- Dr. Surendra Kulkarni,

- Research Director, SABIC Technology Centre,

- Bangalore, India

Sustainability - Driving Business & Innovation in Chemical Industry:

SABIC Example

- IGCW – 2013, Dec 7, Bombay

No. 1

Developing world Today : Plastics usage 5-10 kg/person:

Credit: archartist on Stock.xchng - used under stock.xchng license - http://www.sxc.hu/photo/587281

No. 2

WILL CONSUMER AWARENESS CONTINUE TO RISE?

Add public picture of construction in china

“China will build housing for 400 million people in the next 12 years…”

“China builds the equivalent of two NYC’s every year…”

photo: Creative Commons ShareAlike 5: Baycrest - WikiCommons

Developed world - Today & rest of the world – Tomorrow : ~100 kg/person:

No. 3

If we continue the way we live/consume today

- we will need three earths!

Key challenges are:

• Resources and Environment: Ever rising energy demand. Access to clean

water and scarcity of various non-renewable resources.

• Food and Nutrition: Growing world population - needs more food from less

available land.

• Healthcare and Pharmaceuticals: Aging Population.

Only one earth for Nine billion people in 2050

Challenges provide opportunities……

SABIC Innovative Plastics Confidential

4 SABIC Innovative Plastics Program

December 14, 2013

Nature’s Carbon Cycle

Hydrosphere Biosphere

Lithosphere

Ocean uptake

Sedimentation & Fossilization Sedimentation &

Fossilization

Plant uptake

Sedimentation & fossilization of Carbon takes millions of years

Atmosphere

SABIC Innovative Plastics Confidential

5 SABIC Innovative Plastics Program

December 14, 2013

Stressed Carbon Cycle

Hydrosphere Biosphere

Lithosphere

Ocean uptake

Sedimentation & Fossilization

Sedimentation & Fossilization

Plant uptake Atmosphere

Industrial use of fossil resource puts back Carbon in less than a decade

Carbon Emissions

Fossil use

No. 6

then

Feedstock Have Changed

now

then

then

No. 7 SABIC Confidential

Less Energy Content

Ethylene EDC

LLDPE

Propylene

VCM

EO

Ethyl

Benzene

EG

Ethane

Propane

Naphtha

LDPE

HDPE

PP

PS

Styrene

Biomass

PO

Benzene

-3 -4 -2 -1 0 1 2 3 4

Average Carbon Oxidation State

Challenges in conversion: Fossils/ biomass/ CO2

CO2

Top 15

Products

Acrylic

Acid

No. 8

Global Mega Trends

1980s 1990s 2000s 2010s….

Quality Globalization Internet Sustainability

Sustainability is an emerging business mega-trend that will profoundly

impact a company’s competitiveness and even their survival”

