Chapter 1 - Process Background, Market Analysis and Site Selection

EH2208O
DESIGN PROJECT II (MARCH 2017)
PRODUCTION OF 20,000 METRIC TONNES OF

POLYTETRAFLUOROETHYLENE PER YEAR
CHAPTER 1: PROCESS BACKGROUND,

MARKET ANALYSIS AND SITE SELECTION
GROUP MEMBERS
AIMAN HAKIM BIN ROSLAN 2013849224

FATIN FATIHA BINTI ABDUL RAHIM 2014850038
HANEARYTHA LITAD CHARLES 2014679702
MUHAMMAD FAHMI BIN NIZAM 2013251462
NOOR AMILIA BINTI KHOSIM 2014231358
NURBADAYU BINTI BASIRON 2013493592
SUPERVISOR:
MS CHRISTINA VARGIS
FACULTY OF CHEMICAL ENGINEERING

UNIVERSITI TEKNOLOGI MARA
SHAH ALAM
CHAPTER 1
PART 1: PROCESS BACKGROUND AND SELECTION
1.1.1 PROCESS BACKGROUND
1.1.1.1 History
The discovery of polytetrafluoroethylene (PTFE) was accomplished by an

American chemist named Dr. Roy Plunkett in 1938. During that time, most of the
refrigerants used were highly flammable and toxic meanwhile the safest on the
market, called Refrigerant 114 was protected by a patent and could not be
marketed to other manufacturers. To overcome the restriction, Plunkett decided to
develop a new refrigerant with similar properties to Refrigerant 114 by combining
tetrafluoroethylene (TFE) with hydrochloric acid (HCl). Plunkett carried out the
reaction in metal containers and kept them on dry ice in order to cool down and
liquefy the TFE gas.
The next morning, Plunkett was shocked when he discovered that the
cylinder recorded zero pressure despite having the same amount weight as it had
on the day before. Curiously, both Plunkett and his technician cut open the cylinder
and discovered a small amount of slippery white substance alongside the wall of
the container. They soon analyzed the waxy powder and gave name to the new
substance as polytetrafluoroethylene, later trademarked as Teflon by DuPont
Company (Ebnesajjad, 2016).
1
Figure 1.1.1: Dr. Roy Plunkett, founder of PTFE (Source: Marcote UK
Ltd., n.d.).
1.1.1.2 Chemical and Physical Properties of PTFE
PTFE, or scientifically known aspoly(1,1,2,2-tetrafluoroethylene) is the synthetic

fluoropolymer of TFE. It exists as a white powder at room temperature and has a
waxy appearance. PTFE is very tough, flexible and acts as a good electrical
insulator. The surface energy and coefficient of friction are both very low, the latter
being the lowest of any solid. The combination of low surface energy coefficient
and low friction coefficient gives PTFE an excellent non-stick characteristic, one
which gives the defining value in its everyday use. It also has an excellent chemical
resistance to a variety of reagents, with the exception of molten alkali metals and
fluorine. To date, there is no known solvent for this PTFE.
PTFE is commonly produced through the polymerization of the monomer,

TFE. Although the structure of the monomer would convey thermoplastic
characteristic to the polymer, PTFE does not show conventional melting behavior
nor does it liquefy during heating. However, it forms a high-viscous translucent
substance which fractures rather than flows when a specific amount of force is
exerted onto it (Nicholson, 2012).
2
Figure 1.1.2: Chemical structure of PTFE.
Table 1.1.1: Properties of PTFE (Crown Plastics Inc, 2016).

Physical
Density (g/cm3) 2.16
Water absorption, 24 hours (%) <0.01
Mechanical
Tensile strength (psi) 3,900
Tensile modulus (psi) 80,000
Tensile elongation at break (%) 300
Flexural strength (psi) No break
Flexural modulus (psi) 72,000
Compressive strength (psi) 3,500
Hardness, Shore D 70,000
Thermal
Coefficient of Linear Thermal 7.5
Expansion
Heat Deflection Temperature (C) 55
at 264 psi
Melting Temperature (C) 335
Maximum Operating Temperature 260
(C)
Thermal Conductivity in:
(BTU-in/ft2-hr-F) 1.7
(x10-4cal/cm-sec-C) 5.86
3
1.1.1.3 Applications
Since its discovery in 1938, PTFE has been used in a wide scope of field, ranging
from industrial processes to commercial and household appliances. However,
PTFE is famously known as Teflon a trademark product from DuPont Company.
The non-sticking and slippery properties make it an ideal coating to be used by the
kitchen utensil manufactures for the production of non-stick pans and other
utensils.
Besides the two main characteristics, PTFE also has other unique features
that have been exploited in many ways as it has high temperature resistance, high
melting point, low reactivity to most chemicals as well as water-resistance. These
properties make PTFE a useful substance in a number of applications, some of
which are as listed below:
i) Petrochemical and chemical processing
PTFE is used widely chosen in the use for gaskets, vessel linings, pump interiors,
washers, rings, seals, spacers, dip tubes and well-drilling components. PTFE is
chosen since it is resistance to corrosion and chemically inert (Mishra and Yagci,
2008)
ii) Electrical applications
PTFE is considered one of the best insulators. It has the capability to insulate up
to 500 volts per mil (V/mil) and more in terms of dielectric strength. It is commonly
used in wire and cable wrap, and to separate conductive surfaces in capacitors.
Practically, PTFE are made into shapes of thick walled close-tolerance extruded
tubing whereby it can be able to machine or drill long lengths to close tolerances.
PTFE also can be machined into standoff insulators, and many different types of
high voltage encapsulation devices for electrical components (Mishra and Yagci,
2008)
4
iii) Semi-Conductor Industry
PTFE is inert and its operating temperature range from -350F to 500F. PTFE is
the material of choice for various goods which are commonly used in chip
manufacturing including encapsulation devices for quartz heaters (Mishra and
Yagci, 2008)
iv) Food, Beverage and Pharmaceutical industries
Virgin PTFE can also be use in food, beverages, cosmetics and pharmaceutical
industries. It provides a thin film and sheets that make an inert and non-toxic slide
surface without microscopic depressions which microbes can grow in such
environment. Conveyance components are able to withstand high temperatures
inside baking and drying ovens as well as heated segments of the food, cosmetics
or pharmaceuticals manufacturing processes.
PTFE coatings are important in the pharmaceutical industry since it provides an

ease to clean and purge braid seals as well as to strengthen the system. The
pharmaceutical industry uses a very high standards for all materials within it and
PTFE meets the particular requirement (Mishra and Yagci, 2008)
v) Laboratory applications
PTFE piping, tubing and vessels are used in various laboratory wares. This
statement is true due to PTFEs resistance to chemicals, inertness and the
absences of contaminants on the surface of PTFE products (Mishra and Yagci,
2008)
vi) PTFE Compounds
Various type of fillers can be easily blended with PTFE base resin to enhance
properties of glass or bronze fillers for instance .Fillers can be improve by PTFE to
add stiffness and strength, carbon fillers for conductivity, and moly blends for
added lubricity. PTFE does not melt however it cannot be molded into complex
shapes, but must be machined.
5
1.1.2 PROCESS SELECTION
PTFE can be produced from a variety of polymerization processes namely,

Polymerization in Solution and CO2, Photo-Initiated Polymerization, Suspension
Polymerization and Dispersion Polymerization. The four methods will be compared
side by side according to a set of criteria and scored from 1 5 (with 1 being the
least preferable and 5 being the most preferable) to determine to the best
production method. The process with highest score will be selected for the
production of PTFE.
1.1.2.1 Dispersion Polymerization
Dispersion polymerization is the polymerization of TFE to produce fine powders of

PTFE with the help of an initiator such as ammonium persulfate or potassium
persulfate. Polymerization of TFE by dispersion is a highly controlled regime as it
will produce PTFE particles ranging from 0.05-0.3m. (Teflon Product
Information, 1997). TFE is produced by thermal decomposition of
chlorodifluoromethane at 850 to 900C. After the decomposition process,
molecules of HCl are removed from TFE through stages of purification (Edwards,
1967).
During polymerization of TFE, dispersion polymers are converted into water

dispersed latex particles under the influence of mild agitation at temperature
between 0 to 95C and pressure of 0.3 to 2.4 MPa (Ebnesajjad, ,2016). The water
content in PTFE product from dispersion should be minimized to decrease
transportation cost, therefore heat is used to evaporate the excess water. The
powders then agglomerate into a free flowing fine powder. PTFE dispersions with
solid content up to 65% are commonly used for coating or metal surfaces and
fiberglass. The storage of PTFE product should be below 25C to prevent certain
form of deterioration (Saunders, n.d.).
The mechanism for the chemical reaction for dispersion polymerization of

TFE to PTFE are explained by Ebnesajjad (2016) as follows:
Chloroform preparation:
4 () + 32 () 3 () + 3()

6
Chlorodifluoromethane preparation:
3 () + 2()
2 () + 2()

TFE synthesis:
22 () 2 2 + ()

Polymerization of TFE:
2 ,
2 4 () (2 4 ) ()
Figure 1.1.3: Process Flow Diagram for Dispersion Polymerization
1.1.2.2 Suspension Polymerization
The two forms of PTFE that are most commonly manufactured are granular and
fine powder. Granular PTFE can be produced by suspension polymerization in an
aqueous medium with little or no dispersing agent according toTeng(2012) while
under the effect of vigorous agitation at elevated temperature and pressure as
mentioned by Ebnesajjad (2013). Granular PTFE is widely used for compression
molding, isostatic molding and ram extrusion.
7
The process of suspension polymerization is almost identical to dispersion
polymerization as it involves the use of an initiator to polymerize TFE into PTFE
and same arrangement of equipment. The parameters that differentiate between
these two processes are the operating temperature, operating pressure, agitation
speed, initiation concentration, presence of surfactant, mode of operation and
batch size.
Figure 1.1.4: Polymerization of TFE into PTFE.
A typical suspension polymerization begins with the charging of highly

purified water into a reactor, which is equipped with a stirrer, followed by evacuation
and pressurization with TFE. Figure 1.5 illustrates the typical set up of the reactor.
Polymerization of TFE takes place under constant pressure to control the
molecular weight throughout the process and is held constant by feeding monomer
into the reactor. The content of the reactor is vigorously agitated at 600 rpm
(Ebnesajjad, 2013).
Figure 1.1.5: Typical Suspension Polymerization Reactor (Ebnesajjad,

2013).
8
An important parameter to consider during suspension polymerization is
the temperature as it can affect the size of granules produced. Temperature is
controlled by adjusting the temperature of a cooling jacket surrounding the reactor.
The initiator performance and temperature are interrelated whereby ionic inorganic
initiators such as ammonium persulfate, alkali metal persulfates, potassium and
lithium persulfates would be effective in the range of 40Cto 90C. The
polymerization process is stopped after a certain product weight has been reached.
At the end of the polymerization cycle, the pressure is reduced and agitation
stopped. After the reactor is vented and cooled down, the granular product is
recovered.(Ebnesajjad, 2013)
Figure 1.1.6: Process Flow Diagram of Suspension Polymerization
1.1.2.3 Photo-Initiated Polymerization
For this process, TFE is synthesized in mercury to produce perfluorocyclopropane

as the main product and PTFE as the by-product. Prior to the synthesis process,
TFE is purified which then undergoes photolysis in the presence of mercury in a
5 cm diameter and long quartz cell. The cell is then wrapped in a 10 cm long
asbestos inside an aluminium oven. Hanovia low-medium pressure spiral-shaped
mercury-resonance arc is placed at one of the end of cell for irradiation (Dennis
Saunders & Julian Heicklen, 1964).
9
The photolysis of TFE is carried out at temperature from 21 to 224C.
Initiator such as iodomethane, bromoethane and pentafluorooidoethane are used
but it only produces a small amount oily product and small yield of PTFEas it is
mainly produced at a lab-scale (Cohen and Heicklen, 1965). The chemical reaction
mechanism for Photo-Initiated Polymerization as stated by Cohen &Heicklen
(1965) is shown below:-
2 4 + 22

