China's -Xylene Problem - C&EN Global Enterprise (ACS Publications)

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BUSINESS INSIGHTS

China’s p-Xylene Problem Without an improvement in PUBLIC DIALOGUE, fear of the chemical could infect the wider industry in the country

EARLIER THIS MONTH, the British

NEWSCOM

JEAN-FRANÇOIS TREMBLAY, C&EN HONG KONG

newspaper the Telegraph reported that Shell and its Chinese and Qatari partners had abandoned plans to build a refinery and petrochemical complex in Taizhou in eastern China. For years now, local residents have protested periodically, fearing that the project might produce p-xylene, a key polyester intermediate. A Shell spokesperson in Beijing tells C&EN that the feasibility study is still ongoing and that the complex will not produce p-xylene. But the reResidents protested port and the protests again highlighta p-xylene plant in ed how anxious the Chinese public is Kunming, southern about p-xylene. In May and in August, China, earlier this year. hundreds of residents in Kunming, 1,100 miles southwest of Taizhou, braved government intimidation tactics to protest the construction of a p-xylene plant near their city. And in 2011, in the northern city of Dalian, the local government promised the closure of a newly built p-xylene unit to appease thousands of local residents. Eventually, the Chinese public will wake up to the fact that pxylene is only one of many hazardous materials that the chemical industry produces in large quantities. To avoid a broader backlash against chemical production, China and chemical producers operating there need to give the Chinese public more accurate information about the pros and cons of chemical projects and invite them to participate in the chemical plant approval process. China’s process for chemical project approval is dysfunctional. The public is supposedly allowed to participate in the mandated Environmental Impact Assessment, but local officials, distrustful of their constituents, rarely invite them. When a storm erupts over a project that was approved quietly, the cadre’s reaction is to first try to suppress, and then quickly give in if protests spread. The public lacks a full view of the industry’s risks and benefits. p-Xylene is undoubtedly a hazardous substance. Xylenes—p-xylene included—rank 62 out of 275 on a list of substances with potential threat to human health compiled by the U.S. Agency for Toxic Substances & Disease Registry (http://www.atsdr.cdc.gov/spl/). But benzene and vinyl chloride are ranked worse, and plants handling large volumes of those substances are not all that controversial in China. An aromatic compound made from oil-refinery side streams, p-xylene is mostly used to produce purified terephthalic acid, a raw material for polyester fiber and bottles, explains Kenneth M. Stern, a New York City-based senior managing director at FTI Consulting who has worked in the chemical industry for 40 years. “p-Xylene is a flammable liquid, and inhalation or ingestion can be harmful,” he says. “However, aromatics facilities around the world have a long history of safe operations, and there is no reason to believe that CEN.ACS.ORG

p-xylene plants are inherently unsafe. The p-xylene plants are, however, crucial to China’s economic wellbeing. Were the country to rely on imports for p-xylene, its manufacturing costs for textiles—a major industry in China—would be higher. p-Xylene earned notoriety in China in 2007 when residents of the coastal city of Xiamen held mass protests after learning that the local government had raced though the approval of a large p-xylene plant near the city center. The municipal government eventually caved to public pressure and ordered the project relocated. The Xiamen protests were the first to highlight the Chinese public’s lack of trust in its leaders when it comes to chemical plants. It’s a credibility gap that the government has since done little to dispel. For example, after promising protesters in Dalian that the p-xylene plant they opposed would be ordered to move, municipal officials did no such thing. THE CHINESE PUBLIC will eventually realize that other widely

used chemicals are more hazardous than p-xylene. When that happens, government officials will no doubt continue in their attempts to stymie public opposition through Internet censorship, intimidation, and repression. But these steps will have limited impact with people who believe their lives are threatened. Surprisingly, constructive discussions with the public about chemical projects are possible in China. Some international chemical producers, with Chinese officials curiously looking on, have started to run community relations programs in the country. The most notable example may be BASF, which initiated such a program with residents of Chongqing in 2011. The German firm is building a huge polyurethane plant in Chongqing that requires phosgene as an intermediate. Phosgene is toxic enough that it was used as a chemical weapon in World War I and by Japanese forces in China in the 1930s. And yet, BASF managers meet regularly with local community leaders, and the talks run smoothly enough. When they last met in June, the two sides calmly discussed construction site safety, according to a BASF spokeswoman in Hong Kong. A healthy chemical industry is an important pillar of a modern economy. It may be time for Chinese leaders to learn from the industry’s best practices worldwide and start engaging the public in the approval process for chemical plants. The alternative is greater turmoil, canceled projects, and, ultimately, a rising import bill for chemicals that China cannot make domestically. Views expressed on this page are those of the author and not necessarily those of ACS.

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SEPTEMBER 30, 2013