06handbook PDF

6
Petrochemicals & Plastics
Topics
2004
2011
Established PP compounds in Changchun and Dailan,

China for manufacturing and sales.
Agreement reached with Saudi Aramco to conduct joint

feasibility study about the planned large, integrated refining
and petrochemical complex in the Red Sea town of Rabigh.
2006
2007
2012
PP
LLDPE
PP
Stopped manufacturing and selling general-purpose PP

in North America.
The conversion of The Polyolefin Company (Singapore)s

LLDPE plant to PP production plant was completed.
PP
Decided to move ahead by finalizing the Rabigh Phase II

Project, to be undertaken by Petro Rabigh, a joint venture
with Saudi Aramco.
Acquired polypropylene compounds operations in

Europe.
2009
PP
2013
Decided to close down an ethylene plant at Chiba Works.
A large integrated refining and petrochemical complex

started operation in Rabigh, Saudi Arabia.
Decided to acquire entire stake in Nihon Oxirane and to

cease operation of Nihon Oxirane.
PP
PP
2014
Completed PP compounds production bases in North

America and Thailand. Expand production capacity for
PP compounds in Zhuhai, China.
S-SBR
Constructed a new plant in Singapore for the manufacture of the S-SBR.
Globalization
Sumika Polymers
North America Inc.
Zhuhai Sumika Polymer Compounds Co., Ltd.
Jilin Dongcheng Sumika Polymer Compounds Co., Ltd.
PP PP compounds
PP
PP compounds
PP PP compounds
Sumika Polymer Compounds Dalian Co., Ltd.
Sumika Polymer Compounds (Thailand) Co., Ltd.
PP PP compounds
PP PP compounds
Chiba Works
Petrochemical products
Sumika Polymer
Compounds Europe Ltd.
PP
PP compounds
Sumika Polymer
Compounds America Inc.
PP
PP compounds
Propylene Oxide
Rabigh Refining and

Petrochemical Company
Petrochemical Complex
6-1
NOC
NOC Asia Ltd.
Refined petroleum products and

petrochemicals
Sumitomo Chemical Company, Limited Investors Handbook 2014
Petrochemical Corporation of Singapore (Pte.) Ltd.
Ethylene and Propylene, etc.
The Polyolefin Company (Singapore) Pte. Ltd.
Polyethylene and Polypropylene, etc.
Sumitomo Chemical
Asia Pte. Ltd.
Petrochemical products
Financial Highlights
* 2011 3 2010 3
* From FY2010, we have revised our method of allocation of R&D expenses for company-wide projects, etc. (FY2009 figures have been recalculated using
the revised method for purposes of comparison.)
Sales & Operating Income (Loss)*
Operating Income before Depreciation & Capital Expenditure*
Billions of yen
Billions of yen
792.0
800
649.9
600
Billions of yen
40
40
30
30
20
20
693.9
672.4
29.5
481.5
400
6.2
4.9
10
10
-40
11/3
12/3
13/3
10.5
-10
14/3
10/3
11/3
Total Assets & ROA*
Asset Turnover
Times
637.0
549.7
555.3
555.1
554.4
1.5
6
1.0
400
14/3
800
13/3
Operating income before depreciation

Capital expenditure
*
Billions of yen
12/3

Sales (left axis)
Operating income (loss) (right axis)
600
17.8
17.0
14.1
-3.2
-0.2
10/3
20.3
19.6
13.7
14.4
11.1
200
19.2
1.18
1.21
1.25
11/3
12/3
13/3
1.33
0.92
2.0
200
1.1
0.8
-0.0
10/3
-0.6
11/3
12/3
13/3
0.5
0
-1
14/3
10/3
14/3

Total assets (left axis)
ROA (right axis)
2013 2015
Corporate Business Plan FY2013 FY2015
2015
FY2015 Performance Target
Basic Policy
Billions of yen
900
Maximize profits from major investments

Strengthen business structure, taking account of future changes in business
environment
Change and Innovation
Billions of yen
30
792
760
694
600
20
10
300
805
24
10
5
0
-3
Restructure domestic operations (exit underperforming businesses,

review the management of production operations)
Strengthen competitiveness of operations in Singapore (shift toward
higher value-added products)
Maximize Petro Rabighs profitability (achieve more stable operations)
-300
-10
13/3
14/3
15/3
16/3
Forecast
Target)
Sales (left axis)