22 2 4

2 + 2 4 3 6 + (2 4 )

1.1.2.4 Polymerization in Solution and Carbon Dioxide
This type of polymerization is generally not practiced because the PTFE

precipitation formed is unable to be further processed. For this process, highly
fluorinated hydrocarbon such as hexafluoropropene and
chlorodifluorohydrocarbons are used as the solvent. The solution polymerization
can be initiated by introducing gamma () rays and UV irradiation. It is reported
that large amount of carboxylic end groups need complex post-polymerization
treatments if copolymerization in aqueous media is used (Decker C, 1999).
More regular colloidal PTFE could be prepared in a batch reactor using

supercritical CO2 (scCO2) by adding copolymers of TFE with perfluoro-
propylvinylether (PPVE) or hexafluoropropylene (HFP) and bis-perfluoro-2-
propoxypropionyl peroxide (BPPP) as a free radical initiator. The chemical equation
for the process is as shown in Figure 1.7.
10
Figure 1.7: Copolymerization of TFE and PPVE in scCO2.
1.1.3 SELECTION CRITERIA
For the process selection, eight criteria have been chosen to be used as a
comparison between the available processes. A number will be assigned for each
criterion to determine the ranking of each process. The scores are given with the
number five (5) being the best and number one (1) being the worst. The criteria to
be evaluated are raw materials, catalyst/initiator, by-product, type of reactor,
operating temperature, operating pressure, safety, demand and manufacturing
practicability.
i) Raw material
For any process, raw material is required in order to produce the desired product.
Therefore, when choosing between several available processes, it is always
preferable to select the process with the least and most common raw material as
it is cheaper and can be easily obtained.
ii) Catalyst/Initiator
A catalyst or initiator is a substance that is used to either increase, decrease or

inhibits a certain process. A catalyst can be re-used time and again until it reaches
the end of its lifespan while not affecting the process chemically; meanwhile an
initiator is involved in the chemical reaction and can only be used once. For process
selection, it is wise to select method with a catalyst that is readily available,
inexpensive and can optimize the production performance.
11
iii) By-product
Certain processes produce undesired products which are harmful, toxic and
hazardous to the environment and health. These unwanted components are
commonly referred as by-products and are ideally avoided from being produced in
the process.
iv) Type of reactor
The reactor is typically referred to as the heart for any chemical manufacturing
process. There are many types of reactor that can be used for the conversion of a
raw material to the desired product. Amongst the commonly used reactors are
CSTR, PFR, packed bed reactor, fluidized bed reactor and many more. Hence, it
is crucial to identify the suitable type of reactor to be used for each process and
evaluate based on the maintenance, price and operating costs.
v) Operating condition
Operating condition such as temperature and pressure is the key to the success of
a manufacturing process. However, certain processes require conditions which are
different from normal conditions which will be more costly and harder to control.
Therefore, a process which operates at a reasonably normal condition should be
considered first before selecting the others.
vi) Safety
Safety plays an important role in any manufacturing industry. In process selection,

it is advisable to choose a process which strays from the usage of harmful
substances such as mercury, radiation or any other hazardous material.
vii) Demand
The main purpose of producing a product is to supply the demand and fulfill the
requirements of the market. Therefore, demand of the final product should be
assessed thoroughly before selecting the process.
12
viii) Manufacturing Capability
Factors in designing chemical plant such as economical, efficient process and most
importantly can produce desired amount of product is crucial. Hence, the process
that satisfies the factors will be chosen to be implemented in the chemical plant.
13
1.1.3.1 Summary of the Available Processes
Table 1.1.2: Summary of Available Processes for Production of PTFE.

Methods Dispersion Suspension Polymerization in Photo-initiated
Polymerization Polymerization Solution and Carbon Polymerization
Dioxide
Raw materials Chlorodifluoromethane Chlorofifluoromethane TFE, TFE, Mercury Bromide,
Hexafluoropropene, Phosgene, and Nitrous
PPVE and BPPP Oxide
Catalyst/Initiator Ammonium persulfate Ammonium persulfate Gamma rays or UV UV light or LED
or Benzoyl Peroxide or Benzoyl Peroxide irradiation
By-product Hydrochloric acid (HCl) Hydrochloric acid (HCl) Polymers with PTFE (small amount)
significant amount of
carboxylic end groups
Type of Reactor CSTR with semi batch Semi batch reactor (with Batch reactor or -
or continuous operation vigorous agitation) Autoclave high
(with mild agitation) pressure
Reaction 50 to 85C 65C 100 C 150 C
Temperature
Reaction Pressure 3 to 24 bar 17 bar 50 to 65 bar More than 1 bar
Safety Ammonium persulfate Ammonium persulfate Gamma rays can cause Mercury is a type of
can give bad impact to can give bad impact to stochastic health. poisoning metal. The
the environment the environment toxic can damage
kidneys and brains.
14
Demand Fine powder PTFE Granular PTFE Not highly demand due Small amount of PTFE
emerged as the leading emerged as the leading to no practical value being produced since
product about 50% in product about 33% of since the precipitate of Perfluorocyclopropane
automotive industries total PTFE market. PTFE cannot be further is the main product.
processed.
Manufacturing Practical Practical Lab scale only Lab scale only
Practicability
15
Table 1.1.3: Advantages and disadvantages of each process.
Process/Traits Advantages Disadvantages
Dispersion Fine powder PTFE fibrillates (a When the agitation speed is at
polymerization process which will form fibres) extremely high condition, the
above its ambient transition particle diameter tend to
temperature. Thus, the tendency to increase while polymerization
fibrillate is controllable. rate reduces (Kim et al., 1998)
Semi-batch polymerization is At extreme reaction condition,

acceptable to use on a wide range of the polymerization rate reduces
compositions, including with a very as the polymer particles
slow polymerization rates coagulated during
(Ebnesajjad, 2013) . polymerization. Coagulation
leads to a decrease in the
surface area of the particle,
resulting in a decrease in the
rate of supply of the monomer
and initiating radicals from the
aqueous phase.
Suspension Without regular surveillance,
Granular PTFE can be handled at
polymerization different ambient temperatures the development of hot spots
without much difficulty, although it on the reactor wall can result in
becomes sticky at certain deflagration; exothermic and
temperatures. explosive.
At some point, as the

The system requires no surfactants,
which are difficult to remove from temperature is not in within the
the product. range (lower temperature), the
effectiveness of persulfate may
No ionic end groups present which diminished due to insufficient
may be unstable during processing at decomposition rate (Ebnesajjad
high temperatures (Ebnesajjad, & Morgan, 2011).
2013).
Polymerization Amorphous precipitation often
Without any diluents, TFE forms
in Solution of explosive mixture with air. Thus, leads to undefined
Carbon Dioxide handling TFE with sufficient amount morphologies and shows low
degrees of polymerization in
16
of CO2 offers much safer alternative; several cases (Desimone,
forming a pseudoazeotrope. n.d.).
The removal of CO2 from the The only other solvent to use
TFE/CO2 mixture is not necessary for the fluorination of materials
when using CO2 as a polymerization is the chlorofluorocarbon, CFCs
medium (Du et al., 2009) (Cooper, 2000) which will cause
the depletion of the ozone layer.
Photo-Initiated Most halocarbon tested (which
The polymer formed by photo-
Polymerization initiated polymerisation will act as an excellent initiator) do
thoroughly dispersed on all internal not form a polymer
surface of the reactor (Kricheldorf et characteristic. For example;
al., 2004). 1,2-dibromotetrafluoroethane
shows no polymer formation
Friendly type of technique; operates while CCl4,
at room temperature, solvent-free iodomethane,bromoethane,
formulation and low energy iodoethane, bromo-
consumption (Shirai, 2014). trifluoromethane and
pentafluoroiodoethane yielded
only oily products (Kricheldorf
et al., 2004).
Effective type of lamp used,

LED, which is the most energy-
saving light source and able to
emit shorter wavelengths of
light (< 365 nm) is not
commercially available yet
(Shirai, 2014).
17
1.1.3.2 Scoring Analysis
Table 1.1.4: Scoring Analysis for Each Method
Dispersion Suspension Polymerization in Photo-initiated

Methods Polymerization Polymerization Solution and Carbon Polymerization
Dioxide
Raw material 5 4 2 2
Catalyst 4 4 2 3
By-product 3 3 2 2
Reactor used 5 4 3 1
Reaction Temperature 5 4 3 2
Reaction pressure 4 3 2 4
Safety 4 4 2 2
Demand 5 4 2 2
Manufacturing Practicability 5 5 1 1
TOTAL SCORE 40 35 19 19
Definition Most Preferable Good Moderate Poor Least Preferable

Rate 5 4 3 2 1
18
Based on the criteria and scoring carried out in the Table 1.4, dispersion
polymerization is chosen as the best method to produce PTFE leading with 40
points ahead of the other methods.
In terms of demand, the product from dispersion polymerization has higher

value compared to suspension polymerization, photo-initiated polymerization and
polymerization in solution and carbon dioxide. This is because dispersion
polymerization produces finer particles which is approximately 0.05 m compared
to suspension polymerization that is 25 to 500 m. Fine powders PTFE are easier
to mold to desired end products. In addition, photo-initiated polymerization and
polymerization in solution and carbon dioxide produces only small amounts of
PTFE as both processes are used for lab-scale production.
Besides, the reactor cost for suspension polymerization is higher in the long
term compared to dispersion polymerization. This is due to the vigorous agitation
involved in the suspension polymerization whereby high amount of energy is
consumed. The vigorous agitation can also lead to higher amount of maintenance
cost as it would require regular service compared to mild agitation in dispersion
polymerization.
19
1.1.4 CONSIDERATIONSFOR PRODUCTION OF PTFE
Among the crucial factors to consider when designing a plant for the production of
PTFE is safety. The monomer TFE is a highly flammable and may explode when
exposed to air. Therefore, for this Design Project, we propose to produce the monomer
instead of purchasing it by using chlorodifluoromethane as the raw material. As
opposed to TFE, chlorodifluoromethane is nonflammable and does not explode easily.
Apart from that, chlorodifluoromethane can be obtained through either import

or produced locally from the reaction between hydrogen fluoride and chloroform. After
careful consideration, the former option is chosen as it provides better cost-saving by
minimizing the number of equipment involved and process simplification whereby
purification processes can be reduced.
1.1.5 ASSUMPTIONS FOR PRODUCTION OF PTFE
As basis for the production capacity of the plant, 20,000 metric ton per annum is
selected. The value is based on the amount of PTFE produced in China, the leading
producer of the compound globally (MATRADE, 2016). Also, since the plant aims to
produce a large amount of PTFE, it will operate in a continuous mode of operation.
The plant is designed to operate for 10 years with an additional 2 years spent for the
plant start up and construction. Hence, the total years of plant life is 12 years. The
plant will continuously operate for 11 months in a year whereby one month is allocated
for shut down process and annual leaves.
1.1.6 LIMITATIONS FOR PRODUCTION OF PTFE
Among the limitations faced when designing a plant for the production of PTFE is the
supply of raw material as well as other supporting materials. Based on the market data
obtained from MATRADE, the amount of raw material chlorodifluoromethane and
initiator benzoyl peroxode produced in Malaysia are inadequate to meet the targeted
production capacity. Hence, the materials will have to be imported from China which
serves as the primary supplier.
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1.1.7 PROCESS FLOW DIAGRAM
Figure 1.1.8: Process flow diagram for production of PTFE using Aspen HYSYS.
21
Figure 1.1.9: Process flow diagram for production of PTFE.
22
1.1.8 PROCESS DESCRIPTION
The raw material used for the production of PTFE is chlorodifluoromethane

