gasworld Magazine Issue 123 August 2015 by gasworld

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ISSN 1755-3857 www.gasworld.com August 2015 Issue 123

TNSC

President and CEO Yujiro Ichihara on... • TNSC’s long-term investment • Mitsubishi Chemical Holdings • Increasing importance of MATHESON • Growth in Japan

Inside this issue: Food and beverages • CO

• Cahouet

CONTENTS

Hot topic

Regional News 6 Europe

Air Liquide expands European homecare business

10 Americas

Date set for helium auction at BLM office

14 Asia-Pacific

Energy provider and Air Liquide to cooperate in CCS

18 Middle East

Start-up for major hydrogen plants in Yanbu

20 Technology

Chilling meat and fish with CO2 snow

Interview

TNSC – Synergy, strength and a shifting sales strategy An interview with President and CEO, Yujiro Ichihara Page 32

22 Hydrogen

Customers continue to choose Plug Power

23 LNG

Woodside and Sempra LNG sign MOU

24 Safety Zone

BCGA addresses cylinder returns in waste industry

26 Intelligence/Data Dashboard

Feature Articles 36 Challenges and opportunities in food & beverages By Helen Carmichael

38 CO2 applications in food and beverages

Hot topic

California water crisis underlines looming challenge in water treatment Page 30

An Update by Sam A. Rushing

42 Tackling CO2 supply chain efficiency By Andrey Ruban

44 Countering fraud in food and beverages On the cover this issue

magazines – website – conferences

ISSN 1755-3857 www.gasworld.com August 2015 Issue 123

Fresh from the increased shareholding of Mitsubishi Chemical Holdings Corporation last year, TNSC President and CEO Yujiro Ichihara explains all about the acquisition, what it means for TNSC, and what the future holds for the company in an exclusive interview with gasworld magazine.

TNSC

President and CEO Yujiro Ichihara on... TNSC’s long-term investment Mitsubishi Chemical Holdings Increasing importance of MATHESON Growth in Japan

Inside this issue: Food and beverages • CO

• Cahouet

NEXT ISSUE... Bulk gases Developments in bulk gases Bulk distribution equipment Focus on Africa

By Linde Gases

46 10 minutes with... Serdal Kara

48 Innovation – let the good ideas flow Ravin Mirchandani

50 Regional markets

Focus on South Pacific

52 In focus...

Gas analysers/monitors

54 Equipment profile CO2 safety systems

56 Company profile Cahouet

58 Community corner

Events, tweets and polls August 2015 • gasworld | 03

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TECNO PROJECT INDUSTRIALE CO2 Recovery, CO2 Production, CO2 Extraction plants, Biogas Upgrading

www.tecnoproject.com

WELCOME

TEAM MAGAZINE Publisher John Raquet

Managing Editor Rob Cockerill rob.cockerill@gasworld.com Web Editor Stuart Radnedge stuart.radnedge@gasworld.com Production Manager Jon Evans Graphic Designers Mark Mitchell, Karen Skinner Feature Writers Helen Carmichael, Sam A. Rushing, Dr. Roy Irani

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Editorial Mergers and acquisitions are commonplace in the Managing Editor industrial gases business. They have shaped the industry as we know it today and will continue to rewrite the pages of the industrial gas handbook for some time to come. While the level of M&A activity is well below its peak, our industry is showing increased levels from its low of a couple of years ago, and the face of the industry has continued to evolve over the last year. The US distributor market is a good example. So far this year we have already seen nexAir acquire M&A Welding Supply Co. and Welders Supply & Equipment Co., while Airgas acquired Valley Air Supply, and Tech Air has been busy snapping up McGinnis Welding Supply, Geneva Gas and “Ichihara delivers a Supply, and L&M Welding Supply. The latter refreshingly honest became Tech Air’s eighth add-on acquisition assessment of the in the last 12 months when it was announced in July. deal and much more While great for increasing investment besides...” portfolios and column inches in the media, one could be forgiven for suggesting that such a volume of deals are perhaps met with increasing indifference as a result. But investment strategies do still have the ability to surprise. Take last year’s $980m (¥100bn) acquisition of a majority shareholding in Taiyo Nippon Sanso Corporation (TNSC) by Mitsubishi Chemical Holdings Corp. – for many the news came right out of left field, and it certainly made waves in the chemicals press. This was very much the case for gasworld, and we continue to pursue the ramifications of that big deal this month. In an exclusive interview with President and CEO Yujiro Ichihara, we’re privileged to learn more about the acquisition and what it means for TNSC. Does it create a stronger Tier One player? Does increased involvement from Mitsubishi Chemical Holdings Corp. (MCHC) enhance TNSC’s market power? You might be surprised at some of the answers to those questions. At a time when it would be easy to make positive PR about the prospects for a ‘reinvigorated’ TNSC, Ichihara delivers a refreshingly honest assessment of the deal and much more besides – including the increasing significance of US subsidiary MATHESON, and an update on the challenging Japanese gases market. Don’t miss it, from page 32. ROB COCKERILL

Rob Cockerill, Managing Editor (rob.cockerill@gasworld.com)

Advertise in the September issue From cryogenic distribution and modern microbulk to related technologies and equipment, gasworld’s focus this September is on bulk gases – be sure to showcase your company’s credentials. Contact: Media Sales Manager, Ron Leitch +44 1872 225031 ron.leitch@gasworld.com August 2015 • gasworld | 05

EUROPE

Air Liquide expands European homecare business with the acquisition of Baywater IRELAND

Air Liquide is to expand its home healthcare business in Europe with the announcement that it has acquired Baywater Healthcare Ireland Limited, a major player in this field in Ireland. The acquisition marks a new geographical development for Air Liquide’s home healthcare business, with the extension of its services to Ireland. Baywater Healthcare Ireland Limited has 50 employees and cares for 10,000 patients, generating revenue of more than €12m in 2014. Air Liquide will continue growing the company with the support of the existing team, gasworld understands.

Pascal Vinet, VicePresident, Healthcare Global Operations and member of Air Liquide group’s Executive Committee, said, “The acquisition of this company, which is recognised for its expertise in the treatment of respiratory diseases and for its culture of innovation, is part of Air Liquide’s growth strategy for the home healthcare business. It will allow us to develop on a new growth market in Europe.” On the Irish market for 30 years, Baywater Healthcare Ireland Limited specialises

“The acquisition is part of Air Liquide’s growth strategy for the home healthcare business”

in treating and monitoring respiratory diseases in the patient’s home. Oxygen therapy, continuous positive airway pressure, and noninvasive ventilation are examples of it’s services. 3D-printed bridge Menawhile in another European development, Air Liquide is the sponsor of a new 3D printed bridge project in the Netherlands. The MX3D Bridge in Amsterdam is the first largescale additive manufacturing project in the country. Air Liquide is sponsor of the project, a world premiere imagined by Dutch designers from the Joris Laarman Lab. The goal of the project is to construct a stainless

steel bridge in the historic centre of Amsterdam using an innovative additive manufacturing process (large-scale metal 3D printing by robotic arc welding) that makes it possible to build large-scale works in real time, without human intervention. Air Liquide will lend its expertise for the research and development phase and will provide its premium shielding gases, used in arc welding, from its ARCALTM range for the construction of the bridge, which should be completed by the spring of 2017. This demo project, being fabricated in a single part and autonomously, prefigures a profound transformation in the manufacture of the industrial objects in the future.

BOC and SSI UK celebrate one of largest gases deals UNITED KINGDOM

Senior Directors and staff from BOC and SSI UK joined local business leaders and other dignitaries at a ceremony at BOC’s Teesside site recently to mark the start of a 15-year supply agreement between the two companies. Under the agreement, BOC will supply industrial gases to SSI Steel UK, a major integrated iron and steel manufacturing facility based on Teesside. The agreement, which follows SSI’s purchase of the Teesside 06 | gasworld • August 2015

steelworks from Tata Steel in 2011, is one of the largest gases contracts ever awarded in the UK. It represents a long-term commitment by both companies to support steelmaking on Teesside. To support the contract, BOC has invested £25m in its Teesside site. The two-year investment programme is now complete and includes an upgrade and expansion of the three existing air separation units (ASUs) which supply oxygen, nitrogen and argon, and re-engineering the existing pipeline systems

to SSI UK’s site. Specialist control equipment has also been designed and built for SSI UK’s blast furnace. Cornelius Louwrens, UK Business Director and COO of SSI Steel UK said, “This supply arrangement is key to our long-term plans to maximise our steel slab production capability and satisfy the requirements of our parent company in Thailand and other strategic global customers.” Sue Graham Johnston, Managing Director of BOC, added, “BOC has been

established in Teesside for many years and we are committed to supporting the area’s vital industrial base. Our new partnership with SSI UK is important for jobs and prosperity in the region as well for the UK’s wider industrial sector and I am confident that the investment we have made in our Middlesbrough site will also bring long-term benefits to both companies.” The investment positions BOC’s Middlesbrough’s site as the key location for industrial gases in the region. www.gasworld.com/europe

EUROPE

Air Products CEO and Chairman, Seifi Ghasemi, has expressed his horror and sadness at an apparent attack on the company’s facility in L’Isle-d’Abeau, France. On Friday 26th June, Yassine Salhi – who had managed to gain control of a vehicle permitted to enter the facility – is reported to have driven into the site and a number of its cylinders, causing an explosion. Though he was reprimanded by a fire officer before he was able to do any more damage at the plant, and arrested promptly by police,the attacker’s former

boss (completely unconnected to Air Products or the gases industry) is known to have lost his life during an earlier stage of the incident. Reflecting on the events, Ghasemi expressed appreciation for the assistance and outpouring of support received from around the world and said, “I am horrified and saddened by the attack on our facility in France. I believe I speak for all of our Air Products family around the world in expressing our deepest sympathies to the family of the victim of this unspeakable act.” “My heart also goes out to

“This incident reinforces that we all need to take safety and security very seriously”

BMA calls for end to helium in balloons

AFC Energy receives final building permit

Servomex achieves Planet Mark status

UNITED KINGDOM

GERMANY

UNITED KINGDOM

Balloons filled with helium have been deemed ‘a waste’ by medical professionals who have plead to for an end to the gas being used in this way. The British Medical Association (BMA) has called to an end of its ‘frivolous’ use in balloons – supporting its conservation for medical uses in MRI machines and as Heliox (a helium/oxygen mix used to aid breathing). Speaking at the BMA annual conference, anaesthetist Dr. Tom Dolphin said helium balloons are a ‘colossal waste’ of the element, while BMA Chairman Dr. Mark Porter said not enough attention was being paid to the issue.

AFC Energy has received its second and final Building Permit from the Stade building and urban development authorities in Lower Saxony, Germany, allowing the company to conclude construction of the world’s largest industrial alkaline fuel cell facility. This final stage building permit follows the First Partial Building Permit, announced to the market in March 2015. The final building permit will allow AFC and its contractors to erect all above-ground infrastructure including the industrial steel frame building to house the KORE fuel cell system and all storage tanks.

Servomex has achieved The Planet Mark sustainability certification through a commitment to reduce its carbon footprint by 5% yearon-year. A relatively new certification, The Planet Mark is an independent and impartial accreditation supported by the Eden Project. It is available to all businesses, buildings and projects committed to improving sustainability. The Planet Mark certification achieved as the result of Servomex’s commitment to reduce its carbon footprint (in terms of emissions) by 5% year-on-year.

FRANCE

the people who work at the site and their families. This incident reinforces that we all need to take safety and security very seriously, every day, and remain vigilant in everything we do. I am very glad to know that all of our employees are safe and accounted for.” It is unclear at this time the extent of damage to the facility, understood by gasworld to be a relatively modern merchant ASU.

Wehn kryoplus GmbH recently hosted Cryostar at its premises in Wilnsdorf, Germany for the launch of the latter’s new CBSH 225/5 pump, an innovative new hydraulic-driven pump for cryogenic mobile tankers. Featuring a compact high duty and low noise gearbox with a robust power transmission capable of passing up to 90kW, the pump can achieve high flow rates with a discharge pressure of 40 bar with liquid nitrogen (LIN). The pump also benefits from the latest innovation for safe, reliable and user-friendly operation. It was unveiled amidst strong industry attendance, with gas companies, logistic companies and trailer manufacturers such as Cryolor and VRV present and three European countries (Germany, France and Italy) represented. Cryostar itself was represented by sales, product management, and engineering personnel. The event saw Cryostar make a presentation of the new CBSH 225/5, showing its technical features and innovative design, while a dismounted pump was exhibited to allow for a more detailed exploration.

Air Products horrified and saddened by attack at company site in France

Pump launched for mobile tankers

August 2015 • gasworld | 07

EUROPE

Linde’s oxyfuel technology is to be used in Constellium’s recycling and melting furnaces, with the goal to slash energy consumption in half and increasing melting rates by 20%. The companies have signed a joint development agreement for the project and this deal follows a long-term partnership with Linde in the growing area of energy-efficient re-melting technologies. The agreement will build on the recent successful implementation of Linde’s technology in Constellium’s finishing and recycling aluminium facility of Neuf-Brisach, France, where two of the four rotary tilting furnaces have been converted to low-temperature oxy-fuel combustion technology. Following this implementation, Constellium was able to achieve greater productivity and accelerate progress on its sustainability roadmap. Conversion of the remaining furnaces at the France plant is set for completion by the end of 2016. “This project is very significant for Linde in terms of our commitment to technological progress as a sustainable solutions provider,” said Thomas Niehoff, Head of Non Ferrous and Mining at Linde.

08 | gasworld • August 2015

Licensing agreement signed with ExxonMobil for MTG technology Air Liquide Global E&C Solutions, the Engineering and Construction activity of the Air Liquide Group, has entered into a global technology licensing agreement with ExxonMobil Research and Engineering. Under the terms of the agreement, Air Liquide will market and license its proven Lurgi MegaMethanolTM technology combined with ExxonMobil’s proprietary methanol-to-gasoline (MTG) technology to transform natural gas into ultralow-sulfur gasoline. The combination of technologies will be marketed under the

trademark G2GTM. The G2GTM technology transforms natural gas, as well as other feedstocks, into motor gasoline containing virtually no sulfur and low in benzene content. The integration of both Air Liquide Global E&C Solutions and ExxonMobil technologies into one combined solution will minimise project interfaces, off-sites and logistics complexities, as well as investment for synthetic fuel production. The G2GTM technology offer will be licensed as an integrated solution and will be deployed globally through Air Liquide Global E&C Solutions’ network. The division has

signed nearly 20 licenses for its Lurgi MegaMethanolTM technology since the year 2000, with acceleration over the last 18 months – notably in the US where natural gas prices are advantageous. Cristiano Tortelli, VicePresident and Chairman, Air Liquide Global E&C Solutions, stated, “Methanol has become a promising energy carrier enabling the market to fully utilise the potential of lowercost energy sources into lowsulfur transportation fuels.”

Institute calls for written submissions

Dates announced for Cryogen-Expo event

Messer wins four awards from EIGA

UNITED KINGDOM

RUSSIA

GERMANY

The Birmingham Energy Institute policy commission has announced a call for written evidence submissions for its investigation into an improved and sustainable systems approach to the provision of cold, or cooling. The latest University of Birmingham policy commission is investigating how the growing demand for ‘cold’ and cooling can be met without causing environmental ruin. Commission leaders are inviting international experts from academia, NGOs and industry to attend workshops in the UK and Asia to discuss how to ‘do cold smarter’.

The 14th Cryogen-Expo Industrial Gases exhibition will take place from 27th to 29th October 2015 at Pavilion 5, Expocentre Fairgrounds in Moscow, Russia. The event visually demonstrates the achievements and trends in the cryogenic branch of the gases industry, including industrial gases, rare gases and LNG. During the three-day event, exhibitors will present the latest developments and innovation technologies to a wide range of end-user visitors, from metallurgy and machinery-building to food, chemicals, medical, defence and more.

Messer has been presented by the European Industrial Gases Association (EIGA) with four safety awards for exemplary occupational safety. Its subsidiary in Slovakia was presented with the Gold Two Star EIGA Safety Award for two million hours worked without accident at its Šaľa site, while the Serbian branch received a Gold EIGA Safety Award for 15 years without an accident at the Novi Sad site. For 500,000 hours worked without an accident, Messer Hungary won a Silver EIGA Safety Award, and Messer in Romania won a Bronze EIGA Safety Award for five years without accident in Resita.

FRANCE

Joint oxyfuel development deal

www.gasworld.com/europe

Gases and technologies for the pharmaceutical industry Thanks to specific expertise and years of experience, SIAD supports pharmaceutical companies with its products and technologies throughout the entire process chain, from R&D to production and quality control.

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AMERICAS

Date set for helium auction at BLM office UNITED STATES

The Bureau of Land Management (BLM) is proposing to sell and auction federally owned crude helium on 18th August (2015), at its Amarillo Field Office near Amarillo, Texas, for delivery in Fiscal Year (FY) 2016. The proposal complies with the Helium Stewardship Act of 2013 (Act), passed by Congress in October 2013, that established an auction system for the sale of the Federal helium and mandated that all property, equipment and interest held by the US in the Federal Helium Reserve be disposed of by 30th September 2021. In response to the provisions of the Act, the BLM began an implementation plan in 2014 to provide for an orderly transition to a privatised

system, while ensuring minimal market disruption. The plan included a series of helium sales (auctions and conservation helium sales), measures to ensure continued access to the helium supply for Federal users, and the disposal of government assets in the system no later than 30th September 2021. The proposed plan and schedule for the FY 2016 auction and sale was announced in the Federal Register on 12th June 2015, under the title ‘Notice of Proposed Action: Crude Helium Sale and Auction for FY 2016 Delivery’. The Federal Register Notice includes a 30-day public comment period, and also proposed 18th August 2015, for the helium auction at the BLM Amarillo Field Office, 801 South Fillmore Street, Suite 500.

