Chemistry Canada 2018

Adding Value to Canada’s Polyolefins

A proposal for a workshop
Mauricio Davila, Ph.D., Managing Director
Ken Sinclair, Principal Consultant

June 5, 2018

ENERCHEMTEK, INC.

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Chemistry Canada 2018

Adding Value to Canada’s Polyolefins

Mauricio Davila and Ken Sinclair, EnerChemTek, Inc.

BACKGROUND

Polyolefins – polyethylene (PE) and polypropylene (PP) – are the most widely used plastics worldwide.
They are made from the two light olefins ethylene and propylene that are both derived ultimately from
natural hydrocarbons, crude oil & natural gas.

For the past four decades, Canada has used ethane extracted from Alberta natural gas to make ethylene
and PE, adding substantial value to the raw hydrocarbon resources through exports of PE in pellet form.
Some of this PE is used in Canada to make films & moldings for packaging and other uses, but most of it
is exported.

Canada will also soon become a significant supplier of PP resins to global markets. The first PP
production operation – the Heartland Petrochemical Complex in Alberta – will add value to Canadian
natural resources first by upgrading propane from natural gas liquids into higher value propylene, and
then by polymerizing this propylene to polypropylene plastic.

The pelletized polyolefins – PE & PP – produced in Alberta are and will be shipped in bulk rail & road
tankers to customers in many countries, some in Canada, but mainly in the United States and other
countries overseas. Once there, these customers will convert the raw pellets into a very broad range of
plastic products for industrial, consumer & medical applications, adding, but keeping for themselves,
successive layers of value to the Canada-derived resins.

This workshop introduces the full value chains for PE & PP, starting from hydrocarbon raw materials
through to finished products sold into consumer, industrial & medical markets. It discusses the most
important PE & PP conversion processes in the context of opportunities that may exist to add substantial
additional value to Canadian-made polyolefins through export of converted plastic products. Analogies
are drawn with developments in other resource-rich countries that are encouraging and supporting
downstream resin conversion industries.

WHO SHOULD ATTEND

The workshop is intended for new and experienced professionals involved in the many functional areas of
the polyolefins industry with a technical as well as a commercial interest, such as operations, planning,
sales and marketing, purchasing, etc. The workshop will benefit people in government, industry planners,
investors and other stakeholders interested in updating their knowledge and gaining an understanding of
opportunities down the full plastics value chain from resource to end-user.

The content of the workshop may differ slightly as we might opt to put greater emphasis on certain
aspects of the value chain based upon specific requests by delegates who subscribe early or based on
an internal evaluation of the delegate mix. Please feel free to suggest topics of interest. or mention your
priorities once you subscribe to the workshop.

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WORKSHOP OUTLINE

The Adding Value to Canada’s Polyolefins workshop is a half-day (1:30 to 4:30pm) working session
focused on the full value addition chain for polyolefin plastics, from hydrocarbon resources through to final
end-users of products made from PE and PP: packaging, moldings, films, pipes, automobiles, etc.
Part 1. The Polyolefins Upstream Value Chain
1.1. Oil & natural gas
1.2. Refining
1.3. Natural gas liquids (NGLs)
1.4. Ethylene & polyethylene production
1.5. Propylene & polypropylene production
Part 2. The Polyethylene Value Chain
2.1. What makes PE attractive as a plastic?
2.1.1.HDPE
2.1.2.LLDPE
2.1.3.LDPE
2.2. Major markets for PE resin by industry sector
2.2.1.HDPE
2.2.2.LLDPE & LDPE
2.3. PE resin conversion processes
2.3.1.Profile of each major PE conversion process
2.3.2.Investment & labor pet ton of PE converted
2.4. Global and regional supply/demand
2.5. Key players along the value chain
Part 3. The Polypropylene Value Chain
3.1. What makes PP attractive as a plastic?
3.2. Major markets for PP resin by industry sector
3.3. PP resin conversion processes
3.3.1.Profile of each major PP conversion process
3.3.2.Investment & labor pet ton of PP converted
3.4. Global and regional supply/demand
3.5. Key players along the value chain

WORKSHOP LEADERS

Dr Mauricio Dávila, Managing Director, EnerChemTek, Inc., Toronto

Kenneth Sinclair, Principal Consultant, EnerChemTek, Inc.

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BIOS

Maurcio Dávila, Ph.D.

Managing Director

As Co-founder and Managing Director of EnerChemTek, Inc., Dr. Mauricio Dávila oversees all
management activities of the company, including the firm’s natural gas/LNG and petrochemicals
technical advisory services, as well as all the web-based services such as an online corporate training
platform (EnerChemTek Academy), and interactive databases, market simulation models and polyolefins
process technologies (EnerChemTek Analytics).