Operating income (right axis)
Investors Handbook 2014 Sumitomo Chemical Company, Limited
6-2
Facts and Figures
Global Petrochemical Operations

2015 5 Reduce our ethylene production capacity in Japan (by May 2015)
Saudi Arabia
Rabigh Phase II
Project*
Japan
1,000 t
2,000
1,500
Restructure
domestic
operations
1,000 t
1,600
2,000
1,300
1,500
1,000
1,000
500
607
500
400
Singapore
1,000 t
2,000
1,500
1,000
* 300 40
* Planning the production of higher value-added

petrochemicals using 3 million tons of naphtha
and 400 thousand tons of ethane
Japan
Singapore
Saudi Arabia
6-3
Advantage
1,090
500
Location
1,090
Priority
Measures
Mother plant/laboratory, leading the

effort to develop high value-added new
technologies, products and know-how
Restructure domestic operations

(exit underperforming businesses
and restructure production
operations)
A solid customer base and high-value

added products meeting the needs
of key customers in Asian markets
Strengthen competitiveness by
enhancing higher value-added
petrochemicals business
Robust cost competitiveness, taking

advantage of low-cost feedstocks and
fuels
Maximize Petro Rabighs

profitability (achieve more stable
operations)
Shut down Sumitomo Chemicals

ethylene plant and procure ethylene
from Keiyo Ethylene Downsize/exit
underperforming businesses
Restructuring of Chiba Works: Shut down ethylene plant and procure ethylene from Keiyo Ethylene
2015 5 Reduce our derivative production capacity in Japan (by May 2015)
1,000t/ 1,000t/y
700
600
Keiyo Ethylene
Sumitomo Chemical
415
300
200
100
Company
192
2/3
400
Annual production capacity
1994
1994
768 *
768,000 tons*
1970
1970
415
415,000 tons
Present
* 192

40
* Includes 192,000 tons of allotment to Sumitomo Chemical
Keiyo Ethylene
Sumitomo Chemical
Reduce
production
capacity to
two-thirds
Start-up of operation
500
400
Our ethylene production capacity in Japan
After restructuring
Keiyo Ethylenes plant is the newest and largest ethylene production facility in
Japan.
Sumitomo Chemicals ethylene plant came on stream more than 40 years ago.
Reduce our derivative production capacity in Japan
1,000t/ 1,000t/y
600
SM SM production capacity
PO PO production capacity
1,000t/ 1,000t/y
Nihon Oxirane
600
Sumitomo Chemical
500
Nihon Oxirane

500
181
PRC
400
300
400
200
200
200
100
300
200
200
200
425
100
0
Present
After restructuring
Present
After restructuring
* 2015 5
* Decided to close down SM and PO production at Nihon Oxirane by May 2015.
6-4

Olefin (Ethylene and Propylene)
Capacity, Production, Demand and Capacity Utilization Rate for Ethylene Derivatives
Millions of tons
100
200
81.8
80.8
150
132.0
100
108.0
138.0
111.6
82.2
145.9
82.0
157.0
149.6
126.7
122.7
119.9
82.4
80.7
165.0
83.5
82.5
160.2
142.1
136.2
132.1
182.1
176.2
170.1
84.1
83.1
153.1 75
146.4
50
50
25
08
09
10
11
12
13
14
15
16
17
Estimated

