Document baYL1dE3QNbEKaMDwQY8gevkZ

MONSANTO CHEMICAL COMPANY Texas City, Texas June 12, 1962 cc: J. M. Chamberlin W. R. Nisbet G. T. Ryan C. P. Fullerton L. B. Bullock T. E. Shirley -Jh" L. Price To: W. F. Zimmermann Subject: Cost of Out-of-balance VCM The VCM plant is presently running out-of-balance due to the lack of acetylene to meet requirements of both AN and VCM. This type of operation increases the cost of VCM in several ways: (l) chlorine must be purchased at a premium (out-of-balance with company-wise NaOH usage), (2) an extra chlorine barge must be rented, (3) excess acid must be dumped with loss of raw materials in addition to dumping expenses, and (4) acid absorber maintenance cost is excessive. An analysis of the incremental cost of producing out-of-balance VCM has been made to show the relative effect of the various cost factors. /earn Att. J. W. Kongable CBY 1019447 RSV0031741 1 SUMMARY Cost to deliver 8.0^/lb. VCM made out-of-balance from premium price chlorine while dumping acid. (if acid could be sold at $6.00/ton, the costs would be reduced by 1.12^/lb. VCM). ft Total pounds made Customer: Shell 1MM 2MM 3MM 4 lib 7*37?S/lb$.k3 7-02^/lb.1^ 6. .90^/,lb. I' 7-49 3,fi 7.14 .9L 7.02 /) Velsicol Cary / \',b Escambia Vv ^ -} *\ & 4/T^.Tlrestone 7.52 7.57 7.61 7.69 Mi 7.17 cM 7.22 O.Vj 7.26 0-11 7.34 7.05 .78 7.10 7.14 .u. 7.22 b,7 * is: Chlorine at $59.30/ton delivered CaH^ at 4.734^/'lb. Acid dumping cost $6.00/ton acid Excess maintenance $7,000/month (fixed) Freight - our share of equalized freight Chlorine Cost Out-of-balance CI2 (85$ of market price) Trip-lease of vendor's barge $/Ton 55*50 3*00 Towing charges .80 $ 59.30 Cost/lb. VCM: 126 lb. Clg x $59.30 100 lb. VCM 2000 lb. Cl2 = 3.7Wlb* VCM (assuming the acid made is dumped, none of the Cl2 value is recovered) CBY 1019448 RSV0031742 Ethylene Cost; Co st/11. VCM: CgHjj. x 4- 734^ = 2.37flf/ib. VCM 1O0 lb. VCM lb. CzH4 Acid Dumping Cost Dumping cost is $6.00/ton of acid based on average cost in 1957- 46.00 2000 lb. Acid x 187 100 llbb-! VACcMid _ ,,0.5rs6-j^//1lb1. . VCM Excess Maintenance Cost Acid aTosorber maintenance averages $7,000/month. figure varies only slightly with rate. 47*000 1 MM lb. VCM = 0.7^/lb. VCM This 47,000 2 MM lb. VCM = 0.35^/lb. VCM 47,000 3 MM lb. VCM = 0.23^/lb. VCM Freight Costs Our cost of freight for each customer is as follows: Shell 4/lb. VCM 0.0 Great American 0.12 Velsicol 0.15 Cary Escambia Firestone 0.195 0.235 0.315 6/12/62 CBY 1019499 RSV0031743