“The proposal complies with the Helium Stewardship Act of 2013 (HSA), passed by Congress in 2013” The Federal Helium Programme is responsible for the conservation and sale of federally-owned helium. The BLM operates and maintains a helium storage reservoir, enrichment plant, and pipeline system near Amarillo that supplies enough helium

to meet more than 40% of domestic demand for the gas. Volumes from the Federal Reserve will decline each year as the reservoir depletes and the pressure in the reserve declines. The reserve is set to be depleted (except for a 3 billion cubic feet stockpile) by 2020, at which juncture the BLM will only sell crude helium for supply to Federal Helium Users. The BLM’s Amarillo Field Office hosted its first crude helium helium auction in July 2014, as called for by the HSA. Additional documents relating to the proposed plan for the FY 2016 sale and auction, including documents related to the 2014 Auction Notice, can be found on the Field Office’s website. RELATED ARTICLE ONLINE The helium market in 2015 gasworld.com/2004860.article

Distributor acquisitions continue to mount at Tech Air UNITED STATES

The distributor deals continue to stack up at Tech Air in 2015, after the company recently revealed a further two acquisitions in this area. Having completed the acquisitions of New York-based distributors of industrial gases Prest-O-Sales & Service, Inc. and Prest-OPeconic, Inc. in May 2015 (previously announced in February), Tech Air followed this up with the purchase of Geneva Gas & Supply Inc., an industrial gas and welding 10 | gasworld • August 2015

supply company based in Los Angeles, California. The company, which was founded in 2010, serves a wide range of customers and industries. Geneva will become part of Tech Air of California and the former owners, Glen Irving and Jack Storm, will continue to be employed by the company. Irving will serve as President of Tech Air of California. Geneva became Tech Air’s seventh add-on acquisition in the last 12 months, and the thirteenth since CI Capital acquired the company in

partnership with Tech Air’s management in 2010. Myles Dempsey, Jr., CEO of Tech Air, said, “We are excited to announce the addition of Geneva Gas & Supply to the Tech Air family of companies. Glen Irving has built a tremendous team that will help us take advantage of market opportunities in the Los Angeles area.” “We remain committed to our strategy of acquiring high quality regional distributors throughout the continental US and are actively seeking additional acquisitions.”

Connecticut-based Tech Air then affirmed this commitment with another acquisition, that of Alabama’s L&M Welding Supply, Inc. (L&M), a leading distributor of welding supplies and industrial equipment on the US Gulf Coast. L&M will become part of Tech Air’s Southern Region and the former owner, Clark Kelly, will remain actively engaged with the company. Tech Air now operates 30 branch and fill plant sites and serves clients in the Northeast, South, Southwest and West. www.gasworld.com/americas

AMERICAS

TNSC Interview with President and CEO Yujiro Ichihara, Page 32

Hot topic Looming challenge in water treatment, Page 30

Dearman Chief Exec. speaksinatbrief Wall Street News

Praxair to build new ASU to service growing gas demand in Detroit area Praxair, Inc. is to build a new air separation unit (ASU) to support its Detroit, Michigan area pipeline system in meeting the growing demand for industrial gases in the region, as well as rare gas customers globally. The expansion coincides with the renewals of multiple existing pipeline customer agreements, and will include the installation of state-ofthe-art operating equipment and systems. The new 1,650 tons per day plant will begin operations in 2017 and will supply existing pipeline customers with improved efficiency and continued reliability. The plant will also produce liquid oxygen, nitrogen, argon and rare gases for use by hospitals, food processors, and industrial companies supplying the auto industry. “We understand that efficient and reliable supply of industrial gases to our customers’ operations in the

the border of Ecorse and area is critical to their success River Rouge. The complex and our expanded capacity supplies pipeline customers will continue to help us meet from Southwest Detroit to growing customer needs,” Dearborn, as well as merchant said Joe Abdoo, Central customers throughout Eastern Region Vice-President of Michigan and Northwestern Praxair’s US industrial gases Ohio. Manufacturers can use business. “Our investments large quantities of industrial in the greater Detroit area are possible, in part, because local gases to run their plants and state government officials and, in many cases, enhance their productivity and and DTE Energy understand improve their environmental our business and have helped performance. Pipeline access support Praxair in Michigan.” to these gases is desirable for Praxair operates the such manufacturers for only ASU and pipeline the reliable supply of system in Michigan, high volumes of including five ASUs gases that enable and a hydrogen them to operate production facility The ASU will have a capacity of 1,650 tpd more effectively located along and begin operations in an increasingly in 2017 competitive global economy. “Praxair’s investment in Ecorse represents a strong vote of confidence in our community and evidence that our city is on track toward a stable and sustainable future. I look forward to working with Praxair on this project,” said Mayor Lamar Tidwell.

1,650

UNITED STATES

Toby Peters, Chief Executive of progressive cold Russia asu clean staRt-up technology company plans foR aiR liquide Dearman, addressed a gathering at REFF-Wall Air Liquide is pursuingStreet its long-term development in New York in June. in russia andhighlighted starting-up the a new air Peters separation (ASu) will critical roleunit that coldthat plays produce oxygen and nitrogen in in national and international the Special economic Zone of energy systems, the growing Alabuga in Tatarstan. environmental impact Tatarstan is one of theof cooling, and the potential most economically developedfor republics in the russian cold technologies to become Federation. its economy the a major growth market is within fifth in russia, in terms of the largest renewables sector. gross regional product. One of He called for a joined-up, the main drivers of this economy systems-level approach to is a significant manufacturing the development ‘clean capacity; industrial of production cold’ infrastructure, constitutes up to 40% with of the region’s gross regional product. governments, investors The new state-of-the-art ASu and technology companies will produce 200 tonnes per day working together to enable of oxygen and nitrogen to supply the formation of a ‘cold the current and future needs of economy’customers. worth billions industrial it is fully of dollars and supporting standardised, cost efficient, thousands jobs. comes in fullyofpackaged modules and offers many The US has major demand benefits, including compact for cooling; 48% of domestic design layout and simple energyand consumption in the operations and maintenance. Air US is used to provide heating Liquide is planning to develop or business cooling and the US by is the its in Alabuga world’s largest market forand creating a pipeline network transport refrigeration units. developing the supply chain.

“We remain committed to our strategy of acquiring high quality distributors throughout the continental US and are actively seeking additional acquisitions”

“The decision by such a large refinery to outsource its hydrogen production is a first in the Middle East, and a growing trend in the region...”

Sue Graham Johnston Managing Director BOC

Myles Dempsey, Jr. CEO Tech Air

Pierre Dufour Senior Executive Vice-President Air Liquide Group

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Quotes of the month

“I am confident that the investment we have made in our Middlesbrough site will bring long-term benefits to both companies...”

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subscribe now to Cold Facts tHE magazinE For CryogEniCs Join the Cryogenic Society of America at www.cryogenicsociety.org

August 2015 • gasworld | 11

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AMERICAS

Machine & Welding Supply Co. and its sister company, Arcet Equipment Co., have announced that both companies will be rebranded as ‘Arc3 Gases’. The move, effective from June (2015) onwards, is described as an ‘important and natural step’ to take together following the merger of the two companies in 2013. With the new name, they will be updating their brand in a manner that builds upon their legacy brands and reflects their commitment to gas and welding customers and their industry partners. Machine & Welding and Arcet will continue to transact business with vendor partners and suppliers separately, and will legally remain separate companies at this stage. To assist in processing orders, from 15th June, purchase orders from each company will be co-branded respectively as ‘Arc3 Gases South/Machine & Welding’ and ‘Arc3 Gases North/ Arcet’. After a reasonable period of time, the companies will drop the reference to their legacy names on purchase orders and retain just the North and South distinction. All other information about their respective businesses such as ship to, bill to, and general contact information will remain unchanged. Similarly, existing legal agreements and obligations will be unaffected by the rebranding efforts. 12 | gasworld • August 2015

Remembering Len York, formerly of Taylor-Wharton Cryogenics Taylor-Wharton Cryogenics has announced the passing of former president, Len York, who died of a heart attack on 16th May at the age of 65. York, who also served as CFO for Taylor-Wharton International LLC, is survived by his wife of 25 years, Ginger York, three children (Brian York, Amanda Nordmeyer, Chris York) and one grandchild (Quinn York). He was so looking forward to the arrival of two granddaughters this summer, a statement said. Born in Decatur, Alabama, York earned a Bachelor of Science in Accounting/ Mathematics at the University of Alabama. During his life, he was chairman of the FEI Scholarship Committee, treasurer of the Association

for Retarded Children and Adults, United Way Fund Raising Campaign chairman, and served on the Board of Directors for both profit and non-profit organisations. York was managing director and Founder of York & Company, established in 1990, which focused on corporate restructuring, interim management, business

process improvement, and strategic planning. In addition to his positions at Taylor-Wharton, he held senior leadership positions with automotive, marine, and steel manufacturing companies including Cornerstone Propane, Nichols Brothers Boat Builders, and Prometheus Energy. Foremost in York’s life was the love of his family. He enjoyed his work, his friends, and relaxed with fishing, golfing, and cooking. He will always be remembered for his warm smile and generous nature. Everyone knew him as a friend. He touched, mentored and loved many people far and wide, around the world. A memorial service was planned to be held in Long Beach, California.

Start-up for new unit and gasification train

Reports state need for rise in CCS investment

Appointments at Linde Engineering

UNITED STATES

Linde North America has celebrated the official start-up of its atmospheric gases unit and gasification train, along with associated supporting facilities, in La Porte, Texas Customers, local and state officials, and Linde executives attended a ribbon-cutting event and were given a tour of the new facilities. The new ASU produces oxygen, nitrogen and argon and is part of the $250m that Linde North America has invested at the site, including a new gasification train.

Investment levels in carbon capture and storage (CCS) need to be increased for the technology to play its part in tackling climate change, found two recent reports. Both the International Energy Agency’s (IEA) World Energy Outlook Special Report on energy and climate change and the Grantham Research Institute’s report into improving the CCS framework in Europe find that CCS is vital to long-term goals but current investment levels are simply not enough.

Joerg Linsenmaier has been appointed as President and CEO of Linde Engineering North America Inc. (LENA). Linsenmaier most recently held the position of executive vice-president, central project execution at Linde Engineering in Germany. LENA has also announced that Bill Fronheiser, Principal Structural Designer, was recently awarded the Judges’ Choice Award in the Engineering and Construction category at the Intergraph® 2015 Golden Valve Awards.

UNITED STATES

Companies rebrand as simply Arc3 Gases

www.gasworld.com/americas

ASIA-PACIFIC Long-term nitrogen deal signed in India Praxair has signed a longterm supply contract with United Phosphorus Limited (UPL) in Jhagadia, India, for the supply of gaseous nitrogen to the company’s manufacturing site in Gujarat. The agreement further strengthens Praxair’s presence in the fast-growing western region of the country. UPL is one of India’s largest agrochemicals manufacturers and a leading global producer of crop protection products, intermediates, specialty chemicals and other industrial chemicals. The company is expanding its production capacity, resulting in increasing nitrogen usage. Praxair will build, own and operate a 45 tonnes per day (tpd) nitrogen plant, which is expected to start-up in the second half of 2015. The plant will also replace some of the existing customer-owned lower-efficiency nitrogen production equipment currently in place at the site. Praxair is already supplying UPL through a 20 tpd nitrogen plant installed at the Jhagadia site in 2013. “The small onsite nitrogen plants designed by Praxair offer UPL and our customers operational efficiency and process reliability,” said Anuj Sharma, Managing Director, Praxair India.

“The small onsite nitrogen plants designed by Praxair offer UPL and our customers operational efficiency and reliability” 14 | gasworld • August 2015

Australian energy provider and Air Liquide to cooperate in CCS AUSTRALIA

Air Liquide and AGL Energy have announced a joint commitment to recover carbon dioxide (CO2) at the Torrens Island power station site in Adelaide, Australia. A state-of-the-art CO2 recovery plant will be built and operated by Air Liquide at the AGL Torrens site to capture and purify up to 50,000 tonnes of CO2 emissions from the power station’s exhaust per year. This is equivalent to removing approximately 16,000 vehicles from the road every year. Following recovery from the AGL Torrens site, the CO2 will be used in the merchant CO2 market in South Australia, which is currently supplied predominantly from Victoria. The Torrens CO2 recovery plant will be the only plant in South Australia to capture

CO2 from existing emissions and will be the first plant to capture CO2 from a power station for the CO2 market in Australia. AGL Managing Director and CEO, Andy Vesey, said the plant would deliver an environmental benefit and provide local industry with a muchneeded resource. “Innovative processes such as the Air Liquide CO2 recovery plant will be critical in helping reduce emissions from the electricity generation sector,” he said. “AGL is pleased to

partner with Air Liquide in channeling CO2 from our Torrens site for productive use.” Construction of the CO2 plant will commence shortly and is set to be operational by second half 2016. Meanwhile, Air Liquide’s subsidiary Schülke, which specialises in hygiene and hospital disinfection products, has acquired the services of Healthcare Antisepsis Solutions (HAS) – extending the group’s Asia-Pacific hygiene business.

“Text text...

Messer opens noble gases plant in China CHINA

Messer has recently put into operation a plant for the production of the noble gases krypton and xenon in Panzhihua, Central China’s Sichuan province. It represents Messer’s second noble gas plant in China after the first one was successfully on-stream in Xiangtan of Southern China’s Hunan province in 2012. With an annual production capacity of 5,000 cubic meters of krypton and 450

cubic meters of xenon, both of which at 99.999% purity, Messer becomes the largest producer of high-purity krypton and xenon in China. “We are proud that Messer is now able to produce its own krypton and xenon. I believe with our state-ofthe-art facilities in Xiangtan and Panzhihua, we can better serve the local and international customers reliably with high quality products,” commented Dr. Werner Hickel, CEO of Messer China.

“I believe with our facilities in Xiangtan and Panzhihua, we can better serve local and international customers...” The noble gases krypton and xenon are two of the most valuable products in the portfolio of the industrial gases producer. Among other applications, they are used to manufacture light bulbs and gas lasers, as well as usage in the scientific research sector. www.gasworld.com/northpacific

ASIA-PACIFIC

TNSC to step up its presence in the Thailand market with API acquisition Taiyo Nippon Sanso Corporation (TNSC), together with a newly established joint venture (JV) in Thailand, has acquired Thai industrial gas producer Air Products Industry Co., Ltd. (API). API achieved net sales of ¥4.2bn ($30m) in 2014 and has around 290 employees across its head office in Bangkok and bases including Chonburi, Ayutthaya and Lamphun. The deal is seen as a further reinforcement of TNSC’s growing footprint in Southeast Asia, and the rapidly rising Thai market in particular. Demand for industrial gas

in Thailand is expected to continue growing, not only because the country – with a population of 68 million people – is one of the foremost markets in Southeast Asia, but also due to the industrial infrastructure that the country is building. TNSC became a capital participant in API in the 1980s and through it, had been developing an industrial gas business in Thailand. It then established the TNSC (Thailand) Co. Ltd JV in April 2015, of which TNSC holds a 49% shareholding (MHCB Consulting (Thailand) Co., Ltd. 48%, TISCO Tokyo Leasing Co., Ltd. 3%).

Power-to-Gas system for delivery in Hebei

Bulk gases contract award in South Korea

CHINA

SOUTH KOREA

McPhy Energy has signed a €6.4m contract to supply a Wind to Hydrogen (Power-toGas) system for the recovery of surplus energy generated by a 200mW wind farm site currently under construction in Hebei province, China. The customer, Jiantou Yanshan (Guyuan) Wind Energy, is a member of stateowned Hebei Construction and Investment Group Co., Ltd of the Hebei province with whom McPhy Energy previously signed a long-term partnership agreement. Delivery is scheduled for July 2016 with the equipment to be commissioned in January 2017.

Air Products has been awarded a contract to supply industrial bulk gases and bulk specialty gas supply system for a new semiconductor fab in Pyeongtaek, Gyeonggi Province, South Korea. Air Products will build multiple ultra high-purity nitrogen plants, hydrogen generators and a liquefier to support the facility. “We are honoured to be selected to support this milestone project,” said Kyo-Yung Kim, President of Air Products Korea. “Our investment in capacity will strengthen our industrial gas supply position to serve the expanding northern region.”

THAILAND

Hybrid CO2 plant assists supply chain

With the purchase of a new ASCO carbon dioxide (CO2) hybrid production plant, one of the most popular food Now, TNSC will take and beverage manufacturers management control of API, in South Asia, based in following a stock transfer Bangladesh, has made a agreement that TNSC future-proofing investment in concluded recently with the supply chain. shareholders in Thailand An unbroken CO2 and the approval of API supply cannot always be shareholders. The acquisition guaranteed, especially in will result in its share third world and emerging ownership of API rising markets. To avoid costly from 32% to 97%, including production downtimes and to via the newly established JV control its competitiveness, scheduled for consolidation as the Bengal company decided a TNSC subsidiary. to invest in its own CO2 on-site production with RELATED ARTICLE the acquisition of an ASCO TNSC – Synergy, strength and CO2 system. Thanks to this a shifting sales strategy investment, 1,000kg (approx. An interview with President and one tonne) of liquid CO2 per CEO, Yujiro Ichihara. Page 32 hour will soon be produced on the company´s premises. The self-produced CO2 will provide a purity of Sorrow expressed up to 99.998%. This final following incident liquid purity is above that SOUTH KOREA of the required ISBT quality guidelines and completely Matheson Gas Products Korea corresponds with the Co., a subsidiary of TNSC, requirements of global food has expressed its sorrow over and beverage standards. an incident at the company’s The new plant will be in electronic gases facility in operation in Bangladesh Chungnam which resulted in by the client and ASCO the death of an employee. engineers later this The incident occurred year. The fully on 4th May at the Asan automatic system contains a low Facility in Asan-City, concentrated Chungnam. An investigation into the The system will produce amine solution 1,000kg of liquid CO2 cause of the incident to extract highper hour is currently being quality, gaseous handled by the Korean CO2 out of generated stack gas resulting from governmental authorities. burning fossil fuels. The A company statement read, customer-specific hybrid “We express our sorrow over plant also has the capability the deceased, and extend our to recover CO2 from an deepest condolences and our existing flue gas stream. thoughts are with the family.”

1,000

August 2015 • gasworld | 15

ASIA-PACIFIC

INDIA

India’s first solar-powered renewable fuelling station, supplied by Air Products, was inaugurated in June. Part of a mass public transport fuelling and vehicle demonstration programme, the SmartFuel® station generates 100% renewable hydrogen from solar energy via an electrolyser. An event was held to mark the station’s opening, with chief guest Shri Piyush Goyal, Union Minister for Power, Coal and New and Renewable Energy, in conjunction with Shri Upendra Tripathy, the Secretary, Minister of New and

Renewable Energy, present at the site near Delhi. The station is part of a project managed by the National Institute of Solar Energy (NISE). It was also implemented by India’s University of Petroleum and Energy Studies (UPES) and funded by the Ministry of New and Renewable Energy (MNRE) of the Government of India. With the addition of this SmartFuel® station, Air Products now has three hydrogen fuelling stations operating in India. Air Products India installed, and in January 2012 commissioned, a hydrogen fuelling dispenser in

India’s first hydrogen station officially open

Pragati Maiden, Delhi to serve a fleet of hydrogen-powered auto rickshaws. The threewheeled hydrogen-powered fleet transports visitors at the Pragati Maidan, where many large exhibitions are held. “As a member of industry, Air Products’ is proud to be

involved in a programme that has received such crucial validation and support from public sector, educational institute and the regulatory authorities,” commented Ravi Subramanian, Business Development Manager-Asia for HES.

