A long-standing commitment to safety hastened Huntsman Corp.’s efforts to pre-register 1,937 chemical substances with the European Chemicals Agency (ECHA) before the Dec. 1, 2008, deadline. Huntsman manufactures or imports these substances into the European Union. As such, the company must comply with the European Community REACH legislation (Registration, Evaluation, Authorization and Restriction of Chemicals).
The new law, which came into effect June 1, 2007, aims to streamline and improve the former legislative framework for chemicals in the European Union and places greater responsibility on industry to manage the risks that chemicals may pose to human health and the environment. (Chemical Processing has covered REACH in several articles and columns, including “Don't let REACH become a stretch” http://www.chemicalprocessing.com/articles/2004/162.html; “Regulation Isn’t Smart Enough” http://www.chemicalprocessing.com/articles/2008/225.html; and “European chemical makers face printer overloads” http://www.chemicalprocessing.com/articles/2007/018.html).
“Our company promptly recognized the magnitude and importance of the REACH requirements and reacted swiftly, assembling teams of dedicated professionals to oversee compliance and implementation, as well as to advise our customers and suppliers,” said Peter R. Huntsman, president and CEO of Huntsman Corp.
The Huntsman teams are now focusing on the next phase of REACH, which requires full registration of the highest volume and highest risk substances. During this stage, Huntsman will join with other companies that manufacture or import the same or similar substances to participate in various Substance Information Exchange Forums, to share data and agree on any additional work required prior to submittal to ECHA for final registration.
In other news, Huntsman announced the appointment of André Genton as president of its Advanced Materials Division. Genton most recently served as vice president and global operating officer of Advanced Materials. He has 25 years of experience and has held a variety of positions in the business.
André Genton
Huntsman’s Advanced Materials business had been combined with Huntsman’s Textile Effects business in one division, Materials & Effects, with Paul Hulme serving as president. The two businesses will now function as separate divisions. Hulme will continue to serve as president of the Textile Effects division.
“Under Paul Hulme’s leadership, these divisions have grown to become market leaders in their respective industries. As we anticipated, these divisions are now of the size and scope where they each need the full-time attention of a division president to continue expanding and creating value,” said Huntsman.
Huntsman acquired the Advanced Materials business from Vantico (formerly a part of Ciba) in 2003. Advanced Materials currently operates 13 manufacturing locations across the globe, employs 2,300 people, and serves about 4,500 customers with its 9,000 different products, including adhesives and coatings.
Huntsman also has found success in a recent joint venture in Saudi Arabia. The company’s ethyleneamines joint-venture plant currently under construction in Jubail, Saudi Arabia, is proceeding on schedule and is expected to meet the mechanical completion target of November 2009.
The joint venture, known as Arabian Amines Company, was created by Huntsman and the Al-Zamil Group to construct a world-scale ethyleneamines plant using Huntsman’s proprietary technology.
The parties expect the plant to be fully commissioned and in production in the first quarter of next year. The plant will have the capacity to produce approximately 30,000 metric tons/yr of ethyleneamines, including ethylenediamine (EDA), diethylenetriamine (DETA), triethylenetetramine (TETA) and higher-molecular-weight versions.
Ethyleneamines are specialty chemicals that serve as end products in the production of the growing wind blade market, agricultural applications, laundry detergents, and lube oil additives for gasoline and diesel engines.
On the flip side, Huntsman recently announced it has suspended work on design and feasibility studies for its planned investment in a new methylene diphenyl diisocyanate (MDI) plant at its site in Rozenburg, the Netherlands, because existing production capacity is adequate to meet current demand for MDI-based polyurethanes following the downturn in global economic growth.
The design and feasibility studies, which include preliminary engineering for the planned 400,000-metric-ton/yr capacity unit, will be halted at a stage to allow quick and efficient re-engagement at a future date. Until such time, all third-party work on the project will be suspended.
“We fully expect to see MDI growth return to historical levels as the global economy and consumer demand recover. However, we believe it prudent to suspend the timetable for this major investment until we have greater visibility on how long this will take. We plan to review market conditions on a regular basis, and when we do restart the project, we will likely benefit from lower engineering and construction costs, as the price of commodities such as steel and other construction materials decline,” said Polyurethanes Division President, Tony Hankins.
In addition to reviewing market conditions, Huntsman is reviewing its finances and recently announced a company-wide initiative to reduce costs across its divisions and functions. Including steps begun during the fourth quarter of 2008, the company will cut its full-time employment by approximately 1,175 positions by year-end 2009 — more than 9% of its 12,770 employees. An additional 490 cuts will come from full-time contractors. Together, these reductions will result in operating cost savings to the company of approximately $150 million.
Huntsman also announced that its Pigments Division plans to close its titanium dioxide plant located in Grimsby, U.K. That plant, the division’s oldest and least efficient manufacturing facility, has an annual production capacity of 40,000 tons of titanium dioxide.
Peter R. Huntsman, President and CEO, said, “This restructuring will allow us to improve our business where we most acutely feel the effects of the present global economic slowdown, mainly in our Pigments and Textile divisions. While we are scrutinizing each of our business divisions, we remain optimistic in our current positions in Polyurethanes, Advanced Materials and Performance Products.”
He added, “We will also reduce our 2009 capital expenditures to $230 million — a reduction of $190 million from the $420 million spent on capital projects during 2008. The steps announced should take approximately $340 million out of our cost structure in 2009. These savings, combined with the $1 billion in payments we received during December from Apollo Management, L.P. provide our company with a strong balance sheet and significant liquidity. Huntsman is well positioned to generate shareholder value and to prosper in these times of economic uncertainty.”
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