(CHClF2). The material is stored within a pressurized vessel at 15 bar and 25C to
maintain it in liquid phase as this allows for easier storage and transportation. Upon
exiting the tank, the pressure of CHClF 2 is reduced to 12 bar using a valve to
prevent damage to the upcoming equipment due to sudden inflow of high pressure
liquid.
The stream is then heated to 450C as a preparatory step before entering

a tubular reactor (Ebnesajjad, 2013). Within the reactor, gaseous CHClF 2
undergoes pyrolysis reaction and is converted to TFE (C 2F4) alongside
hydrochloric acid (HCl) as the side product. When operating at 810C and 6.55 bar,
a conversion of 100% can be achieved as stated by (Ebnesajjad, 2016). The
product stream containing TFE and HCl is then condensed to liquid state before
entering a distillation column for purification and separation. Since HCl has a lower
boiling point than TFE, it will exit through the overhead stream meanwhile TFE exits
through the bottom stream. The separation produces product streams containing
99.9% w/w HCl and 99.5% w/w TFE, respectively.
The purified HCl is then diluted with water and sold as a second source of
revenue. Meanwhile, the purified TFE is fed to a continuous stirred tank reactor
(CSTR) for polymerization reaction and produce PTFE. Additionally, water and
benzoyl peroxide are added to the reaction which acts as the solvent and organic
initiator, respectively (Ebnesajjad, 2013). According to (Mori, Tsuchiya, & Okahata,
2005), the conversion can achieve as high as 80% and produce PTFE ranging
between 10,000 g/mol to 1,000,000 g/mol.
The product stream is then fed to a mixing tank whereby a surfactant,

sodium borate is added to reduce the interfacial tension and form a stable colloidal
dispersion of PTFE. (Fernandez & Jebbanema, 2007). The sludge-like stream is
subsequently transported using an extruder to a filter press to remove unwanted
components (waste stream) from PTFE.
The discharged waste stream containing unreacted TFE, HCl and water is
purified using two distillation columns whereby TFE and HCl are recycled back into
the process meanwhile water is sent to a water treatment facility. The solid PTFE
is then transferred onto a conveyer belt and dried to remove residual moisture and
achieve the desired 99% purity.
23
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22. Toshiaki Mori, Yuri Tsuchiya and Yoshio Okahata. (2005). Polymerizations of
Tetrafluoroethylene in Homogeneous Supercritical Fluoroform and in Detergent-
Free Heterogeneous Emulsion of Supercritical Fluoroform/Water.
Macromolecules(39), 604-608.
23. Ebnesajjad, S. (2013). Introduction to Fluoropolymers: Materials, Tehcnology, and
Applications (1st Edition ed.): Elsevier Science & Technology Books.
Manufacturing and Applications. Cambridge: Matthew Deans.
25. Fernandez, A. M., & Jebbanema, L. (2007). The Effect of Surfactant Selection on
Emulsion Polymer Properties. Retrieved 1 December, 2016, from
26. Mori, T., Tsuchiya, Y., & Okahata, Y. (2005). Polymerizations of
25
CHAPTER 1
PART 2: MARKET ANALYIS
1.2.1 INTRODUCTION
The demand of PTFE has been increasing over the years and consumed by
various industry over the world. The two major forms of PTFE granular and fine
powder represent the biggest share in the market as both can be utilized to produce
a variety of products. PTFE is the synthetic polymer of the monomer TFE, whereby
granular particles can be formed through suspension polymerization and fine
powder through dispersion polymerization.
According to a report titled Global Polytetrafluoroethylene (PTFE) Market

Analysis and Segment Forecasts To 2020, granular PTFE emerged as the one of
the leading product segment consumed worldwide and accounts for 33% of the
total market in 2012. The substance has high molecular weight and is commonly
used in moulding applications and used as a feedstock for filled compounds.
Besides that, it can also be used in the production of sheets, rods, billets and other
general mouldings.
On the other hand, fine powder PTFE is used as insulation primarily in the
automotive, industrial and aerospace industries as it has high chemical and
temperature resistance. In the year of 2012, an estimated 58.6 kilo ton of fine
powder PTFE was used with the automotive industry consuming 50% from the
amount.
26
1.2.2 GLOBAL MARKET OF PTFE
Based on the most recent information, global market for PTFE had reached 165
thousand metric tons in 2015 and is projected to reach 247 thousand metric tons
by 2022. Asia-Pacific represents the leading consumer of PTFE, which is also likely
to post the fastest 2016-2022 Compound Annual Growth Rate (CAGR) of 7.3%
(Ltd, 2016).
Also, the market data obtained from Malaysia External Trade Development
Corporation (MATRADE), showed that the global export and import statistics of
PTFE between 2013 to 2015 remained at steady rate with an average of 33%, as
seen from Figures 1.2.1 to 1.2.4.
Based on the observation, the global export of PTFE had increased

following a higher demand from 2013 to 2014. However, the demand decreased
by 6% in just one year from 2014 to 2015. This is due to most countries deciding
to produce their own PTFE instead of importing it from outside or exporting it to
other countries. The same goes to import statistics of PTFE where there is an
increase of 8% from 2013 to 2014. From 2014 to 2015, the import PTFE
experienced a decreased of 4%.
EXPORT STATISTIC OF PTFE FOR

WORLDWIDE
2015 2013
34% 33%
2014
33%
Figure 1.2.1: Export statistics of PTFE for worldwide (Source: MATRADE, 2016)
27
EXPORT STATISTICS OF PTFE FOR
WORLDWIDE
84000
83000
82000
81000
QUANTITY
80000
79000
78000
77000
76000
75000
74000
2012.5 2013 2013.5 2014 2014.5 2015 2015.5
YEAR
Figure 1.2.2: Trend for export statistics of PTFE for worldwide (Source:
MATRADE, 2016)
IMPORT STATISTICS OF PTFE FOR

WORLDWIDE
2015 2013
34% 33%
2014
33%
Figure 1.2.3: Import statistics of PTFE for worldwide (Source: MATRADE,

2016)
28
IMPORT STATISTICS OF PTFE FOR
WORLDWIDE
78000
77000
76000
QUANTITY
75000
74000
73000
72000
71000
2012.5 2013 2013.5 2014 2014.5 2015 2015.5
YEAR
Figure 1.2.4: Trend for import statistics of PTFE for worldwide (Source:
MATRADE, 2016)
1.2.3 PTFE IN MALAYSIA
Currently, there is no chemical plant that produces PTFE in Malaysia. However,

Malaysia is one of the target markets for the production of PTFE as it had already
imported around 655 tons per year in 2013, 598 tons in 2014 and 734 tons in 2015.
The demand for the PTFE had decreased from 2013 to 2014 but it increased back
by 136 tons from 2014 to 2015, so this plant will help to cover the demand of PTFE
in Malaysia rather than import it from other countries.
Malaysia does not only import but also export PTFE to fulfill the demand of
the market. As of 2013, 13 tons per year has been exported but the value
decreased to 7 tons per year and it increased back to 17 tons in 2015.
Table 1.2.1: Export and import statistics of PTFE for Malaysia (Source:
MATRADE, 2016)
Year Export Import
USD Quantity (TPA) USD Quantity (TPA)
2013 141820 13 8437568 655
2014 47926 7 6582796 598
2015 80077 17 5732804 734
29
EXPORT STATISTICS OF PTFE FOR
MALAYSIA
18
16
14
12
Quantity
10
8
6
4
2
0
2012.5 2013 2013.5 2014 2014.5 2015 2015.5
Year
Figure 1.2.5: Export statistics of PTFE for Malaysia

(Source: MATRADE, 2016)
IMPORT STATISTICS OF PTFE FOR MALAYSIA

800
700
600
500
Quantity
400
300
200
100
0
2012.5 2013 2013.5 2014 2014.5 2015 2015.5
Year
Figure 1.2.6: Import statistics of PTFE for Malaysia

30
1.2.4 RAW MATERIALS
1.2.4.1 Chlorodifluoromethane
Chlorodifluoromethane exists as a colorless gas and can also be known as HCFC-

22, or R-22. It is commonly used as a propellant and refrigerant. The use of this
substance is gradually being phased out in developed countries due to the
compound's ozone depleting potential(ODP) and high global warming
potential (GWP), although global use of chlorodifluoromethane continues to
increase because of high demand in developing countries. is a versatile
intermediate in industrial organofluorine chemistry such as a precursor
to tetrafluoroethylene production and current applications. (Revolvy, 2016)
Worldwide production of chlorodifluoromethane in 2008 was about 800 Gg

per year, up from about 450 Gg per year in 1998, with most production in
developing countries. Chlorodifluoromethane use is increasing in developing
countries, largely for air conditioning applications. Air conditioning sales are
growing 20% annually in India and China. (Revolvy, 2016)
The demand forchlorodifluoromethane have increased from year to year.

To overcome this problem, Malaysia had to import the bulk of
chlorodifluoromethane from other countries. According to MATRADE (2016),
Malaysia imported 5340 tons per year in 2013, and it increased to 5963 tons in
2014 and 5455 tons in 2015.
Table 1.2.2: Export statistics of chlorodifluoromethane for Asian Region in 2015

Countries USD Quantity (TPA) Percentage (%)
Malaysia 93,471 26 0
India 10,292,905 23,310 15
China 3,868,016 11,527 84
Singapore 153,861 111 1
Thailand 79,686 83 0
Japan 3,457,788 8,989 0
31
EXPORT STATISTICS OF CHLORODIFLUOROMETHANE FOR ASIAN
REGION IN 2015
0%
1% 0%
0%
15%
MALAYSIA
INDIA
CHINA
SINGAPORE
THAILAND
JAPAN
84%
Figure 1.2.7: Export statistics of chlorodifluoromethane for Asian Region

Table 1.2.3: Import statistics of chlorodifluoromethane for Asian Region in 2015

Malaysia 10,791,856 5,455 13
India 0 0 0
China 0 0 0
Singapore 3,213,597 1,424 4
Thailand 18,709,357 9,776 24
Japan 47,383,143 23,938 59
32
IMPORT STATISTICS OF
CHLORODIFLUOROMETHANE FOR ASIAN
REGION IN 2015
0% 0%
13%
4%
MALAYSIA
INDIA
CHINA
SINGAPORE
24%
59% THAILAND
JAPAN
Figure 1.2.8: Import statistics of chlorodifluoromethane for Asian Region

