Investments in technological startups, leadership in the fertilizer industry, and agreements with world players such as the EXXON. In the United States, Maire Tecnimont is the protagonists of the new petrochemical revolution with strategies that point at green chemistry.
The evolution of a company, especially a multinational company, can in many cases recall a path similar to that of the protagonists of a classic Hollywood story. There is a challenge to be grasped, a series of strategies to be developed, a phase of attempts, steps forward, rethinking and obstacles to overcome. And then a moment of stability and balance, where the company finds its identity, in its own people and in the goals achieved.
With a first-hand experience of Maire Tecnimont’s path in North America, Giovanni Sale - Senior Vice President of Corporate Strategies of Maire Tecnimont Group (and current VP for Americas) - explained to Evolve that the challenge taken by the Group to become a protagonist in the US market is one of those exciting tests (and at the same time full of complicated variables) that give the idea of how an entrepreneurial path can reach levels of excellence over time.
“In the United States, explained Sale, which is home of oil and gas, we have been called, in recent years, to industrialize and commercialize a series of important technological innovations in the context of “Greening the Brown”. With shareholdings in Siluria in San Francisco, where a new transformation from gas to propylene has been developed, and in Pursell Agri Tech in Alabama focused on urea coating, we are investing in specialized start-ups in gas and fertilizers sectors. Siluria and Pursell Agri Tech are young companies that aim at more sustainable solutions in a market conditioned by intense energy transition”.
Tecnimont in North America in the “first wave of petrochemicals”
Tecnimont's path in the United States starts in the so-called “first wave of petrochemicals” – which hit the US economy from the 1960s to around 2000. Back then, Tecnimont was an extraordinary company that combined expertise in petrochemistry and oil and gas. The company was known overseas for its great history: it was the engineering division of Montecatini / Montedison and built plants using proprietary technologies in the field of plastics that had earned the Nobel prize to Giulio Natta.
“Until the eighties,” continues Sale, “our presence was of great support to some projects in the field of engineering and procurement.” For geopolitical reasons, over the following decade, we focused on plants and orders located mainly in Central and South America. However, these have been important years because many of our current leaders have trained and professionally grown during that period. With the advent of shale gas around 2008, much has changed: we call it ‘the second wave of petrochemical’. Many observers today say that after ten years the “shale gas” revolution is not fading but has just begun... ”.
The time of shale gas
Shale gas, according to a report by the IHS Markit (“The Shale Gale Turns 10: A Powerful Wind at America’s Back”) has radically changed the US national energy landscape. The Northeast has replaced the Gulf Coast as the largest gas producing region in the United States. Pennsylvania and New York, which traditionally imported most of the energy, are becoming exporters.
Shale gas is methane extracted from unconventional deposits, formed in clayey soils resulting from the anaerobic decomposition of organic matter. The extraction of shale gas requires the use of special techniques in the vicinity of the wells, which make it possible to recover one-third of the gas present in the reservoir.
This has helped natural gas production in the United States to be increased by more than 40% between 2007 and 2017, bringing gas prices down by more than two thirds in the same period. Ten years after the start of the revolution, the total recoverable natural gas reserves seem to increase year by year.
A further step forward in a fast-growing market such as the US was made thanks to the agreement signed in 2014 with Foster Wheeler to build and revamp petrochemical, chemical, and fertilizer plants in the USA, Canada and Mexico. Sale explains, “At a time when the shale gas revolution was reshaping the geography of the downstream industry globally, Maire Tecnimont made its excellence available in the technology-oriented chemical sectors, including olefins and fertilizers and, in particular, in polyolefins (polyethylene and polypropylene), thus providing significant added value for our customers”.
A fertilizers plant in Iowa
The presence of Maire Tecnimont in the United States is not linked solely to shale gas. The company has continued to work on what the CEO Pierroberto Folgiero defines ‘technological adjacencies’. “The investments and partnerships with Siluria and Pursell Agri-Tech go exactly in that direction,” explains Vice President Sale. Being the American market very competitive, for some years the Group has strategically concentrated on sectors more compatible with our entrepreneurial history. Thanks to a large-scale agro-food sector, the demand for fertilizers has always been very high in the United States. Our know-how and the cutting-edge technologies we make available through Stamicarbon have meant that the name Maire Tecnimont has become increasingly associated not only with engineering and construction of petrochemical plants but also with intellectual properties in this sector”.
In September 2012 Maire Tecnimont announces that two of its subsidiaries, Tecnimont SpA and Stamicarbon BV, were awarded two contracts relating to a new fertilizer complex in Iowa, United States, by Iowa Fertilizer Company (IFCo), a wholly-owned subsidiary of Orascom Construction Industries (OCI).