Courtesy of Japan’s The Gas Review

Slump in compressed hydrogen market arrested A sense is emerging that the long-held slump in the Japanese compressed hydrogen market has bottomed out, according to The Gas Review (TGR). A number of factors are cited as being behind the balancing in the market, including the recovery in the silicon wafers business, the high operational ratios of the surviving semiconductor fabs, as well as the stable operation of the automotive industry which consumes a comparatively large amount of hydrogen in processes like heat treatment and glass melting. There is still no sign of a period of growth, however – the possibility is considered rather low, says TGR. 16 | gasworld • August 2015

While the trend toward a contraction has petered out, this does not necessarily mean that compressed hydrogen is now on the road to expansion. Areas in which the Japanese manufacturing industry had made repeated capital investments in the past are now increasingly being found in the developing economies; as a result, there

concerned as a by-product is a common awareness of electrolysis. in Japan’s industrial gases But as part of the industry that the growth industry’s measures to potential for compressed cope with a lessened hydrogen for industrial use market for compressed is small. hydrogen, there has been With such dynamics consolidation of plants/ in mind, the contraction sources and the closure of sources, the rise of unnecessary in electricity production sites. fees, and the Further, (upward) concerted price revisions push of liquid Distribution accounts are being hydrogen for 30% of the price implemented for by Iwatani of compressed each region and are complexly hydrogen customer as a result of intertwined. The the consolidation of plants rise of liquid hydrogen (distribution expense and the ‘hydrogen economy’ accounts for up to 30% of is well documented, while the price of compressed the price of electricity is hydrogen) and the rise in significant where compressed electricity prices. hydrogen production is

30%

www.gasworld.com/northpacific

MIDDLE EAST

Start-up for major hydrogen plants in Yanbu SAUDI ARABIA

Air Liquide has announced the start-up of its global-scale hydrogen production site in Yanbu Industrial City, on the West coast of the Kingdom of Saudi Arabia. Announced in 2010, this investment of more than €350m represents both the largest industrial investment and largest ‘over the fence’ hydrogen contract of the group. In the context of a long-term agreement, Air Liquide Arabia will supply hydrogen to the new YASREF refinery (a joint venture between Saudi Aramco and Sinopec) located in Yanbu, one of the main industrial areas of the country and a high growth area for refining and petrochemicals. YASREF is the largest refinery in the region and

will process 400,000 barrels customers in the region. With of heavy crude oil per day. the start-up of these new Hydrogen will allow the units, the group’s hydrogen reduction of the sulfur production capacity increases content of the produced fuels, by close to 20%. and meet the environmental Pierre Dufour, Senior standards for cleaner Executive Vice-President transportation fuels. of the Air Liquide Group, With two global-scale commented, “This new hydrogen production units global-scale project reinforces and one purification unit, the our strategic presence in Air Liquide site has a total the Middle East, where we hydrogen capacity of continue to develop 340,000 Nm3/hour. our industrial gas The production will ramp up, according to the Start-up of the site realises an investment needs of YASREF, of €350m during the course of 2015. The presence of significant industries such as refining or petrochemical in the industrial basin of Yanbu will allow Air Liquide to further develop and optimise the hydrogen supply to its

€350m

infrastructure.” “The decision by such a large refinery to outsource its hydrogen production is a first in the Middle East, and representative of a growing trend in the region. Thanks to its technologies and operational know-how, Air Liquide offers its customers hvalue-added solutions that contribute to their competitiveness in the long run.”

AFRICA

Afrox technology meeting needs of HCFC phase-out As a signatory to the Montreal Protocol on Substances that Deplete the Ozone Layer, South Africa has implemented strict laws that are designed to reduce the production and consumption of ozone depleting substances. As of January 2013, government targets are to reduce ozone depleting substances by 5% per annum, before being entirely phased out by 2040. HCFC gases, which are regarded as having high ozone depleting 18 | gasworld • August 2015

potential, are still widelyused in the local refrigeration industry. R22 is the most commonly-used HCFC gas. Sub-Saharan gas market leader Afrox is able to assist refrigeration companies in dramatically reducing their environmental impact and overall operational costs, by offering a highly-specialised refrigerant recovery, reclaimation and recycling service for R22 and all other synthetic refrigerants. As revealed by Afrox Business Manager for Special Products and Chemicals, Jaco

Coetzee, Afrox is the only company in Africa to make use of the technologicallyadvanced and patented ZUGIBEAST – a portable, high-speed decontamination unit that works similarly to kidney dialysis. It is able to operate at speeds up to three times faster than any other

SOUTH AFRICA

current technology available in South Africa. As part of this offering, Coetzee says that Afrox is able to undertake the service for clients at their premises, or at its specialised facilities. “Clients provide us with the contaminated refrigerant in either cylinders or drums, and we will handle it in a responsible and safe manner,” he explained. Afrox can also provide recovery cylinders and drums to customers who can return the contaminated product to Afrox for safe disposal. www.gasworld.com/middleeast

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Device improves gas readings in packages Food, pharmaceutical and medical device companies will now be able to improve the accuracy of their package headspace oxygen readings via first-of-its-kind instrumentation technology from MOCON, Inc. The objective is to help brand owners optimise material attributes and improve economics, while meeting shelf life and other performance objectives.

“The technology relies on an optical sensor that ‘fluoresces’ to the amount of oxygen in the headspace” The company’s new OpTech®-O2 Model P test system uses a patent-pending Pressure Needle™ and a sensor to automatically measure internal package pressure and calculate the correct oxygen reading. The ability of the instrument to automatically compensate for the internal pressure when measuring headspace gas is particularly important for small packages, such as blister packs. This is because a variety of actions, such as the force required to insert the needle, can impact the internal pressure. The capability also benefits any package size with unknown internal conditions. The OpTech-O2 technology relies on an optical sensor that ‘fluoresces’ or gives off light related to the amount of oxygen in the headspace. 00 | gasworld • September 20 August 20152014

Chilling meat and fish with CO2 snow FREEZING AND CHILLING

Meat, poultry and seafood currently packed with water ice or dry ice in boxes can be chilled more safely and efficiently when using the DRI PACK® automated box chilling system from Linde LLC, which uses the chilling power of carbon dioxide (CO2) snow. Designed and built to USDA requirements, the DRI PACK chilling system is ideal for meat packing plants, as well as poultry and seafood operations, and is intended for use with new or existing packaging operations. The automated chilling system quickly fills boxes (up to about 24 inches wide) with CO2 snow as they travel along a conveyor.

Benefits include reduced labour costs as a result of the automated system, more accurate and consistent use of CO2, gentle distribution of CO2 snow in open boxes or totes, and adaptability to most conveyor lines. “With fish and seafood products retailing for $10 to $20 a pound or more, preserving the product’s highquality appearance, taste, and texture becomes extremely important,” said Ed Cordiano, Linde Programme Manager for Prepared Foods and Seafood. With the DRI PACK system, extremely cold CO2 snow quickly chills the food product, locking in moisture and preserving freshness and quality. A controlled flow of CO2 snow is directed

TECHNOLOGY

into containers or boxes at temperatures of -78.5ºC. Once in the container, the CO2 snow does not melt; rather, through sublimation, the CO2 provides the refrigeration to chill food – so there is never any liquid. The automated box chilling system offers safety advantages over chilling with water ice or dry ice pellets, including less motion injuries from handling bagged ice or shovelling water ice or CO2 pellets.

Quick change cutting SFT launches new torch from Hypertherm self-contained pump

Servomex updates DF-500 ultra-trace range

CUTTING TORCH

PUMP

ANALYSER

Hypertherm has announced a new Centricut brand quick change torch for use with ESAB plasma cutting systems. The torch, which incorporates proprietary Hypertherm technology, is designed to replace the ESAB PT-36, PT600, and PT-19XLS torches. It performs as well as the original ESAB single piece torch design, while increasing productivity. The two-piece design allows operators to change out consumables up to three times faster or load consumables for the next job while cutting the current job.

Supercritical Fluid Technologies, Inc. (SFT) has introduced the completely self-contained SFT-10 Liquid Carbon Dioxide Pump. Advanced Peltier (thermoelectric) technology makes it possible to achieve high pressure without the need for an external cooling bath. The SFT-10 pump can deliver carbon dioxide at pressures up to 10,000 psi (69 MPa) at flow rates from 0.01 to 24.0 ml/min, making it ideal for use in supercritical fluid extraction and other high pressure applications.

Servomex has updated its industry-leading DF500 ultra-trace oxygen (O2) analyser range with performance-enhancing new firmware and an improved user interface. Widely regarded as the industry standard for ultratrace O2 analysis, the DF-500 analysers are optimised for semiconductor, LED and specialty gas applications that depend on ultra high purity (UHP) gas quality, using a Coulometric E-sensor to measure down to 200 partsper-trillion (ppt) and 45 ppt. www.gasworld.com/technology

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HYDROGEN NEL ASA acquires H2 Logic for $38m NEL ASA has entered into a binding agreement with the shareholders of H2 Logic A/S to acquire the company for a total consideration of NOK 300m (€35m/$38m). The acquisition will be financed through NOK 100m in cash and the remainder in new shares of NEL at NOK 1.35 per share. NEL has leading hydrogen production systems capability based on water electrolyser technology. Through the acquisition of H2 Logic, NEL positions itself as a world-leading supplier of hydrogen refuelling stations and takes a key role in the development of the supply infrastructure for Fuel Cell Electric Vehicles (FCEVs). Further, the combined company will benefit from the technical and commercial know-how of both organisations within production and fuelling, as hydrogen is taking centrestage in the development of renewable energy. Martin Nes, Chairman of NEL ASA, said, “NEL is the first dedicated hydrogen company on the Oslo Stock Exchange. Through the combination with H2 Logic, we significantly expand our position in the value chain, taking the driver’s seat in the hydrogen fuel movement: Hydrogen fuel cell electric vehicles have a significant potential to reduce emissions from the transportation sector.” Based in Herning, Denmark, H2 Logic is the world’s largest independent hydrogen refuelling station company. 22 | gasworld • August October2015 2014

New and existing customers continue to choose Plug Power UNITED STATES

Plug Power Inc. has revealed that Uline, Inc. is a new GenKey customer – announced just days after the company secured an unnamed big box retailer in Ohio also as a customer. Uline, a family-owned business, is the leading distributor of shipping, industrial and packaging materials to businesses throughout North America, offering more than 30,000 products. Given its business strategy of same day turnaround, productivity and predictability are important to Uline, these factors are key benefits that the proven GenKey solution delivers. The initial deployment of GenDrive units will be

powering the forklift fleet at one of Uline’s distribution centres in Pleasant Prairie, Wisconsin. Additionally, Uline will deploy a second fleet of GenDrive-powered lift trucks into a newly constructed facility in the coming months. Uline distributes from 12 branches located across the US, Canada and Mexico. Meanwhile, Plug Power has also revealed Dietz & Watson, Inc. as a new customer of its GenKey solution, as well as securing an expansion to its contract with Walmart Canada to provide 124 GenDrive fuel cells for its new High Velocity Distribution Centre building in Balzac, Alberta, Canada. Dietz & Watson will deploy GenDrive fuel cells in its entire fleet of class-2 and

class-3 lift trucks for its new warehouse building under a full GenKey agreement. In its newly constructed facility in Philadelphia, Pennsylvania, Dietz & Watson will be using the GenDrive, GenFuel and GenCare solutions provided through GenKey. Plug Power has also recently been celebrating the last stop on its milestone Plug POWERTrip, a six-city road show intended to present the company’s success to its investment community. Plug Power hosted guests at the Willard InterContinental for presentations delivered by CEO Andy Marsh and General Counsel Gerry Conway. The Plug POWERTrip also welcomed remarks from special guest US Congressman Chris Gibson.

Sassenage hydrogen station opened FRANCE

Highly committed to the development of hydrogen mobility, Air Liquide has installed a charging station at its Sassenage site in Isère (Rhône-Alpes). This station will allow the first users of the HyWay project to recharge their vehicles with hydrogen. Next fall, a second station will be installed in Grenoble. Coordinated by the Tenerrdis new energy technologies cluster, HyWay is the first French project whose aim is to deploy fleets

of hydrogen-powered electric vehicles. A major project milestone was reached in June with the delivery of the first 20 Renault Kangoo ZE-H2 utility vehicles to Grenoble. These constitute the largest electric vehicle fleet equipped with a hydrogen-powered range extender currently deployed in Europe. The Air Liquide station at its Sassenage site is accessible to the various partners in the HyWay project. Among the first users is the local platform of La Poste, France’s postal service, whose three Kangoo ZE-H2 vehicles will be

recharging regularly at the Air Liquide Sassenage site, as well as at the large capacity station that will be rolled out next fall in Grenoble. Air Liquide has chosen to support the HyWay project by investing in the development of this first station in Sassenage, but also by deciding to acquire three Kangoo ZE-H2 vehicles.

www.gasworld.com/hydrogen

LNG

Woodside and Sempra LNG sign MOU for Texas project UNITED STATES

Sempra LNG and Woodside have signed an MOU relating to the potential development of an LNG facility at Port Arthur, Texas. Woodside has a track record of more than 30 years of experience in the development and safe and reliable operations in the LNG industry with the North West Shelf and Pluto projects in Australia. Sempra LNG, as lead sponsor of the Cameron liquefaction project in Louisiana currently in construction, has demonstrated its ability to develop high-value, low-cost liquefied natural gas (LNG) projects in North America. The non-binding MOU is the initial step for Sempra

LNG and Woodside to explore this opportunity and undertake due diligence for the potential development of the Port Arthur liquefaction project. “Sempra Energy and Woodside bring together an extraordinary complimentary set of experience and skills from two world-class organisations,” said E. Scott Chrisman, Vice-President of Commercial & Development for Sempra LNG. “We look

forward to engaging Woodside in discussions regarding the proposed Port Arthur liquefaction project.” The proposed Port Arthur liquefaction project would be located at a site previously permitted for an LNG regasification terminal and designed to include two natural gas liquefaction trains with a total export capability of approximately 10 million metric tons per annum.

World first dispenser launched by Cryostar

Texas LNG project continues to progress

Chart completes turnkey installation

FRANCE

UNITED STATES

ESTONIA

Cryostar has released its brand new LNG Dispenser, called the LNG Dispenser 2.0. Production of the device is thanks to Cryostar’s knowhow in LNG refuelling stations technology and capitalising on its strong experience acquired from the design and start-up of more than 90 LNG/LCNG fuelling stations worldwide The LNG Dispenser 2.0 is a unique piece of equipment in the world, designed for LNG refuelling stations, for fleet operators and lorry drivers using LNG as a truck fuel.

Texas LNG Brownsville is progressing on schedule and will be producing product in 2020, according to a recent update on the project. Texas LNG is planning to build the Brownsville Project in two phases, each with LNG production of two million tonnes per annum (mtpa). Pending FERC’s final approval to construct the Project, Phase 1 is expected to commence production in 2020. FERC regulates the siting, construction, operation and maintenance of the LNG terminal and infrastructure.

Chart Ferox has successfully installed and commissioned two new LNG Gaspak stations in Estonia, at the Maardu Terminal. Each station consists of two 40m3 horizontal storage tanks and an evaporation unit, and will provide natural gas to the local community for a range of applications. The Chart group has considerable expertise and experience in the rapidly growing LNG sector, having completed countless equipment orders and installations across the globe.

Double development in LNG in China Hangzhou Fortune recently announced that the second phase of the Xinxingsheng Energy Co. Ltd project in Baotou City, Inner Mongolia, which includes a 500,000 Nm3/d LNG plant, has been successfully completed. Hangzhou Fortune is responsible for the design of the process package, all of the plant’s process equipment, the design and manufacture of non-standard process equipment, as well as the procurement of control systems and electrical systems, project management, commissioning and training, and other support services. The project lasted for one year, starting from the delivery of equipment in March 2014. In October 2014, all of the static equipment and machines were tested individually, and in April the whole plant was tested, with first product achieved on 25th April.

Meanwhile another recent development in LNG by a Chinese company occurred when CIMC Sanctum – a subsidiary of CIMC Enric – became the first Chinese cryogenic equipment manufacturer to get E-mark certification for its LNG onboard cylinders. Certification means the company is now authorised to provide these cylinders to the European market. August 2015 • gasworld | 23

SAFETY ZONE

→ Safety zone BCGA updates info to waste management sector BCGA The British Compressed Gases Association (BCGA) has updated its information for the waste management industry – offering insight into the return procedure and safe handling of gas cylinders on-site. The revised leaflet, entitled The Safe Handling of Gas Cylinders at Waste Facilities, is available for free download from the publications area of the BCGA website (www.bcga.co.uk). Outlining the processes to establish legitimate ownership and to ensure

HSE UPDATES COMAH DOCUMENT FOR 2015 HSE The Health & Safety Executive (HSE) has updated its guidance document to explain the revised Control of Major Accident Hazards (COMAH) Regulations for 2015. The new regulations came into effect on 1st June 2015, implementing the Seveso III Directive and aligned with the CLP Regulations. COMAH 2009 has now been revoked. This guidance is for anyone who has duties under the COMAH Regulations 2015, particularly operators of establishments, and also others such as local authorities and emergency planners.

AWD ANNOUNCES FUME FOCUS GROUPS CALENDAR → AWD The Association of Welding Distribution (AWD) has announced a series of networking and learning events for all involved in and 22 | gasworld • October 24 August 2015 2014

that a cylinder is in a safe condition for processing and disposal, it has been produced to share best practice and give the waste management industry easy-toaccess information. Features include a flowchart detailing safe disposal methods, as well as useful contacts for further advice and assistance. Doug Thornton, Chief Executive of the BCGA, explained, “The majority of cylinders remain the property of the gas supply companies and are provided under a rental agreement with an expectation that cylinders are returned.” “However, many end up at waste

facilities and the management at the centre should be determining who the legal owner is, and then, where appropriate, informing the owner of the whereabouts of the cylinder.” The new leaflet (L2) has been produced in partnership with The Environment Agency, Natural Resources Wales, The Scottish Environment Protection Agency and The Northern Ireland Environment Agency. The BCGA has also worked in partnership with UKLPG, the trade association for the LPG industry in the UK, to introduce an initiative to help civic amenity sites correctly return cylinders.