Production capacity (left axis)
Demand (left axis)
Capacity utilization rate (right axis)
Estimated
09
10
11
12
13
14
15
16
17
Production capacity
Middle East
Japan
China
Other Asia
Europe
Americas
Others
Total
14.3
7.8
12.2
23.5
29.5
39.7
5.0
132.0
20.6
7.7
13.2
23.9
28.7
38.9
5.1
138.0
22.5
7.7
15.7
26.9
28.6
39.3
5.2
145.9
24.9
7.5
17.7
27.7
27.0
39.3
5.6
149.6
26.8
7.4
20.8
30.0
27.0
39.3
5.7
157.0
26.9
7.3
22.5
30.8
26.7
40.2
5.8
160.2
28.6
7.3
24.2
31.9
26.1
40.9
6.0
165.0
28.7
7.3
25.6
33.3
26.2
42.5
6.5
170.1
29.8
7.3
25.9
33.3
26.3
46.9
6.7
176.2
30.1
7.3
26.1
34.1
26.3
50.3
8.0
182.1
Production
Middle East
Japan
China
Other Asia
Europe
Americas
Others
Total
12.5
6.8
10.4
20.2
24.0
33.3
4.2
111.4
15.5
6.4
12.1
21.0
22.5
31.9
4.2
113.4
18.7
6.6
14.6
22.5
23.5
33.1
4.3
123.4
21.8
6.2
16.5
23.1
21.4
34.9
3.7
127.6
23.6
5.6
15.8
23.7
21.5
34.4
3.9
128.5
24.5
5.9
19.1
25.5
21.0
35.4
4.4
136.0
25.4
5.9
22.1
26.0
21.1
36.3
4.7
141.5
26.4
5.9
24.7
27.0
21.4
38.0
5.1
148.5
27.0
5.9
25.4
27.1
20.8
42.7
5.5
154.3
28.1
5.8
25.2
28.1
20.8
45.5
6.3
159.9
Demand
Middle East
Japan
China
Other Asia
Europe
Americas
Others
Total
4.1
5.4
20.0
15.3
27.7
29.2
6.2
108.0
4.9
4.3
26.2
16.7
25.9
27.5
6.0
111.6
5.2
4.9
28.7
18.5
27.0
28.6
6.9
119.9
8.4
5.1
30.7
18.5
22.2
30.6
7.4
122.7
8.9
4.8
31.0
19.2
23.4
31.4
8.1
126.7
9.5
4.8
32.8
20.1
23.7
32.4
8.6
132.1
10.2
4.9
34.3
20.3
24.0
33.3
9.2
136.2
10.8
4.9
36.3
21.8
24.3
34.2
9.7
142.1
11.4
4.8
38.2
22.7
23.9
35.1
10.2
146.4
12.2
4.9
40.6
24.4
23.8
36.5
10.7
153.1
(Source) Ministry of Economy, Trade and Industry
2013 4 (Note) Announced April 2013
6-5
Millions of tons
08
Capacity, Production, Demand and Capacity Utilization Rate for Propylene Derivatives
Millions of tons
100
160
85.7
84.0
83.4
84.4
81.4
82.8
120
111.3
95.8
80
84.7
86.9
84.8
82.6
126.6
124.5
122.8
75
105.6
101.4
96.5
92.2
87.7
81.7
79.9
74.8
72.6
116.3
104.0
100.3
89.0
83.0
110.0
50
25
40
08
09
10
11
12
13
14
15
16
17
Estimated
Demand (left axis)
Capacity utilization rate (right axis)
Production capacity (left axis)
Estimated
Millions of tons
08
09
10
11
12
13
14
15
16
17
Production capacity
Middle East
Japan
China
Other Asia
Europe
Americas
Others
Total
5.1
5.7
14.1
15.7
18.6
22.8
2.6
84.7
6.7
5.8
15.8
16.9
18.8
22.4
2.6
89.0
8.0
5.9
18.7
19.0
18.5
22.5
3.1
95.8
8.4
5.8
20.7
19.3
19.7
23.4
3.1
100.3
8.6
5.7
23.1
20.6
19.5
23.4
3.1
104.0
9.0
5.6
27.3
22.0
19.5
24.1
3.8
111.3
9.7
5.5
31.2
22.4
19.5
24.2
3.8
116.3
10.5
5.5
33.9
22.4
19.8
26.6
4.0
122.8
10.6
5.5
34.8
22.7
19.9
27.1
4.0
124.5
10.8
5.5
34.8
23.2
19.9
27.6
4.9
126.6
Production
Middle East
Japan
China
Other Asia
Europe
Americas
Others
Total
3.3
5.2
12.6
13.1
16.9
18.8
2.2
72.2
4.1
4.8
14.2
14.5
16.1
18.7
2.2
74.6
5.9
5.3
15.0
16.2
16.5
20.0
2.3
81.1
6.5
4.9
16.8
16.5
17.6
18.9
2.5
83.6
7.4
4.6
18.3
17.1
17.7
20.0
2.5
87.8
7.5
4.8
21.7
18.6
17.8
20.5
3.0
94.0
8.0
4.8
24.8
19.5
17.7
20.9
3.4
99.0
8.8
4.8
27.8
19.8
18.1
22.8
3.5
105.6
9.4
4.7
29.3
19.7
18.9
24.1
3.7
109.9
9.9
4.7
30.0
20.6
18.5
24.6
4.2
112.4
Demand
Middle East
Japan
China
Other Asia
Europe
Americas
Others
Total
2.2
4.8
16.8
9.9
18.4
17.8
2.6
72.6
2.0
3.8
20.8
10.7
17.3
17.5
2.7
74.8
2.2
4.4
21.5
12.1
18.1
18.5
3.1
79.9
4.2
4.2
23.1
12.6
18.5
16.1
3.1
81.7
4.5
4.0
24.8
13.3
19.7
18.1
3.3
87.7
4.8
4.4
26.7
13.9
20.1
18.8
3.5
92.2
5.2
4.4
28.8
14.5
20.5
19.4
3.8
96.5
5.6
4.4
31.0
16.0
20.8
19.6
4.0
101.4
6.0
4.3
33.3
16.5
20.9
20.2
4.2
105.6
6.6
4.3
35.9
17.4
20.7
20.7
4.4
110.0
(Source) Ministry of Economy, Trade and Industry
2013 4 (Note) Announced April 2013
6-6
Ethylene: Global Production Capacity