1.2.5 INITIATOR
1.2.5.1 Benzoyl Peroxide
Benzoyl peroxide (BPO) is an organic compound in the peroxide family. It is white,

granular, crystalline solid and it is tasteless and has faint odour of benzaldehyde.
It is manufactured by using benzoyl chloride and hydrogen peroxide as basic raw
material. It is mainly used as polymerization initiator or curing agents in the
chemical and plastics industry. Malaysia does not produce Benzoyl Peroxide, so
this initiator agent has to be imported from other countries for this plant (Global
Benzoyl Peroxide Market 2016 by Manufacturers, Regions, Type and Application,
Forecast to 2021, 2016).
In 2013, Malaysia had imported 187 tons per year Benzoyl Peroxide, and it
increasing to 636 tons in 2014 but it decreasing back to 258 tons per year in 2015.
German, China, Belgium and United States are the main countries that export
Benzoyl Peroxide ("Global Benzoyl Peroxide Market 2016 by Manufacturers,
Regions, Type and Application, Forecast to 2021", 2016).
33
Table 1.2.4: Countries export statistics of benzoyl peroxide for Asian Region in
2015 (Source: MATRADE, 2016)
Malaysia 23,141 7 0
India 220,350 67 1
China 22,408,108 6,638 65
Singapore 32,656 4 0
Thailand 2,418 1 0
Japan 4,451,255 3,525 34
EXPORT STATISTICS OF BENZOYL

PEROXIDE FOR ASIAN REGION IN 2015
1% 0%
Malaysia
34% India
China
Singapore
0% 65% Thailand
0% Japan
Figure 1.2.9: Export statistics of benzoyl peroxide for Asian Region

34
Table 1.2.5: Import statistics of benzyl peroxide for Asian Region in 2015
Malaysia 939,715 258 4
India 4,828,876 2,448 41
China 3,971,669 2,107 35
Singapore 225,390 31 1
Thailand 957,156 306 5
Japan 2,620,171 844 14
IMPORT STATISTICS OF BENZYL

PEROXIDE FOR ASIAN REGION IN 2015
4%
14%
Malaysia
5%
1% India
China
41%
Singapore
Thailand
35% Japan
Figure 1.2.10: Import statistics of benzyl peroxide for Asian Region (Source:
MATRADE, 2016)
35
1.2.6 GUIDELINES IN CALCULATING MARKET ANALYSIS FOR THE
PRODUCTION 20,000 METRIC TONNE OF PTFE
In order to evaluate the potential of this plant production, few assumptions must be
made as a benchmark in every calculation. These assumptions are to be used in
the estimation of capital cost, manufacturing cost as well as breakeven and
profitability study. The assumptions are:-
1. Additions of certain equipment in the plant are taken into consideration for
back-up purposes. Those equipment are:-
Centrifugal pump carbon steel (2 units)
Cooler (1 unit)
Heater (1 unit)
2. Plant is continuously operating for 11 months in a year whereby the other 1
month is encountered for shut-down process as well as annual leaves.
3. CEPCI value for year 2001 is 397.
4. CEPCI value for year 2015 is 543.
5. The plant operated for 10 years while 2 years is to set up the plant at the
beginning of the operation. Thus, total plant operating and set up is 12 years.
1.2.7 ESTIMATION OF CAPITAL COST
Capital cost relates to the cost involved with the construction of a new plant to be
build or any modifications to an existing chemical manufacturing plant. An
important factor to be considered is the bare module cost whereby it is any cost
calculated using the equipment module technique. The equipment module costing
technique is used to estimate the cost of all equipment. The bare module cost can
be evaluated from;
Bare module cost, CBM = CPFBM

Where;
CBM = bare module equipment cost
FBM = bare module cost factor
CP = purchased cost for base condition
36
Then, total module cost and grassroots cost are calculated. The term
grassroots refers to a completely new facility in which the construction is started
on essentially undeveloped land, a grass field. The total module cost can be
evaluated from;
Total module cost, CTM = 1.18 =1 ,
And the grassroots can be evaluated from;
Grassroots cost, CGR = FCI(2015) = CTM + 0.50 =1 ,
1.2.7.1 Bare Module Cost
For the bare module cost calculation, both base and non-base condition are
calculated. Below is the formula to calculate the module cost:
, = 0 = 0 = 0 (1 + 2 + 2 )
The assumptions made for the calculating bare module cost are:
1. Surface area for all two the heat exchangers is assumed to be 100 m 2.
2. Volume for Tubular (Pyrolysis) reactor is assumed to be 20 m3.
3. Volume for CSTR reactor is assumed to be 20 m 3
4. Volume for Distillation column is assumed to be 50 m 3.
5. Volume for storage tanks and vessel is assumed to be 100 m 3.
6. The pressure for non-base condition for all equipment is assumed to be
the highest pressure condition in the plant which is at 29.5 barg.
7. Area of filter press is assumed to be 3 m 2.
8. Area of dryer is assumed to be 3 m 2.
9. The material for non-base condition is assumed to
The limitations are:

1. The volume for the reactor, distillation column and storage tank is in the
range of 1-100 m3.
2. The type of materials that are used for the equipment is carbon steel and
stainless steel.
3. Only heat exchangers have the same dimension for all units.
4. All this limitation could give error on the estimated capital cost.
37
Below is the bare module cost sample calculation for the heat exchanger. The
bare module costs for the other equipment are calculated in the same manner and
tabulated in Table 2.6 and Table 2.7 respectively.
1.2.7.2 Bare Module Cost Sample Calculation
The calculation is for Heater (E-101).
From Turton et al., (2013);

A = 100 m2
P = 11.5 bargs
B1 = 1.63
B2 = 1.66
FP =1
FM(Carbon steel) = 1.8
Thus,
log0 = 4.1884 0.2503 log (100) + 0.1974(log(100))2
0 (2001) = $ 30,019.26
For base condition, FP is equal to 1
0
(2001) = 0 (B1+B2FPFM)
0
(2001) = 30,019.26 (1.63 + 1.66(1)(1.8))
0
(2001) = $ 138,628.90
For non-base condition,
C1 = 0.03881
C2= -0.11272
C3=0.08183
log FP = C1 + C2 log10P + C3(1og10P)2

log FP = 0.03881 - 0.11272log10(11.5) + 0.08183(log10(11.5))2
Fp = 1.0265
38
(2001) = 0 (B1+B2FPFM)
(2001) = 30,019.26 (1.63 + 1.66(1.0265)(1.8))
(2001) = $141,005.93
The CEPCI for year 2001 and year 2015 are 397 and 566.6 respectively. Thus,
0 566.6
(2015) = $ 138,628.90 x = $ 197,851.72
397
566.6
(2015) = $141,005.93 x = $ 201,244.23
397
39
Table 1.2.6: Result of bare module cost estimation (base condition) for PTFE plant.
Equipment Unit FP FM FBM Cp0(2001) CBM0(2001) CBM0(2015) CBM0(2015)
(RM) (RM/unit) (RM/unit) (RM)
Heater (CS) 2 1 1.8 6.70 133,585 616,898 843,767 1,687,534
Cooler (SS) 2 1 2.9 9.38 133,585 1,228,564 1,680,378 3,360,756
Tubular reactor (SS) 1 1 3.0 4.00 19,858 153,108 209,414 209,414
CSTR (CS) 1 1 1.0 4.07 397,130 1,616,320 2,210,734 2,210,734
Distillation column (SS) 3 1 3.1 12.90 165,108 1,303,038 1,782,240 5,346,722
Pump (SS) 2 1 2.1 4.30 10,825 51,148 69,958 139,916
Pump (CS) 6 1 1.8 4.30 10,825 46,764 63,961 383,766
Filter Press 1 1 1.0 1.80 83,935 341,628 467,264 467,264
Drier 1 1 2.7 2.70 37,557 269,062 368,011 368,011
Storage tank (SS) 1 1 3.1 734,250 734,250 1,004,276 1,004,276
Storage tank (CS) 2 1 1.0 734,250 2,988,397 4,087,405 8,174,810
Vessel (CS) 2 1 1.0 213,600 869,352 1,189,063 2,378,126
Vessel (SS) 1 1 3.1 213,600 869,352 1,189,063 1,189,063
TOTAL 21 2,888,108 11,087,881 15,165,540 26,920,392
40
Table 1.2.7: Result of bare module cost estimation (non-base condition) for PTFE plant.
CP0(2001) CBM(2015) CBM(2015)
Equipment Unit FP FM FBM (RM) CBM(2001)(RM/unit) (RM/unit) (RM)
Heater (CS) 2 1 1.8 6.70 133,585 616,898 843,767 1,687,534
Cooler (SS) 2 1 2.9 9.38 133,585 1,228,564 1,680,378 3,360,756
Tubular reactor (SS) 1 1 3.0 4.00 19,858 153,108 209,414 209,414
CSTR (CS) 1 1 1.0 4.07 397,130 1,616,320 2,210,734 2,210,734
Distillation column (SS) 3 1 3.1 12.90 165,108 1,303,038 1,782,240 5,346,722
Pump (SS) 2 1 2.1 4.30 10,825 51,148 69,958 139,916
Pump (CS) 6 1 1.8 4.30 10,825 46,764 63,961 383,771
Filter Press 1 1 1.0 1.80 83,935 341,628 467,264 467,264
Drier 1 1 2.7 2.70 37,557 269,062 368,011 368,011
Storage tank (SS) 1 1 3.1 734,250 5,794,701 7,925,749 7,925,749
Storage tank (CS) 2 1 1.0 734,250 2,988,397 4,087,405 8,174,810
Vessel (CS) 2 1 1.0 213,600 869,352 1,189,063 2,378,126
Vessel (SS) 1 1 3.1 213,600 1,685,731 2,305,672 2,305,672
TOTAL 21 2,888,108 16,964,711 23,203,623 34,958,479
Total module cost, CTM (2015) = 1.18 (RM 34,958,479)

CTM (2015) = RM 41,251,005
Grassroots cost, CGR = FCI(2015) = RM 41,251,005 + 0.50 (RM 26,920,392)
= RM 54,711,201
The capital cost estimated to build the plant is RM 54,711,201
41
1.2.8 ESTIMATION OF MANUFACTURING COST
The cost associated with the production of polytetrafluoroethylene (PTFE) in 330 of

working days are estimated in this subtopic which is encountered for 11 months in a
year. The information needed to calculate the cost are from the process flow diagram
(PFD), estimation of the fixed capital investment and estimation of the number of
operators required in a chemical plant. Manufacturing costs are expressed in units of
dollars per unit time.
There are three factors that affect the cost of manufacturing chemicals. The factors
are:
1. Direct manufacturing costs

These costs represent operating expenses that vary with production rate. The costs
associated are raw materials, waste treatment, utilities, operating labor, direct
supervisory and clerical labor, maintenance and repairs, operating supplies, laboratory
charges, patents and royalties.
2. Fixed manufacturing costs

These costs are independent of changes in production rate such as taxes, insurance
and depreciation which are charged at constant rates even when the plant is not
operated.
3. General expenses
These costs represent an overhead burden that is necessary to carry out the business
functions such as management and sales.
The equation used to calculate the cost of manufacture using these costs are:
Cost of manufacture Direct Manufacturing Cost (DMC) +

(COM) = Fixed Manufacturing Cost (FMC) +
General Expenses (GE)
42
However, the total manufacturing cost is simplified by using the equation below;
= 0.280 + 2.73 + 1.23( + +
The cost of manufacture without depreciation, COMd is :-
= 0.180 + 2.73 + 1.23( + + )
Where;
COL = Cost of operating labor
CUT = Cost of utility
CWT = Cost of waste treatment
CRM = Cost of raw materials
In order to calculate the yearly cost of raw materials or utilities, the fraction of
time that the plant is operating in a year must be known. This fraction is known as
stream factor and calculated by dividing number of days plant operates per year with
365. Stream factor represents the fraction of time that the process unit is on-line and
operates at design capacity.