EIGA introduces homecare personnel document to assist in identifying risks The European Industrial Gases Association (EIGA) has published the Security and Safety for Homecare Field Personnel Document 198/15, applicable to field personnel who deliver product or services to patients. Field homecare personnel are required to deliver products and services to patients’ homes, which can be in areas subject to high criminality, leading to risks to staff during the delivery process.

EIGA notes that some of the patients and patients’ relatives, or people in the area, have been known to threaten and assault member company staff. These threats and assaults have included physical and verbal abuse, as well as the use of weapons. Companies shall have a zero tolerance to threats, violence and abuse, and the new EIGA document is designed to assist in the preparation of guidance to field staff so that they, their managers and schedulers are better able to identify potential threats and risks.

committed to the welding industry. By its very nature the welding and cutting process creates fume, given off from a welding arc or gas cutting torch, which can contain both harmful gases and particulates. It is important that process operators are made aware and protected from this risk. The AWD Fume Focus Groups will provide attendees with the knowledge

on how these risks can be avoided and the type of protection levels that are available. The seminars will also offer the chance to get up to speed with the new European norm standard EN1090, which has been in effect since 1st July 2014, requiring all structural fabricators to ensure that their processes are to a qualitymanagement system or CE approved.

EIGA

www.gasworld.com

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August 2015 • gasworld | 25

INTELLIGENCE

intelligence Steady growth projected in Finland, Iceland and Sweden From gasworld Business Intelligence With a Eurozone bailout seemingly agreed and set to avert the most acute of Greece’s current debt problems*, the news has brought calm to many of Europe’s markets, not least in Scandinavia where Greece’s turmoil had driven up national currencies and threatened export markets. Traditionally resilient Scandinavian economies have been vulnerable to Eurozone woes in recent years, most notably during the global economic crash of 2008/9. Iceland was perhaps the most notable example. In the run up to the global financial crisis, the country had enjoyed impressive growth and low unemployment, but was hit hard by the onset of the crash and its banks suffered greatly. Likewise, Finland enjoyed one of the best performing economies in the EU in recent times and its financial institutions managed to steer clear of the harshest effects of the global crisis. The recession did hit Finland particularly hard in the most severe years of the crisis, however, with its economy having suffered one of the deepest slowdowns of the Eurozone. And in Sweden, which had enjoyed sustained economic upswing until 2008, significant finances and underlying fundamentals were unable to stop the economy falling into recession in the latter part of 2008 – a contraction maintained until 2009, as worsening global 26 | gasworld • August 2015

conditions hampered export demand and consumption. Despite this, the relatively small industrial gas markets of all three countries have demonstrated solid growth in the last decade. Iceland, despite being arguably the most high-profile casualty of the 2008/9 economic crash, has shown the strongest average annual growth rate at 6.6% between 2004-2014. This resulted in an industrial gases market worth $27m last year (2014). Finland and Sweden, meanwhile, experienced average annual growth rates of 5.2% and 3.6% for the same period and boasted 2014 revenues of $340m and $720m, respectively. All three markets are also united by two key trends: dominant packaged gas supply chains; and strong end-user demand from the metallurgy and manufacturing sectors. Indeed in Iceland, though the food and beverages business is the most significant end-user market, the country’s considerable geothermal and hydropower sources have brought in strong foreign investment injections to the aluminium sector. gasworld Business Intelligence projects further

$1bn Combined, the commercial industrial gas markets of Finland and Sweden represented revenues of $1.06bn in 2014.

5.2% Finland recorded average annual growth of 5.2% from 2004-2014

steady growth in the Finnish, Swedish and Icelandic gas markets through to 2020, while potential exists in the captive production business for each, currently accounting for just 12% and 17% of the supply chain in Finland and Sweden, for example. In Iceland, this figure is thought to be even less, such is the dominance of the packaged gases model in the country. Any calming of European markets in the

short-term following Greece’s prospective bailout package can only help to smooth this growth path in the next few years. *Situation at time of gasworld magazine going to press.

REPORT UPDATE For more information on the European markets, contact: intelligence@gasworld.com

www.gasworld.com/intelligence

INTELLIGENCE

European industrial gas market reports now available From gasworld Business Intelligence Industry analysts of gasworld’s by specialist consultants Business Intelligence Team examining each country in have outlined the growth depth. Each report contains a potential within East and West 15-year history and five-year Europe in their latest series of forecast of the respective gas European ‘gasreports’. markets. The newly published market Potential market forecasts reports provide up-to-date have shown that European and in-depth analysis of the growth has recently industrial gas market in the improved, with the increase region. These new reports in GDP coming in at 1.3% examine Europe’s economic in 2014. Europe is home to a trends, industrial gas supply population of approximately structure, market structure in 750 million, the third largest terms of demand for gases, in the world and accounts macro-economic for 6.8% of the Earth’s influences and total land area. The drivers, future European Union market forecasts, (EU) is the world’s The European industrial as well as looking largest single gas market is currently at the companies market economy valued at $17bn operating within and European each country and the trade accounts for overall investment potential. around 20% of global Prepared by the gasworld imports and exports. Business Intelligence team, The European industrial research has been conducted gases market is currently

$17bn

valued at around $17bn, accounting for over 20% of the global industrial gases market. The European gasreports aim to support future business and strategic decisions by providing timely and valuable data, helping companies assess the region with the most upto-date information available. The reports also detail the end-user analysis, helping to discover future opportunities within this sector. gasworld’s Business Analyst, James Barr, recently discussed his findings at the company’s Europe Industrial Gas Conference that took place in May, 2015. At the event, Barr gave firm encouragement about the growth potential in East and West Europe, concluding that the gases industry “needs to work and be innovative at carving out growth in the years ahead.”

OIL IN FOCUS

Barr said, “The high-growth markets of Eastern Europe offer a wealth of opportunities for new companies to enter these markets. Much of the existing capacity will soon need replacing and the potential for captive-to-onsite conversion is impressive.” If you want to expand your business or investigate the potential in Europe, these gasreports provide vital information that will allow organisations to make an informed decision on the region in question. Available in a format to suit your needs, gasworld’s analysis is compact and precise and easily digestible across all departments. REPORT UPDATE For in-depth analysis of the European industrial gas market: intelligence@gasworld.com

From Platts

China oil demand climbed 8.2% year over year in May China’s apparent oil demand in May increased 8.2% from a year earlier to 43.80 million metric tons (mt), or an average 10.36 million barrels per day (b/d), according to a justreleased Platts analysis of Chinese government data. Apparent demand during the month was supported by healthy demand growth across all oil product categories. China’s refinery throughput in May averaged 10.38 million b/d, rising 7.4% from a year

earlier, data from the country’s National Bureau of Statistics (NBS) showed 15th June. On the other hand, China was a net oil product exporter in May, with volumes totalling 120,000 mt, according to data released 24th June by the General Administration of Customs. During the first five months of this year, China’s total apparent oil demand averaged 10.45 million b/d, an increase of 5.2% from the same period

of 2014. This continues to be the fastest pace of yearto-date growth since 2011 and defies a relatively weak macroeconomic outlook. “This was the fastest pace of growth since June 2013, when demand grew by 11.53%. Demand for all key products showed year-on-year increase in the month,” commented the Platts Associate Editorial Director for Asia oil news, Mriganka Jaipuriyar.

8.2% China’s apparent oil demand in May increased 8.2% from a year earlier

August 2015 • gasworld | 27

DATA DASHBOARD

OIL Downstream/Upstream Earnings for Select Global Integrated Oil Companies Source: US EIA, based on Evaluate Energy 70

billion dollars

downstream earnings upstream earnings downstream share of total

70% 60%

50%

40%

30%

20%

10%

2011

2012

total operable capacity

Idle Operating

2014

2015

Medium Crude Oil Imports to Gulf Coast Refineries by Country Source: US EIA, Petroleum Supply Monthly million barrels per day 1.50 1.25

Other countries Iraq Kuwait

1.00 75 50

Saudi Arabia

25 00 Mar-14 May-14 Jul-14

2013

US Operable Refinery Capacity as of January 1st Each Year Source: US EIA, 2015 Refinery Capacity Report million barrels per calendar day 20 18 16 14 12 10 8 6 4 2 0 2010 2011 2012 2013

Sep-14 Nov-14 Jan-15 Mar-15

2014

2015

Recent data from the US Energy Information Administration (EIA) paints an interesting picture of the oil and refining market at the midway point in 2015. Amidst all of the doom and gloom surrounding the global oil markets in the last 12 months, increased refinery runs – based on increases in both capacity and utilisation – have helped accommodate increases in US crude oil production (see left). And improved refining margins from processing additional volumes of heavy crude have resulted in a 3% increase in gross atmospheric distillation unit (ADU) throughput in the Gulf Coast region from first quarter 2014 to first quarter 2015, with medium-grade crude oil imports to Gulf Coast refineries decreasing 45% in this period. But first quarter 2015 financial results for globally integrated oil companies – those that focus on both the exploration and production of crude oil (upstream) and the refining of crude oil into petroleum products (downstream) – show that total earnings were $22bn (54%) lower than in first quarter 2014. Lower crude oil prices contributed to a decline in profits in the upstream sector of $28bn (80%) compared to first-quarter 2014, EIA data suggests. Profits in the downstream sector, however, were the largest for any quarter since third quarter 2012 – almost $6bn (95%) higher than in first quarter 2014, which offset some of the decline from the upstream segment.

ELECTRONICS First Quarter 2015 Worldwide Semiconductor Equipment Figures

Source: SEMI/SEAJ June 2015 (Figures may not add due to rounding) Region

1Q2015

4Q2014

1Q2014

1Q15/4Q14 (Q-o-Q)

1Q15/1Q14 (Y-o-Y)

Korea

2.69

2.09

2.03

29%

33%

Taiwan

1.81

2.03

2.59

-11%

-30%

North America

1.47

1.83

1.85

-19%

-20%

Japan

1.26

1.11

0.96

13%

31%

China

1.17

0.68

1.71

73%

-32%

Europe

0.69

0.58

19%

Rest of World

0.43

0.59

0.42

-27%

Total

9.52

8.91

10.15

-6%

28 | gasworld • August 2015

SEMI, the global industry association for companies that supply manufacturing technology and materials to the world’s chip makers, reported that worldwide semiconductor manufacturing equipment billings reached $9.52bn in first quarter 2015, 7% higher than in fourth quarter 2014 and 6% lower than the same quarter a year ago. The data is gathered jointly with the Semiconductor Equipment Association of Japan (SEAJ) from over 100 global equipment companies that provide data on a monthly basis. As shown left, worldwide semiconductor equipment bookings were $9.66bn in first quarter 2015, 2% lower than the same quarter a year ago and 3% lower than the bookings figure for fourth quarter 2014. The quarterly billings data by region in billions of US dollars. www.gasworld.com/intelligence

Your Gas Analyzers and Cryogenic Valves Partner in Malaysia and South East Asia

Contact: sales@sermax.my

Website: www.sermax.my

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August 2015 • gasworld | 29

HOT TOPIC

California water crisis underlines looming challenge in water treatment STUART RADNEDGE gasworld, Web Editor

fficials in California – facing the state’s driest year on record amid a multi-year drought – have implemented mandatory water consumption limits in a bid to prevent what could be devastating shortages. The state instituted water usage cuts in April; 400 water supply agencies throughout California were ordered to deliver 25% less water to residential customers this year, following Governor Jerry Brown’s largely unsuccessful attempt to get California residents to voluntarily cut water use by 20% last year. Agriculture use is not included in the mandatory restrictions. But neither is another huge industry, with the restrictions yet to extend to California’s refining sector, despite its use of hundreds of millions of gallons of water every day. The state is reluctant to force refiners into the processing rate cuts that would surely follow, only creating another new set of problems. Jennifer Allen, Public Affairs Director of the Contra Costa Water District, said district officials have asked refiners to try to reduce water use by 5%, a voluntary benchmark designed to conserve water without hindering refinery operations. The Contra Costa district 30 | gasworld • August 2015

is home to two refineries – Shell’s 165,000 barrels per day (b/d) Martinez plant and Tesoro’s 166,000 b/d Golden Eagle facility – and Allen said the district was working with refiners to increase the use of recycled water and water from alternative sources. And California’s refinery operations appear to be unaffected by the drought so far; US West Coast refinery gross inputs at 2.47 million b/d on a four-week moving average the week ending 5th June, compare favourably to 2.53 million b/d for the same week in 2014, according to data Energy Information Administration (EIA) data. Though this is the case, clearly issues over the availability and quality of the California’s water supply is a hot topic right now. But is this just the tip of the iceberg? Global crisis While all eyes are on California’s four-year drought which is forcing the most severe mandatory water restrictions in the state’s history, another water crisis is brewing that will affect far more people and a much greater territory – planet Earth – according to a recently completed study on the future of water quality. The global study was conducted by the International Food Policy Research Institute (IFPRI), an international agricultural research centre, and the Veolia Group, which designs

and provides water, waste and energy management solutions that contribute to the sustainable development of communities and industries. It found that the world is on a path toward rapidly deteriorating water quality in many countries and that the evidence of drought in the US and in many parts of the world – from lack of rain or snowfall, drying rivers and lakes, water shortages, and water restrictions – is real. However, all is not lost. The study also points out that sustainable solutions do exist for cities and industry, including more aggressive investment in wastewater treatment, increased recycling and reuse, green infrastructure, the establishment of markets for nutrient credit trading, and governance models based more on watersheds and less on traditional political borders. The industrial gases industry could have a key role to play here, in the application of wastewater treatment and increased recycling and reuse. Aeration has been a primary method for treating municipal and industrial wastewater for more than 40 years. It is a natural way to control biological oxygen demand (BOD), maximise aerobic digestion of organics, and control odours. As a firmly established technology, aeration systems will continue to play a role well into the future. However, is there a way to improve efficiencies

and reduce operating costs? Some types of aeration systems are inherently more efficient. It requires less energy to inject straight oxygen (O2) than to push volumes of air into an aeration basin. Even a moderately-sized plant may treat a million gallons or more per day, and banks of air blowers and surface aerators running three-phase at 460 volts on a continuous basis can easily consume kilowatts per hour. It is clear why electricity typically accounts for about 30% of a facility’s operating costs, which are avoided in an O2-based plant. One common method of O2 injection for municipal systems is via special gas jets for even distribution of oxygen-enriched water. Jets are easy to install in existing lagoons or treatment tanks. Installation includes an oxygen storage tank, a control system and a vaporizer unit that converts the liquid O2 to low-pressure oxygen gas. The system is engineered to match anticipated peak loads, while the control system meters oxygen to meet instantaneous treatment demands and minimises O2 consumption. Meanwhile, carbon dioxide (CO2) is increasingly emerging as an attractive alternative for neutralising the alkaline wastewaters generated in meat, food and beverage processing, pulp and paper mills, and many other chemical and industrial operations. A CO2 treatment system www.gasworld.com/hottopic

HOT TOPIC

for alkalinity control includes gas supply, related piping, gas metering, injection and a control system. CO2 can be injected in any one of several different ways, depending on the size and configuration of the facility. Carefully metered amounts of gas can be injected into process wastewater through diffusion mats at the bottom of treatment ponds, or directly into wastewater pipes through high-volume spray nozzles. Linde North America is one such example of a company that has been developing and implementing wastewater treatment solutions for municipalities and industrial operations for decades. In that time, the company has developed many processes that cover a broad cross-

section of sustainable technologies that have had a positive effect on a variety of municipal and industrial processes. Two of these – the SOLVOX® oxygen systems and SOLVOCARB® CO2 system – are particularly pertinent to the kind of solutions referred to in the IFPRI study. Linde’s Stephanie Bland said, “Linde’s SOLVOCARB process is a fast and economical way for process industries to neutralise alkaline wastewater with a high degree of control using CO2. The process injects the CO2 into the process wastewater, forming carbonic acid to quickly reduce pH to appropriate levels for discharge. The process is also useful for reverse osmosis (RO) and remineralisation systems.”

