Economic Indicators

PLANT WATCH
Company / Contractor or Licensor Plant location Product Cost, capacity Startup
Petro Vietnam / Technip Consortium / Dung Quat, Vietnam Refined oil 148,000 bbl/d Early 2009
Honeywell
Sinopec Tianjin Petrochemical Co. / Basell Dagang, China Polypropylene 450,000 tons/yr 2009

Panda Development Group / Lurgi Hereford, Tex. Ethanol 130,000, 140,000 tons/yr 2nd half 2007

Dow Chemical Co. China $200 million for manufacturing and R&D 2009-2010
Liquid epoxy resins facilities,100,000 m.t./yr
Epichlorohydrin 150,000 m.t./yr
Converted epoxy resins Expand from 41,000 to 75,000 m.t./yr
CSJC Nizhnekamsk Refinery / Basell Nizhnekamsk, Russia Polypropylene 200,000 tons/yr 2011

Dow Corning Corp. / Wacker Chemie AG Zhangjiagang City, China Siloxanes Not disclosed Not disclosed

Motiva Enterprises LLC / Bechtel Corp. / Port Arthur, Tex. Refined oil 325,000 bbl/d refinery expansion Not disclosed
Jacobs Engineering Group Inc.

Basell Muenchsmuenster, Germany High-density polyethylene 120,000 tons/yr, with future expansion to Beginning of 2009
150,000 tons/yr
Cobre Las Cruces SA / Outokumpu Spain Copper 72,000 m.t./yr Early 2008
Technology

Huntsman Corp. Port Neches, Tex. Specialty amine product Increase capacity by 20% August 2006

Repsol YPF Portugal Olefins and polyolefins 600-million total investment in the Not disclosed
petrochemical complex to increase
cracker capacity 40% and double the
capacity of olefins and polyolefins to
about 1-million m.t./yr each
Sabic Polyolefins GmbH / Uhde Geisenkirchen, Germany High-density polyethylene Total investment of approx. 200 million, Late 2008
250,000 m.t./yr
Coshocton Ethanol, LLC / Pro- Coshocton, Ohio Ethanol 60 million gal/yr October 2007
Environmental, Inc.
Shell Eastern Petroleum / Foster Wheeler Singapore Ethylene oxide / mono- 750,000 m.t./yr Not disclosed
ethylene glycol

MERGERS, ACQUISITIONS AND DEALS

Buyer Other party Date Details

Siemens Sernagiotto July 14 The Siemens Industrial Solutions and Services (I&S) Group has strengthened its range of solutions for wastewater treatment
Industrial Technologies by acquiring the environmental-technology company, Sernagiotto Technologies S.p.A. The company will operate under
Solutions (Casteggio, Italy) the name of Siemens Water Technologies, S.p.A. at its current location under the operational management of the I&S
(Erlangen, Water Technologies Division and will be integrated into Siemens Italy. Terms of the transaction were not disclosed.
Germany)
USFilter August 1 Siemens has also completed its integration of USFilter into the Water Technologies division of the Siemens I&S Group
(Warrendale, and USFilter is now officially known in the marketplace as Siemens Water Technologies. This completes a transition
Pa.) period that began when Siemens purchased USFilter just over two years ago. The new I&S division Water Technologies is
headquartered in Warrendale, Pa.

BASF Engelhard August 1 BASF announced an important step in the integration process of Engelhard into the BASF Group with the registration of a
(Ludwigshafen, (Iselin, N.J.) new corporate name BASF Catalysts LLC in the U.S. BASF will extend its brand to Engelhard companies in other regions
Germany) of the world within the next months based on local registration requirements. Engelhard businesses not included in the
catalysts division will also operate under this new corporate entity until plans are finalized for the businesses in Appearance
and Performance Technologies and Ventures to be transferred to other existing BASF business units.

Akzo Nobel Feixiang August 8 Akzo Nobels Surfactants business has formed a strategic alliance with Feixiang Chemicals Co., a Chinese specialty
(Arnhem, The Chemicals Co. surfactants supplier. The new 50/50 joint venture, which is subject to approval by the Chinese authorities, is expected to
Netherlands) (Jiangsu, China) generate substantial additional sales in mainland China.

