1. Aromatics Outlook “ The Evolution of Benzene ” 31 May 2011 By Churairat Nimha

2. Benzene Highlight Part I : Introduction of Benzene Part II : The Evolution of Benzene Part III : Conclusion

3. Part I : Introduction of Benzene What is Benzene ? Where is Benzene come from ? Who is Consume Benzene ?

4. What is Benzene ? Benzeneis an aromatic hydrocarbon and one of the primary chemical building blocks for the petrochemical industry. Its key characteristic is its unique six carbon ring.It is a clear colorless liquid with a sweet odor which is why it is called an “aromatic hydrocarbon”. Global Benzene Capacity by Process Type Benzene Source Flow Chart Xylenes TDP Pygas Heavy Olefin Cracker HDA Refinery Crude Oil Aromatics Extraction Benzene STDP Reformer Reformate FCC Motor Gasoline Gasoline Blending Pool

5. BZ Value Chains 45% PS 1.00 Ethylene EB/SM 16% BZ 0.30 0.55 with ACN and BDE ABS/SAN 27 Million ton 0.80 53% 4% SBR 0.35 with BDE Polycarbonate 0.91 Propylene Cumene/Phenol 2.7 Million ton Bis-Phenol A 0.48 0.88 8.8 Million ton Epoxy Resin 4.2 Million ton 0.75 18% Cyclohexanone CPL Nylon 6 Cyclohexane 1.05 0.93 13% 3.7 Million ton 4.2 Million ton 4.0 Million ton 5 Million ton 40 Million ton 1.06 Cyclohexanol Nylon 6,6 Propylene ADN HMDA 0.53 Adipic Acid 2.5 Million ton 0.66 2.5 Million ton 0.74 Specialty Intermediates for Polyurethane 7% Nitrobenzene Aniline MDI 1.34 0.76 0.60 4 Million ton 0.65 PO 53% of world BZ go to SM and a half of SM go to PS (Equi. 24% of BZ demand)

6. Who will consume Benzene ? Global Benzene 2000 Global Benzene 2005 Global Benzene 2010 Total Demand 37 MTPA Total Demand 40 MTPA Total Demand 33 MTPA

7. Benzene “ The Evolution of Benzene ”

8. Part II : The Evolution of Benzene Evo I [ 1996-2000 ] : Prolong Low Margin Era Evo II [ 2001-2005 ] : Every Cloud has a Silver Lining Evo III [2006-2010 ] : From Heaven to Earth Evo IV [ 2011-2020 ] : Come Back to Growth Mode

9. Evo I : 1996-2000 World Benzene Demand additional World GDP Growth Tom yum kung crisis Crude & Benzene Price World Benzene Capacity additional

10. MOBIL SELECTIVE TOLUENE DISPROPORTIONATION PROCESS Evo I : 1996-2000 Cyclar Process 1998-1999, Cyclar [Low Cost LPG is available ] The Cyclar process for producing aromatics is unique by producing C6+ aromatics from propane and/or butane (BZ 350 KMTA) The process was employed by IbnRushdin Saudi Arabia with commercial start-up originally planned for 1998, but in fact did not begin real commercial operation until late 1999, Closed in 2001, restart 2002 and Conversion to Propane dehyrogenation in 2008 MSTDP Technology by Mobil, 1995 it was pursuing its own aggressive expansion plans on paraxylene and viewed the technology as a lever to attract JV partners. In 1997, UOP announced a process called PX-Plus, which is essentially the Mobil STDP process. UOP can offer this technology because the patent rights to ZSM-5 have expired.

11. Evo I : 1996-2000 Unit : $/MT Economic Crisis in Asia and Technology Change : Average Margin (Spread Price) around 91 $/MT Historical (1995-2000)

12. Evo II : 2001-2005 “Every Cloud has a Silver Lining”

13. Evo II : 2001-2005 World Benzene Demand additional World GDP Growth Dot-Com Bubble Crude & Benzene Price World Benzene Capacity additional

15. Require other blendstockto reduce vapor pressure - Aromatics (Toluene and Mixed Xylenes)

16. High cost of blending - Investment and transportation cost of Ethanol.Phase-in of sulfur regulations begin in January 1, 2004. Sulfur reduction and MTBE phase-out. Require more reformate which contain zero sulfur, high octane number and low RVP.

17. Evo II : 2001-2005 “ Every Cloud has a Silver Lining “

18. Evo III : 2006-2010 From Heaven to Earth

19. Evo III : 2006-2010 World Benzene Demand additional World GDP Growth Economic Crisis in Asia (Financial Problem) Hamburger Crisis Crude & Benzene Price World Benzene Capacity additional

21. Demand loss more than 3 MTPA suffered from severe economic downturn

22. Massive of new capacitymostly in China more than 2MTPA coming on stream

23. Benzene spread collapsed free fall, once in a life time that benzene trades below naphtha

24. Economics expanded at all region Especially China economics growth at alarming rate over 12 % after joining WTO.

25. Evo III : 2006-2010 2009-2010 : Why Benzene bounced back swiftly? Weak Naphtha cracking margin pressured by new Ethane Crackers from ME Weak refining margin China’s Automobiles Sales volume Light Naphtha() Naphtha Cracker Cut Run() CDU Cut Run() Ethylene / Propylene Crude cut Short Supply Heavy Naphtha() Typical Aromatics Plant CCR Cut Run () Pygas () Reformate() FPU () China’s retail sales recovery Heavy Reformate Light Reformate Sulfolane () Xylene Frac. () PX Supply() BZ Supply() BZ Margin() PX Margin()

26. Evo III : 2006-2010 Unit : $/MT

27. Evo IV : 2011-2020 Come Back to Growth Mode

28. Evo IV : 2011-2016 World Economy : Recovery - Growth The market is once again back to 40 million tons. Beyond 2011, we believe thatbenzene demand will resume growth rates similar to the previous growth period. Strong Growth in 2010 Growth By Derivative

30. Forecasted Price 2011-2020 Unit : $/MT

31. Part III : Conclusion

32. Benzene Spread Journey through time Unit : $/MT

33. Benzene Spread Journey through time Evo I : 1996-2000 Unit : $/MT New Technology Asia Economic Crisis

34. Benzene Spread Journey through time Unit : $/MT Evo II : 2001-2006 New Gasoline Regulation in US Environmental Disasters Asia Demand Growth

35. Benzene Spread Journey through time Unit : $/MT Evo III : 2005 -2010 Massive New Benzene Supply (CHINA & MIDDLE EAST) Refinery Produce More BTX The Grate Economic Recession Shale Gas, and Refineries mothball Stimulus Packages and demand from emerging economies

37. Dynamic Forecasted Price 2011-2020 Unit : $/MT Massive New Benzene Supply From Middle East The New Round of Economic Recession New Environmental Rule and Regulations Natural Disaster Technology Breakthrough

38. Thank you