“CO2 is an inert gas and the carbonic acid formed is a mild buffering agent, so SOLVOCARB provides a much safer alternative to hazardous and corrosive mineral acid treatments, such as hydrochloric acid (HCl) and sulfuric acid (H2SO4).” “With mineral acids, a few drops too many can create pH excursions which risk discharge fines from the water treatment authority or US Environmental Protection Agency (EPA), for example.” Into focus The water crisis in California pulls a looming global problem sharply into focus. Chemical production plants are under mounting pressure to process ever-larger quantities of wastewater to

increasingly higher standards, while also needing to operate under various regimes of cost constraint. Plant operators face the dilemma of how to maintain treatment throughput at reasonable cost even when the plant reaches design capacity. Further, many industrial operations with highly alkaline wastewater that discharges into public waterways are moving away from mineral acid treatment systems. While HCl and H2SO4 have effectively neutralised alkaline waste streams for decades, environmental, regulatory and cost factors are making CO2 gas diffusion treatment – just like O2 technologies in aeration applications – an increasingly attractive option for this sector. gw

THE FUTURE OF GAS FLOW CONTROL

www.bronkhorst.com/prestige I www.bronkhorst.com - E sales@bronkhorst.com August 2015 • gasworld | 31

INTERVIEW

TNSC

Synergy, strength and a shifting sales strategy An interview with President and CEO, Yujiro Ichihara

ne year into the role as President and CEO of Taiyo Nippon Sanso Corporation (TNSC), Yujiro Ichihara has already been in at the deep end of a busy period of project and investment activity. A long-term member of the TNSC family having joined Nippon Sanso Corporation in 1974, Ichihara was named President and CEO in June 2014. The appointment arguably spelled the start of a new phase of development for the group, a decade since its formation via the merger of Nippon Sanso Corporation and Taiyo Toyo Sanso Co., Ltd. in October 2004, and with TNSC still recovering from the effects of recent economic crises. The global economic crash of 2008 32 | gasworld • August 2015

and the consequences of the great East Japan Earthquake in 2011 both saw TNSC’s business performance significantly deteriorate. By 2014, the company had seen a satisfactory recovery in its performance and, since Ichihara’s appointment, had embarked upon its new three-year medium term management plan, Ortus Stage 1. There have also been a number of investments across the group, including the acquisition of Continental Carbonic in the US (via Matheson Tri-Gas, Inc.), a new joint venture with Samator in Indonesia, and the merger of its Singapore and Malaysia business to create Taiyo Nippon Sanso Holdings Singapore Pte. Ltd. Perhaps the biggest development during Ichihara’s time in office occurred

in November 2014, when TNSC became a member of the Mitsubishi Chemical Holdings Group (MCHC). Today, TNSC enjoys a 40% market share in the Japanese industrial gas market, with a focus on large, onsite business to the steel and chemical industries, and is increasingly active outside of the country with its overseas sales ratio growing from 15% to 35% in the past 10 years. Here, in an exclusive interview with gasworld magazine, Ichihara discusses his first year in the role, the acquisition by MCHC, the market in Japan, and more. Ichihara on…The first year In June 2014 when I was appointed www.gasworld.com/interview

INTERVIEW

President of TNSC, Japanese manufacturers were shifting their production operations overseas due to the very high appreciation of the Japanese yen in the years leading up to 2014, and there were fears that the market in Japan for our industry was shrinking. The Japanese electronics industry experienced consolidation and shutdown of plants, and there was a temporary but significant decrease in plant utilisation levels in the industry. The high electricity charges following the decommissioning of all nuclear power plants, coupled with low rates of ASU (air separation unit) operation due to a reduction in demand for industrial gases, increased production costs in Japan. Outside of Japan, on the other hand, the industrial gas market has continuously been expanding, thanks to the shale gas revolution in the US and the growth of the emerging economies. In response to these circumstances, a three-year medium term management plan (Ortus Stage 1) was launched last fiscal year, designed to strengthen the earnings base in Japan through structural reforms, while further expanding overseas business operations, including regions within which TNSC has no operations. Various projects have come on-stream or been announced in the last 12 months, including a new Matheson Tri-Gas ASU in Mesa, Arizona and a contract for an ethane cracker project with Sasol in Louisiana – the first large onsite project in the US for TNSC. The group has also been on a significant acquisition push through 2014/15, with notable business purchases in California and Hawaii (February 2015) and the high-profile acquisition of Continental Carbonic in the US by Matheson Tri-Gas, an investment that Ichihara notes has been ‘showing steadily increasing earnings for TNSC’. The envisioned business expansion by Matheson Tri-Gas in the US is making satisfactory progress. At present, Matheson Tri-Gas has 18 ASUs in the US and conducts business in 43 states. Matheson Tri-Gas is expanding its supply

network in the US. TNSC’s subsidiary Thermos KK has also acquired a German vacuum bottle manufacturer – alfi GmbH – and has started building a new vacuum bottle manufacturing plant in the Philippines. Additionally, in November 2014, TNSC became a member of the Mitsubishi Chemical Holdings Group (MCHC). The company is now implementing various measures to accomplish synergic effects within the group. Ichihara on…Japan Ichihara described the rapidly changing business environment surrounding TNSC in recent years, most of which has been evident in its domestic Japanese market. Here, the 64 year-old elaborates further on the gases business in Japan and what’s driving growth.

“We were afraid that the industrial gas market in Japan, which accounted for 70% of our total sales at that time, would shrink” In Japan, after decommissioning of nuclear power plants due to the Great East Japan Earthquake and Tsunami in 2011, electric power companies have been increasing their basic charges since April 2012. TNSC diligently negotiates with customers concerning gas price increases to minimise the effects on revenue due to manufacturing costs. The value of the Japanese yen appreciated excessively before 2013, and Japanese manufacturers shifted their production operations outside of Japan. We were afraid that the industrial gas market in Japan, which accounted for 70% of our total sales at that time, would shrink. Against this backdrop, TNSC has taken action to capture demand for gases shifting from Japan to overseas geographies by selling our gases to these Japanese manufacturers utilising its supply network overseas. After 2013, the excessively high appreciation of the Japanese yen

has been rectified, and the trend of Japanese manufacturers moving their operations outside of Japan seems to have eased. Some of these manufacturers are returning, moving their overseas operations back to Japan. We intend to achieve growth [in Japan] through the reinforcement of our corporate make-up and through expansion in new and innovative businesses such as hydrogen refuelling stations, cell freeze-preservation systems for medical applications, oxygen stable isotope labelled water (Water-18O), and MOCVD (Metal Organic Chemical Vapor Deposition) systems. Further, in January 2015, TNSC organised a new onsite promotion project team, aiming at winning orders for new on-site projects in the steel and chemical industries, including the development of new applications. Having alluded to the ongoing proliferation of Japanese companies expanding their operations in lucrative ‘overseas’ markets in the wider AsiaPacific region, Ichihara describes TNSC’s own network outside of Japan – including its new joint venture in Indonesia with Samator (February 2014). In Asia, TNSC established a joint venture company in Singapore in 1982 to enter the industrial gas business. At present, TNSC is engaged in the industrial gas business in China, Taiwan and South Korea in East Asia, and Malaysia, Indonesia, Thailand, the Philippines and Vietnam in Southeast Asia. In India, TNSC established a joint venture company in 2010 and built an ASU there in 2014. Most recently, TNSC established a joint venture company in Indonesia in 2014. Indonesia is the largest market for industrial gases in Southeast Asia and is enjoying a high level of economic growth – many Japanese companies are doing business in this country. By establishing a joint venture company with Samator, which has an extensive supply and sales network in that market, TNSC will expand the supply of gases to meet the requirements of the Japanese companies there. Most recently, the joint venture August 2015 • gasworld | 33

INTERVIEW

“We believe that a foothold can be gained to accomplish the sales of ¥600bn and operating profit of ¥45bn targets for the fiscal year ending March 2017...” company has won orders for on-site projects for two Japanese companies in Indonesia. In 2014, a holding company was established in Singapore, and TNSC subsidiaries in Singapore were merged under this holding company. There are 10 local corporations in China engaged in the industrial gas business, including electronics companies. A holding company in China has been given controlling responsibility for them and is now overseeing their management affairs to strengthen cooperation among them and coordination of the materials handled. In April 2015, a new ASU started operations in the Philippines, and TNSC has won orders for a number of new on-site projects. At present, TNSC is also building ASUs in Vietnam and Malaysia. Ichihara on…Ortus Stage 1 TNSC’s long-term plan envisions achieving sales of ¥1 trillion ($8.1bn approx.), a 10% operating margin, 10% 34 | gasworld • August 2015

or higher ROCE (Return On Capital Employed) and a 50% or higher ratio of overseas sales to total sales, by fiscal year ending March 2023. The three-year medium term management plan (Ortus Stage 1) that kicked off last fiscal year is regarded as the first step in accomplishing this long-term vision, as Ichihara explains. Ortus Stage 1 sets numerical targets of accomplishing sales of ¥600bn ($4.8bn), operating profit of ¥45bn ($365m), 8% or higher ROCE and a 40% or higher ratio of overseas sales to total sales in the fiscal year ending March 2017, which is the final fiscal year under Ortus Stage 1. In the fiscal year ending March 2015, the first year in the plan, sales totalled ¥559.3bn, while operating profit totalled ¥35.2bn – registering a higher income and profit compared with the previous year and accomplishing the targets set in the plan. In the gases business in Japan, sales increased, while TNSC and one of its engineering subsidiaries reduced

personnel, achieving a satisfactory result in operating profit. In overseas operations, a substantial increase in profit can be achieved through M&A in the US and expansion in the electronics business in Asia. We believe that a foothold can be gained to accomplish the sales of ¥600bn and operating profit of ¥45bn targets for the fiscal year ending March 2017. In the next fiscal year, IFRS will be adopted voluntarily and ¥3bn ($24m) will be added to operating profit for the current fiscal year (year two in the three-year plan) as some of TNSC’s subsidiaries in the US and Asia will have 15 months in their settlement of accounts. Except for this increase, no change has been made in the numerical target of ¥38bn ($308m) for year two. TNSC projects an operating profit for following fiscal year – the final year in the plan – of ¥45bn ($365m), up by ¥7bn projected for the current fiscal year. Various measures will be implemented to achieve this substantial increase in profit. These measures will, gasworld understands, include further streamlining in Japan in accordance with the preparations made since the previous fiscal year, while efficiencies will be tightened across the whole TNSC group in terms of plant operating costs, logistical operations, and reinforcing the supply chain. TNSC will also implement its growth strategies in innovation and overseas investment. Of the total investments of ¥200bn ($1.6bn) planned for three years, ¥40.9bn ($332m) was invested in the fiscal year ending March 2015. Major projects include new ASUs in Japan, the US and the Philippines, along with the construction of Plant No. 3 for Water18 O in Japan. In the fiscal year ending March 2016, investments totalling ¥72.5bn ($588m) are planned and major projects include a large ASU for Sasol, a liquid production ASU in Vietnam, and a small on-site ASU in the Philippines. Depending on the success or failure of future M&A projects, the amount of investments and financing for the current year may further increase. Active www.gasworld.com/interview

investments in new plants and M&A ventures will continue. Ichihara on…MCHC In the first place, TNSC was already an equity-method affiliate of MCHC. To further strengthen the relationship between the two firms and to maximise the synergy between the two groups, in May 2014, the two companies announced an agreement reached between them for MCHC to launch a takeover bid of shares of TNSC, ranging between 50% as a lower limit and 51% as an upper limit. After completing the necessary procedures and taking action in accordance with the fair trade laws inside and outside of Japan, the takeover bid was launched in September and was completed in November 2014. MCHC now owns 50.6% of the shares of TNSC. The company has become a consolidated subsidiary of MCHC but will continue to be listed on stock exchanges and steer its company management independently. So, what does the investment mean to TNSC? Ichihara is eager to point out that this investment does not alter the position of TNSC in the industrial gas business, and the company’s management plans have not changed either. TNSC will take part in orchestrating the collective strengths of the Mitsubishi Chemical Holdings Group as we aim to capture synergies by creating new businesses and expanding business globally. For example, TNSC will expand its overseas business too via new production operations, from which the companies of MCHC may choose to access industrial gases, thereby leveraging TNSC’s know-how in onsite plant systems and technology. As a member of the MCHC Group, TNSC will aim for sustainable growth by earning profitable revenues while contributing to solving environmental and social problems and challenges. We also believe that Matheson Tri-Gas will be able to cooperate in supplying industrial gases in conjunction with the business operations of the MCHC Group companies in the US.

Ichihara on…MATHESON This brings us neatly on to MATHESON, or Matheson Tri-Gas as Ichihara still refers to it, a substantial branch of the TNSC business that clearly continues to grow in importance to the group. At present, the pace of development of shale gas and oil has slowed, owing to a decline in the crude oil price. In the medium to long-term, however, we believe that the industrial gas market in the US will continue to grow favourably. In 2012, Matheson Tri-Gas organised an onsite sales expansion team and is actively soliciting orders for new onsite projects for oxygen, nitrogen and hydrogen. The coast-to-coast bulk industrial gas network of Matheson Tri-Gas is making progress as planned. In the past, Matheson Tri-Gas expanded its ASU network at a rate of more than one unit per year and currently possesses 18 ASUs in the entire US. Matheson Tri-Gas has built a bulk gas network from California to Florida, mainly on the south side. The completion of a back-up system based on this bulk gas network has been conducive to the success in landing a large onsite project in Louisiana. We intend to continuously expand ASUs at the present rate in order to strengthen the network. We believe that the importance of Matheson Tri-Gas, which is active in the growing market of the US, will further increase within the TNSC Group. Under our long-term vision, we are aiming at sales of ¥1 trillion, including overseas sales of more than ¥500bn, in the fiscal year ending March 2023. At present, sales by Matheson Tri-Gas are about ¥150bn ($1.2bn). We are aiming at increasing sales by Matheson Tri-Gas to ¥200bn ($1.6bn) early on, by skilfully capturing the economic growth of the US. Ichihara on…The future for TNSC Pressed further on the group’s long-term vision, Ichihara concludes our interview by explaining what the future holds for TNSC – and what impact the acquisition by MCHC will have on this outlook. We need to complete the building of a synergistic global network of businesses,

“We believe that the importance of Matheson Tri-Gas, which is active in the growing market of the US, will further increase within the TNSC Group” instead of merely increasing sales outside of Japan. One future aspiration is to consolidate business operations in Southeast Asia under the regional controlling company in Singapore established in 2014, to accelerate our business expansion in the whole of Southeast Asia. We envision empowering our individual regions – Japan, the US, Southeast Asia, and China – with controlling responsibility in order to foster agile organisations that can respond immediately to changes in market environments and thereby accelerate the global growth of our group. TNSC is intensifying its activities with the MCHC Group in the area of R&D to achieve synergistic effects within the MCHC Group. We wish to lay a ‘new cornerstone’ by merging the material development capability of the MCHC Group and the application development capability of TNSC in the industrial gas field, which has been a TNSC hallmark throughout its history of more than100 years. gw August 2015 • gasworld | 35

SPECIAL FEATURE

Challenges and opportunities in food and beverages Food-grade industrial gases will increasingly find their way into the packaging and storage we use for our food and beverages over the next few years. Helen Carmichael reports.

ases such as oxygen, nitrogen, argon, hydrogen and carbon dioxide are already in use to chill, freeze and package foods ranging from frozen goods to fruit and vegetables, meat, seafood and bakery products. But ever-higher consumer expectations that food manufactures must avoid contamination and optimise their product’s safety mean that companies are expected to deploy food grade industrial gases in packaging and storage applications. Today’s health-conscious consumers want products with fewer additives, with the added assurance of freshness and longevity. So in addition to safety concerns, locking in aroma and texture as well as further extending product shelf life are continuing goals in the food industry. All of this means that continued demand is forecast: the food-grade industrial gases market is projected to reach $9.1bn by 2019, at a compound annual growth rate (CAGR) of 7% from 2014 to 2019, according to recent research published by Markets&Markets in the

36 | gasworld • August 2015

report Food-Grade Industrial Gases Market, by Region, 2013 vs. 2019. Nitrogen applications set to grow The whipped cream on top of an indulgent hot chocolate is propelled from the can by nitrogen, which is also used to create micro bubbles for added fluffiness in desserts. Growing customer demand for these products is expected to continue to help the market for nitrogen over the next seven years, according to San Franciscobased market research company Grand View Research. But another significant application for nitrogen is in modified atmospheric packaging (MAP), which is increasingly being adopted by the food processing and packaging industry. By using a tailored combination of gases – usually oxygen, carbon dioxide and nitrogen – within the sealed product pack, MAP boosts the shelf life of certain foods considerably. The gas combination is tailored depending on the food’s fat content, microbiological character, and other factors. The packaging process is deployed for

chilled foods including meat and fish, as well as for some salads and pre-cut fruit and vegetables, and requires high-quality raw materials, strict temperature controls and specialised equipment. Contrary to popular belief, many salads are packaged in air rather than given the MAP treatment, as only the iceberg and cos varieties of lettuce benefit. Nitrogen is a good gas for blanketing – filling a container’s headspace. High purity nitrogen, dry and inert, prevents oxygen and moisture coming into contact with the product as a safe and reliable means to stop food spoiling as a result of oxidation. This is particularly useful with edible oils, and in fruit juices, which retain their colour for longer and preserve their vitamins and flavour as a result. A further common inerting application is purging, where nitrogen, carbon dioxide or argon is passed through a food or beverage, effectively exchanging atmospheric gases for a new, inert atmosphere to preserve food quality. Injecting nitrogen into a liquid in tiny bubbles is known as sparging – a fast and effective way to remove oxygen and maintain freshness without adding any other substances (increasingly unpopular additives) to the liquid. Nitrogen is also vital for cryogenic freezing of a number of foods, including meat, dairy products and ready meals. Freezing with liquid nitrogen reduces product clumping and ice crystal formation, and can lead to an end product with a texture and flavour almost identical to the fresh version. Totally tasteless Inert, odourless and tasteless, argon has been allowed for use in MAP in the European Union (EU) since 1995. Although argon is inert, it has been suggested that it has biochemical activity, such as interfering with oxygen receptor sites of enzymes, and changing protein conformation (bending them out of shape). Argon also displaces oxygen more effectively than nitrogen, perhaps because of it’s physical properties: it is a similar size to molecular oxygen, is more water soluble, and has a higher density than nitrogen. www.gasworld.com/specialfeatures

SPECIAL FEATURE

In a bid to shine more light on its packaging potential and safety parameters, scientists have made various studies over the past few years to attempt a comparison of argon versus nitrogen in inhibiting various bacteria, in fruit, vegetables, and a range of meats and meat products. However, in combination with carbon dioxide, both are found to be equally effective in delaying bacterial growth in most studies, although some bacterial did grow in both cases, with bacteria capable of thriving without oxygen faring best1. Meanwhile, tasting bars and sales reps for wineries, as well as restaurants, have found that argon can be used instead of nitrogen, particularly for keeping opened bottles of wine fresh. “Argon is heavier than nitrogen and stays in the bottle better, both on top of the wine and doesn’t leak out as easily,” says Bruce Currie at the Department of Viticulture and Enology at the University of California, Davis. Nitrogen is slightly lighter than air, so is less optimal for blanketing. Carbon dioxide can also be used to blanket wine, but tends to dissolve into the wine, leading to a situation where some air is also sucked in. Products such as VinAssure, which use winery-grade argon supplied by Air Liquide, purges the air in the empty bottle space and leaves an argon-rich atmosphere, which can preserve flavour for up to a week – and stop many litres of wine from half-used bottles from being poured away. CO2 maintains its fizz As well as putting the fizz in carbonated drinks from cola to sparkling wine or water, carbon dioxide (CO2) is essential for rapid freezing. This quick-chill method has minimum impact on food’s molecular structure, and means that frozen meals are both tasty and convenient for their evergrowing consumer base. Philippe Girardon, Air Liquide’s expert in food application spoke to gasworld recently about CO2. He said, “Globally we see definite growth in this market. It’s use in the food and beverages domain accounts for about 80% of the total.” He cited developing countries as major consumers of carbonated drinks, now

overtaking the US. “Carbonated drinks is a big growth driver, but pH balancing is also a big sector – as is the inerting of tanks and its use in wine,” Girardon said. Packaging around the world “Asia-Pacific is expected to be one of the largest food grade industrial gases markets over the forecast period,” states Grand View Research in its report, Food Grade Industrial Gases Market Analysis, Market Size, Application Analysis, Regional Outlook, Competitive Strategies and Forecasts, 2015 to 2022, followed by North America and then Europe.