1,000t/ 1,000t/yr
Company
1
2
3
4
5
6
7
8
9
10
SABIC
SABIC
Dow Chemical
ExxonMobil
SINOPEC
LyondellBasell
Shell
Iran NPC
Ineos Olefins
Chevron Phillips
Total Petrochemicals
Sub-total of 10 companies
Total
NPC
10
America
Europe
6,787
4,400
2,115
3,065
800
4,450
2,212
1,448
1,659
1,772
3,552
1,710
24,883
39,985
2,580
Asia and others
10,250
1,144
3,800
7,835
750
1,922
5,268
1,615
13,282
32,221
Total
698
640
32,307
83,336
12,365
10,996
9,000
7,835
6,648
5,793
5,268
4,352
4,250
3,965
70,472
155,572
2,997
607
1,090
1,300
2,997
607
1,090
1,300
2013(Source) The Heavy & Chemical Industries News Agency
2012
(Note) Production capacity in 2012. Production capacity of JVs calculated in proportion to shareholdings.
Sumitomo Chemical
Sumitomo Chemical
PCS
Petro Rabigh
PCS
(Source) Sumitomo Chemical
2012 1,413
(Note) As of end of FY2012. Production capacity for each company calculated individually. Total, commensurate with shareholdings, is 1,413k tons/year.
Ethylene: Domestic Production Capacity of Japanese Chemical Companies
Company (or joint venture)
JX
Mitsui Chemicals
(Osaka Petrochemical Industries)
(Keiyo Ethylene
Sub-total
Idemitsu Kosan
Mitsubishi Chemical
Maruzen Petrochemical
(Keiyo Ethylene)
Sub-total
Showa Denko
Tonen Chemical
Tosoh
JX Nippon Oil & Energy
Sumitomo Chemical
(Keiyo Ethylene)
Sub-total
Asahi Kasei Chemicals
Total
1,000t/ 1,000t/yr
Production capacity
Current
612
500
192
1,304
1,103
1,374
525
384
909
691
540
527
460
415
192
607
504
8,019
Plan
*1
-192
-192
*2
-322
-72
-72
*4
*3
-415
264
-151
-504
-1,241
Total
612
500
0
1,112
1,103
936
525
312
837
691
540
527
460
0
456
456
0
6,778
*1 2014
*2 2014
*3 2011 2016 4
*4 2015 5
*1 Aim to exit from Keiyo Ethylene Co. in fiscal 2014.
*2 Decided to close down the No. 1 ethylene plant at Kashima in 2014 to coincide with periodic maintenance.
*3 Asahi Kasei Chemicals and Mitsubishi Chemical have been jointly running their two ethylene facilities in Mizushima under Nishi Nippon Ethylene LLP
since 2011. The two firms have decided to unify their ethylene operations into the Mitsubishi facility and scrap the Asahi Kasei facility in April 2016.
*4 Decided to close down an ethylene plant in or before in May 2015 when periodic maintenance will take place. Also decided to increase purchases of
ethylene from Keiyo Ethylene.
2012 12 31
(Note) Capacity before scheduled maintenance shut down (As of December 31,2012). Production capacity of JVs calculated in proportion to shareholdings.
6-7
Capacity Expansion Plans for New and Additional Ethylene Plants in Asia, Middle East and United States
1,000t/ 1,000t/yr
Region
Asia
Country
China
Company
1,000
Naphtha/Gas Oil/
Residues
800
Naphtha/Gas Oil/
Residues
800
EPB/Naphtha/Gas
Oil/Residues
600
KPC
EPB/Naphtha
1,000
Naphtha/Gas Oil/
Residues
1,000
Naphtha/Gas Oil/
Residues
1,000
SINOPEC Hainan Refining & Chemical
/QPI/Shell
CNPC/QPI/Shell (China) refining and