Dan Esty, Harvard Business Review, May 2010

Sustainability is a major business mega-trend for some time

Climate Change

Energy Demand

Resource Scarcity

Food Demand

Water Scarcity

Environment Destruction

GHG Reduction

Conservation, Renewable

End-of-Life Solutions

New Crops

Conservation, Desalination

Clean Chemistry, End-of-Life

SABIC: A Diversified Chemical Industry

No. 10

SABIC IN NUMBERS

90 B$ total assets

50 B$ annual revenue

6.6 B$ net income

* Forbes 2012

8000 global patents

No. 11

WE RANK AMONG THE TOP PRODUCERS WORLDWIDE

#1 #2 #3 Mono-ethylene glycol

MTBE

Polycarbonate

Polyphenylene ether

Polyether imide

Methanol Polyethylene

Polypropylene

Polybutylene terephthalate

Engineering plastics

and its compounding

SUSTAINABILITY at SABIC

No. 13

THREE PILLARS OF SUSTAINABILITY

Environment

Economic

Social

Socio-

Economic

Eco-

Efficiency

Socio-

Environmental

Sustainability

• Job Creation

• Skills Enhancement

• Local Economic Impacts

• Social Investments

• Business Ethics

• Diversity

• Community Involvement

• Community Health/Education

• Poverty Eradication

• Work/Labor Standards

• Revenue

• Earnings

• Shareholder Return

• Growth

• Resource Efficiency

• Energy Efficiency

• Product Stewardship

Lifecycle Analysis

• Emissions Reduction

• Water management

• Waste Minimization

• Regulatory Compliance

• Incident/Spill Prevention

• Biodiversity

• Safety & Health

• Local Environmental Impacts

• Global Climate Change

• Resource Management

No. 14

SABIC’S SUSTAINABILITY CAN BE TRACED BACK TO ITS ROOTS

SABIC was founded in 1976 from a vision to

turn natural gas that had been previously flared

into valuable petrochemical products that we

could supply to meet the world’s needs

No. 15

SABIC SUSTAINABILITY KPIs

Established environmental performance targets for reductions in

2025 Intensity Reduction Targets

• 25% reduction in

• GHG emissions

• Energy

• Fresh Water Use

• 50% reduction in

• Material Loss Intensity

Sustainability Report

2011

GHG Energy

Water Material

Loss

Baseline Year- 2010

Sustainability Report

2012

Journey so far:

No. 16

Manufacturing improvements

Short term strategic projects

Investments

Long term strategic projects

Breakthrough

Technologies

2025

CONTINUOUS JOURNEY TO IMPROVE SUSTAINABILITY PERFORMANCE

2010

LIFECYCLE THINKING

No. 18

INNOVATING ON SUSTAINABILITY ACROSS THE VALUE CHAIN

Lifecycle assessment

plays the role of

strategic tool both for

quantification and

innovation

around sustainability

No. 19

INNOVATING ON SUSTAINABILITY ACROSS THE VALUE CHAIN

UPSTREAM

PRODUCTION SABIC

DOWNSTREAM

VALUE ADDITION

END USER (CONSUMER)

END

OF LIFE

Sustainable Feedstocks

New Chemical

Routes/Pathways

Sustainable Sourcing

Sustainable Biofuels

New Technologies/

Processes

Best Oper Practices

Footprint Reduction

Supply Chain Optimzn

Sustainability in Design

Green Chemistry

Projects

Sustainable Products

Material Efficiency/

Downgauging

Energy Efficiency

Solutions to

Customers

Alternate Products

Light Weighting

Use Phase Savings

Enhanced Life and

Functionality

Replacement of toxic

chemicals with non-toxic

chemicals

Waste Management

Closing the loop -PCR

Bio-degradable Products

Chemical Recycling

No. 20

LCA AS A BUSINESS TOOL

Sustainability

Policy Making

Regulations

Process Improvement

Product Marketing

Supply Chain Optimization

Technology Assessment

LCA

Environmental

Economic

Social

No. 21

SUSTAINABILITY ASSESSMENT IN PROCESS / PRODUCT EVALUATION

Project Proposed

Stage

e.g. R&D

Stage

(e.g. Piloting)

Project Completion

(e.g. commercialization)

Success

Sustainability

Evaluation

Business

Decision

Sustainability

Evaluation

Sustainability

Evaluation Sustainability

Evaluation

Business

Decision

Business

Decision Business

Decision

Data quality and richness increases over time

Sustainability Evaluation in Business Decision Making

SABIC SUSTAINABLE PRODUCT INITIATIVES

CHEMICAL RECYCLING

No. 24

VALOX IQ* RESIN - CHEMICALLY RECYCLED PBT

Based on novel chemical “up-cycle” process

• Eliminates post-consumer solid waste

• Delivers performance of virgin PBT

• Inhouse technology with # patents granted

Valox iQ* Recycled PBT Resin has better

environmental footprint

LIFE CYCLE GHG AND ENERGY

FOOTPRINT COMPARISON

Cradle to Gate Analysis

49% lower

GHG emissions 61% lower

energy demand

VALOX IQ*

40% fossil derived

input

Fossil Feedstock

Waste Plastic Feedstock

60% PCR

Applications

No. 25

25

IMPACT OF IQ PBT AND XENOY IQ* PRODUCTS ON ENVIRONMENT

Carbon Dioxide

Barrels of Oil

Solid Waste

Saved vs Standard PBT

~ 2 Tons/Ton

8 barrels/Ton

0.9 Tons/Ton

CO2 SEQUESTRATION

No. 27

SABIC CARBON CAPTURE AND USE PLANT

Largest CO2 plant (1500 tons/day) in the world

Concentrated CO2 vented gas from ethylene glycol plants

Ethylene Glycol

Plant

Methanol

Plant

Liquid CO2

EG (Main Product)

CO2 Vent CO2 Purification

Process Urea Plant

Reduces 500,000 MT CO2/year

venting

Material Efficiencies

Displaces need for additional natural gas

Affiliate

United Jubail Petrochemical

Company (UNITED) plant

Beverage

Industry

SUSTAINABLE BIOFUELS - BIOMTBE: 2ND GENERATION BIOFUEL

No. 29

EU RENEWABLE ENERGY DIRECTIVE (RED)