“A project to extend the shelf life of strawberries with this technology shows considerable promise” A growing population, along with increased spending power and changes in food preferences, mean packaged food is truly in demand in Asia-Pacific. Advances in processing technology and burgeoning domestic consumption are lifting the food and beverage industry, and so gas consumption, particularly in India and China. In India in particular, the Government’s Draft National Chemical Policy announced in 2012 and updated in 2014 aims to increase growth of the nation’s chemical sector and make it more competitive. The policy should pave the way for investment and open new markets for industrial gas manufacturers supplying the food and beverage sector. Over one fifth of the EU’s workforce works in the food and drink sector, which contributes around 6% of the region’s GDP. Food and beverage processing has a turnover of around €1 trillion, making it the largest manufacturing sector in the EU economy. The EU is also the largest global exporter and importer of food and drinks. Moves by both the European Commission and the US Environmental Protection Agency to reduce greenhouse gas emissions aim to further reduce the use of fluorochemical gases, such as HFCs in food and beverage applications. Foodgrade gases are likely to replace HFCs.

Looking ahead The future looks bright overall for gas manufacturers serving the food and beverage industry; in addition to food grade industrial gases, many gas companies also supply specialty gases to this sector relevant to the more technical laboratory and quality control (QC) side of the business. The only possible blip could come from the increasing trend to use vacuum packaging for foods, which by necessity eliminates the need for gases. Looking further ahead, cold plasma technology is attracting interest from the food industry. In addition to applications in disinfecting surfaces and processing equipment, the technique could potentially be used to sanitise the surfaces of some foods. The potential for cold plasmas – typically generated with noble gases to which other gases such as oxygen and nitrogen can be added – to inactivate microorganisms has been understood for around 20 years. As well as the possibility of tailoring the plasma chemistry to the application, plasma also succeeds in getting in and around pores, crevices, and other hardto-reach areas that other techniques (such as UV light) fail to attain. Scientists have been working with the UK Food Standards Agency on this type of disinfection. A project to extend the shelf life of strawberries with this technology shows considerable promise. Other plasma disinfection research has shown various successes with melons, mangoes, tomatoes, lettuce, potatoes, cheese, nuts, eggshells, ready meals and meats. Although it may be some years before such novel techniques are routinely used on the foods we buy in the supermarket, there is no doubt that the food industry and its customers will continue to drive innovation forward to reach greater heights of freshness and convenience. The gas industry will be there to partner this innovation throughout the supply chain. gw REFERENCES 1. Ulrike Herbert et al, Poultry Science (2013) 92 (5):1348-1356.doi: 10.3382/ ps.2012-02590

August 2015 • gasworld | 37

SPECIAL FEATURE

CO2 applications in food and beverages An update

Sam A. Rushing explains why the industry is still significant among all others and where future growth in CO2 demand is likely to emerge from.

arbon dioxide (CO2) usage in the food and beverage sector is a major component of the merchant CO2 industry, and has been for many decades. The applications in the food sector, of course, are more resilient and diverse than soft drink or beverage carbonation; however, both are important to the long-term growth and success in the CO2 industry. On the growth front, the food sector is where more diverse and significant expansions will be noticed over time compared to many other applications for the product. The industry is keen to develop new applications for use of the commodity as a major mission for the future. Historically, most new successes for a new food-related application which endure are occasional, even if such occasional new uses can sometimes represent significant growth. It is more likely that most of the expansion of CO2 in the food industry will largely come from market growth of existing applications. Aside from large captive CO2 use, such as enhanced oil recovery (EOR), the food-related market in North America should dominate all other single sectors served individually, such as beverages, dry ice pressing, and the sub-categories 38 | gasworld â&#x20AC;˘ August 2015

of industrial usage such as Ph reduction, metallurgy, welding, and greenhouse enrichment. The percentage of growth in food applications, as per my estimates, may well exceed CO2 industry growth as a whole. Mixed market As I have written in the past, the entire merchant CO2 business is highly driven by the food and beverage sectors, and thus by the trends they follow throughout the years. During prior times, when the oil and gas industries took off significantly, usage surrounding CO2 frac usage expanded as well. And interestingly, with some merchant firms, the steady food and beverage businesses was almost taken for granted for a period of time, in light of the relatively â&#x20AC;&#x2DC;excitingâ&#x20AC;&#x2122; oil and gas expansions in North America. One such company which took this posture was the former Amerigas. However, during these days of low oil and natural gas prices there remains high production of both commodities domestically, but little usage surrounding frac applications for CO2. This is due to prevalent trends found with hydraulic fracturing. But this trend toward hydraulic fracturing may be taking a turn, in favour

of other agents and specifically CO2, due to water disposal, recycling, and water availability problems. Today, growth in the food and beverage sectors remains well focused, where expansion tends to be a function of food processing techniques and industry growth; the food sector is extremely resilient and should continue to be well suited for (CO2) growth in years ahead. On the other hand, beverage applications as a function of market utilisation are growing at a very slow rate, or are flat, in part since carbonated beverages in the US are sometimes giving way to other types of soft drinks. It is clearly a mixed market in terms of beverages. Soft drinks, in some developed markets such as North America are focusing on non-carbonated sports drinks, bottled and canned water, and specialty drinks. This does not mean that carbonated drinks are a thing of the past; new labels for carbonated beverages are picking up the slack where the major soft drinks are not gaining market share, so there are a few new demands for new carbonated products being delivered to the markets. But in terms of breweries and merchant CO2 usage, many of the beer manufacturers have consolidated www.gasworld.com/specialfeatures

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“Conservation and improved efficiencies are often the calling card for existing and expanded use of the product instead of other forms of refrigeration...” and in some cases more CO2 is being recovered from their fermentation process, sometimes only used to back pressure their systems and not boost carbonation, as they claim. In the end, this represents less merchant CO2 growth for the beverage industry at large. Most of the changes which we are seeing these days related to food processing are represented by the improvement of delivery systems into or for the food product itself rather than a variety of new applications for food processing. The actual hardware, controls, engineering, design and precision behind delivering the right temperature as a product of using the cryogen is key to making the very best of any food cooling or freezing operation. Therefore, application equipment – along with specific components of the hardware – represent most of the new developments in the food-related part of the CO2 industry. The basic generation of CO2 snow, and gaseous applications in MAP (modified atmosphere packaging), are evolving via equipment options, as are cryogenic freezers of all types, automated snow applicators, and dry ice pressing operations. Basically, much of the same is taking place in terms of basic food-related applications – actual new applications are the domain of both the major gas companies and the larger food processors. Precision is key to saving money With improvements in CO2 delivery systems, and generally the application equipment found in the food sector, more gas companies are aiming to create a form of precision behind the way their machines work and interact with the CO2 and the food product. Given that all CO2 is essentially a commodity, and assuming the specifications are the same, the industry or specific gas companies hope to make this commodity a proprietary brand via the use of their technology. This 40 | gasworld • August 2015

technology, and making a commodity gas proprietary, is generally reduced to engineering expertise. Beyond flour and dough applications for CO2, the same is true of meat and other food product processing operations. With improvements which are being made in the application equipment, more CO2 can be sold to customers who expand their operations, hoping for greater savings and efficiencies brought about by such new or improved methodology and technologies. Conservation and improved efficiencies are often the calling card for existing and expanded use of the product instead of other forms of refrigeration. In the large food processing plants, reducing losses – which may appear to be small for individual processing lines or plants – can represent savings in the range of thousands to hundreds of thousands of dollars with today’s more efficient cryogenic technologies. This includes freezers, to cabinet machines, and not to forgetting snow production devices. Freezers have come a long way since their inception, in terms of quality, improved control mechanisms, and configuration; upgrades from flighted freezers which are used for products which can be fragile or can stick together involve new, proprietary configurations. Other improvements these days involve enhanced air flow characteristics in cryogenic spiral and linear freezers, which are said to enhance temperature reduction and general efficiencies using a comparable amount of CO2 in the cooling or chilling process. What this means for the gas supplier is a long-term opportunity to serve the food and beverage industries, and to continue to develop innovative approaches to achieve more efficient results. As for the processor, this means – over time – more innovative and creative solutions will become available for the application of CO2 in the food industry. Perhaps many of today’s upgrades and

changes with respect to the food and beverage industries include company mergers and acquisitions. It is significant that the two major CO2 ‘independents’ were acquired by major industrial gas firms (EPCO Carbon Dioxide by Air Products and Continental Carbonic by MATHESON), all of which lead to a better chance for the entities and plants serving these companies to improve their ability to develop and deploy applications for food and beverage service. Given that most of the major CO2 suppliers have facilities to serve as test settings for new machines and the application of various food products, such opportunities should be made available to the significant tonnage and markets now owned by the new operators of these CO2 merchant firms. The long-term development of applications, and their improvements are the domain of the CO2 majors – at least this has been the case in North America. In the long-term, the food industry, particularly the meat processing sector and also including poultry and seafood, will continue to have core applications for CO2. Further, the improvement and fine tuning of application equipment from nozzles, injectors, temperature controllers to a variety of machines which manually or automatically feed and reduce the temperature of food products, will continue to evolve in the industry. This will, in some cases, create new applications for food products and continue to improve efficiencies surrounding the use of the cryogen, reduce labour demands, and gain speed in the process of operations. gw ABOUT THE AUTHOR Sam A. Rushing is a chemist and President of Advanced Cryogenics, Ltd, a major CO2 and cryogenic gas consultancy. The company celebrated 25 years last year and welcomes enquiries for consulting expertise across all areas of the industry. E-mail: rushing@terrranova.net Phone: +1 305 852 2597 www.carbondioxideconsultants.com www.gasworld.com/specialfeatures

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August 2015 • gasworld | 41 biogas_84x247.indd 1

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SPECIAL FEATURE

Tackling CO2 supply chain efficiency in the restaurant business By Andrey Ruban

arbonated beverages are drinks that include carbon dioxide (CO2) dissolved in water. Many people find the fizzy feeling to be pleasant and like the different taste that CO2 provides. Carbonated beverages, particularly naturally carbonated spring water, were once thought to be health tonics. Other examples of carbonated beverages include beer and soda, wine spritzer, Coke, Pepsi or ‘pop’. The history of drinks carbonation goes back as early as the 18th century when the British chemist J. Priesley founded a way to infuse CO2 in water in 1767. This was followed by commercial experience of J. Schweppes from Switzerland in 1783 and B. Silliman from the US in 1807. Most well-known brands of carbonated beverages were invented between 1860 and 1900. 42 | gasworld • August 2015

Today’s carbonated drinks marketplace exists in post-mix and pre-mix shapes. According to the data available, up to 73% of the European carbonated drinks market is a pre-mix market1. The European post-mix market – socalled on-trade sales channel – is rather limited, when comparing to that of the US. Such a market structure creates certain inefficiencies: water in pre-mixed drinks puts up additional costs into the price of the consumed drink due to a transportation element; the same applies to packaging material used. The pre-mix market, however, isn’t tight up to the consumption point. On the other hand, the post-mix system – allowing for the mixing of syrup out of bags with water and CO2 on the spot – is suitable for outlets that serve large amounts of soft drinks quickly, such

as a sports stadium or a busy fast-food restaurant. Due to the existing customer preferences in Europe, even in the postmix segment we observe the differences with the US: in Europe a standard drink is 0.3 litres; in the US it is 0.5 litres. What are the sales channels for dispensed carbonated drinks in Europe? Here, less than one third of the fast-food market is comprised of top international brands like McDonald’s, Autogrill, KFC, Burger King, and more. From Spain to Norway to Russia, there are many fastfood restaurants such as Telepizza, IKEA and Teremok beloved by locals more than American chains. On top of that, Europewide there are also small and mediumsized restaurants (up to 60% according to Chart estimates) – at least half of which may also be engaged in carbonated dispensed drinks sales. www.gasworld.com/specialfeatures

SPECIAL FEATURE

among the first to present this solution to Thus, it is understandable that all of the post-mix market in the early 1990s. the on-trade businesses – either local Very often gas companies, as well as or international – strives to improve end-users, in Europe claim that it customer loyalty, the quality of is difficult to justify the switch drinks served, and to become from high pressure cylinders to more price/cost competitive. the cryovessel. The argument One such development, End-users can save against initial microbulk tank underlined by keynote 20-30% on price per speaker Kent Masters at kg of CO2 by shifting to investment is offset by supply microbulk supply chain and logistics savings. the recent Europe Industrial By switching to the microbulk Gas Conference held by supply mode, the end-user is able gasworld in Budapest, has led to achieve up to 20-30% saving on gas to Coca-Cola – accounting for almost prices per kg of CO2 (purchases in bigger 37%2 of the carbonated drinks market in Europe – repositioning CO2 from a batches, no additional energy waste for commodity to an ingredient. This has cylinders refilling from a bulk tank)3. This also resulted in capital expenditure in the reduces transportation and manipulation restaurant industry becoming a growth costs and allows a greater control of the and efficiency driver: businesses are amount of CO2 available in each tank; increasingly look for more friendly CO2 storage solutions. “...gas companies familiar Chart Industries offers a direct with microbulk can profit replacement for high pressure CO2 bottles, and has the widest range of by overtaking the CO2 Carbo-series vacuum insulated vessels:

20%

• Carbo-Matic® Bulk CO2 System • Carbo-Max® Bulk CO2 System • Carbo-Mizer® Bulk CO2 System • Carbo-Mite™ Bulk CO2 System These are able to meet the demand of the end-users with a wide spread of annual CO2 consumption: from 300kg per annum up to 600-800kg or even more (NER consideration puts a minimal CO2 consumption requirement of 89 pieces 0.5 litre drinks per day). Market shift Big international restaurant chains in the US were the pioneers in reducing the costs of their CO2 supply chain. McDonald’s in the US, for instance, was among the first in the mid-1980s to approach Chart Industries (then MVE) with an idea to develop a customised cryogenic stationary tank that would facilitate reducing the gas logistics costs by a shift from CO2 supplied in high pressure cylinders to stationary cryovessels. Later on this trend spread to Europe, where Chart (under the MVE brand) was

supply chain of beverage companies active in the post-mix market in certain geographies”

just-on-time delivery, no CO2 supply disruptions, no need to manipulate high pressure cylinders stored in restaurant cellars. While the high pressure cylinder manufacturers constantly strive to reduce the cylinder weight to ease up CO2 cylinders handling, Chart Industries seems to be a step ahead in offering solutions with no handling at all. The equipment director of one of the leading international chains in Europe has also confirmed to Chart Industries that restaurant flooring repairs from repeated high pressure cylinder handling is a significant budget issue. For a typical restaurant affiliated with a big chain (typically 100 seats and sales of 1,000 dispensed drinks per day) an investment in a Carbo-series vessel is less than 1% of the total restaurant set-up costs. A gas supplier or CO2 distributor benefits from the microbulk CO2 system by cutting the labour costs associated

with cylinder filling, distribution and less cylinder maintenance. For example, annual labour costs for one employee filling cylinders are worth half the investment into a microbulk CO2 delivery unit. When multiplied by the number of CO2 deliveries through the lifetime of a tank, such savings are tremendous. Additionally, gas companies familiar with microbulk systems can profit by overtaking and enhancing the CO2 supply chain of beverage companies active in the post-mix market in certain EMEA geographies (like Romania, Greece, Bulgaria, Middles East and Russia), where Carbo-series tanks are still not used due to the lack of knowledge. Beverage CO2 is being increasingly defined as a food ingredient in the international market. Therefore, the Carbo-series microbulk tanks, constructed of high-grade stainless steel for food-grade compatibility and long service life, secure a better option for CO2 storage than high pressure steel (alloyed and non-alloyed) cylinders that are exposed to the corrosive influences of CO2. The modern CO2 microbulk tank has great potential to improve beverage quality and provide more efficient and safe distribution of food grade product. This adds greater value to gas companies, beverage system operators, and the consuming public. gw

ABOUT THE AUTHOR/REFERENCES Andrey Ruban works as an EMEAR Business Development Manager of Chart Inc. He brings more than 12 years of experience in senior roles in international corporations, including nine years of experience from packaged gases equipment manufacturers. andrey.ruban@chartindustries.com 1. Carbonated Soft Drinks in Europe. Marketline, August 2013 2. Carbonated Soft Drinks in Europe. Marketline, August 2013 3. The Global Industrial Gases Business Annual Report 2013. Esprit Associates.

