Stefan Lepecki
CEO
Braskem IDESA
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View from the Top

Etileno XXI: Consolidating Early Success

Wed, 01/18/2017 - 11:13

Q: What has Braskem IDESA achieved in the Mexican market?

A: Braskem IDESA is an association founded at the beginning of 2010 to lead the Etileno XXI project. We started operations in April 2016, with our first plant transforming ethane into ethylene using the cracking process. In mid-2016 we started production at three other polyethylene plants, two of which focus on high-density polyethylene and the other on lowdensity polyethylene. As of April 2017, we have achieved 95 percent operability, when comparing average production to the nominal designed production, and have also introduced our product to the local market, which is an important achievement.

Prior to production we were importing products from Braskem and other companies and selling them in the Mexican market. Now we are selling our own product. We faced some difficulties in achieving stability, mainly because of bottlenecks at PEMEX plants, which made the pipeline unstable. To address the issue, our technical and managerial teams worked with their counterparts at PEMEX to ensure a constant supply.

Q: What are the main challenges Braskem IDESA faces as a producer?

A: We face the challenge of convincing customers to replace the products they are accustomed to using with ours. Instilling in them the confidence to change requires that we exhibit production stability and quality but that takes time. To speed up adoption, we incorporated potential customers and their customers into our pre-marketing stage to understand their needs, worries and expectations. This strategy has delivered strong results and a high-quality product that is becoming widely known in the market. Not many companies follow this approach because most petrochemical companies treat their products as commodities, especially US companies that are geographically far away from their clients. We try to work with our clients as closely as possible, which has proven extremely important in the qualification and certification processes.

Another important challenge is the logistics of distribution. With exports to over 40 countries and a production of millions of tons of polyethylene, we have to develop a flexible and adaptable delivery process, including a variety of transportation methods, such as railroads, trucks or boats. Developing this network, for both imports and exports, has been a major challenge.

Q: How does Braskem IDESA illustrate its commitment to Mexico?

A: We like to work with local content. During the construction phase of our petrochemical complex, we focused on hiring and training people from the region. At a certain point, we had more than 26,000 people working onsite. Armed with a premarket study, we started hiring personnel for our future operations and bringing specialists from Braskem Brazil to train them. We started with a group of 60 people from Brazil doing this task and now have fewer than 20 still in the country, which shows the skill of the local talent pool and the positive way in which they have accepted the challenge.

Q: What are your plans for the long term?

A: Thanks to our combined efforts we have achieved a constant supply of ethane from PEMEX. Nevertheless, we are aware that PEMEX suffers from a lack of investment and we understand how that could affect us. Having a long-term commitment to Mexico we are looking for ways to positively work together with PEMEX and other companies to ensure a proper supply of ethane. To that end, we need an appropriate level of investment, mainly because of the lower oil prices and financial difficulties faced by the country. The Energy Reform is not tackling the problems the petrochemical industry faces because the reform is mainly focused on upstream. But we are confident that once the Energy Reform starts showing results the country will work to improve the situation and we will be working together to create a positive result for the country.