petrochemical complex
IOC
ONGC/GAIL/BPCL
Long Son
ExxonMobil Chemical
Shanghai
Sichuan
Chengdu
Lanzhou
Guangzhou
Maoming
Hainan
Panipat etc.
Dahej
=
Ba Ria-Vung Tau
Naphtha
1,200
Ethane/Naphtha
1,100
Naphtha/Gas Oil/
Residues
Jurong
Total
Sadara
Qatar
UAE
Iran
1,000
Shell
Borouge3
Kavyan
Ras Laffan
Ruwais
Assaluyeh
U.S.A.
ExxonMobil
CP Chem, TX
Dow Chemical, LA
Sasol
Chevron Phillips
Shell
Formosa, TX
OxyChem/Mexichem
Axiall/Lotte Chemical
Mexico
Braskem/IDESA
Texas
Texas
Louisiana
Texas
Pennsylvania
Texas
Texas
1,300
Ethane
1,500
Ethane
1,000
0
1,500
3,800
1,500
Ethane (Shale)
1,500
Ethane (Shale)
1,500
Ethane (Shale)
1,500
Ethane (Shale)
1,500
Ethane (Shale)
1,500
Ethane (Shale)
1,200
Ethane (Shale)
550
1,000
Ethane (Shale)
Louisiana
Total
1,200
Ethane/Propane
Ethane (Shale)
Texas
Coatzacoalcos
5,660
1,500
5,500
EPB/Naphtha
Jubail
Total
North
America
800
1,800
Middle East Saudi Arabia
1,360
Naphtha
1,200
Recovery from FCC/

DCC unit
Jamnagar
500
Naphtha
Zhejang
2018
800
Coal to Olefins
Shaanxi
2017
RELIANCE
Naphtha
Wuhan
2016
Shenhua and Dow Cooperate in

Coal-to-Chemicals Project
2015
Maoming Petrochemical
Singapore
2014
Naphtha/Gas Oil/
Residues
Sinopec Guangzhou and KPC JV
2013
CNPC Lanzhou Petrochemical
Vietnam
Material
Chengdu Petrochemical
Location
Sinopec Wuhan Petrochemical
Sinopec Sichuan Petroleum
India
Sinopec Shanghai Petrochemical
1,050
Ethane (Shale)
1,050
1,500
9,250
1,000
(Source) Compiled by Sumitomo Chemical based on the Chemical Daily Co., Ltd. Kagaku Keizai, extra edition, Mar. 2013 and Dec. 2012, Ministry of
Economy, Trade and Industry.
6-8
Polyolefin (Polyethylene, Polypropylene and Advanced Polymers)
Polyolefin Production Capacity of Japanese Chemical Companies

2013 12 31 As of December 31, 2013
1,000t/ 1,000t/yr
Production capacity
Company (or joint venture)
LDPE
LLDPE
417
Prime Polymer
HDPE
338
Sumitomo Chemical
347
364
172
183
475
SunAllomer
Tosoh
Nippon Unicar
Asahi Kasei Chemicals
DuPont-Mitsui Polychemical
*1Japan Polychem*1 (65%)

Chisso (35%)
1,186
*1Japan Polychem*1 (58%)

*2Japan Polyolefin*2 (42%)
316
671
408
408
Including amount produced by Evolue Japan

Co., Ltd.
LyondellBasell (50%)
Showa Denko (32.5%)
JX
125
339
180
72
48
300
Tonen Chemical (50%)

*3Union Carbide*3 (50%)
163
283
Asahi Kasei (100%)
170
Mitsui Chemicals (50%)

DuPont (50%)
174
Chisso (50%)
Maruzen Petrochemical (50%)
173
Ube Industries (50%)