Dow Chemical Asahi Kasei August 8 Dow Chemical Co. and Asahi Kasei Chemicals announced the conclusion of an agreement for Dow to acquire Asahis
Co. (Midland, Chemicals Corp. shares in Styron Asia Ltd. in Hong Kong (SAL HK) and for Dow Financial Holdings Singapore Pte Ltd. to acquire Asahis shares
Mich.) (Tokyo, Japan) in SAL Petrochemical Co. in China (SAL ZLG). Styron Asia Ltd. is a 50/50 joint venture between Dow and Asahi, with SAL ZJG
as the production entity that manufactures polystyrene resins and SAL HK as the marketing entity. Dow will acquire Asahis
remaining 50% ownership in SAL HK directly and SAL ZJG indirectly for an undisclosed sum.

Cathay ISK Magnetics August 14 Cathay Pigments, Inc., a subsidiary of Cathay Pigments Group, a manufacturer of synthetic iron-oxide pigments and
Pigments, Inc. Inc. other colorants, announced the completion of its purchase of ISK Magnetics, Inc. The worlds largest producer and
(El Mirage, Ariz.) (Valparaiso, Ind.) supplier of magnetic iron oxides for audio and data applications, ISK Magnetics also manufactures particles for specialty
applications, including magnetic-ink character recognition and security inks, oxides for printer toner and a line of pure
iron-oxide pigments for cosmetic, food and pharmaceutical applications. ISK Magnetics will now be known as Cathay
Pigments Inc. - Cathay Magnetics. Financial details of the acquisition were not disclosed.

September 2006; VOL. 113; NO. 9

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FOR MORE ECONOMIC INDICATORS, SEE NEXT PAGE CHEMICAL ENGINEERING WWW.CHE.COM SEPTEMBER 2006 101
Economic Indicators 2005 2006

DOWNLOAD THE CEPCI TWO WEEKS SOONER AT WWW.CHE.COM/PINDEX

CHEMICAL ENGINEERING PLANT COST INDEX (CEPCI)

(1957-59 = 100) June 06 May 06 June 05

Prelim. Final Final Annual Index
CE INDEX 502.6 495.6 466.3 1998 = 389.5
Equipment 592.3 582.4 541.3
Heat exchangers & tanks 551.6 538.7 511.9 1999 = 390.6

Process machinery 548.2 543.1 517.4 2000 = 394.1

Pipe, valves & fittings 720.6 708.1 619.8

Process instruments 428.7 419.1 377.9 2001 = 394.3
Pumps & compressors 787.5 786.7 753.5 2002 = 395.6
Electrical equipment 398.8 396.6 370.5
Structural supports & misc 628.3 618.4 583.6 2003 = 402.0
Construction labor 309.8 307.8 304.4 2004 = 444.2
Buildings 469.5 468.9 440.7
351.4 352.0 348.3 2005 = 468.2
Engineering & supervision

CURRENT BUSINESS INDICATORS LATEST PREVIOUS YEAR AGO

CPI output index (2000 = 100)1 Jul.06 = 106.0 Jun.06 = 105.9 May.06 = 105.2 Jul.05 = 102.1
CPI value of output, $ billions Jun.06 = 1,537.5 May.06 = 1,551.6 Apr.06 = 1,508.3 Jun.05 = 1,380.5
CPI operating rate2, % Jul.06 = 82.8 Jun.06 = 82.8 May.06 = 82.3 Jul.05 = 80.3
Construction cost index (1967 = 100) Aug.06 = 719.0 Jul.06 = 718.8 Jun.06 = 716.8 Aug.05 = 696.2
Producer prices, industrial chemicals (1982 = 100) Jul.06 = 219.9 Jun.06 = 217.5 May.06 = 212.3 Jul.05 = 182.1
Index of industrial activity (1992 = 100) Jul. 29,06 = 285.2 Jul. 22,06 = 285.1 Jul. 15,06 = 284.1 Jul. 30,05 = 251.9
Hourly earnings index, chemical & allied products (1992 = 100) Jul.06 = 140.4 Jun.06 = 141.3 May.06 = 142.4 Jul.05 = 143.9
Productivity index, chemicals & allied products (1992 = 100) Jul.06 = 117.4 Jun.06 = 118.9 May.06 = 119.7 Jul.05 = 122.1

