N-paraffin demand saw healthy growth beginning in 2002 and reached 3.1 million tons in 2007, CAHAs study says. Long-term, consumption of n-paraffins is on an upward track, and will grow to 3.4 million tons worldwide in 2017. Most of that growth will come after 2012, once global economies begin to pick up.

But before that occurs, the merchant market for normal paraffins will be distressed, CAHA says, due to the planned departure of ExxonMobil Chemical. That departure is imminent – next month – and will leave Sasol and Cepsa as the worlds largest n-paraffin producers. Sasols plant in Lake Charles, La., will be the only significant North American source. And both availability and prices for n-paraffins are likely to feel the effects.

Capacity for n-paraffin production isnt expected to recover from ExxonMobils closure in 2009 until Shell opens its new GTL plant in Qatar, according to Joel Houston, CAHA president. As one of the worlds largest producers and the only merchant supplier in North America exits the business, supply options will remain tight over the next two years, until the market can become balanced again.

The Lube Connection

One key area where this change will be felt is aluminum rolling oils, where n-paraffins do a great job, Houston told LubesnGreases. There are alternatives, yes, and some may even be cheaper in some cases, but the performance of n-paraffin is simply better. Aluminum manufacturers are very sensitive to staining issues, and foil rolling mills will have a hard time finding good substitutes, he stated.

The constriction in n-paraffin supply may be felt even more in chlorinated paraffins, offered Jim MacNeil, vice president of DRD Additives in Crown Point, Ind. Chlorinated paraffins are pretty ubiquitous in metalworking fluids, and there are not very many that dont use it. Its in soluble oils, straight oils, semi-synthetics – everything except synthetic fluids. Theyre used in metalworking, drawing and stamping operations.

Among the characteristics that customers expect in chlorinated paraffins is a consistent mix of the C14 to C17 chain lengths from batch to batch, and clarity of color. A very pale, straw color is what customers making metalworking fluids usually prefer.

Dover Chemical, a subsidiary of ICC Industries, is the leading producer of both liquid and solid chlorinated paraffins in North America. Based in Dover, Ohio, it also serves the larger CP markets beyond metalworking, such as in rubber and plastics for use as a flame retardant and plasticizer. Overseas, there are a handful of other CP suppliers, led by the U.K.-based Ineos Chlor.

Dovers global business director for chlorinated products, Thomas Kelley, said his company has been preparing for ExxonMobils exit for some time. There are additional overseas normal paraffin producers which we are evaluating, he said. We have been working to approve new suppliers and, as a wholly owned subsidiary of ICC Industries, Dover Chemical can access ICCs knowledge and expertise in the global market for these products.

Kelley assured, Fluid formulators should not be concerned. We buy raw materials on tight specifications and quality is strictly controlled. Do we expect supplies to be short? Not for Dover Chemical. There likely will be some tightness in the market, but we have taken steps to ensure sufficient quantities for our requirements.

Pricing could be an issue but having enough n-paraffin to meet our demand is not a concern at this time.

Closing Up Shop

At the heart of these changes is ExxonMobil Chemicals Baytown, Texas, linear paraffins unit, which will cease production next month. ExxonMobil Chemical will decommercialize its trademarked Norpar 12, Norpar 13 and Norpar 15 fluids this June, company spokesman Jeff Neu in Houston confirmed. The chemical giant has notified its customers to allow them time to convert to alternatives, he added, including its own Exxsol solvents and Isopar fluids. There are no drop-in substitutes for n-paraffins in metalworking fluids and rolling oils, though, numerous sources agreed.

As Joel Houston explained, N-paraffins are a very purified petroleum product, a borderline product between the refining and chemical areas. Unlike their heavier wax cousins (which are extracted from lubricating base oils), n-paraffins usually are separated from kerosene by using molecular sieves, and are liquid at room temperature. A paraffin-rich kerosene may yield 20 to 25 percent paraffins; the kerosene itself can be further processed in the refinery for fuel.