Maruzen Petrochemical (50%)
120
170
174
123
50
8
Mitsui Chemicals
Total
1,075
31
2,026
Mitsui Chemicals (65%)

Idemitsu Kosan (35%)
183
Keiyo Polyethylene
Ube-Maruzen Polyethylene
Remarks
Ownership ratio, etc.
Total
JX Nippon Oil & Energy (17.5%)
1,271
1,075
Japan Polypropylene
Japan Polyethylene
PP
Including amount produced by other companies
1,295
1,117
1,331
8
3,070
6,813
*1 Mitsubishi Chemical (100%)

*2 Showa Denko (65%)JX JX Nippon Oil & Energy (35%)
*3 Dow Chemical (100%)
2013
SourceCompiled by Sumitomo Chemical based on the Heavy & Chemical Industries News Agency.
2012
Note
Production capacity in 2012. Production capacity of JVs calculated in proportion to shareholdings.
2013 12 31 As of December 31, 2013
Sumitomo Chemical
172
Petro Rabigh
Total
427
670
925
600
300
700
1,600
783
300
1,686
3,196
*4 Sumitomo Chemical (95.71%)

6-9
621
50
255
316
50
Evolue Japan
TPC
The Polyolefin Company
(Singapore)
133
Prime Polymer (75%)

Sumitomo Chemical (25%)
NSPC*4 (70%)
Sumitomo Chemical (37.5%)
Saudi Aramco (37.5%)
Polyethylene: Global Production Capacity

1,000t/ 1,000t/yr
Company
LDPE
HDPE
Total
ExxonMobil
5,430
4,130
9,560
Dow Chemical
6,171
1,457
7,628
3 SABIC
SABIC
3,860
3,653
7,513
LyondellBasell
2,548
3,079
5,627
Chevron Phillips
Not disclosed
2,948
2,948
58,225
45,138
103,363
1,510
1,510
Total
2013
(Source) The Heavy & Chemical Industries News Agency
2012
Sumitomo Chemical
2012
Note
As of end of FY2012. Production capacity for each company calculated individually.
1,000t/ 1,000t/yr
Company
LyondellBasell
2 SABIC
SABIC
Total Petrochemicals
Formosa Plastics Corp/

Formosa Chemicals & Fibre
America
Europe
Asia and others
Total
1,996
4,529
1,373
7,898
1,100
2,470
3,570
1,175
1,315
345
2,835
2,060
2,740
680
ExxonMobil
1,223
440
765
2,428
5,074
7,384
7,013
19,471
Total
11,661
11,769
41,455
64,886
1,686
1,686
Polypropylene: Global Production Capacity
2013
(Source) The Heavy & Chemical Industries News Agency
2012
Sumitomo Chemical
2012 1,016
Note
As of end of FY2012. Production capacity for each company calculated individually. Total, commensurate with shareholdings, is 1,016k tons/year.
6-10
Shifting to High Value-Added Products
Proportion of high value-added products in PE and PP business of the company

2013
Capacity
FY2013
Polyethylene
1,510
World total
355
Japan
EPPE (inner linings for shoes, agricultural films, etc.),

PE for protective films, EVA for photovoltaic cells
255
Singapore
Saudi Arabia
0%
2013 FY2013
LDPEEVAEPPE
PEEVA
High value-added products: High value-added LDPEEVA,
900
50%
100%
LDPEHDPELLDPE
Commodity products: Commodity LDPE, HDPE, LLDPE
(films, extrusion molded products)
Capacity
LDPEHDPELLDPE
Commodity
products: Commodity LDPE, HDPE, LLDPE
(films,
extrusion
World
total molded products)
1,686
LDPEEVAEPPE
316
Japan
PEEVA
Polypropylene
High
value-added products: High value-added LDPEEVA, EPPE

670
Singapore
(inner
linings for shoes, agricultural films, etc.),
PE for protective films, EVA for photovoltaic cells

700
Saudi Arabia
0%
50%
100%
PP
PP
High value-added products: High value-added PP block
copolymer (automobiles, etc.), PP random copolymer,

High-performance PP (film for retort-packaged foods,
food containers, etc.) etc.
PP PP
Commodity products: Commodity PP homopolymer &

block copolymerfilms, misc. goods, industrial fibers, etc.)
PP PP

PP
Commodity products: Commodity PP homopolymer & block
copolymer
films, misc. goods,
industrial
fibers,
etc.)
Sumitomo Chemicals
manufacturing
bases
for PP
compounds
PP PP