CPI OUTPUT INDEX (2000 = 100) CPI OUTPUT VALUE ($ Billions) CPI OPERATING RATE (%)

1.Beginning with data that appears in 2. Beginning with data that appears in CEs December 2005 issue, the weight of industrial subcategories used in calculating the CPI
CEs December 2005 issue, the base operating rate has been redistributed according to the following breakdown: Chemical (SIC 325) = 43.86%, Nonmetallic mineral
year for the CPI output index has been products (SIC 327) = 9.47%, Petroleum and coal products (SIC 324) = 6.37%, Plastics and rubber products (SIC 326) = 15.92%, Paper (SIC
shifted from 1997 to 2000 322) = 13.08%, Primary metal (SIC 331) = 9.93%, Nonferrous metal (ex. aluminum) production & processing (SIC 3314) = 1.38%

VATAVUK AIR POLLUTION CONTROL COST MARSHALL & SWIFT EQUIPMENT COST INDEX
INDEXES (VAPCCI) (1st Quarter 1994 = 100.0) (1926 = 100) 2nd Q 1st Q 2nd Q
CONTROL 2005 2004 2003 4th Q 1st Q 2nd Q 2006 2006 2005

DEVICE Avg. Avg. Avg.1 2005 2006 20062 M & S INDEX 1,306.3 1294.6 1257.8

Process industries, average 1,347.4 1334.4 1294.4
Carbon adsorbers 149.1 135.9 113.0 152.1 154.9 157.5
Cement 1,344.2 1,329.2 1288.8
Catalytic incinerators 167.9 148.6 124.0 177.1 188.1 202.1
Chemicals 1,322.3 1,310.4 1271.9
Electrostatic precipitators 132.1 124.0 102.9 132.6 134.5 136.9
Clay products 1,324.7 1,310.4 1272.6

Flares 150.1 134.2 105.2 150.7 152.8 155.9 Glass 1,251.1 1,237.7 1196.7

Gas absorbers 128.2 121.8 117.3 131.7 133.9 134.4 Paint 1,353.1 1,339.9 1301.7
Refrigeration systems 128.9 119.6 108.8 130.2 131.9 134.8 Paper 1,282.2 1,270.6 1238.1
Regenerative thermal Petroleum products 1,425.8 1,410.3 1359.7
oxidizers 131.6 124.0 113.9 132.9 134.3 136.0 Rubber 1,402.5 1,390.1 1359.0
Thermal incinerators 133.2 121.9 110.0 135.0 137.0 141.1 Related industries

Wet scrubbers 157.2 144.0 120.1 158.6 160.1 163.1 Electrical power 1,234.0 1,219.2 1162.3
Mining, milling 1,383.5 1,368.4 1326.5
1. Effective fourth quarter 2003, the Bureau of Labor Statistics (BLS) converted all Refrigeration 1,576.6 1,562.4 1519.3
of the Producer Price Indexes (PPIs) from the Standard Industrial Classification
Steam power 1,298.6 1,285.3 1246.1
(SIC) to the North American Industrial Classification System (NAICS). During this
conversion, many PPIs were abolished among them most of the PPIs that had
been key inputs to the VAPCCIs. As a consequence, substitute PPI inputs had to Annual 2000 = 1,089.0 2003 = 1,123.6
be found. The VAPCCIs for fourth quarter 2003 and subsequent quarters reflect Index: 2001 = 1,093.9 2004 = 1,178.5
these substitutions.
2. All second-quarter 2006 indexes are preliminary. 1999 = 1,068.3 2002 = 1,104.2 2005 = 1,244.5

102 CHEMICAL ENGINEERING WWW.CHE.COM SEPTEMBER 2006