Document DQoqO4KK0w2jnGvy2nbOykqN

WONSANTO CHEMICALS LIMITED - NEWPORT TOi H.C. CAROCR J.C. CARRELS K.H. HANDY W.B. HICKS D.B. HOSIER A.C.W. PEMBERTON R.J. SIMON R.E. SOOEN R.J. STRATMEYER E.V. WEEKES - bflNMft ST. ue^S/7 LONOON St LONDON BRUSSELS ST. LOUIS NEWPORT BRUSSELS BRUSSELS ST. LOUIS LONDON Tt) III / U ^ bH CHLORALKALI OPERATIONS/ NEWPORT The target date for ehutting down the Newport Chlorine Plant ie January let. 1969. The 1969 Budget hea been prepared on thie basis and absorbs f.I.E. costs which for 1968 totalled 25,818. There is no depreciation in the Budget for M & E (1968 - 8,772) Purchasing Department are now in a position to proceed to contract and secure e satisfactory raw material supply position ( R.C. Lebrett August 27th. 1968 ) Net gain on Operation Retirement will be 144,446. 1969 net operation saving on shut down against manufacturing cost will be 4,$$7 1971 estimated savinge on the same basis with forecasted adjustment in Hydrogen price 27,500. It ie recommended that the shut down date of January 1st. 1969 be implemented, based on the attached Retirement Request outline. fih/em 19,9.69 DSW 200535 STLCOPCB4058599 TITLE* RETIREWENT OF CHLORftLKALI OPERATIONS - NEWPORT SUMMARY OF PROPERTY TO BE RETIRED Gross asset value to be retired Less accrued depreciation Estimated retirement loss of Gross Asset Value) Dismantling Expense Salvage values equipment. Copper and Mercury Capital required to improve Chlorine Off-loading facilities Nett gain on retirement operation EFFECT ON OPERATIONS Shut down against continued manufacturing saving in 1969 Estimated Saving 1971 396,096 369,042 6.8 15,000 194,000 7,500 144,446 4,537 27,500 X '-' A o -j_ ~ c A*" ^ (Oj LLO&& 1 ' DSW 200536 STLCOPCB4058600 The existing De Nora installation consists of 46 cells constructed in granite slab lined steel shells operating at 15,000 amps, to produce 17 tons per day, Newport Short Fall this year is estimated at 1,570 tons and by 1972 this will be 4,650 tons. The plant is completely outdated, in extremely poor state of repair in all sections, and maintenance costs are running at 11 ton chlorine. In addition. The Works Medical Officer states that the plant is operating at unacceptable high Mercury toxicity levels. Hydrogen off-gas with a purchase cost at 48/- per 1,000 cu. ft, end required for hydrogenation of rubber chemical intermediates has ensured that l^he operation of the chloralkali plant was economic until this year. Purchasing Department now stats that a satisfactory raw material position can be established under contract as followst- 1. Chlorine 24,13,5 per ton (2,62 / / lb) Hydrogen 1.15,4 per 100 sof (42 / / 100 scf) including facility charge 48$ Caustic Soda 13.10.3 per ton (1.39 / / lb) 2, Acceptable security of supply 3, Acceptable price protection 4, Acceptable future flexibility Hydrogen price will fall to 25/- per 1,000 within 2 years and to 18/- if a local pipe line supply becomes available. Based on these figures, shut down in 1969 would result in a saving of 4,537 against continued manufacture after discounting an allocation of 34,314 for Factory Expenses, 1969 Budget allowances for new projects and increased capacity levels will absorb 26,336 leaving 7,978 against continuing chlorine, hydrogen and caustic alkali distribution operations^ With hydrogen price at 25/- the net saving on shut down operation will be 27,500 p.a, estimated by 1971. Recovery end disposal of Mercury end Copper at F,T, price indices represent a value of 194,000 Murgatroyds have indicated that they will purchase all mercury recoveries; Dismantling costs are estimated at 15,000, Chlorine bulk storages, vapourisation and distribution systems will be retained and an expenditure of 7,500 will be required to improve chlorine bulk receipt facilities and rail access for road or rail supplies. Bulk caustic alkali storages will be retained. Sodium Hypochlorite facilities will remain in operation, . DSW 200537 STLCOPCB4058601 -4It is not proposed to dismantle any of the buildings involved, for all three main buildings have potential utilisation. The book value of buildings is 80,783 accrued depreciation 27,362, leaving an investment balance of 53,421. The conversion of the cell house to a warehouse would save 8,000 per annum, in warehouse hire charges for Newport products. Such conversions will be submitted as separate projects. 23 redundant operators will become available for new projects and to mept normal wastage. Maintenance and other craft personnel, total 17, will become redundant and are available for transfer to other activities. DSV\| 200538 STLCOPCB4058602 APPENDIX NEWPORT CHLORALKALI OPERATIONS 1968 Est. 1969 Production million lbs. Chlorine 12.68 13.37 Cost of Manufacture after Caustic and Hydrogen credits 209,800 221,214 Alternative cost of Purchased Chlorine 141,543 147,235 differential (A) 68,257 73,979 1971 Hydrogen Credit 45,176 Alternative purchase for internal usage 72,364 Savings on Steam for H2 compression 5,000 51,812 81,600 5,000 Hydrogen Loss (B) Factory Indirect Expenses Depreciation (C) (D) 22,188 32,680 10,340 24,788 34,314 10,340 (A) - (B C D ) Discontinued Warehouse Hire Nett operation gain after Cell House Conversion 3,049 4,537 8,000 12,537 27,500 8,000 35,500 NOTEt Purchase price CI2 I960 25. 0. 0* per ton " h m 1969 24. 13. 5. per ton N H2 1968 3.6 m.c.f. at 42/- plus 36.4 m.c.f. at 35/- M 1969 46 m.c.f. at 35/ Rental of 1100 for each year Prodn. Qty/ for 1968 based on Jan-Aug figures and for 1969 on Budget data, with adjustment of H2 by reaeon of S'flex meter check. In 1969 Budget there is no provision for Building & Yard Expense or Admin. & General Expenses which total 25818 in 1968. There is also no dep'n shown on the 1969 Budget for W. & E. (1968 figure 8772) 10 ^ RECOVERY VALUES Copper New 600 per ton Scrap 410 Mercury New 3 per lb. Second hand 2il0.0 STLCOPCB4058603