=
365
Typical values of the stream ranges between 0.90 and 0.96. Normally, a well
managed chemical plant will shut down for one or two weeks a year for scheduled
maintenance. The lower the stream factor, the less reliable processes may require
more down time. In this chemical plant, the stream factor is to be found equal to 0.90.
330
= = 0.90
365
43
1.2.8.1 Cost of Operating Labor
The operating labor required is estimated according to the various equipment in this
plant. Operating labor requirement for chemical processing plant is calculated by the
following equation:
NOL = (6.29 + 31.7P2 + 0.23Nnp)0.5
Where NOL is the number of operators per shift, P is the particulate processing
per shift and Nnp is the non-particulate processing steps. The Nnp is equivalent to the
number of equipment found in the chemical plants. However, pumps and vessels are
not included as there is no reaction found there. Table 2.7 below shows the calculation
of Nnp. Assume three shifts per day plus equivalent of one shift on the weekend. The
estimated operating labour cost is shown in the following table.
Table 1.2.8: Results for the estimation of operating labor requirements for the PTFE
plant using the equipment module approach
Equipment Total number of Nnp
equipment
Tower 3 3
Compressor 0 0
Reactor 2 2
Cooler 1 1
Heater 1 1
Vessel 3 -
Pump 6 -
TOTAL 7
NOL = [6.29 + 31.7(1)2 + 0.23(7)]0.5= 6.29
The number of operators required to run the process unit per shift is 6.29.
However, this is not the actual number of operators that needed to be hired. The day
of operated plant, shift per day, working hour per day, sick leave and vacation needed
to be calculated too.
44
A chemical plant operates 24 hours per day with 8 hours shifts. The plant is
assumed to be working 330 days per year. Hence the number of shifts per year,
47 5
= 235 /

365 3
= 1095 /

1095
= 4.66
235
= 4.66 (6.29) = 29.31 30

(2016) = 30 (18,000/) = 540,000/
Table 1.2.9: Estimated operating labour cost*

Position Quantity RM/yr Total
per worker RM/yr
General manager 1 72,000 72,000
Plant manager 1 96,000 96,000
Marketing manager 1 48,000 48,000
Production manager 1 60,000 60,000
Human resource (HR) officer 1 30,000 30,000
Process engineer 1 47,376 47,376
Instrumentation engineer 1 49,200 49,200
Quality control engineer 1 36,000 36,000
Safety Officer 1 48,000 48,000
Production and maintenance engineer 1 36,000 36,000
Field engineer 1 48,000 48,000
Chemist 1 18,000 18,000
Accountant 1 18,000 18,000
Maintenance technician 3 21,600 64,800
Clerks (administration) 3 14,400 43,200
Skilled operators 30 18,000 540,000
Total 73 660,576 1,254,576
45
1.2.8.2 Cost of Utilities
Table 1.2.10: Utilities provided by offsite for a plant with a multiple process units
Utility Cost Cost
Electricity 0.3370/kWh
Table 1.2.11: Estimation of utilities cost for PTFE plant

Utilities Usage Total Cost (RM/year)
Electricity 414,969 kWh 162,784.43
Total 162,784.43
The total sum of the cost multiplies with stream factor yield the cost of utility, C UT which
is:
= = 162,784.43 0.90 = 146,506
1.2.8.3 Cost of Raw Material
Table 1.2.12: Cost of chemicals used in PTFE plant

Raw Material Cost per unit (RM/kg)
Chlorodifluoromethane 1.9783
Benzyl Peroxide 10.44
Sodium Borate 13.35
*Chlorodifluoromethane price taken from MATRADE
*Benzoyl Peroxide price is taken from average market price in India.
*Sodium Borate price is taken from alibaba.
Table 1.2.13: Estimation of raw material cost for PTFE plant

Chemical Flow Price Cost (RM/yr)
Chlorodifluoromethane 31,333,183 kg/yr RM 1.9783/kg 61,986,436
3 3
Water 24,256 m /yr RM 0.92/m 22,315
Benzyl peroxide 50,000 kg/yr RM 10.44/kg 522,000
Sodium Borate 50,000 kg/yr RM 13.35/kg 667,500
46
Total 63,198,251
*The stream factor has already been accounted in the calculation of the flow and volume.
*For every 400 kg of PTFE, 1kg of benzyl peroxide is used.
*For every 400 kg of PTFE, 1 kg of Sodium Borate is used.
Table 1.2.14: Estimation of yearly revenue for PTFE plant

Chemical Flow (kg/yr) Price (RM/kg) Revenue (RM/yr)
Polytetrafluoroethylene 20,000,000 5.7104 114,208,000
Hydrogen chloride 8,002,764 0.89 7,122,459.96
Total 121,330,460
The stream factor has already been accounted in the calculation of the flow and volume.
The yearly revenue from polytetrafluoroethylene and hydrochloric acid sales is RM

101,330,460. The sum of the raw material is the raw material cost, C RM which is RM
66,766,751.
1.2.8.4 Cost of Waste Treatment
In a year, the waste as based on HYSIS containing 100% of pure water producing
1.8477 ton/yr. However, in realistic situation it is impossible to have a pure component
without constituent from any components. Thus, the calculation will involve waste
production containing water and HCl with 1.8477 ton/yr. The waste is needed to be
sent to Kualiti Alam Sdn Bhd for waste treatment to treat the remaining HCl.
Total mass of waste produced per year = 1.8477 ton/yr

Cost of waste ton per pallet = RM 1,440
Total Cost of waste (CWT) = RM 1,440 x 1.8477 ton/yr
= RM 2,660
47
1.2.8.5 Profit Margin Analysis
The profit margin analysis of this plant is calculated as below:
= ( ) ( )
P = 121,330,460 63,198,251
= 58,132,208
Since the profit margin is positive, this plant may be profitable bur it does not
guarantee that the process will be profitable but further investigation may be
warranted to increase the profit.
1.2.8.6 Cost of Land
The land is assumed to be 30 acres.
653,400
= 30 = 3,267,000
1
1.2.8.7 Calculation of Manufacturing Cost
The total manufacturing cost can be obtained by adding these three cost categories
together and solving for the total manufacturing cost, COM. The result is
= 0.280 + 2.73 + 1.23( + + )

= 0.280(54,711,201) + 2.73(1,254,576) + 1.23(146,506 + 2,660 + 63,198,251)
= 96,209,804
The cost of manufacture without depreciation, COMd is
= 0.180 + 2.73 + 1.23( + + ) = 63,455,326

= 0.180 (54,711,201) + 2.73 (1,254,576) + 1.23 (146,506 + 2,660 +
63,198,251)
= RM 91,190,331
48
1.2.9 BREAKEVEN ANALYSIS
Break even analysis is important in order to determine how much is the plant needs to
produce per year, to cover the cost of doing business, COMd. The cost that is needed
to run this plant is RM 91,190,331 yearly. Each unit of the products will give revenue
of RM 4710 per ton of PTFE and RM 890 per ton of HCl. The breakeven point is when
the sale is equal to the cost to run the plant yearly is when no loss or profit is gain.
The formula of calculating the sales is shown as below,
91,190,331
= = 13,816
(5710 + 890)
Thus, the plant needs to have total sales of 13,816tonnes per year to break even. As
this project aim is to produce 20,000 tons per year. Therefore, from this analysis
indicates that this project is profitable.
(5710 + 890)
= 13,816 = 91,185,600

The profit of the production of17,111 tons is almost equal to COMd, RM 91,190,331.
From the amount of profit that was calculated proved that the breakeven analysis is
correct. This project is profitable as the project is aim to produce 20,000 tons per
year of PTFE.
1.2.10 PROFITABILITY ANALYSIS
For the profitability analysis of this PTFE plant basically involve in the calculation of
large expenditures. In this subchapter, the concept of non-discounted and discounted
was being introduced. In this analysis, the purchasing of land is assumed to be done
at the start of the project which is at time zero. After the decision has been made to
build a new chemical plant or expand an existing facility, the construction phase of the
project starts.
49
Three bases being used for the evaluation of the profitability which are:
1. Time
2. Cash
3. Interest rate
1.2.10.1 Non-Discounted Profitability Criteria
Non-discounted profitability criteria for the time criterion are:
1. Payback Period (PBP)

= ,
, ,
2. Cumulative Cash Ratio (CCR)

=

3. Interest rate which is rate of return on investment (ROROI)

1
=
( )
1.2.10.2 Modified Accelerated Cost Recovery System (MACRS)
The capital investment can be depreciated by using MACRS whereby it is used over
a short period of time. In general, it is better to depreciate an investment as soon as
possible since less taxes will be paid with high depreciation in a given year. This means
that it is better to pay less in taxes at the beginning of a project than at the end of it.
The MACRS method uses a Double Declining Balance (dkDDB) method and a
Straight Line method (dkSL). The straight line method will be used when it yields a
greater depreciation allowance for that particular year. The formula used to determine
the depreciation allowance for Double Declining Balance and Straight Line method is
as follows:-
50
=1
2
= [ ]

=0
From these two formulas, the depreciation allowance calculated are 20%, 32%,
19.2%, 11.52%, 11.52% and 5.76% respectively. Then, the depreciation value can be
determine from the depreciation allowance with FCI, obtaining few figures as shown
in Table 1.2.15
Table 1.2.15: Depreciation allowances and depreciation values

Year Depreciation Allowance Depreciation value
(% of Capital Investment) (Depreciation Allowance FCI)
3 20% 10,942,240
4 32% 17,507,584
5 19.20% 10,504,550
6 11.52% 6,302,730
7 11.52% 6,302,730
8 5.76% 3,151,365
51
Table 1.2.16: Non-discounted After-Tax Cash Flow (All Value is in RM)
End of Investment dk FCIL - dk R COMd (R-COM-dk) x (1-t) + dk Cash Flow Cumulative Cash
year (k) Flow
0 -3,267,000 0 54,711,201 - - - -3,267,000 -3,267,000
1 -27,355,600 0 54,711,201 - - - -27,355,600 -30,622,600
2 -19,148,920 0 54,711,201 - - - -19,148,920 -49,771,520
3 10,942,240 43,768,961 121,330,460 91,190,331 20,158,210 20,158,210 -29,613,309
4 17,507,584 26,261,376 121,330,460 91,190,331 19,149,789 19,149,790 -10,463,520
5 10,504,550 15,756,826 121,330,460 91,190,331 16,698,727 16,698,728 6,235,208
6 6,302,730 9,454,096 121,330,460 91,190,331 15,228,090 15,228,091 21,463,299
7 6,302,730 3,151,365 121,330,460 91,190,331 15,228,090 15,228,091 36,691,389
8 3,151,365 0 121,330,460 91,190,331 14,125,112 14,125,113 50,816,502
9 0 0 121,330,460 91,190,331 13,022,135 13,022,135 63,838,638
10 0 0 121,330,460 91,190,331 13,022,135 13,022,135 76,860,773
11 0 0 121,330,460 91,190,331 13,022,135 13,022,135 89,882,908
12 18,206,680 0 0 131,330,460 91,190,331 19,522135 37,728,815 127,611,723
*Taxation rate = 35% Red box indicates that RM 11.47 Million (in negative) is in
*Working capital = 15% x FCI = RM 2,197,318 between the two values in which it is relevant to obtain the
payback period (PBP).
*Salvage value = RM 10,000,0
Green box indicates the cumulative cash position (CCP).
52
Non-Discounted Cumulative Cash Flow Diagram
140,000,000
120,000,000
100,000,000
RM Millions
80,000,000
60,000,000
40,000,000
20,000,000
0
0 2 4 6 8 10 12 14
-20,000,000
-40,000,000
-60,000,000 End of Year
Figure 1.2.11: Non-Discounted After-Tax Cash Flow
The breakeven analysis of the PTFE plant or the payback period for this project
calculated at the point when the cumulative is in the same value as the land and working
capital value. It is because the land and working capital is being salvaged at the end of
the project. Therefore, it is not accounted in the calculation of the breakeven analysis.
The cost of land and working capital for non-discounted is as the following formula.
( + ) = [3.26 + (15% 54.71)] = 11.47
The value is in negative to indicate the cash flow out whereby from Table 2.16, the
cumulative cash flow of RM 11.47 Million is in between year 3 and year 4.This means
that the position after value of land and working capital has been settled between year 3
and 4. Therefore, the breakeven or payback period (PBP) for non-discounted profitability
criteria is,
RM 10.46 + RM 11.47
= 4 + [( ) (4 3)]
RM 10.46 + RM29.61
= 4.05 years
53
PBP (after 2 years of set-up) = 4.05 2
= 2.05 years
From the calculation that was obtained from above indicates that this PTFE plant
project payback period for this project is at 2.05 year after the project started. The
Cumulative Cash Ratio for this project is;
20.16 + 19.15 + 16.69 + 15.23 + 15.23 + 14.23 + 13.02 + 13.02 + 13.02 + 37.73
=
3.27 + 27.36 + 19.15
= 3.57
From the CCR that was being calculated shows that the project yield of 3.57 which
shows that the CCR is higher than 1. Thus, it can be said that this project is potentially
profitable.
Calculation of the Rate of Return on Investment (ROROI) for this project is,
Average Annual Net Profit 1