High value-added products: High value-added PP block copolymer
(automobiles, etc.), PP random copolymer,

PP
High-performance PP
retort-packaged
foods, food Zhuhai
containers,
etc.) etc.
Sumika
Polymer
Developmentof(film
our for
global
manufacturing
250
Global production capacity: Approx. 250
Compounds Co., Ltd.
Sumika Polymer Compounds

Dalian Co., Ltd.
22Production capacity 22
1,000t/ Capacity 1,000t/yr
Sumika Polymer Compounds

(Thailand) Co., Ltd.
Jilin Dongcheng Sumika Polymer

Compounds Co., Ltd.
Sumika Polymer
Compounds Europe Ltd.
Chiba Works
Sumika Polymer
Compounds America, Inc.
Sumitomo Chemical Polymer

Compounds Saudi Arabia Company Ltd.
The Polyolefin Company

(Singapore) Pte. Ltd.
*
* In addition to the major production sites on the map, global production capacity includes the capacity of contracted production.
6-11
S-SBR
Supply-demand forecast for S-SBR for high-performance fuel-efficient tires

1,000t
400
Demand for original equipment (worldwide)

Demand for replacement (Japan)
Production capacity
300
243
243
21
263
243
15
200
10
5
100
139
192
25
254
263
337
30
30
28
353
353
353
360
379
310
218
09
10
12
11
13
14
15
16
Sumitomo Chemical estimates
S-SBR
Competitive advantage of Sumitomo Chemicals S-SBR for high-performance fuel-efficient tires
Batch manufacturing enables

the production of polymer with
a highly controlled structure
Proprietary modification
technology
Achieves a good balance of high fuel-efficiency and

wet-grip performance at a high level
6-12
Petrochemicals (Propylene Oxide)
Advantage for Our PO-Only Process

PO-only process

PO
Air

PO
OOH
Oxidation
H2O
C3
OH
[Ti]
Epoxidation
Hydrogenation
O
Product
H2
PO
Purification
By recycling cumene as an oxygen carrier, it is possible to produce

PO without any by-products or co-products.
We have achieved significantly higher yields for PO than with
conventional processes using our proprietary high-performance
epoxidation catalyst developed in-house.
The process does not produce any chlorinated wastes or waste
water, reducing environmental impact.
Heat of reaction in each step is recovered and used efficiently,
making it far more energy-efficient than conventional processes.
Propylene Oxide: Global Production Capacity

1,000t/ 1,000t/yr
Company
America
Europe
Asia and others
Total
Dow Chemical
1,730
780
215
2,725
LyondellBasell
1,103
613
142
1,858
Shell
335
585
920
2,833
1,728
942
5,503
Total
3,473
2,463
2,939
8,875
2013
(Source) Compiled by Sumitomo Chemical based on the Heavy & Chemical Industries News Agency.
(Note) Production capacity of JVs calculated in proportion to shareholdings.
Sumitomo Chemical
Nihon Oxirane
200
200
181
181
Petro Rabigh
200
200
Sub-total
581
581

2012 2015 PO
181
(Note) As of end of FY2012. Production capacity for each company calculated individually. Sumitomo Chemical decided to close down PO plant in NOC
by 2015.
6-13
Rabigh Refining and Petrochemical Company (Petro Rabigh)

The Rabigh Project Flow Chart

1,000t/ Capacity 1,000t/yr)
Naphtha
Topper
Crude Oil
400,000 barrels/day
2,900
Naphtha reformer
Paraxylene/Benzene
1,300/400
Kerosene
Caprolactam
(TBD)
Distillation under
reduced pressure
Gas Oil
-6
Nylon-6
(TBD)
Fuel Oil
FCC
Gasoline
Butane
2,800
Alkylation
LLDPE
EVA/LDPE
HDPE
EPDM/TPO
600
Ethylene
1,3001,600
Ethane Cracker
Ethane
70/80
70/10
300
MEG
1,2001,600
600
350
350
9001,100
Phenol/Acetone
250/150
PPBlock
Propylene
Acrylic Acid
(TBD)
PO
SAP
(TBD)
200
Polyols
PPHomo
(TBD)
MTBE
MTBE/Metathesis
MMA/PMMA
(90/50)
Petroleum refinery Petrochemical IIPhase II Items under consideration
Cost Difference of Petrochemical Feedstocks