Dr. Mauricio Dávila specializes in strategic planning, competitor analysis, valuation of companies,
market research, and regulatory policy analysis in the energy and chemical industries. He has more than
25 years of experience helping major corporations in their strategic planning. His recent assignments as
a consultant have been related to: participate as technical advisor in three different international
projects evaluating the global natural gas/LNG value chain from source to final consumer for utilization
in the oil refining, power generation, industrial, and transportation sectors in North and Latin America
(e.g. capital investment required for an LNG regasification plant; capital and operational costs for LNG
liquefaction, storage, road and wheel distribution, and regasification); economic and energy scenario
development, analysis of future petrochemical feedstock and product pricing, and evaluation of the
local and regional markets for HDPE and LDPE for an eastern European company; he supervised and led
a multi-year consulting engagement for the Ministry of Energy in Mexico and the state-owned oil
company for the promotion of a private investment in a new grassroots petrochemical complex (Project
Ethylene XXI involving US$5.2 billion of capital investment) in collaboration with Goldman Sachs;
evaluation of global market entry strategies for an Asian specialty polyolefins producer; market analysis
and marketing strategies for refinery products for an Asian company, including an analysis of new fuels
specifications and emissions legislation in Europe, the USA and Asia; assessment of U.S. markets for
some specialty chemicals for a Japanese company; US market analysis of some fluoropolymers for a
European company; worldwide market analysis of a specialty fiber for a Mexican company;
development of a strategy for restructuring a petrochemical state-owned company in Latin America.

Mauricio spent 7 years as a Senior Consultant in the Chemicals and Energy Practice of SRI Consulting
(formerly Stanford Research Institute) in California where he completed a wide variety of assignments
for European and Latin American energy and petrochemical players. He also worked for 5 years as an
investment banker for Banamex (now Citibank Banamex) and Serfin (now Santander Serfin). Mauricio
holds a B.S. in chemical engineering from Iberoamericana University, an M.Sc. in chemical engineering
and a Ph.D. in political economics from Laval University in Canada. He has also been a post-doctoral
visiting scholar at the Center for Latin American Studies at Stanford University, where he conducted
research on the natural gas and petrochemical sectors in Latin America. He is fluent in Spanish, English,
French and Portuguese, proficient in Italian and knowledgeable in German and Arabic.

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Kenneth Sinclair
Principal

Ken Sinclair is Principal Consultant of EnerChemTek, Inc. and specializes in the strategic interpretation of
technology for the plastics industries. He has more than 30 years of experience as a consultant to the
petrochemicals and polymers industries. He is a specialist in polyolefin technology, and specifically in the
relationships between catalyst/process combinations and the structures, properties, applications, and
costs of polymers produced. His primary aim is to provide the industry with insights into the role of
technology and its exploitation in the achievement of competitive advantage.

A frequent speaker at international conferences, he has authored a number of articles published in

leading industry journals, has lectured on polyolefin manufacturing technology, and has conducted many
private seminars on research planning, technology interpretation, and process evaluation in the polyolefin
industry. He has been the prime author of several multiclient studies on polyolefins technology, markets,
and business management that are recognized worldwide as benchmark studies in this field.

A chemical engineer with a BSc. in Chemical Engineering from the University of the Witwatersrand, South
Africa, Mr. Sinclair spent 8 years with chemical plant contractors in the United Kingdom, followed by 6
years as a Consultant with Chem Systems International (now Nexant, Inc., a Bechtel company) in
London, and 16 years as a Senior Consultant with SRI International in California. He left SRI at the
beginning of 1996 to set up STA*Research, a consultancy providing specialized advice to the plastics
industry on strategy development and technology exploitation. He is now a member of EnerChemTek’s
network of consultants.

KEN SINCLAIR -- SUMMARY OF PUBLISHED ARTICLES & PROFESSIONAL PRESENTATIONS

“Product Range and the Competitive Positioning of Polyethylene Production Technologies”, presented at
Society of Plastics Engineers, SPE International Polyolefins Conference, Houston, TX, Feb. 28, 2017.
"The Growing Importance of Performance LLDPE in Global Markets," presented at the 2006 Nova
Licensing Conference, Calgary, AB, September 18, 2006.

"Innovation & Globalization In Polyolefins Technology," presented at the Baxter Healthcare Corporation
2005 Medical Plastics Global Conference, Mundelein, IL, June 28, 2005.

"Metallocene polyolefins: progress and prospects," published in Hydrocarbon Processing, April, 2004,
Gulf Publishing

"Production Potential of SSCs in Solution, Slurry and Gas Phase Processes," delivered at MetCon 2004,
Houston, May 13, 2004, The Catalyst Group Inc.

"Polyketones: Current Status of Production Technology and Future Commercial Prospects" presented at
Specialty Polymers 2003, Philadelphia, November 2003, The Catalyst Group Inc.

"Polyolefins: Current and Future Prospects," presented at Advances in Polyolefins 2003, Sonoma,
October 2003, American Chemical Society.

