDP Plus, two new generation steam-reforming catalysts for manufacturing synthesis gas that is used to produce hydrogen, ammonia, and methanol. Their unique and innovative configuration ensures that the pressure drop in the reactor can be decreased by up to 20%, which allows for significant energy cost savings while increasing the reformer gas throughput.

Market to Customer

2.2. Customer orientation as a guiding principle

Understanding that customer orientation is essential for business success, Catalysis conducts workshops regularly with customers to understand their needs, target innovation activities, develop solutions that add value, and create convincing value propositions. In 2017, Catalysis held numerous customer conferences and trainings all over the world. These included client seminars and workshops in China, South Korea, Bahrain, Egypt, Germany, the UK, Canada, and the U.S. The strong regional presence allows Catalysis to cater to customer needs, as these needs often differ from country to country. In 2017, Catalysis opened two new offices in Qingdao, Shandong province and Yinchuan, Ningxia province to strengthen its presence in China. The Shandong region in the north is a key location for refining, petrochemical and chemical companies, the Ningxia region in the northwest of the country is home to many coal-to-chemicals producers as well as numerous syngas and polyolefin companies. The new offices allow Clariant to cooperate more closely with local customers and enable faster, tailor-made engineering services and sales assistance.

A quick-reacting sorbent reduces the costs of the warm gas desulfurization process by up to 50% percent.

Collaborations with strong process technology licensors help Catalysis lead innovation and continuously improve efficiency. Such partnerships open doors to large growth projects and significantly contribute to the development of tailor-made products and solutions. In 2017, Clariant signed a global licensing agreement with RTI International, granting the exclusive right to supply a solid fluidizable sorbent material used for RTI’s warm gas desulfurization process technology. The quick-reacting sorbent has a high capacity for adsorbing sulfur, thus enabling sulfur-containing gas streams to be cleaned at elevated temperatures, which reduces the need for substantial gas cooling and expensive heat recovery. Thanks to the more efficient process, capital and operating costs for the customers are reduced by up to 50%, and greenhouse gas emissions are minimized.

»Our service quality proves to be of great added value for our customers.«
Stephan WernerSales Account Manager, Business Unit Catalysts

Catalysis has long-standing experience in the development and production of Custom Catalysts for petrochemical and refining, emission control, syngas, chemical, and other applications. State-of-the-art production facilities around the world and outstanding technical expertise enable Clariant to scale up and commercialize new custom-made catalysts, while guaranteeing confidentiality at all stages to protect the customers’ intellectual property. In 2017, Custom Catalysts ran more than 50 projects that have been commercially implemented.

To ensure the safety, reliability, and cost-effectiveness of the customers’ plant operations, Clariant’s highly experienced technical service engineers provide a range of performance evaluation and monitoring services, along with on-site service, software provisioning, and trainings. The high service quality is key for customer retention, as the example of a Spanish petrochemical company illustrates. After being a customer for many years, the company switched to another supplier due to a significantly lower price offer. However, product quality proved inferior and the lacking technical service decreased process efficiency. After Clariant’s engineers provided first-class, comprehensive service and intensive technical advice, the customer decided to source their catalysts from Clariant again and renewed the successful cooperation.

Customer to cash

2.3. Accelerating change in procurement

Efficient procurement activities are a prerequisite for leveraging economies of scale and minimizing expenditure on ordering and delivery tracking processes. To increase efficiency and streamline raw material procurement, Catalysis partnered with Global Business Services and Group Procurement Services in 2017. Accordingly, previously decentralized operational procurement departments in Germany, Italy, Qatar, and South Africa were consolidated in Clariant’s Shared Service Center in Lodz, Poland, and activities in the United States were transitioned to the Shared Service Center in Mumbai, India. A clear delineation of responsibilities between Catalysis, Global Business Services, and Group Procurement, in combination with defined processes, further increased the effectiveness and efficiency of Catalysis’ supply chain organization. The newly established performance measurement, which incorporates service-level agreements, also permits greater flexibility in customer order fulfillment. In addition, globally standardized processes help better identify and eliminate cost-intensive airfreight for raw materials. Overall, the reorganization of procurement practices resulted in an increase of efficiency with a positive effect on the Business Area’s performance.

Targets

6 – 7 %

Growth potential per year

24 – 26 %

EBITDA target margin

Input

Performance

6.4 %

R&D spend of sales

214

Raw material procured in CHF m

110

Active innovation projects

Production sites (50:50 or minority joint ventures not included)

1 296

Number of raw materials procured

People

19 101

Training hours

567

Raw material suppliers

Planet

557

Energy consumption in m kWh