(US$/MMBTU)
30
25
Naphtha (Singapore)
Natural gas (US)

Ethane (Middle East)
20
15
10
5
0
04
05
06
07
08
09
10
11
12
13
6-14
Market Conditions
Price of Polyethylene in Southeast Asia

US$/Mt
2,000
LDPE
Naphtha
*Cash Margin*
1,600
1,200
800
400
08/
09/
10/
11/
12/
13/
1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12
(Source) Sumitomo Chemical* LDPE-1.3* Estimated theoretical value based on the formula LDPE naphtha 1.3.
Price of Polyolefin in Southeast Asia

US$/Mt
2,000
PP
Naphtha
*Cash Margin*
1,600
1,200
800
400
08/
09/
10/
11/
12/
13/
1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12
(Source) Sumitomo Chemical* PP- 1.3 * Estimated theoretical value based on the formula PP naphtha 1.3.
Price of Olefin in Southeast Asia

US$/Mt
2,000
1,600
1,200
Styrene monomer
Propylene Oxide
Ethylene
Propylene
MEG
800
400
08/
09/
10/
11/
12/
13/
1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12 1~3 4~6 7~9 10~12
ICIS (www.icis.com)(Source) ICIS (www.icis.com)
6-15

6-16

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6

Petrochemicals & Plastics

Established PP compounds in Changchun and Dailan,

Agreement reached with Saudi Aramco to conduct joint

Stopped manufacturing and selling general-purpose PP

The conversion of The Polyolefin Company (Singapore)s

Decided to move ahead by finalizing the Rabigh Phase II

Acquired polypropylene compounds operations in

Decided to close down an ethylene plant at Chiba Works.

A large integrated refining and petrochemical complex

Decided to acquire entire stake in Nihon Oxirane and to

Completed PP compounds production bases in North

Constructed a new plant in Singapore for the manufacture of the S-SBR.

Zhuhai Sumika Polymer Compounds Co., Ltd.

Jilin Dongcheng Sumika Polymer Compounds Co., Ltd.

Sumika Polymer Compounds Dalian Co., Ltd.

Sumika Polymer Compounds (Thailand) Co., Ltd.

Rabigh Refining and

Refined petroleum products and

Sumitomo Chemical Company, Limited Investors Handbook 2014

Petrochemical Corporation of Singapore (Pte.) Ltd.

Ethylene and Propylene, etc.

The Polyolefin Company (Singapore) Pte. Ltd.

Polyethylene and Polypropylene, etc.

Sales & Operating Income (Loss)*

Operating Income before Depreciation & Capital Expenditure*

Total Assets & ROA*

Petrochemicals & Plastics

Operating income before depreciation

Operating income (loss) (right axis)

ROA (right axis)

Maximize profits from major investments

Change and Innovation

Restructure domestic operations (exit underperforming businesses,

Sales (left axis)

Operating income (right axis)

Investors Handbook 2014 Sumitomo Chemical Company, Limited

Facts and Figures

Global Petrochemical Operations

* Planning the production of higher value-added

Mother plant/laboratory, leading the

Restructure domestic operations

A solid customer base and high-value

Robust cost competitiveness, taking

Maximize Petro Rabighs

Sumitomo Chemical Company, Limited Investors Handbook 2014

Shut down Sumitomo Chemicals

Annual production capacity

Our ethylene production capacity in Japan

Reduce our derivative production capacity in Japan

Petrochemicals & Plastics

Investors Handbook 2014 Sumitomo Chemical Company, Limited

(Source) Ministry of Economy, Trade and Industry

2013 4 (Note) Announced April 2013

Sumitomo Chemical Company, Limited Investors Handbook 2014

Petrochemicals & Plastics

(Source) Ministry of Economy, Trade and Industry

2013 4 (Note) Announced April 2013

Investors Handbook 2014 Sumitomo Chemical Company, Limited

Ethylene: Global Production Capacity

Asia and others

2013(Source) The Heavy & Chemical Industries News Agency

(Source) Sumitomo Chemical

Restructure domestic operations (exit underperforming businesses,

1Japan Polychem1 (65%)

1Japan Polychem1 (58%)

By recycling cumene as an oxygen carrier, it is possible to produce