*for installations where production started on or after 1 Jan 2017

EU Mandatory Targets for 2020 Sustainability criteria for biofuels and

bioliquids

0

20

40

60

80

100

Fossil Gasoline Biofuel (2010) Biofuel (wef 1Jan 2017)

Biofuel (wef 1Jan 2018*)

Gre

enh

ou

se g

as e

mis

sio

ns,

gC

O2/M

J

Direct ( emissions from combustion)

Indirect (process, transportation)

-35% -50%

-60%

2010 2017

2018*

The GHG emissions saving from the use of

biofuels and bioliquids 20 % share of energy from renewable

sources

Mandatory national target of 10%

share of energy from biofuels in

transport petrol and diesel

consumption

AUTOMOTIVE LIGHT WEIGHTING

No. 31

High performance materials help customers meet industry and

environmental challenges

Environmentally Progressive

Safety Fuel Efficient

Enabling Design Branding Durable @ Every Temp

TODAY AND INTO THE FUTURE

No. 32

FENDERS MADE WITH NORYL GTX RESINS

KEY BENEFITS • On average 50% lighter than steel

• Improved fuel economy

• Improved dent resistance

• Electrostatically paintable

• Greater design freedom vs. steel and aluminum

• Compatible with recycling practices

LIFE CYCLE GHG AND ENERGY

FOOTPRINT COMPARISON

45% lower

Energy Demand

46% lower

GHG emissions

No. 33

FUTURE IMPERATIVE : LESS WEIGHT/HIGHER FUEL EFFICIENCY

How?

33

PACKAGING -DOWNSTREAM VALUE CREATION

No. 35

SABIC MULTILAYER PACKAGING FILM CONCEPT

C4 LLDPE + LDPE

HDPE + LDPE

mLLDPE + LDPE

LDPE + HDPE

mLLDPE + LDPE 9

27

9

HDPE + LDPE

C4 LLDPE + LDPE

LDPE + HDPE

5

17

4

4

5

Total film thickness down from 45 microns to 35 microns (22% downgauging)

Market Incumbent Solution SABIC 5 Layer Film

Smart Combinations Leading to Material Efficiency

Beverage Collation Shrink Film

for packaging application

No. 36

LCA RESULTS

5 Layer PE Film SABIC solution is environmentally better than 3 Layer PE Film

Cradle to Grave Analysis

-50

0

50

100

150

200

IPC

C 2

00

7 G

WP

10

0a

,

kg

CO

2 e

q. p

er

fun

cti

on

al u

nit

SABIC 5 Layer PE Film

3 Layer PE Film

-1000

0

1000

2000

3000

4000

Cu

mu

lati

ve

En

erg

y D

em

an

d,

M

J p

er

fun

cti

on

al

un

it

SABIC 5 Layer PEFilm

Functional Unit: 1000 m2 of multilayer PE packaging film

ELIMINATION OF HAZARDOUS CHEMICALS

No. 38

Alternatives to halogenated flame retardants –

elimination of hazardous incineration byproduct

Noryl NH series, Lexan non-BR FR series, Cycoloy

FR series, Valox/Xenoy ENH series, Flexible Noryl

ADVANCED FLAME RETARDANTS – ENHANCED PRODUCT SAFETY

Broad Portfolio – different applications

Noryl printed

circuit board

enclosure –

washing machine

Cycloloy LED

lighting enclosure

Lexan LED cover

High Performance

Eco-labels

External Regulations

RoHS, WEEE

EPAT, TCO,

Ecoflower,

Blue Angel

Flexibly Noryl

cables and

wires

http://www.sabic-ip.com/gep/en/AboutUs/SustainabilitySolutionsDetail/advancedflameretardance.html

