Cloroetil to expand ethyl acetate production

Monday, January 15, 2007

Brazil's Cloroetil, a manufacturer of acetic solvents based on sugarcane alcohol, is planning to expand ethyl acetate production capacity at its Mogi Mirim plant in São Paulo state, news agency Agência Estado reported.

Ethyl acetate is employed mainly in the paint industry and it can be used as a substitute for solvents made from toluene. The company expects to increase its current production level from 18,000t/y to 50,000 t/y, according to coordinator of operations Alexandre Logli.

"The expansion of the plant is aimed at dealing with the growth in the market for green solvents [ethanol-based products]," Logli was quoted as saying by the news agency.

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Total investments for the project have not yet been defined, but the expansion is expected to be completed in two years, the executive said.

Cloroetil sold 14,000t of ethyl acetate in 2006, which is below the firm's production limit. The below-capacity figure was because of a shortage of acetic acid, the raw material used to produce the solvent, Agência Estado reported. The company now plans to import this chemical, Logli said.

Cloroetil recently formed a partnership with oil derivatives distributor BR Distribuidora, a subsidiary of federal energy company Petrobras (NYSE: PBR). Under the deal BR Distribuidora will exclusively distribute 100% of Cloroetil's production of oxygenated solvents.

The company currently buys 33 million liters a year of ethanol in the spot market directly from plants, the agency reported, and its net profits totaled 60mn reais (US$28mn) last year.