=
Fixed Capital Investment (FCII ) 10
20.16 + 19.15 + 16.69 + 15.23 + 15.23 + 14.23 + 13.02 + 13.02 + 13.02 + 37.73
10 1
=
54.71 10
= 0.2244 = 22.44 %
From the calculation that was obtained from above yield 22.44 % rate of return on
investment. It shows that for every RM 1 Million that was invested, the investor will get
RM 224,400 of profit. At the end of this project life, the Cumulative Cash Position (CCP)
is RM 127.61 Million.
54
1.2.10.3 Discounted Profitability Criteria
In discounted criteria, discount at each of the yearly cash flows back to time zero is being
made. The resulting discounted cumulative cash flow diagram is then used to evaluate
profitability. There are three different types of criteria in discounted profitability criteria
which are:
1. Time Criterion : The Discounted Payback Period (DPBP)

DPBP = is the time required, after start-up, to recover the Fixed Capital Investment
(FCIL), required for the project, with all the cash flows discounted back to time zero.
2. Cash Criterion : The Net Present Value (NPV) or Net Present worth (NPW)
The NPV of the plant project is highly influence by the level of Fixed Capital
Investment (FCIL), and a better criterion for comparison of projects with different
investment levels may be the Present Value Ratio (PVR).
55
Table 1.2.17: Discounted after-tax cash flow (all value is in RM)
End of year (k) Nondiscounted Cash Flow Discounted Cash Flow Discounted Cumulative Cash Flow
0 -3,267,000 -3,267,000 -3,267,000
1 -27,355,600 -24,868,727 -28,135,727
2 -19,148,920 -15,825,553 -43,961,281
3 20,158,210 15,145,161 -28,816,119
4 19,149,790 13,079,563 -15,736,555
5 16,698,728 10,368,596 -5,367,959
6 15,228,091 8,595,860 3,227,901
7 15,228,091 7,814,418 11,042,320
8 14,125,113 6,589,469 17,631,789
9 13,022,135 5,522,656 23,154,446
10 13,022,135 5,020,596 28,175,042
11 13,022,135 4,564,178 32,739,221
12 37,728,815 12,021,563 44,760,785
Red box indicates that RM 9.48 Million (in negative) is

*Interest Rate = 10% in between the two values in which it is relevant to obtain
the discounted payback period (DPBP).
Green box indicates the net present value (NPV).
56
Discounted Cumulative Cash Flow
50,000,000
40,000,000
30,000,000
20,000,000
(RM Million)
10,000,000
0
0 2 4 6 8 10 12 14
-10,000,000
-20,000,000
-30,000,000
-40,000,000
-50,000,000
End of Year
Figure 1.2.12: Discounted Cumulative Cash Flow
The discounted break even or as known as the discounted payback period for this
project will be achieve at the point when the cumulative cash flow is equivalent to the land
and working capital value. Land and working capital is salvaged at the end of the project
thus, the calculation of breakeven analysis for these two values are not accounted. The
cost of land and working capital for discounted analysis is;
11.47
= = 9.48
1.12
Based on Table 2.16, the cumulative cash flow of - RM 9.48 million is between year
4 and 5. Thus the breakeven or discounted payback period (DPBP) for discounted
profitability criteria is;
5.36 + 9.48
= 5 + ( ) (5 4) = 5.39
5.36 + 15.74
57
DPBP for discounted analysis is 5.39 years after start up. The present value ratio
of this project is;
(15.15+13.08+10.37+8.6+7.81+6.59+5.52+5.02+4.56+12.02
PVR = [ ] = 4.11
3.27+2.47+15.83
The project yielded PVR of 4.11. PVR value is higher than unity which is one
indicates that this project is profitable. At the end of this project, the NPV of the project is
RM 44,760,785.
1.2.11 CONCLUSION
Supply and demand of PTFE product worldwide is reviewed. The demand for PTFE in
context of worldwide and in Asia has increased each year up until year 2015 as reported
statistically. The production rate for this project is attained by performing forecast method
and it has been decided that the plant will produce 20,000 tons of PTFE per year. The
price for the raw materials is obtained from reliable source, MATRADE.
Economic analysis is performed to study the feasibility of this project. As been

estimated in Section 2.6, the fix capital cost (FCI) for this project is RM 54.71 Million. In
Section 2.7 onwards, the cost of manufacturing is estimated to be RM 91 Million per year.
The expected price of PTFE is RM 5.71 per kg and HCl with RM 0.89 per kg which is
estimated to give revenue of RM 121 Million per year. Next onto Section 2.8, breakeven
analysis is performed to evaluate the production rate at breakeven point. After evaluation,
the production rate at breakeven point is at 13,816tonnes. The economic analysis is then
further investigated by performing the profitability analysis for this project.
Based on the discounted profitability analysis in Section 2.9.2, the payback period
or break even time for this project is 5.39 years after the project started. In addition, the
present value ratio for this project is calculated to be 4.11. Present value ratio greater than
1 indicates that this project is profitable. It is also analyzed that the project is worth RM
44.76 Million at the end of the year. Thus, it can be concluded that this project is potentially
profitable.
58
REFERENCES
1. Global Benzoyl Peroxide Market 2016 by Manufacturers, Regions, Type and Application,
Forecast to 2021. (2016). Fiormarkets.com. Retrieved 19 October 2016, from
http://www.fiormarkets.com/report/global-benzoyl-peroxide-market-by-manufacturers-
regions-type-2910.html
2. Ltd, R. (2016). Polytetrafluoroethylene (PTFE) - A Global Market Overview.
Researchandmarkets.com. Retrieved 9 October 2016, from
http://www.researchandmarkets.com/research/37p6wn/polytetrafluoroeth
3. Polytetrafluoroethylene (PTFE) - A Global Market Overview (April 2016)
http://www.researchandmarkets.com/research/37p6wn/polytetrafluoroeth
4. Polytetrafluoroethylene (PTFE) Market Analysis By Application (Industrial Processing,
Electronics, Automotive & Transportation) By Product (Granular, Micro-powder, Fine-
powder) And Segment Forecasts To 2020 (July 2015) Retrieved 9 October 2016 from
http://www.grandviewresearch.com/industry-analysis/polytetrafluoroethylene-industry
5. Revolvy, L. (2016). "Chlorodifluoromethane" on Revolvy.com. Revolvy.com. Retrieved 19
October 2016, from
http://www.revolvy.com/main/index.php?s=Chlorodifluoromethane&item_type=topic
6. Turton, R., Bailie, R. C., Whiting, W. B., Shaeiwitz, J. A., & Bhattacharyya, D. (2013).
Analysis, Synthesis, and Design of Chemical Processes (Fourth Edi). USA: Pearson
Education, Inc.
7. Ebnesajjad, S. (2013). Introduction to Fluoropolymers: Materials, Tehcnology, and
Applications (1st Edition ed.): Elsevier Science & Technology Books.
9. Fernandez, A. M., & Jebbanema, L. (2007). The Effect of Surfactant Selection on Emulsion
Polymer Properties. Retrieved 1 December, 2016, from
http://www.pcimag.com/articles/87271-the-effect-of-surfactant-selection-on-emulsion-
polymer-properties
10. Mori, T., Tsuchiya, Y., & Okahata, Y. (2005). Polymerizations of Tetrafluoroethylene in
Homogeneous Supercritical Fluoroform and in Detergent-Free Heterogeneous Emulsion
of Supercritical Fluoroform/Water. Macromolecules(39), 604-608.
59
CHAPTER 1
PART 3: SITE SELECTION
1.3.1 PLANT LOCATION
Plant location is one of the most important factors to consider before the construction of a
new plant. There are several major factors that need to be evaluated before the location
is selected such as geographical, environmental, infrastructure and many more.
Furthermore, the plant needs to operate according to the regulations mandated by the
country in order to ensure the safety and health of the public and environment. Ideally, a
plant should be constructed where there is availability of raw material, low operating and
buildup costs and high demand of product although several other criteria may also be
considered such as political stability, climate conditions as well as local community
considerations, to name a few. Before deciding on a location, several alternatives should
be listed in order to compare the advantages and disadvantages for each location. This
will ensure that the plant can operate optimally and maximize the profitability of the project.
For the construction of a PTFE production plant, there are several industrial areas
that are shortlisted, namely:
a) Dahej Industrial Estate, Gujarat, India
b) Gebeng Phase III Industrial Park, Pahang, Malaysia
c) Shanghai Chemical Industrial Park, Shanghai, China
60
1.3.1.1 Dahej Industrial Estate, Gujarat, India
Figure 1.3.1: Dahej Industrial Estate, Gujarat, India (Source: Google Map, 2016)
Dahej Industrial Estate is a developed industrial area situated 46 km from Bharuch City.
Dahej was a major port in ancient times providing trade linkage between western India
and southern India/Middle East. Over a period of time, it went into oblivion due to
geographical, topographical and sea-bathymetric changes. Visualized by the government
of Gujarat, it is quickly transforming into a major industrial hub and on its way to become
India's form of Shanghai. This vision is endorsed by the growth in the region over last 10
years. It is well connected with National Highway (NH-8) Road and Railway both are
having the connectivity to New Delhi, the National Capital and Mumbai, the commercial
Capital of India. (Dahej SEZ Ltd, 2016)
Among the facilities and infrastructure provided here are:

Gujarat Chemical Port Terminal Company Limited
GCPTCL for chemical cargo and Adani-Petro LNG for solid bulk cargo handling.
Transportation National Highway
45 kms from Bharuch Railway Station
61
List of the plants within or near Dahej: (Brief Industrial Profile of Bharuch District, n.d.)
1. Gujarat Fluorochemical Limited
2. Firmenich Aromatics Production India Pvt Ltd
3. Navin Fluorine International Ltd
4. PVC Plant
5. Insecticide India Limited Dahej
6. Birla Copper Dahej
1.3.1.2 Gebeng Phase III Industrial Park, Pahang, Malaysia
Figure 1.3.2: Gebeng Phase III Industrial Park, Pahang, Malaysia (Source: Google Map,
2016)
Gebeng Phase III Industrial Park is a newly developed industrial area situated 31 km from
Kuantan City. Gebeng is the petrochemical hub for multinational players like BASF,
Amoco, Kaneka and Eastman. The petrochemical zone provides an integrated
environment that meets the specific needs of a petrochemical industry Peninsular Gas
utilities (PGU) project.
62
Centralized utility facilities such as power, industrial gas, water and steam.
Kuantan Port
- Centralized tankage facilities.
- Pipeline and pipe rack system connecting Gebeng to Kuantan Port.
- Container and bulk liquid port.
- Railway linking Kerteh, Gebeng, and Kuantan Port.
Environment Technology Park - Incorporating a training centre, a waste collection
and processing centre as well a raw material management and storage facilities,
maintenance and servicing facilities.
Transportation - East Coast Highway.
(Source: Pahang State Development Corporation, n.d.)
List of plant situated within or near Gebeng:

1. BASF Petronas Chemical (M) Sdn Bhd
2. Eastman Chemicals (M) Sdn Bhd
3. Amoco Chemicals (M) Sdn Bhd
4. Kaneka Paste Polymers Sdn Bhd
5. MTBE ( Malaysia) Sdn Bhd
6. Polyplastics Asia Pacifics Sdn Bhd
7. Polypropylene (M) Sdn Bhd
8. Toray BASF PBT Resin Sdn Bhd
63
1.3.1.3 Shanghai Chemical Industry Park, Shanghai, China
Figure 1.3.3: Shanghai chemical Industry Park, Shanghai, China (Source: Google
Image, 2016)
Shanghai Chemical Industry Park (SCIP) lies at the north coast of Hangzhou Bay and is
located in the south of Shanghai, on the boundary between Jinshan District and Fengxian
District. SCIP is one of the industrial projects with the largest investment in China during
the 10th Five-year Plan. Its Phase 1 investment totaled RMB150 billion. It is the first
industrial zone specialized in the development of petrochemical and fine chemistry
businesses, and the southern center of Shanghais six industrial bases. The industrial
output of SCIP will achieve RMB100 billion when all approved projects are put into
operation. SCIP is known as the "Wing of Industrial Take-off of Shanghai (Shanghai
Municipal Peoples Government, n.d).
The petrochemical zone provides an integrated environment that meets the

specific needs of a petrochemical industry. SCIP provides investors with best investment
environment by integrating production projects, public utilities, logistics, eco protection and
administration services. It is the petrochemical hub for multinationals players like BP,
BASF, Bayer, Degussa, Huntsman, SUEZ, Vopak, AIR LIQUIDE and Praxair. SCIP aims
64
to be one of Asias largest and most advanced petrochemical bases (Shanghai Municipal
Peoples Government, n.d.).
A4 Expressway that connects Shanghai-Nanjing and Shanghai-Hangzhou
Expressway network, it is only a 45-minute drive, or 50 kilometers, away from
downtown.
Railway sub-lines for its exclusive use connecting to the 113-kilometer-long
Pudong Railway (Fengxian-Pudong Airport-Zhangmiao).
The park is connected to Huangpu River and Yangtze River water system via
dredged inner river channel system.
(Source: Shanghai Municipal Peoples Government, n.d.)
List of plant situated within or near Shanghai:

1. Chemical Industrial Zone Of Shanghai
2. Fuaomu( Shanghai) Chemical Industry Limited Company
3. Doushan (Shanghai) Chemical Industry Material Limited Company
4. Shanghai Chemical Industry Wupin Automobile Transport Company
5. Shanghai Chemical Industry Light Industry General Company
1.3.2 CRITERIA FOR SITE SELECTION
Before the chemical is constructed, a preliminary study needs to be carried out to evaluate
the feasibility of the selected location. The study conducted based on the following criteria:
65
i) Availability of Suitable Land
The characteristics of the land at the proposed plant site should be examined
carefully. The topography of the tract of land structure must be considered, since either or
both may have a pronounced effect on the construction costs. The cost of the land is
important, as well as local building costs and living conditions. Future changes may make
it desirable or necessary to expand the plant facilities. The land should be ideally flat, well
drained and have load-bearing characteristics. A full site evaluation should be made to
determine the need for piling or other special foundations
ii) Grant and Taxation
Capital grants, tax concessions, and other inducements are often given by
governments to direct new investment to preferred locations; such as areas of high
unemployment. The availability of such grants can be the overriding consideration in site
selection.
iii) Transport Facilities
The transport of materials and products to and from plant will be an overriding
consideration in site selection. If practicable, a site should be selected so that it is close to
at least two major forms of transport: road, rail, waterway or a seaport. Road transport is
being increasingly used, and is suitable for local distribution from a central warehouse.
Rail transport will be cheaper for the long-distance transport. If possible the plant site
should have access to all three types of transportation. There is usually need for
convenient rail and air transportation facilities between the plant and the main company
headquarters, and the effective transportation facilities for the plant personnel are
necessary.
iv) Climate Condition
Climate condition plays a crucial role when determining the suitability of a specified
location. Constructing a plant within countries with abnormally low or high temperature will
lead to higher operating costs as it require special heating equipment and insulation for
66
the piping as well as major equipment. Besides that, stronger material of construction will
be required for areas that are prone to natural disasters such as earthquake, typhoon,
flood and others.
v) Water Supply
The water is required for large industrial as well as general purposes, starting with
water for cooling, washing, steam generation and as a raw material in the production of
sulfuric acid. The plant therefore must be located where a dependable water supply is
available namely lakes, rivers, wells, seas. If the water supply shows seasonal
fluctuations, its desirable to construct a reservoir or to drill several standby wells. The
temperature, mineral content, slit and sand content, bacteriological content, and cost for
supply and purification treatment must also be considered when choosing a water supply.
Demineralized water, from which all the minerals have been removed is used where pure
water is needed for the process use, in boiler feed. Natural and forced draft cooling towers
are generally used to provide the cooling water required on site.
vi) Electricity
Power and steam requirements are high in most industrial plants and fuel is
ordinarily required to supply these utilities. Power, fuel and steam are required for running
the various equipments like generators, motors, turbines, plant lightings and general use
and thus be considered as one major factor is choice of plant site.
vii) Effluent Disposal
Allowable tolerance levels for various effluents must be taken into considerations in
choosing a plant site. As all industrial processes produce waste products, full
consideration must be given to the difficulties and coat of their disposal. Therefore, the
plant must be provided with facilities for the effective disposal of the effluent. The disposal
of toxic and harmful effluents will be covered by local regulations and the appropriate
authorities must be consulted during the initial site survey to determine the standards that
must be met.
67
viii) Local Community Considerations
The acceptance from the local community is an important factor that should be
considered before constructing a chemical plant. This is to ensure that the plant can
operate normally and avoid unfavorable circumstances from arising such as
environmental damage, human casualties, property damage and others. Among the
privileges that a project can provide to the community are residential facilities such as
offices, banks, parks, open space and recreational facilities.
ix) Availability of Labors
Labors will be needed for construction of the plant and its operation. Skilled construction
workers will usually be brought in from outside the site, but there should be an adequate
pool of unskilled labors available locally; and labors suitable for training to operate the
plant. Skilled tradesmen will be needed for plant maintenance. Local trade union customs
and restrictive practices will have to be considered when assessing the availability and
suitability of the labors for recruitment and training.
68
1.3.3 CONSIDERATIONS FOR EACH LOCATION
Table 1.3.1: Comparison between proposed locations
Selection Dahej Industrial Area, India Gebeng Phase III Industrial Park, Shanghai Chemical Industry
Criteria Malaysia Park, China
Distance from 46km from Bharuch 31km from Kuantan 50 km from Shanghai
town
Type of Heavy, Medium and Petrochemical Heavy and Petrochemical Petrochemical, Polymer
industry
Chlorodifluoromethane Chlorodifluoromethane Chlorodifluoromethane
TriveniInterchem Pvt Ltd, Vapi, Zhejiang Haiqiang Chemical Arkema (Changshu) Chemicals
Gujarat. Co.,Ltd. Hangzhou, Zhejiang, Co, Ltd
Gujarat Fluorochemicals China
Availability of Limited, Dahej, Gujarat.
Materials Benzoyl Peroxide Benzoyl Peroxide Benzoyl Peroxide
Tejas Parikh Pvt. Ltd. Honworld Chemicals & Machinery Jiangsu Taizhou Yuanda
Sdn. Bhd. Chemical Materials Co. Limited
WujinJiaoxiShengan Chemical
Factory
69
Gujarat Chemical Port Kerteh Port, Terengganu (103km) Yangshan Deep Water Port
Terminal Company Limited Kuantan Port, Kuantan (10km) (100km)
Port (50km)
Adani Petronet Port Pvt Ltd. ,
Dahej, Dahej, Gujarat, India
(100km)
Vadodara Airport, Baroda, Sultan Ahmad Shah, Kuantan Pudong International Airport
Gujarat, India Kerteh Airport, Terengganu Hongqiao International Airport
Surat International Airport,
Air Port Surat, Gujarat, India
Ahmedabad Airport,
Ahmedabad, Gujarat, India
National Highway Jerangau-Johor Highway Shanghai-Nanjing and
Karak-Kuantan Highway Shanghai-Hangzhou
Road Kuala Terangganu-Kerteh-Telok Expressway
Facilities Kalong-Gebeng-Kuantan-Kuala
Lumpur Highway
Sachin Water Supply Company Semambu Water Treatment Plant Sino-French Water
Private Limited Current capacity of water supply is Development Co.,Ltd
Water Supply Gujarat Industrial Development 2MG/D.
Corporation Centralized Utilities Facilities
(CUF), Gebeng, Kuantan.

Water rate per First 25: USD 6.73 USD 0.45 USD 0.9
70
1m3 Additional : USD 0.3
Adani Power Tenaga Nasional Berhad (TNB) The Shanghai Electricity
Electricity Torrent Energy Ltd Phase I and II 132/11kV Company
Supply Phase III 12/275kV main intake Shanghai Municipal Electric
Power Company