August 2015 • gasworld | 43

SPECIAL FEATURE

Harnessing science to counter fraud in food and beverages By Linde Gases

he economic impact of counterfeiting products in the food and beverage industry amounts to millions in lost sales and profits to retailers, producers and suppliers. Fake claims about the content of foods and beverages also pose an unsuspected risk to consumer health, as well as those who base their food choices on ethical and religious convictions. Consumers make their purchases in good faith, putting their confidence in the honesty and integrity of the supply chain. Counterfeiting is at odds with this reasonable assumption that a product is all that it claims to be on its labelling. In contrast to the financial losses facing businesses on the production and supply side, the consequences to consumers can range from simply being deceived about the product’s content, or not benefitting from the anticipated efficacy, to the more severe outcomes of illness and death. The world was made aware of this danger in 2008, when six babies died and 300,000 babies fell ill after drinking melamine-tainted milk products in 00 44 | gasworld • August September March 2014 20152014

China. Another major food scandal broke in Europe in 2013, when it was revealed that horse meat was being labelled as beef from cattle. Although horse meat is suitable for human consumption, the public health issue relates to the type of tests conducted to prove the suitability of the beef for human consumption. Since these tests differ from those applied to horse meat, applying the wrong tests to the sample could create an opportunity for hazardous substances, such as residual chemicals from veterinary medicines, to enter the food supply chain. Food and beverage counterfeiting syndicates are motivated by greed and driven by the attraction of increased sales margins. Sometimes a reluctance to discard products that have passed their sell-by date leads to re-labelling and, in the case of exported products, there is an objective to bypass or reduce Customs and Excise duties on certain products. Despite the best efforts of national food safety authorities such as the US Food & Drug Administration (FDA) and the European Food Safety Authority,

certain food and beverage product types continue to fall prey to counterfeiting. Notable examples include olive oil, goat’s milk, wines, basmati rice, honey, caviar, vanilla and saffron. Olive oil is produced to different standards by varying methods of production and its quality is also determined by the free acidity of the soil. The production and sell-by dates are also important, because olive oil eventually oxidises and becomes rancid. Since each of these factors determine the value of the end product, falsifying any of this information amounts to counterfeiting. In a similar vein, a variety of aromatic basmati rice types are sold at premium prices on the world market and the increasing value consumers are placing on this product also makes it a prime target for counterfeiters who adulterate the product with the addition of cheaper types of long grain rice. Likewise, goat’s milk can be diluted with cow’s milk and the difference is very difficult to detect by taste alone, while honey can be counterfeited in various different ways. It can be adulterated with sugar, corn syrup and other sweeteners, or the type of honey is misrepresented by a fake declaration of botanical or geographical origin to attract a higher price on the market. For example, Manuka honey is broadly hailed as a wonder product that demonstrates antiviral and antibacterial qualities. Not as sweet as normal honey, it is made by bees gathering nectar from the delicate flowers of the Manuka bush, native to New Zealand. When this rare and highly priced product is misrepresented, consumers are not only duped financially, but are also cheated of the health benefits associated with it. Caviar is another rare and expensive product which black market dealers substitute with the roe of other fish, passing it off as the roe of the sturgeon harvested only in the waters off Russia and Iran. Expensive spices like saffron and vanilla are frequently faked by being synthetically produced or are by being substituted with cheaper spices that taste and look the same thanks to food www.gasworld.com/specialfeatures

SPECIAL FEATURE

flavouring and dyes. Meanwhile wines and brandies also lend themselves to counterfeiting through false information on the labelling, particularly as certain vintages attract far higher prices than others. This includes adulterating these liquors with the addition of cheaper products such as fruit juices, and sometimes with the addition of harmful chemicals and sweeteners to compensate for colour or flavour. Growing focus The increasing penetration of counterfeit food and beverages in the consumer supply chain is prompting authorities to accelerate existing measures to intercept and identify these products. For example, during 2013, Customs and Excise laboratories in France ran half a million analytical tests on wines and beers entering the country, bringing the role of scientific analysis into sharp focus. Counterfeit goods are invariably undetectable by sight and smell alone, and must be analysed using sophisticated chemical analysis techniques. The food standards authorities associated with counterfeit goods typically make use of expert food laboratories which run sophisticated instrumentation. Gas chromatographymass spectrometry (GC-MS) and liquid chromatography-mass spectrometry (LC-MS) are routine in food and environmental laboratories, alongside High Performance Liquid Chromatography and Ultra-High Performance Liquid Chromatography (HPLC and UHPLC). When more sophisticated analysis is required, Nuclear Magnetic Resonance (NMR) comes into play, the most advanced technique available for food counterfeiting investigations. NMR involves generating a very high magnetic field around the nuclei in a particular molecule to allow the nuclei to absorb and re-emit electromagnetic radiation. The pattern in which this occurs is detected to identify which particular molecules are present. The intense magnetic field is generated by a superconducting magnet that can only operate

in extremely cold temperatures, achieved via the use of liquid helium. The authenticity of olive oil can be established to a certainty of about 80% by analysing the most frequently occurring chemical components through Principal Component Analysis (PCA) and developing a ‘fingerprint’ for a particular product. PCA typically identifies the top 50 naturally occurring chemicals and their concentrations, providing analysts with a good indication of the oil’s geographical origin and how it was processed. Linear Discriminate Analysis (LDA) on some of the most occurring components compares these chemicals to the genuine article to determine how

“...the demand for gases that facilitate the detection of chemicals in food is on the increase” closely the sample resembles it. The instrument most likely to be used to conduct this sophisticated fingerprinting of the olive oil is NMR, harnessed to focus on isotopes of hydrogen to identify variations in the fingerprint. The most reliable technique for determining the age of a wine or a brandy is looking at the quantity of carbon isotope that exists in these liquors. This method uses radioactive carbon isotopes left in the atmosphere by atomic bomb tests carried out about 50 years ago, as well as from the burning of fossil fuels and volcanic eruptions. NMR is also used to conduct this analysis to determine the vintage of a wine. Although NMR is being increasingly applied to detect adulterated honey, other methods include GC and LC, Near Infrared Transflectance (NIR), spectroscopy, Fourier Transform Infrared (FTIR) spectroscopy with Attenuated Total Reflectance (ATR), Protein characterisation, High-Performance Anion-Exchange Chromatography with Pulsed Amperometric Detection (HPAEC-PAD), LC coupled to Isotope Ratio Mass Spectrometry (HPLC-IRMS), calorimetric methods, stable Carbon

Isotope Ratio Analysis (SCIRA), Fourier Transform (FT) Raman spectroscopy and Microscopic detection. To determine whether caviar is from a sturgeon or another type of fish, analysts examine the product’s DNA, the unique marker of a species. Sometimes enhanced with fluorescent dyes, samples can be examined by a photo spectrometer or, if more sophisticated test is required, the NMR is once again brought into play. DNA testing is also proving an effective way to identify the authenticity of basmati rice, since rice varieties have different DNA fingerprints. After saffron, vanilla is the world’s most expensive spice, and counterfeiters typically substitute vanilla extract with vanilla flavouring containing synthetic vanillin and ethyl vanillin in foods and beverages to save costs. Some illegal manufacturers add coumarin – a phytochemical found in many plant species – to vanilla products to increase the vanilla flavour perception. However, coumarin has been shown to be hepatotoxic (damaging to liver cells) and prohibited from being added to food in the US since 1940. LC-MS, HPLC and UHPLC have proved effective in determining the presence of coumarin, vanillin, and ethyl vanillin in vanilla extract products. In demand Over and above issues of public health, fraud and tax evasion, the counterfeiting of food impacts the spheres of ethics and religion. Food analysis is, therefore, a growing market and the demand for the specialty gases that facilitate the detection of ever-lower levels of chemicals in food is on the increase. gw ABOUT THE AUTHOR Linde has a broad offering to the food industry through its HiQ® range, including nitrogen and helium for GC-MS, nitrogen for LC-MS, liquid helium for NMR, and helium gas for HPLC and UHPLC. Linde also ensures uncompromised delivery of these gases to the instrument via its REDLINE® range of regulators.

August 2015 • gasworld | 45

INTERVIEW

10 minutes with... SERDAL KARA Sales and Marketing Manager, ISISAN Thanks for taking 10 minutes out with gasworld. What can you tell us about ISISAN in 2015? Firstly, ISISAN has been serving its customers in the energy field for 50 years with pressure vessels and process tanks. Today, we are exporting our products to more than 60 different countries, having added Cameroon, Ireland, Russia and Turkmenistan to our export portfolio, and are looking forward to expanding our geography further. The success story of ISISAN in its standard products is well-known by its customers. Within the last few years we have added our engineering knowledge to our engineered pressure vessels, by this means our goal is to establish a new brand under the name of ISISAN Engineering. ‘Engineered vessels’ means that the design and the accessories of the vessels are planned and manufactured on the basiss of the process of the customer. Until today, we have shipped and successfully commissioned engineered tanks to Scandinavian countries, as well as European countries. What is the vision or future aim for ISISAN? Our vision is to continue to pay importance to engineering, while also directing our investments along the same path. ISISAN will continue in its innovative production, looking to establish its name alongside the production of engineered vessels, in addition to the successful commissioning services its provides. We understand the food and beverages business, our cover theme this month, is a key end-user market for ISISAN. What can you tell us about this? In the carbon dioxide (CO2) sector we are providing solutions to our 46 | gasworld • August 2015

customers by selection from our product range. Depending on the needs and requirements of the customers, ISISAN manufactures vacuum and foam insulated storage vessels, as well as transportation vessels with ADR and T9 certification. In particular, for the food and beverage sector, ISISAN differentiates itself via its Duplex Stainless Steel products. On the other hand, ISISAN services clients with turnkey solutions and its engineering services. ISISAN sets up and commissions the facilities, which include storage tanks, vaporizers, skid systems with pump, piping and automation systems. Lastly, we have successfully completed a turnkey project at the facility of Coca-Cola in Baku, Azerbaijan. One of our near future goals is to bring such engineering services to the forefront by this means – we can build the basis of the system where we can suggest different solutions to our customers. What other end-user markets is ISISAN active in? ISISAN is manufacturing a broad range of pressure vessels to meet with customer’s demands who are each

operating in different fields. If we begin with CO2, our main customers are operating in the beverage and food industry, while ISISAN’s LNG customers are mostly operating in agriculture, the livestock industry and hotels, and domestic users account for the biggest part of our customers. Lastly, the cryogenic vessels of ISISAN are used and operated in heavy industry and the medical and pharmaceutical fields, and especially the engineered tanks of ISISAN are mostly preferred for the ASU plants. What message would you like to leave gasworld’s readers with? As you can see, ISISAN is not only a manufacturer, we are the company where our brand is cited by the engineered projects we undertake. gw 10 MINUTES MORE... Spend 10 minutes catching up with fellow gas professionals online. Use your smartphone to scan the code (right) or visit: www.gasworld com/interviews www.gasworld.com/interview

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COLUMNIST

Innovation – let the good ideas flow RAVIN MIRCHANDANI MACK VALVES

ecently, when visiting our R&D Team for a review meeting, Chris Browell our Head of R&D, made an observation that left me pondering. He said, “To the optimist, the glass is half full. To the pessimist, the glass is half empty. But to the engineer, that glass is likely twice as big as it really needs to be.” Beyond the irony of his teasing our engineers, when his statement sunk in, it made me contemplate how companies that are driven largely by an engineering focus (as is the case in our industry), can structure themselves to react to what customers really expect from them. It left me wondering how some companies seem to get this right all the time. Today, it is quite common for many companies to talk about being ‘innovative’. However, most businesses continue to be dominated by a historical product-line and/or a manufacturing or channel focus, which often places little value on understanding the real needs of the customer. This leads to a product or channel development cycle independent of customer expectations, resulting at first in a slow evolution of the market, but with the potential for rapid dissonance when change does take place. To be truly effective through innovation, successful companies learn how to first develop an understanding of the core needs of their customers and then alter their entire structure, including their product, manufacturing, service and distribution strategies to meet these objectives. I was fortunate enough to be a part of a similar process we launched at Mack Valves recently, which involved a European industrial gas major in the Asia-Pacific region. Our customer required us to develop a product we had 00 48 | gasworld • September March August2014 20152014

never manufactured before. The product not only had some unique technical cryogenic specifications, but also had to be produced in a small order quantity. We chose to put in place a working-group to fully understand the challenge and decide on how to proceed. The customer-centric innovation process that we implemented relied on a cross-functional team spanning all of our business-lines and functional departments. This group worked closely with the customer through focus-group exchanges in person and through video and teleconferences, to develop a healthy understanding of what our

“Despite being a customer for many years, we chose to view this as a first date, or first romance – a first opportunity to get things right...” customer really cared about. Despite being a customer of ours for many years, our working group endeavoured to forget what we knew about one of our most important customers and instead chose to view this as a first date, or first romance – a first time opportunity to get things right! The result was that we were not only able to develop an exceptional new cryogenic valve product, but one that closely delivered on the needs of our customer. These were: a unique set of technical cryogenic specifications, delivered in small quantities at a costeffective price that did not disadvantage their project and finally, were delivered on time, built to last and operate safely. More importantly, our own objectives of developing a closer relationship with our major customer, whilst at the same time launching a new product line were met. The project allowed us to earn the

confidence of a major customer and also brought our teams much closer together, – helping us start the journey of making the spirit of innovation an intrinsic part of the Mack Valves culture. Internally, in jest, we refer to this as Mack 2.0 Creating a culture of integration It is true that ‘culture eats strategy for breakfast’. No new initiative in any organisation can truly achieve its potential, if the culture of the organisation does not allow for its success. We changed the way we work, launching our Mack 2.0 effort through this cross functional working-group which also included people in Asia and Australia working together, to achieve the specific objective of intrinsically understanding our customer, promising what we can deliver, but delivering well over expectations. We learned that working in a close environment of trust with our customer allowed us to implement a new mechanism for rapid prototyping. We invited our customer decision-makers to each milestone review meeting, including the virtual design proof of concept and the physical prototype testing. An environment was created where failures were an acceptable part of the process and meant to be learned from. We also learned that staying close to our customer during the design innovation process meant that we saved months during the prototyping and validation phase. Our product launch happened ahead of schedule, at a design cost far lower than we had anticipated, and allowed us to roll out the manufacture partly in Australia, but also at our new factory in India – something we had not anticipated implementing so early in the lifecycle. Our lessons in sustainable innovation were breathtakingly simple, but so easy to forget as an organisation grows. At Mack Valves, it has helped us to Let The Good Ideas Flow. gw www.gasworld.com/specialfeatures

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REGIONAL MARKETS

Regional markets Focus on South Pacific

decidedly mixed market is in progress in the Asia-Pacific region, both economically and in terms of industrial gas drivers/ applications. The double-digit growth in China has slowed and the outlook in Japan has been varied for some time; yet many emerging economies in the region still enjoy healthy growth. This is very much the case in the South Pacific, our definition of which comprises a number of countries attracting strong international interest and investment. Though the region is inevitably picking up the tailwind of China’s economic slowdown on some level, growing populations, the development of economies and industrial bases, and investments in the energy sector all augur well for the South Pacific. Australia Australia is very much in the news, economically speaking, as it endures softening commodity prices and transitions from mining to non-mining investment led growth. Between 2004 and 2014 GDP grew by an average of 3.2% p.a. Slowing export demand and softening commodity prices – partly due to weaker demand from China for commodities such as coal and natural gas, as well as iron ore from the wider Asian region – have curtailed growth, however. As a result of this, a number of companies in country’s

50 | gasworld • August 2015

mining sector have had to downsize, and investment has slowed. Despite this, mining and metallurgy is still the biggest end-user in the country – for industrial gas sales, the metallurgical sector accounted for just over a quarter of the market’s total revenues of $1.2bn in 2014. The metallurgical and mining/ energy sectors are likely to continue to account for the majority of industrial gas revenues for some time to come. Indeed, as recently as February Air Liquide signed a long-term €60m ($66m) agreement in Australia with Nyrstar, an integrated mining and metals company. As investment in mining slows, this is likely to be counterbalanced by a steady strengthening of the country’s non-mining industries which will be spurred on by improved levels of confidence, a favourable exchange rate and an expansionary monetary policy. Australia’s budding LNG business is also significant, with the country positioned – and determined – to become the world’s largest LNG producer in the years ahead. This will provide a fillip to a commercial industrial gases market estimated to have grown at an average annual growth rate of 6.6% between 2004-2014 (2014: $1.2bn). Indonesia Indonesia is firmly in the ascendency as an industrial gas hub, attracting considerable attention from the Japanese industrial gas community in particular.

It’s easy to see why. “Indonesia is the biggest archipelago in the world, possessing 17,508 islands with a population of more than 250 million. It is the fourth biggest population after China, India and the US,” explained Rachmat Harsono, Executive Vice-President of Corporate Finance and Strategic Planning at Samator Group, earlier this year. In many respects, it is Samator that dominates the Indonesian gases business, if any one company can be considered to do so; the privately-owned domestic group is the leading industrial gas company by revenues and market share in Indonesia. But, such is the wealth of opportunity in the country, Samator finds itself operating in an increasingly competitive market. Global industrial gas players such as Air Liquide, Air Products and The Linde Group all have operations in Indonesia, while it is also the focus of a number of leading players in Japan’s gases industry. Migrating tonnage clients from captive to supply scheme contracts is a trend that is expected to continue through to 2020 and will boost an industrial gases market in Indonesia estimated to have generated revenues of $399m in 2013, up from $192m in 2003. Malaysia Nearby, Malaysia is another of the enterprising South Pacific markets attracting attention. The Malaysian economy grew solidly between 2003 and 2013, on average by 5% per annum (p.a.), and benefits from substantial oil, mineral and natural resources. But Malaysia has also been at pains to diversify its economy and there is a commitment to further develop the economy by boosting domestic demand, reducing dependence on exports and in particular reducing dependence on Malaysia’s significant hydrocarbon sector. It is therefore expected that a healthy, multi-faceted commercial and industrial base will continue to offer good returns for the industrial gas business in the country – a gas business that has enjoyed strong growth in the last decade ($455m value in 2013). The migration of captive supply remains an opportunity in Malaysia. www.gasworld.com/regionalmarkets

REGIONAL MARKETS

Myanmar Despite operating within a reasonably mixed economy in general, the industrial gas sector in Myanmar remains relatively undeveloped, with no tonnage business and only a very small bulk business. By and large a fragmented market, the commercial industrial gases business in Myanmar is estimated to have generated revenues of $18m in 2013. The economy in Myanmar has grown quite well since 2000 and draws upon vast natural resources, with substantial economic benefit reaped from extractive industries linked to the oil and gas industry and the mining sector. Myanmar lies on the west side of the Indochinese Peninsula, bordered by Thailand, China and Bangladesh, and is a market benefiting from increasing democracy and infrastructure development. The country recorded a GDP growth rate of 7.5% in 2013 and, with a population of more than 50 million, expansive geography and low-cost resource, is attracting increased investment as ‘the last frontier’ of Asia. Philippines The Philippine economy grew at an average rate of 5% p.a. between 2003 and 2013, underlining its well-administered model and ability to weather recent financial turmoil in the wider global economy. Despite there remaining a great deal of poverty and high unemployment, continued good prospects are expected for the economy and there will likely be further investment in the chemical and electronic industries, as well as increased investment in heavy industries such as steel and refining. Industrial gas intensity has increased considerably across essentially all enduser categories over the last decade, while gas companies have been successful in introducing new applications and expanding their revenue base in the country. All of which culminated in a commercial gases market worth $267m in 2013 – up from $117m in 2003. Going forward, as in Myanmar, healthcare may prove to be an opportunity for the gases community as the government intends to make

improvements in this sector. Metallurgy may also attract increased investment in the future, though it is perhaps LNG that will grab much of the attention in the Philippines as the country opens its doors to imported LNG this year.

The industrial gas sector has been able to grow its revenues at a faster rate than the economy at large thanks to an overall increase in industrial gas intensity and engagement with a number of important industries across the country during the last decade. As well as a thriving merchant market, the industry has been successful in converting many clients from captive gas production to onsite supply scheme contracts over the last 20 years. Recent developments in Thailand include TNSC, together with a newly established joint venture (JV) in Thailand, acquiring Thai industrial gas producer Air Products Industry Co. Ltd. (API). The deal is seen as a further reinforcement of TNSC’s footprint in Southeast Asia, and the Thai market in particular.

