INSTRUMENTATION
Helium shortage looms Qatar blockade could increase costs for users of scientific instruments The blockade of Qatar that started on June 5 has shut down the source of 30% of the world’s helium, threatening another round of shortages and price increases for scientific instrument users. Helium is used to cool nuclear magnetic resonance magnets and as a carrier gas for gas chromatography and mass spectrometry. The element is also used in medical imaging and electronics manufacturing, as well as to float dirigibles. Supply limitations and maintenance projects in the U.S. and overseas led to a quadrupling of helium prices and even scientific instrument shutdowns between 2011 and 2013. Some helium users may be better positioned to cope this time because they installed recycling equipment during the most recent shortage. Qatar halted helium production after the blockade severed helium’s main route out of the country: by truck through Saudi Arabia to the Port of Jebel Ali in Dubai, United
Arab Emirates. Saudi Arabia and several other Middle Eastern countries initiated the blockade when they cut diplomatic ties over Qatar’s support of extremist Islamic groups and ties to Iran. Shipments take about a month to arrive at their destination, points out Phil Kornbluth, a consultant who previously ran Matheson Tri-Gas’s helium operations. That buffer of helium in transit, along with helium that left Qatar’s Port of Hamad on June 19, means customers may start to feel the blockade’s effects in July, Kornbluth says. Some helium distributors are beginning to allocate supplies, he says, but instrument users contacted by C&EN say they are not feeling any effects yet. If the diplomatic situation isn’t resolved soon, helium distributors may set up regular shipments from Qatar’s Port of Hamad so the country can restart helium operations, perhaps in another month. All bets are off should Qatar’s adversaries
This Air Liquide helium liquefier, shown under construction, is now idle in Qatar. block the ocean route, Kornbluth says. The U.S. Bureau of Land Management (BLM), which accounts for about 20% of global helium supply, has ramped up production at its Cliffside facility in Texas to help offset the loss of the Qatari helium. However, technical problems capped additional supplies, notes Walter Nelson, vice president for helium at Air Products & Chemicals, which operates two helium refining plants tied to BLM operations. Thus, a continuation of the Qatar embargo will impact prices, Nelson says.—MARC REISCH
MERGERS & ACQUISITIONS
Celanese, Blackstone to combine acetate units
CREDIT: AIR LIQUIDE
The new partnership will be the global leader in cigarette filter materials Celanese and the New York City-based private equity firm Blackstone will combine their acetate tow businesses into a joint venture that will be the world’s leading producer of the cellulose acetate fiber, used mainly in cigarette filters. Celanese will own 70% of the joint venture; Blackstone will hold the rest. It will command more than 25% of the roughly 800,000 metric tons per year of global acetate tow capacity. Blackstone and Celanese estimate that the partnership will have about $1.3 billion in annual sales and robust profit margins of some 40% before taxes. Blackstone became involved in acetate tow when it acquired Solvay’s business in a $1.1 billion deal completed earlier this month. Celanese has long been a major factor in the business, with strength in China, where it operates three joint ventures. Acetate tow is made by treating wood pulp with acetic anhydride to yield cellu-
lose acetate, which is spun into a fiber for filtered cigarettes. Although profitable, the business is in a state of decline. People are smoking less.
Healthy trend Smoking is in a state of decline. Global cigarette demand, trillions of cigarettes 8 7 6 5 4 3 2 1 0 2011 12
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a Estimates. Sources: Euromonitor, Celanese
And Chinese companies are building big acetate tow plants, reducing the need to import the material from abroad. This year, Celanese estimates, China’s acetate tow imports will be less than a quarter of what they were five years ago. The new joint venture will take on $2.2 billion of debt. Upon the close of the deal, Celanese will receive a one-time dividend of $1.6 billion. Celanese CEO Mark Rohr sees the joint venture as a way to extract cash from the business and redeploy it to higher-growth areas, such as engineering polymers. At the same time, the partnership will benefit from greater efficiency and market focus. “The joint venture will be better positioned to invest in support of transforming consumer trends such as smokeless tobacco and super slim cigarettes as well as new uses of cellulose acetate,” Rohr told stock analysts on June 19. Blackstone has a history with Celanese. Blackstone purchased the Texas-based company in 2004 and owned a large stake in it until 2007.—ALEX TULLO JUNE 26, 2017 | CEN.ACS.ORG | C&EN
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