“Our Group has provided engineering services and materials procurement for the construction of a new 2200 MTPD ammonia plant based on KBR technology. In addition to that, Stamicarbon BV provided a ‘process design package’ for a new urea production plant that was part of the same fertilizer complex. A double award that allowed Maire Tecnimont to consolidate its presence in North America’s urea licenses market. In fact, today 100% of the fertilizer plants built in the USA use Stamicarbon technology. It is a clear sign in the strategic sector of fertilizers, thanks to the expertise of our Group both in licensing and in construction”.
Stamicarbon technology in 100% of the plants
One of the strengths of the Maire Tecnimont Group is ownership of a large number of patents related to urea (which today is a gas derivative). “In 2017 in Alabama,” explains Sale, “we stipulated, through Stamicarbon, an agreement with an American company to create a coating production plant. Maire Tecnimont acquired a 20% stake in Pursell Agri-Tech, an American start-up specialized in the development and marketing of polymer-coated fertilizers. We thus combined the best of urea (Stamicarbon) and coating (Pursell) technologies”.
The American company developed a new technology for coating fertilizers at a competitive cost and with controlled release: urea pellets are covered by a membrane that opens a little at a time depending on temperature and humidity and releases the product gradually into the soil, over a period ranging from 3 to 6 months.
The Vice President continues, “We can treat and fertilize very extensive agricultural lands, using less urea and being more efficient. If the product is not dispersed in the atmosphere and in the air, there is no waste and smaller than the usual amount is required. In the end, excessive fertilization decreases, and the environmental impact of fertilizers is also reduced. We are really satisfied because Maire Tecnimont has a worldwide exclusive right to market this technology outside the US. The first urea was produced from fossil fuels, today we use gas. And shortly, speaking of green chemistry, from gasified waste coated with biodegradable coating”.
To Silicon Valley with Siluria
In 2016 the Group’s commitment to developing innovative industrial processes and technologies led to the acquisition of a minority stake in Siluria Tecnologies, a company based in San Francisco, which develops innovative industrial technologies to produce chemical products and fuel from natural gas. “The technologies,” continues the Vice President, “are based on an innovative and proprietary process of direct conversion of methane into ethylene and propylene, the so-called “OCM” (Oxidative Coupling of Methane)”. With this investment Maire Tecnimont has become the exclusive partner of Siluria for the development, marketing and licensing of this new technology”. Thanks to this revolutionary innovation, converting natural gas (the most abundant and cheapest hydrocarbon) directly into one of the most important products of basic chemistry (propylene) finally becomes possible.
It is useful to remember that propylene is one of the main constituents of the global petrochemical industry, with a total market of around 100 million tons per year. For decades, propylene has been obtained through energy and resource-demanding processes. Today, through an innovative process, it is possible to produce it efficiently: that is at lower temperatures, with fewer hydrocarbons and, ultimately, cleanly.
“This collaboration,” adds Giovanni Sale, “capitalizes on Maire Tecnimont’s international expertise in the engineering and construction, technology and new business development sectors, thanks also to the innovative contribution of MET Gas Processing Technologies, a Group’s company specializing in the development of innovative technologies”. We are all very happy to combine these strengths with the revolutionary technological development platform of Siluria: this also means feeling more and more present in the Silicon Valley market, thanks to high added value solutions for our customers in the Oil & Gas and Petrochemical sectors”.
Looking back on Maire Tecnimont in the United States, we can say that today the Group has become part of world petrochemical leaders, thanks to its ability (demonstrated globally) to do excellent engineering. With a strong push towards energy transition, the Group chaired by Fabrizio Di Amato and managed by Pierroberto Folgiero, is evolving to keep up with the transformation.
“The ability to export globally a technology that produces polymers from gas rather than fossils,” says Giovanni Sale, “has added a strategic focus on technological innovation that embraces green chemistry and the whole topic of waste and plastics recycling”. Thanks to this background, now big investors and big petrochemical companies want to join us. An example? The agreement with Exxon, a top-level multinational company that has recognized Maire Tecnimont as a key strategic partner for the development of new polymers in the United States”. A milestone achieved last November which consolidates the Group’s global leadership in the polyolefin market and expands its presence in North America, a complex and attractive market, also in terms of industrial plants. “The agreement with Exxon gives us further impetus for the future,” concludes Sale, “in a sector (the petrochemical sector) that presents interesting opportunities for new investments in the United States and Canada, driven by cheap feedstock (shale gas and derivatives). In America, we are proving to be ready and able to operate in Anglo-Saxon culture, where the keywords are transparency, efficiency, competence, and planning. It is not easy to compete every day with researchers and managers from the best universities on the planet, such as Berkeley and Philadelphia. Here you breathe the most important industrial, financial and technological culture in the world. The challenge is, therefore, sky high, exciting and risky at the same time. But we look to the future with great commitment and positivity”.