Singapore As one of the ‘Four Little Dragons’ in Asia, the growth of the economy of Singapore has been remarkable among the ASEAN countries. With the establishment of Jurong Island, Singapore has become one of the largest centres of petrochemicals and oil refining, and the industrial gas business has undergone step changes as a result of this development. The commercial industrial gases market in Singapore is estimated to have generated revenues of $767m in 2013, up from $325m in 2003 and Vietnam demonstrating near double-digit average Firmly in the brackets of double-digit annual growth. The marketplace is one growth is Vietnam, registering 12.4% of the most sophisticated in the region, average annual growth for the decade with significant pipeline and onsite from 2003-2013. This resulted in a supply infrastructure for a variety of gases commercial industrial gases market worth including nitrogen, oxygen, hydrogen and $125m in 2013. syngas. There is also a significant special While there was a modest slowdown and electronic gases business, according to in the pace of economic growth in gasworld Business Intelligence. Thailand during 2013, it is felt that there The growing LNG business may also are continued good prospects for the be behind a new wave of growth in Vietnamese economy going forward – Singapore, especially as new supply begins and further investment in the chemical to enter the market from Australia. As and refining industries, as well as an example of the effects of this, earlier possibly increased investment in other this year (February 2015) Air Liquide heavy industries such as steel. This – via SOXAL – signed a longwill be significant for the gases term agreement to supply industry; the international large quantities of nitrogen companies have seen some Indonesia’s population success in establishing a to SLNG (Singapore LNG of over 250 million is Corp Pte Ltd.), the company nascent onsite business in the fourth largest in managing Singapore’s first Vietnam, with supply scheme the world LNG terminal. contracts signed with a growing number of clients within the steel, Thailand electronics and float glass industries. Like Singapore, Thailand’s commercial There is also a strongly growing merchant industrial gases market experienced near market for bulk and packaged gas. double-digit average annual growth from The Messer Group is particularly active 2003-2013, resulting in a gases business in Vietnam, completing the construction valued at $612m. This was achieved of its third industrial gas production plant against a backdrop of solid economic in northern Vietnam in October (2014) growth in the country, a relatively wellfor the steelmaker Hoa Phat Steel, as part developed infrastructure, and a strong of a 25-year deal, further reinforcing its commitment to a free market economy. position in the region. gw

250

August 2015 • gasworld | 51

SPECIAL FEATURE

x ido Rap

In focus...

Gas analysers/monitors STUART RADNEDGE

gasworld, Web Editor

here are two key considerations any business, which involves technology at its core, has to achieve to obtain success. The first is the staple of any business – what does the customer want? But the latter – what will the technology of the future be? – is a somewhat more difficult question to find the answer to. This is due to the lightening pace the technological sector moves at, but also partly due to the fact a customer may not have the budget or desire to upgrade all devices to the latest software. This month’s In Focus... delves into the gas analysers/monitors sector, seeking information about what is driving growth and where technological trends are moving the industry. Growth drivers The food and beverage sector, as well as the specialty gases industry, are two of the many clusters which rely upon the performance of the analysers and monitors. Both of these industries are worth multi-millions every year. But what about the positive effects of globalisation? Emerging economies, which were absent of any source of the industrial gases business, could prove lucrative should a company be able to satisfy a company’s requirements.

00 March 2014 52 | gasworld • August September 20152014

For Indiana-headquartered company Thermco, that’s exactly the focus for its growth. Dennis Richardson, VicePresident of Sales and Marketing, said, “Much of the opportunity for growth is from developing countries. Some of these countries did not previously have an industrial gas industry, and are in need of all the equipment needed to support this industry.” However, other companies are finding growth in a particular section of industrial gas dependent on their customer’s requirements. As a gas analysis instrument manufacturer, Cambridge Sensotec’s main area of growth is in inert gas analysis. Inert gas applications span many industries, from food and welding to electronics and pharmaceuticals. David Boxshall, Cambridge Sensotec’s Marketing Manager, stated, “Drivers of growth in this area stem from an increase in demand for quality and repeatability. The importance of maintaining an inert atmosphere in a manufacturing process is paramount to ensure that production standards are met. Even trace presence of oxygen can increase the chances of oxidisation resulting in a compromise in quality of the parts produced.” “For example, the electronics industry utilises an inert atmosphere in the manufacture of printed circuit boards. The use of nitrogen blanketing within the soldering process, which was once a rarity, has now become common practice.”

“Gone are the days of the ‘TV repair man in a van’. Thankfully modern televisions and many other electronic devices for that matter, are far more reliable than similar products manufactured 30, or even 20, years ago.” “This progress is not only due to increasing developments in technology, but also vast improvements within the manufacturing process itself.” Boxshall added, “Cambridge Sensotec have been presented with many opportunities to enhance and expand the Rapidox range of trace oxygen gas analysers, in line with customer requirements. In order to optimise processes and reduce wastage, a Rapidox analyser was developed that has the ability to communicate with a process logic controller (PLC), or directly to a proportional flow control (PFC) valve.” “By using an oxygen gas analyser capable of measuring down to ppm (parts-per-million) levels, any residual oxygen can be detected with the measurements communicated to such external devices. Additional nitrogen can then be pumped into the manufacturing environment to maintain a constant inert atmosphere.” “Each Rapidox analyser is supplied with powerful software allowing users to data log oxygen measurements to aid quality control and traceability. The software also allows for the control of to optimise the use of nitrogen, which leads to significant cost savings by reducing nitrogen usage.” The answers to this month’s In Focus... question regarding growth have addressed all manners of increasing revenue generation – from targeting an emerging market, to a more specific sector of the industry. Concluding the insight into the growth drivers, Servomex President Chuck Hurley feels it’s recognising global megatrends that is crucial to the gas analysis market. He said, “The industries we work in need to respond to a wide range of growth drivers, so it’s crucial we understand these same challenges – so we help them meet real world challenges faster and more effectively.” www.gasworld.com/specialfeatures

SPECIAL FEATURE

Technological trends Investing in technological advancements, in the analysers and monitors sector can save a business money through reduced operating costs. Thermco’s Richardson believes this trend is also an opportunity for growth. “There is opportunity for growth if the vendor can offer higher accuracy for gas analysis. Some users of industrial gases utilise high volumes, and a small improvement in analysis accuracy can translate into important process savings. This trend is especially apparent in East Asia in the field of analysing H2/N2 mixtures for furnace atmospheres.” Echoing the trend of technological demand for products in Asia and the Far East, Cambridge Sensotec’s Boxshall stated, “Cambridge Sensotec has experienced an increasing demand for the company’s Rapidox SF6 gas analysis

instruments from new and existing customers in Asia and the Far East. These territories have been undergoing rapid industrial growth in recent years, therefore increasing the demand for energy and the installation of new substations.”

“Every time we push forward any technologies, we have to create a benefit for the customer...” “There is, of course, a link between technological trends and opportunities for growth. An increase in the demand for electronic products, both in consumer and industrial markets is a key indicator. Due to the majority of the world’s electronic goods being manufactured in countries such as China, Korea, Malaysia and Taiwan, it is likely that demand in these regions will continue to expand.” Concluding this month’s In Focus... is Servomex President Chuck Hurley. He explained,“For the past 50 years the world has been driven by extractive analysis. The emergence of Tunable Diode Laser (TDL) technologies has changed that: a true in-situ measurement has come along, giving the potential to move into the point where you’re not only measuring the outcome or the

“Broadly speaking, the opportunities for growth are understood: rapid population growth is driving large-scale industrialisation across the world, so our products are integral to the efficient mass production of gases and materials that drive infrastructure build. With the need to improve air quality, a leading issue in many territories, Servomex’s emissions monitoring solutions meet growing compliance demands. The safety, efficiency and emissions benefits of our gas analysis solutions are also being applied within the growing demand for power generation, as well as to the processing of chemicals produced through hydrocarbon extraction.” “Each of the growth drivers harbours a wide range of market opportunities. For instance, when we talk about population growth, it’s not just about an increased birth rate – it’s about people living longer too. This means the demands for healthcare are growing rapidly to meet the needs of an ageing global population. For us, increased demands for respiratory care have been a bit driver for sales of our Hummingbird sensors, which provide measurements that meet the precise and delicate demands of critical care,” Hurley concluded.

inputs to a process. Moving to the point when you can measure inside of a process can yield significant benefits, as there are many processes that run at very low efficiencies and could all be improved with data ascertained in-situ.” “The other challenge is to responsibly exploit technologies that aren’t necessarily the leading edge of development but in reality still provide improved performance for the customer. A good example is the difference between using a traditional electrochemical cell and Servomex’s non-depleting Paramagnetic sensor to measure oxygen – there’s a distinct crossover point where Paramagnetic’s superior reliability and performance easily outweighs short-term cost considerations, so it’s important we make customers aware of these choices.” Hurley added, “Every time we push forward any technologies, we have to create a benefit for the customer. The three most important things to customers are safety, efficiency and a cost-reduction – in particular a labour cost reduction. So while R&D is crucial, one trend is to supply products that don’t necessarily make a more detailed measurement, but provide a more stable and reliable measurement to reduce maintenance needs. As Servomex has the widest available range of gas sensing technologies, we are able to select the precise correct sensing method, which in turn will provide better performance and better return-on-investment.” “So when we talk about technology meeting a need, it’s not purely because it’s technologically clever but because it meets a precise requirement. That’s why you have to understand customer applications and be close to their needs, because if you don’t understand what they want you won’t develop the right technology solution to help.” This answer from Hurley demonstrates two things. The first is how your products must utilise the benefits of the latest technology on offer. But, the second factor that’s also equally important is, you must ensure the new technology is what your customers require. The customer, and not necessarily technology, is king. gw August 2015 • gasworld | 53

EQUIPMENT PROFILE

An introduction to...

CO2 safety systems

Progress in CO2 monitoring There have been huge steps made within the CO2 sensor technology sector in recent decades. Driving the sector has been the building control/energy side of the industry. In this application the sensors are used to monitor the occupancy of buildings by monitoring the breathing of the inhabitants and ventilating in relationship to this. Here, inaccuracy inevitably could have very large economic consequences. This has made the sensors very accurate, as well as driving the cost aspects of the technology down, making them both reliable and cost-effective to produce. CO2 safety systems today communicate with digital technology, 54 | gasworld • August 2015

aving worked during the past 25 years with carbon dioxide (CO2) safety, it has been a fantastic trip within one of the most expanding industries that I know. The different applications and uses of CO2 are of a magnitude that is hard to match within the gas industry, while the revenues are tremendous. It is for this reason that it is time for the industry to consolidate the safety aspects before too many accidents happen that will undoubtably throw question marks over its use. The press naturally has a tendency to write and report everything about accidents, but often forgets about all of the many fantastic qualities of CO2. These include applications across the whole drinks dispensing industry (soft drinks and beer), greenhouses, refrigeration, swimming pools, wastewater treatment, dry cleaning, quick freezing, and the hundreds of new applications deriving from the research of super critical CO2. But one also has to be very aware that CO2 is also used to ‘put the animals to sleep’ in the slaughter house – the Immediate Danger to Life and Health (IDLH) is at just 4% CO2.

“Today’s CO2 safety systems are easy and cost-effective to install, irrespective of whether it is a fast food restaurant or a huge soft drinks production plant...” eliminating any negative external influences. LogiCO2 has its sensors tested and approved for life-saving applications by internationally respected and acclaimed testing institutes such as the French LNE and the German TUV/ DIN Institute, assuring the company and its customers that these systems work as they should do. Today’s CO2 safety systems are easy and cost-effective to install, irrespective of whether it is a smaller or larger system, a fast food restaurant or a huge soft drinks production plant, or a wastewater plant or a greenhouse. Today, at LogiCO2, our sensors are run in climate and calibration chambers for days, 4,000 at a time. The sensors have a MTBF (Mean Time Between Failures) of over 15 years, are self-calibrating, multi-lingual, and cost less than most smartphones. Commitment The US is taking a lead in the introduction of safety codes that mandate the use of CO2 safety systems where CO2 is used and can expose restaurant

personnel, as well as customers, to the risk of being overcome by carbon dioxide. I am seeing a real commitment by most restaurant operators. At LogiCO2 we have already installed over 40,000 CO2 safety systems worldwide within McDonald’s alone. I believe that it is in the interest of the whole CO2 industry to consolidate this market by ensuring it takes a lead in the field of safety issues, as well as assisting the different organisations involved in the mandating of safety codes, setting standards for the equipment being used, and the installation of related equipment – ensuring that good economical solutions get promoted. gw

WITH THANKS gasworld would like to thank LogiCO2’s Bo Hansson for providing this month’s equipment profile. LogiCO2 offers carbon dioxide (CO2) safety systems that at the same time minimise the risk of running out of CO2. www.gasworld.com/specialfeatures

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August 2015 • gasworld | 55

COMPANY PROFILE

Cahouet

Experience, safety, reliability

long-term reliable partner to all the main gas producers in the world for decades (Air Liquide, Linde, Air Products, Messer, Westfalen, Praxair, SOL), Cahouet has been in the gases business for the last 90 years. The company also serves the OEM market, as well as a number of installation companies implementing pipeline systems for applications such as oxygen, hydrogen, nitrogen, and argon. The Cahouet story started in 1925 when Mr Cahouet (pronounced Kahwet) created the company in Paris, with an acetylene equipment repair shop. The first range of regulators manufactured on-site was successfully introduced in the 1930s. After world war two, Cahouet became part of a group producing brass forgings until it was bought by the current owner in 1991, becoming part of an independent family-owned business. It was the start of a new era. ISO 9001 certification confirmed its position as a leader in the market and with its most important key accounts. From then on, Cahouet has grown from strength-to-strength to become a supplier for a wide range of high-quality, compliant gas regulating equipment including changeover manifolds, flow meters, safety valves, cylinder pressure regulators with or without flow meter, high pressure hoses, and high flow bundle valves to customers all over the world. The company now offers a comprehensive range of gas pipeline equipment. Cahouet produces small-to-mediumsized batches in its modern ISO 9001 certified factory. All of its product ranges – medical, industrial, specialty gases, food and beverage – are designed, assembled, and tested at its site in Montreuil, just outside of Paris. Medical CE certification (and ISO 13485), obtained in 1998, gave Cahouet a new and very important orientation towards 56 | gasworld • August 2015

the medical gases pipeline applications, whether for installed products or cylinder equipment including flow meters for all kinds of special gas mixes. Longevity Cahouet’s success and longevity rely on experience and know-how throughout the organisation. The company designs and manufactures equipment that guarantees the safety of its customers’ personnel and installations – an important responsibility that it is committed to making by always offering the best products for each application. With its own in-house R&D, Cahouet maintains its position at the forefront of technical evolutions and market requirements. For instance, the company was among the first suppliers of cylinder valves integrated with pressure regulator and flow meter for both medical and industrial applications. “Our flexible structure is also appreciated for its capacity to give fast feedback on specific projects, providing a quick response to our customers, be it for small modifications on existing products or for brand new developments,” the company says. Cahouet has its roots in France, but export is a very important part of its business, representing over 30% of turnover, serving customers on all continents thanks to its ability to propose solutions for any type of installation in the industrial and medical gases sectors – and soon for food and beverage applications too. “Food and beverages is our new challenge, with the introduction of our ‘Gastronomy’ range of gas control equipment to be launched later this year. The European market has the most stringent and constantly changing

safety standards and Cahouet has decided to propose a bespoke solution,” the company notes. “This range will feature food grade components, which means specific cleaning and degreasing procedures, a traceability system and a certificate of conformity. Here, our long experience with the very demanding medical CE marking is a valuable asset and a guarantee for our customers who need to rely on strategic suppliers.” Cahouet is also a partner for the development of gas regulating equipment. Amongst the most challenging products it has successfully worked on, there is a new generation VIPR for 300 bar application with high precision flow control and advanced integrated safety devices, a new highprecision pilot valve regulator, and its recent compact dual bypass regulating assembly – all of which are perfect additions to its existing range, which includes the renowned BP line of regulators with 50 bar inlet pressure delivering up to 800 Nm3/h. Cahouet’s ambition is to build an even stronger position in the international market in the years to come, adding, “We will continue to develop our product ranges and geographical presence to consolidate our position as a leading supplier of bespoke, high quality gas equipment.” gw GET IN TOUCH Cahouet 52 rue de Lagny F-93100 Montreuil (Paris) www.cahouet.com commercial@cahouet.com www.gasworld.com/companyprofile

Do you know what’s on your doorstep? The European industrial gases market is currently valued at around

Which is

20%

$17bn

of the overall global industrial gases market

Europe: the latest industrial gas intelligence Get the latest info on: •

Economic trends

•

Industrial gas supply structure

•

Market structure in terms of demand for gases

•

Macro-economic influences and drivers

•

Future market forecasts

•

Companies operating within each country

•

Overall investment potential

For more information, email intelligence@gasworld.com or visit www.gasworld.com/intelligence

August 2015 • gasworld | 57

COMMUNITY Around the gasworld in 140 characters

Community

02/07/2015 @LindeGases_NA

The forum for gas and equipment views and information Your news, your views, your say! Recently gasworld conducted its annual Readership Survey, asking you, our loyal readers, to evaluate and comment on the services that gasworld offers. As the weeks have flown by, the results have been coming in, and we’re happy to report a first glance of what we have found. An important function of the survey is to unearth the ‘hot topics’ that our editorial plan should include for the year ahead. No less than 75% of participants so far nominated CO2 as their key area of interest, with oxygen and nitrogen in close attendance. Helium is also still a topical subject, perhaps ahead of further market shifts anticipated in the years ahead.

Warm up to new way to control freeze drying (Iyophilization) processes bit.ly1f61XXN by @LindeGases_NA

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Happy #4thofJuly to all our American TIMS users #Celebrate #IndependenceDay

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2015 Readership survey results: What gas markets/products are you interested in?

Transport, Storage, Processing and Defence are just some of the industrial sectors that have specified our valves. bestobellvalves.com/sections/views/...

Oxygen/nitrogen Carbon dioxide

10/07/2015 @airliquidegroup

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But the die is not cast just yet! This information will feed into gasworld’s plans for 2016 across both magazines and conferences – so be sure to tell us what topics matter most to you. Our monthly poll asks, what is your favourite edition of gasworld? Is it helium or distributive that floats your boat? Or is it welding gases that sparks your interest? Take our straw poll by visiting www.gasworld.com/community and have your say now.

#AirLiquide #Chile provided helium for the balloons of the #CopaAmerica opening ceremony!

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