Going forward, Baytown will likely retain its n-paraffins in the fuels stream. Exiting the market wont be difficult for them, Houston said. They simply wont separate the n-paraffin out, and will leave it in the kerosene.

ExxonMobil did not give a reason for the withdrawal, but Houston suggested the company felt the merchant market was contracting and the role of merchant paraffins was not supportable. He also pointed out that there has been a steady decline in the supply of highly paraffinic kerosenes, hurting yields of n-paraffins. This raised costs, as more material must be processed to maintain a steady flow of n-paraffin.

At the beginning of this decade, industry sources estimated Baytowns n-paraffins output at 550 million pounds a year of the C9 to C17 cuts. Of these, the shorter chains (C12 and below) are absorbed in the detergents stream; the ones desirable for lubricants and chlorinated paraffins are the mid-length C14 to C17 chains. This is because the short-chain C8 to C12 molecules are deemed carcinogenic, and metalworking fluid suppliers now shun them, pointed out MacNeil.

Some people formulated away from chlorinated paraffins due to regulatory issues, he said, but suppliers were very active to move from short-chain to safer mid-chain paraffins. They did a good job to help preserve that business. This is key, because there is no really cost-effective substitute for metalworking. In Europe, some are using phosphorus compounds, but they are much more expensive.

The next wave of n-paraffin supply wont come until Pearl, Shells massive gas-to-liquids venture in Qatar, comes on stream in late 2011. Most of Pearls output, however, is aimed at the LAB market, where customers already are lining up for its output. Even more unfortunately for lubes, Joel Houston added, what Shell will be making at Pearl is not in the best carbon number range for lubricants. The ideal for lubes are the C14 to C17 chain lengths, while Pearl is going to be making C10 to C13 mostly. So dont expect relief from that quarter.

Into the Lab

The best way to manage this or any upstream change is to be prepared with alternatives, advised Joe Clayton, president of specialty chemical distributor Sea-Land Chemical in Westlake, Ohio. That means looking at the formulations you have, and the chemistries that are available.

From a global situation, there are other suppliers such as our client Ineos Chlor. But for those thinking to completely eliminate chlorinated paraffins, one product probably wont replace it. Youll need several different chemistries. Sulfur and phosphorus compounds may be used, but it depends on the [metalworking] operation. Sulfur may not do as well as chlorinated paraffins in water bases, and will stain if there is active sulfur, so you need to check into that. Phosphorus is good, but is active only at certain temperatures.

Were in an interesting position. Sea-Land has both chlorinated paraffins and the replacement chemistries. But in fact, there is no silver bullet to replace them.

Thomas Kelley pointed out that alphaolefins can be used interchangeably with n-paraffins in many applications and this would also help to offset any potential shortage in paraffin supply. We have customers who have both a paraffin based and alphaolefin based product approved, meeting the same specifications, who use then interchangeably based on market conditions.

The key thing is to start looking at new technology, new supplies and alternatives to chlorinated paraffins, echoed DRDs MacNeil. They are available, and while some may be more expensive, there may be a lower treat rate possible which will offset the increased cost.

Eyeing the coming shift in n-paraffin supply, Houston said, the market will have to get sorted out. The more highly valued applications will capture and outbid the others for the available supply. Lubricants are a particularly complicated end use, because there are so many specific requirements and range of needs. That, and their small share of the market, weakens their ability to dictate what happens upstream.

Fortunately, said Sea-Lands Clayton, most metalworking fluid formulators have some alternative already in their arsenal in case n-paraffin supplies become limited or prices climb too high. And nows time to dust off those alternatives for a closer look. As chemistry changes, product availability changes, and so do prices, he said. Some blenders may need to check if theres a better or more economical chemistry now in the marketplace.

At least theres room to work on the issue, he added. Actual demand is down, in combination with overall manufacturing being down. So fluid suppliers at least are not forced to act quickly – but they need to review their formulations, and see where a non-chlorinated products would fit in.

This has not been talked about much, but its not way out there, Clayton emphasized. Its pretty imminent.