Asahi Kasei, Mitsui, Mitsubishi Establish New Company! Sinopec, BASF Already Positioned

On September 1st, Asahi Kasei Corporation, Mitsui Chemicals, Inc., and Mitsubishi Chemical Corporation announced the joint establishment of a limited liability partnership, Setouchi Ethylene LLP. The three companies will focus on researching carbon reduction technologies and capacity optimization for two ethylene production facilities in western Japan, with plans to achieve a green transformation by 2030.

Ethylene decarbonization: Why are Japan's three major chemical giants joining forces?

Ethylene, as one of the largest chemical products by global output, accounts for 1.8% of global industrial carbon emissions in its production process, primarily due to the high-temperature energy consumption of steam crackers. At the same time, ethylene is a key raw material for synthesizing various plastics. Through different polymerization processes, it can give rise to basic resins such as polyethylene, polyvinyl chloride, and polystyrene, which can further be processed into high-performance engineering plastics like nylon, polycarbonate, and polyester.

As the world's third-largest ethylene producer, Japan currently has a production capacity of approximately 10 million tons per year. However, the carbon intensity (CO₂ per ton of ethylene) of its traditional processes is 20%-30% higher than the leading levels in Europe and the United States. According to plans by the Ministry of Economy, Trade and Industry (METI) of Japan, the chemical industry is required to achieve a 40% reduction in emissions by 2030.

Therefore, the stability, greenness, and efficiency optimization of ethylene production are directly related to the development quality of the downstream engineering plastics industry, and have become an important underlying logic for the joint arrangement of the three companies.

Ethylene green transition, how to layout?

As early as last year, the three companies had already begun in-depth discussions on specific measures to promote carbon neutrality in ethylene production facilities. Focusing on multiple aspects, they proposed a series of forward-looking strategies.

For example, there is a plan to gradually shift raw materials from traditional petroleum resources to biomass-based materials, while simultaneously introducing low-carbon fuels to reduce carbon emissions from the source. In addition, optimizing the production framework is a key aspect, which even includes planning for potential capacity reductions in the future to achieve more efficient resource utilization. After extensive discussions and considerations, the three companies unanimously agreed that establishing an LLP is the best way to deepen cooperation and accelerate the achievement of their goals.

In terms of technological reserves, it is reported that Asahi Kasei has developed a "lignin depolymerization technology" that can convert biomass such as paper waste into ethylene feedstock, replacing part of the petroleum-based raw materials. Pilot data shows that when the biomass proportion reaches 20%, carbon emissions can be reduced by 35%, and the cost is 15% lower than that of the traditional bioethanol route.

The difference between bio-based olefins and traditional ethylene?

From a technical perspective, bio-based ethylene has opened up a new pathway for ethylene production. It originates from renewable biomass resources, such as agricultural and forestry waste, energy crops, and industrial waste. Through a series of biological and chemical conversion processes, the organic components in these biomasses are efficiently converted into ethylene.

From the perspective of carbon emissions, taking the technological pathway of biomass → bioethanol → bio-based ethylene as an example, relevant data show that its CO2 emissions are 0.8–1.2 kg CO2 per kg of product, representing a 60% reduction in carbon emissions compared to the petrochemical route.

Therefore, the core advantages of bio-based ethylene lie in the use of renewable raw materials and low carbon emissions. At the same time, the technological and industrialization challenges of bio-based ethylene are also very apparent at present.

From a cost competition perspective, the raw material cost of bio-based ethylene accounts for 60-70% of the total cost and is subject to significant price fluctuations. The energy consumption of the process is 20-30% higher than that of the petrochemical route, and the small scale of individual units leads to poor economic efficiency.

In terms of breakthroughs in key technologies, there are bottlenecks such as high energy consumption in biomass pretreatment, fermentation conversion being limited by efficient industrial strains and enzyme preparations, high costs of separation and purification, and the need to improve catalytic selectivity.

Major companies are entering the field, and breakthroughs in bio-based ethylene are worth anticipating.

Despite numerous challenges, as one of the most important basic chemicals worldwide, bio-based ethylene has become a hot pursuit for major chemical companies under the trend of low-carbon sustainability, with companies such as Braskem, BASF, and New Energy Blue all having their own layouts.