GREEN CAMPUSES

No. 40

GREEN CHEMISTRY CAMPUS

Green chemistry campus

in Netherlands to convert

agricultural waste into

value-added bio-based

building blocks

SABIC Sustainability report 2011

No. 41

SABIC | GRIHA | RECOGNITIONS

Award for Exemplary Demonstration of Site Management Practices

SABIC Research Center Bangalore

No. 42

OUR KEY ASSETS: PEOPLE AND INNOVATION

SABIC’s Bangalore Global Research Center,

Inaugurated last week, is the largest of the

4 Research and application Centers SABIC

will inaugurate in 2013

COLLABORATION & NETWORKING WITH GLOBAL FORUMS

No. 44

EXTERNAL ADVOCACY / ENGAGEMENT

Global Sustainability Consortiums

Industry Associations

Academia/ International Sustainability Conferences

No. 45

SUMMARY

SABIC commitment to sustainability

Sustainability is in SABIC DNA

Sustainability as Innovation Driver

Clear and transparent sustainability goals

Footprint reduction projects

LCA as a strategic tool

LCA studies helped business make informed decisions

Reduce cost by terminating non sustainable projects at early stage

Help identify major hotspots in value chain

Direct technologists to develop sustainable solutions for customers and society

No. 46

REFERENCES

1. DIRECTIVE 2008/28/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 11 March 2008, Official

Journal of the European Union, L 81/48, 20.3.2008,

http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2008:081:0048:0050:en:PDF

2. DIRECTIVE 2009/30/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 23 April 2009, Official

Journal of the European Union, L 140/88, 5.6.2009,

http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:140:0088:0113:EN:PDF

3. Well-to-Wheels analysis of future automotive fuels and powertrains in the European context, WELL-TO-TANK Report,

Version 2c, March 2007JRC, http://ies.jrc.ec.europa.eu/uploads/media/WTT_Report_010307.pdf

4. Ecoinvent Report# 08_Chemicals

5. PERP Report # 07/08-2, Methanol

6. PERP Report # 94/95-4, MTBE

7. http://www.prnewswire.com

8. Ecoinvent Report 14_Transport

9. International Reference Life Cycle Data System (ILCD) Handbook: Recommendations for Life Cycle Impact Assessment in the European context, First Edition, 2011.

10. ISO 14040:2006 “Environmental management — Life cycle assessment — Principles and framework”

No. 47

REFERENCES

11. ISO 14044:2006 “Environmental management — Life cycle assessment — Requirements and

guidelines”

12. Eco-profiles of the European Plastics Industry, “HIGH DENSITY POLYETHYLENE (HDPE)”, A report by I

Boustead For PlasticsEurope, 2005

13. Eco-profiles of the European Plastics Industry, “LOW DENSITY POLYETHYLENE (LDPE)”, A report by I

Boustead For PlasticsEurope, 2005

14. Eco-profiles of the European Plastics Industry, “LINEAR LOW DENSITY POLYETHYLENE (LLDPE)”, A

report by I Boustead For PlasticsEurope, 2005

15. PlasticsEurope (May 2009) Eco-profiles & Environmental Declarations _ Methodology, PCR & Protocol ,

Belgium; Brussels

16. PlasticsEurope Report “Plastics - the Facts 2011: An analysis of European plastics production, demand

and recovery for 2010”, 2011

17. Ecoinvent Report# 01_OverviewAndMethodology

18. Ecoinvent Report# 11_II_Plastics

19. Ecoinvent Report 13_I_Waste_treatment_General_V2.1

20. Ecoinvent Report 13_II_Waste_Incineration_V2.1

No. 48

REFERENCES

21. Ecoinvent Report 13_III_Landfills_V2.1

22. Franklin Associates Final Report “Life cycle inventory of 100% postconsumer HDPE and PET recycled

resin from postconsumer containers and packaging”, April 2010.

23. ReCiPe 2008 “A life cycle impact assessment method which comprises harmonised category indicators

at the midpoint and the endpoint level” First edition, Report I: Characterisation, Mark Goedkoop, Reinout

Heijungs, Mark Huijbregts, An De Schryver, Jaap Struijs Rosalie van Zelm, 6 January 2009.

24. “LIFE CYCLE ASSESSMENT: PRINCIPLES AND PRACTICE” By Scientific Applications International

Corporation (SAIC), EPA/600/R-06/060 May 2006.

25. SimaPro 7.3.3, http://www.pre-sustainability.com/simapro-lca-software

26. http://www.mfe.govt.nz/publications/waste/product-stewardship-options-mercury-containing-

lamps/page9.html

27. http://www.pod-sabic-ip.com/KBAM/Reflection/Assets/Thumbnail/22508_2.pdf

28. http://www.pod-sabic-ip.com/KBAM/Reflection/Assets/Thumbnail/20333_5.pdf

Acknowledgements:

• SABIC

• My Colleagues

• IGCW Organizers

No. 50

Thank you