Electricity rate USD 0.046 USD 0.06 USD 0.1
per kWh
Disposal Gujarat Alkalies & Chemicals Ltd Kualiti Alam Sdn Bhd Swire SITA Waste Services Ltd.
facilities
Selling price = USD 5.98/acre Selling price = USD 624.52/acre Price land = USD 88.80/acre
Availability of Brokerage = 2% Minimum area = 3 acres Land area = 150 acres
suitable land Land area = 100 acres Maximum area = 250 acres
99 years lease
Diverse conditions, the winters Tropical rainforest climate, hot and Shanghai climate is generally
are mild, pleasant, and dry with humid throughout the year. mild and moist, with four
Climate 100% sunny days and clear Average temp : 27 C distinct seasons.
Condition night. Rain for about one third of the
Daytime temp: 29 C year.
Night temp: 12 C Average temp: 28 0C (hot)
Average temp: 5 0C (cool)
71
Resident area is far away so Resident area is far away so Resident area is far away so
human contact with the CO2 human contact with the CO2 gas is human contact with the CO2
Environmental gas is avoidable avoidable gas is avoidable
impact HF is sent to chemical waste HF is sent to chemical waste HF is sent to chemical waste
disposal company hence disposal company hence human disposal company hence
human contact is avoidable contact is avoidable human contact is avoidable
Exemption from excise duty for Pioneer Status with income tax Business tax rates range from
development of Special exemption up to 100% for 5 to 10 3% to 20% and value added tax
Economic Zones for authorized years rates approximate 17%.
operations approved by the Investment Tax allowance up to Industrial and commercial
BOA 100% for 5 years. Allowance can registration fee is at the ratio of
Income tax exemption on be offset against 100% of statutory 0.1% of the total registered
Grant and income derived from the income. capital.
Taxation business of development in a Reinvestment allowance of 60%
block of 10 years in 15 years for a period of 15 years
Exemption from minimum
alternate tax
Exemption from dividend
distribution tax
Exemption from Central Sales
Tax
Exemption from Service Tax
72
Narmadeshwar Enterprise one Industrial area that has been As one of the largest cities in
of the companies that supply specialized for Chemical Industrial the world, Shanghai has an
man power and labor in Zone to get labors for development abundant workforce of both
Gujarat. of the plant. skilled and unskilled laborers
They can supply all type of A highly competitive and and 60 universities enrolling
labor unskilled, semiskilled, reasonable wage structure and more than 442,600 students.
Labour skilled and special skilled middle cost locations are available
labors. for laborers.
Offer of job opportunity to resident
in Pahang, Kelantan and
Terengganu as well as from other
country.
Cost of labor USD 4 USD 4.38 USD 9.56 USD 38.23 USD 4.93 USD 7.40
per hour
73
Local Provide work opportunities to The local community supported the The plant is far from the
community the local community during development of plant in Gebeng residential area
considerations construction in Dahej. because it is near from Kuantan From the construction of the
Accommodate safety port that surely safe from new plant, it can create job
environment and has no residential area. opportunities for the local
minimal impact on normal life From the construction of the new community and general public.
of nearby communities. plant, it can create job opportunities
for the local community and
general public.
Competition As one of the leading country There is less competition in As one of the leading country
that manufactures PTFE, Malaysia because up till this day, that manufactures PTFE,
automatically the competition there is no company that automatically the competition
there is quite strong. That manufacture PTFE but there is lot there is quite strong. That
because the raw materials are of company that need PTFE in their because the raw materials are
available and easy to get in products for example the company available and easy to get in
India, there is lot of companies that produce pan or pipe. China, there is lot of
that produce PTFE. companies that produce PTFE.
74
1.3.4 SCORING ANALYSIS
Table 1.3.2: Scoring analysis for each location.
Dahej Industrial Area, Gebeng Phase III Industrial Park, Shanghai Chemical Industry Park,
Location
India Malaysia China
Total land available 3 4 2
Price of land 4 2 3
Raw material 4 2 4
sources
Labor Cost 4 2 3
Utilities (water and 4 3 2

electric)
Transportation Cost 2 4 2
Competition 2 5 2
Climate 2 5 2
Total 25 27 20
Definition Most Preferable Good Moderate Poor Least Preferable

Rate 5 4 3 2 1
75
1.3.5 SELECTION OF PLANT LOCATION
Based on our evaluation, it can be concluded that the best location for the construction
of PTFE production plant is in Gebeng Phase III Industrial Park, Malaysia. The
selection is based on the total score obtained for utilities and labor cost, price of land,
climate condition and several other factors.
Gebeng Phase III Industrial Park is situated only 31 km away from the city centre,
Kuantan and is close to the Petrochemical Hub situated in Gebeng. The total area
available for the plant is 250 acres which is the most out of all of the others. This allows
for the expansion of the plant should it be necessary in the future. Another advantage
to this location is that is has the Centralized Utilities Facility (CUF), which is owned
and operated by Tenaga Nasional Berhad (TNB). CUF supplies utilities including
electricity, steam, demineralized water and gases such as nitrogen, oxygen and argon
to meet the requirement of petrochemical complexes. The main supplier of electricity
for Gebeng Industrial Park is TNB and it fares a lot cheaper compared to China and is
only marginally higher than India.
In addition, the accessibility to Gebeng Phase III Indsutrial Park is excellent due
to the existence of major highways such as the East-Coast Highway which links
Kuantan to Kuala Lumpur at an estimated travel time of only 2 hours. Not only that, a
railway that connects the integrated petrochemical complex in Kerteh, Terengganu to
Gebeng and Kuantan Port is also available. This railway link further strengthens the
chemical and petrochemical linkage between Gebeng and other industrial centers by
ensuring the safety during transportation of materials.
With regards to public and environment safety, the Pahang Fire and Rescue
Department is located near Gebeng and can provide immediate assistance in case of
emergencies. Apart from that, Gebeng Phase III Industrial Park is also located within
the vicinity of Petronas Centralized Emergency Facilities which are equipped with
hazardous material facilities. Another advantage of this location is that Gebeng
Emergency Mutual Aid (GEMA), a voluntary crisis management organization which
was set up by the government is able to offer proactive safety actions and execute
expert services to handle emergency situations.
76
REFERENCES
1. Government of India Ministry of MSME. Brief Industrial Profile of Bharuch District.

(n.d). Retrieved 10 October 2016, from
http://dcmsme.gov.in/dips/dip%20bharuch_gu.pdf
2. All distance between (n.d). Retrieved 10 October 2016, from
http://alldistancebetween.com/in/distance-between/dahej-industrial-estate-
bharuch-railway-station-d5101e18c5dcbce28ecd8eaa5e1e9e2f/
3. Dahej SEZ Ltd. Dahej SEZ Profile. (n.d),Retrieved 10 October 2016, from
http://www.dahejsez.com/dahej_sez_profile.html
4. Shanghai Municipal Peoples Government. (n.d.) Shanghai Chemical Industry
Park.Retrieved 10 October 2016, from
http://www.shanghai.gov.cn/shanghai/node27118/node27873/node27997/n31510/
n31512/u22ai73232.html
5. SCIP profile. (n.d), Retrieved 10 October 2016,
fromfromhttp://www.scip.com.cn/english/enabout.htm
6. Expat Focus. (n.d.) Shanghai - Utilities (Electricity, Gas, Water, Household Waste).
Retrieved 10 October 2016, from http://www.expatfocus.com/expatriate-shanghai-
utilities
7. Hermann G. HauthalandTiinaSalonen. (n.d).Chemical industrial parks in China.
Retrieved 10 October 2016, from
http://dechema.de/dechema_media/851_S_14_16-p-1146.pdf
8. Trivista. (2010). Shanghai Manufacturing & Investment Information. Retrieved 10
October 2016, from http://understand-china.com/province/shanghai/
9. Travel China Guide (n.d.). Shanghai Weather. Retrieved 10 October 2016, from
https://www.travelchinaguide.com/climate/shanghai.htm
10. Pahang State Development Corporation. (n.d.). Gebeng Industrial Estate.
Retrieved 10 October 2016, from
http://www.investinpahang.gov.my/index.php?rp=gebeng_facilities_infra.pdf
11. Ministry of Commerce and Industry. (2009). Incentives and facilities offered to
the SEZs. Obtained from http://www.sezindia.nic.in/about-fi.asp
12. Malaysian Investment Development Authority. (2011). Profit from Malaysias
Petrochemical Indsutry. Retrieved 10 October 2016, from
77
http://www.mida.gov.my/env3/uploads/Publications_pdf/Profit_%20MalaysiaPetro
chemical/SIB%20Broc(Petrochemical).pdf
13. Magicbricks. (n.d.) Industrial Land for Sale in Dahej.Retrieved 10 October
2016, from http://www.magicbricks.com/property-for-sale/Industrial-Land-real-
estate-Dahej-in-Bharuch
14. Ebnesajjad, S. (2013). Introduction to Fluoropolymers: Materials, Tehcnology,
and Applications (1st Edition ed.): Elsevier Science & Technology Books.
16. Fernandez, A. M., & Jebbanema, L. (2007). The Effect of Surfactant Selection
on Emulsion Polymer Properties. Retrieved 1 December, 2016, from
17. Mori, T., Tsuchiya, Y., & Okahata, Y. (2005). Polymerizations of
78

Chapter 1 - Process Background, Market Analysis and Site Selection

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EH2208O

DESIGN PROJECT II (MARCH 2017)

PRODUCTION OF 20,000 METRIC TONNES OF

CHAPTER 1: PROCESS BACKGROUND,

AIMAN HAKIM BIN ROSLAN 2013849224

FACULTY OF CHEMICAL ENGINEERING

PART 1: PROCESS BACKGROUND AND SELECTION

1.1.1 PROCESS BACKGROUND

The discovery of polytetrafluoroethylene (PTFE) was accomplished by an

1.1.1.2 Chemical and Physical Properties of PTFE

PTFE, or scientifically known aspoly(1,1,2,2-tetrafluoroethylene) is the synthetic

PTFE is commonly produced through the polymerization of the monomer,

Table 1.1.1: Properties of PTFE (Crown Plastics Inc, 2016).

i) Petrochemical and chemical processing

ii) Electrical applications

iv) Food, Beverage and Pharmaceutical industries

PTFE coatings are important in the pharmaceutical industry since it provides an

vi) PTFE Compounds

PTFE can be produced from a variety of polymerization processes namely,

1.1.2.1 Dispersion Polymerization

Dispersion polymerization is the polymerization of TFE to produce fine powders of

During polymerization of TFE, dispersion polymers are converted into water

The mechanism for the chemical reaction for dispersion polymerization of

Figure 1.1.3: Process Flow Diagram for Dispersion Polymerization

1.1.2.2 Suspension Polymerization

Figure 1.1.4: Polymerization of TFE into PTFE.

A typical suspension polymerization begins with the charging of highly

Figure 1.1.5: Typical Suspension Polymerization Reactor (Ebnesajjad,

Figure 1.1.6: Process Flow Diagram of Suspension Polymerization

1.1.2.3 Photo-Initiated Polymerization

For this process, TFE is synthesized in mercury to produce perfluorocyclopropane

1.1.2.4 Polymerization in Solution and Carbon Dioxide

This type of polymerization is generally not practiced because the PTFE

More regular colloidal PTFE could be prepared in a batch reactor using

1.1.3 SELECTION CRITERIA

A catalyst or initiator is a substance that is used to either increase, decrease or

iv) Type of reactor

Safety plays an important role in any manufacturing industry. In process selection,

Table 1.1.2: Summary of Available Processes for Production of PTFE.

Semi-batch polymerization is At extreme reaction condition,

At some point, as the

No ionic end groups present which diminished due to insufficient

may be unstable during processing at decomposition rate (Ebnesajjad

high temperatures (Ebnesajjad, & Morgan, 2011).

Effective type of lamp used,

Table 1.1.4: Scoring Analysis for Each Method

Dispersion Suspension Polymerization in Photo-initiated

Definition Most Preferable Good Moderate Poor Least Preferable

In terms of demand, the product from dispersion polymerization has higher

Apart from that, chlorodifluoromethane can be obtained through either import

1.1.5 ASSUMPTIONS FOR PRODUCTION OF PTFE

1.1.6 LIMITATIONS FOR PRODUCTION OF PTFE

The raw material used for the production of PTFE is chlorodifluoromethane

The stream is then heated to 450C as a preparatory step before entering

The product stream is then fed to a mixing tank whereby a surfactant,

1. Avataneo, M., De Patto, U., Guarda, P. A., & Marchionni, G. (2011).

PART 2: MARKET ANALYIS

According to a report titled Global Polytetrafluoroethylene (PTFE) Market

Based on the observation, the global export of PTFE had increased

EXPORT STATISTIC OF PTFE FOR

IMPORT STATISTICS OF PTFE FOR

Figure 1.2.3: Import statistics of PTFE for worldwide (Source: MATRADE,

1.2.3 PTFE IN MALAYSIA

Currently, there is no chemical plant that produces PTFE in Malaysia. However,