"Commercialization of New Polymers: From Zero to Lift-Off," delivered at MetCon 2003, Houston, May 8,
2003, The Catalyst Group Inc.

"Global Market Outlook for 2nd Generation Metallocene Polypropylene," delivered at MetCon 2002,
Houston, June 7, 2002, The Catalyst Group Inc.

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"Metallocenes and Single-Site Catalysts: Global Status and Future Trends," presented at the DeWitt &
Company World Petrochemical Review, Houston, March 21, 2002.

"Recent Advances in Polyolefin Manufacturing Technologies," presented at the Polyolefins 2002

International Conference, Society of Plastics Engineers, Houston, February 25, 2002

"Overview of Nanocomposite Opportunities," presented at Nanocomposites 2002, Amsterdam, January

28-29, 2002, Emap Conferences.

"Future Trends in Polyolefin Materials," in Insertion Polymerization (W. Spaleck Ed.), Macromolecular
Symposia, Wiley-VCH Verlag, 2001.

"The Market Potential for Nanocomposites: Quantifying the Opportunities," delivered at Nanocomposites
2001, Chicago, June 25-27, 2001, Executive Conference Management.

"The Outlook for Single-Site and Conventional Catalysts in the New Millennium," delivered at MetCon
2000, Houston, June 8, 2000, The Catalyst Group Inc.

"Process/Product Optimization Developments In Polyolefins," delivered at Flexpo 2000,

Galveston/Houston, August 24, 2000, Chemical Market Resources, Inc.

"The Impact of Technological Advances on Polyolefins & Elastomers," delivered at The Second Houston
Polyolefins & Elastomers Conference, October 31-November 2, 1999, PlastiChem Consultants.

"Polyethylene Production Technology: Selecting The Optimum Process/Licensor Combination," delivered

at the NOVA Chemicals Technology & Licensing Conference, Mississauga, October 1999.

"What's New In The Polyolefin Revolution - Limitations In Processing," delivered at the Global Plastics
Processing Conference, Dallas, September 12-15, 1999

"The Future Potential of Metallocene Polypropylene," delivered at MetCon '99, Houston, June 10, 1999,
The Catalyst Group Inc.

"Trends In Polyolefin Manufacturing Technology: Synergistic Interactions Between Process Development,

Catalyst Development, And Market Specialization," delivered at The Third Polymers Producers
Conference, AICHE Spring Meeting, Houston, TX, March, 1999.

"The New Generation Polyethylene Technologies: A Comparison," delivered at Polyolefins XI, SPE
Regional Technical Conference, Houston, TX, February 1999.

"Economic Factors Determining Market Acceptance of Single-Site Catalyzed (SSC) Polymers," delivered
at MetCon '98, Houston, June 10, 1998, The Catalyst Group Inc.

"The Impact of Metallocene Technology on Polyolefins & Elastomers," delivered at The Houston
Polyolefins & Elastomers Conference, February 1-3, 1998, PlastiChem Consultants.

"SSC Technologies: Incubators For Innovation In Polyolefins," delivered at Advances In Polyolefins, ACS
Division of Polymer Chemistry, Napa, CA, September, 1997

"Emerging Applications for Metallocene Polypropylene," delivered at Metallocene Technology '97,

Chicago, June 1997, Executive Conference Management.

"Metallocenes: Catalysts For Growth In Synthetic Elastomers", delivered at the Annual Meeting of the
IISRP, Vancouver, BC, May 1997.

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"Market Update on Metallocene-Catalyzed Polymers," delivered at the CMAI 1997 World Petrochemical
Conference, Houston, March, 1997

"The Renaissance in Polyolefin Manufacturing Technology," delivered at Polyolefins X, SPE Regional

Technical Conference, Houston, TX, February, 1997

"To License Or Self-Develop: Options For Suppliers And Converters Of Metallocene Resins", delivered at
SPO '96, Houston, September 1994, Schotland Business Services Inc.

"Global Outlook for Metallocene Technology," delivered at Additives for Metallocene Catalyzed Polymers,
Chicago, IL, June, 1996

"Metallocenes: Avoiding Opportunity Overload", published in Plastics Formulating & Compounding,

May/June, 1996

"Tailoring A Wide Array of Polymers with Ziegler-Natta Catalysis," delivered at the SPE Annual Technical
Conference, Indianapolis, May, 1996

"Global Market Potential for Metallocene-Based Polymers," delivered at Metallocenes '96, Düsseldorf,
Germany, March 1996.

Pre-1996:

About 20 presentations at international polyolefins industry conferences, with an emphasis on polyolefin

technology (catalyst, process & product) and the dynamics of new product introduction in this industry.
These included presentations during the 1980s and 1990s to meetings of the CMRA, AICHE, SPE, ACS
and SPI Canada. Also authored two articles published in leading chemical industry journals.

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