Document zg39LRDvoqyarQxD759ERE30

/A -SSTASUSHCD t$02 E. I. d u Po n t d e Ne mo u r s & Co mp a n y in c o r po r at ed Wil min g t o n , De l a w a r e 19898 CHEMICALS AND PIGMENTS DEPARTMENT cc: 'KRM6d iey^MSl:-0^2068 LPHeinold-GS-D-2094 CHHuendel-CSP-Chestnut Run TABartolec LRGattman TRPriebe CRAntonson REYoung/SORogers CAChaplin February 21, 1983 T. J, WELLMAN - C&P - NEW YORK OFFICE J, N. LONG - C&P " WYNNEW00D OFFICE W. W. GREER WEEHAWKIN, NJ Ti02 SLURRY TERMINAL ALTERNATIVE Attached is the cost comparison of delivering Ti02 slurry (R-940) ex Hudson Tank, X-Rai1, and New Johnsonvilie. Summarizing this informations Ship Point Hudson Tank - Weehawkin, NJ X-Rai1 - Newark, NJ New Johnsonvi1le - Direct Truck Net Freiqht Costs ....~ m... .-- 323,2 278. 4 308.4 Tank Car Requirements k 6 - Our present tank lease contract with Hudson Tank will be up for renewal on 6/30/83 with 90 days notice of cancellation. With the lower R-940 volume and early 1982 phase-out of R-941, the terminal costs do not justify renewing the tank lease. In addition to costs, the terminal does not schedule the truck carrier or fill out monthly stock reports (SOC does this now). Also, the terminal does not promptly communicate invoicing information following shipments resulting in poor invoicing lag time. An alternative that has been discussed with the district is direct trucking ex New Johnsonvilie. the truck freight costs are lower than shipping through Hudson Tank and tank car requirements would be eliminated; however, there are several concerns. Additional lead time bn orders will be required (approximately seven days). Also, the truck rates ex New Johnsonvilie are at its proper level and, therefore, no freight reduction can be expected (currently negotiating rail and truck rates ex terminal). Physical Distribution recommends starting up a rai1-to-truck transloading operation at X-Rai1, Newark, NJ. X-Rai1 handled this business prior to Hudson Tank but was replaced when higher slurry forecasts dictated shipping out of storage tanks. This operation will be similar to our other Ti02 slurry terminals In Houston, TX tv -2 and Portland, OR. Tank cars will be circulated on a regular basis to keep the solids suspended, tank trucks will be loaded direct from these tank cars. Laboratory services will remain the same as used at Hudson Tank. Cost reduction will be approx imately $45M/year. Unless there are significant objections/changes to this proposal, the time table for establishing this terminal is as follows: Action Responsibi1ity Timing Finalize operating contract with X-Rai1 Ship T/C of slurry to terminal for test ship ments JSL/CAC JSL/CAC/SOC . 3/7/83 3/10/83 Set up ship point code for terminal SOC 3/14/83 Review operating manual, procedures, etc., with X-Rai1 JSL/CAC/ Chestnut Run when T/C arrives Coordinate first truck loading JSL/CAC/SOC 3/28/83 Inform Hudson Tank of intent to cancel contract Inform customers of pending terminal change LPH Field Sales 3/31/83 6/83 If there are any questions or comments, please contact me on 774-3308. JSLsdlw Attachment J. S. LEE PHYSICAL DISTRIBUTION DUP050144851 PRODUCT: Ti02 SLURRY (R-940) LOCATION: WEEHAWKIN, NJ SHIP POlNT COD E: 255 (FKJ) TERMINAL CONTRACTOR: HUDSON TANK TERMINALS Alternate Facility - Basis: EAR = 6MM lbs. TiO9 (commodity) 32 tank cars/year 133 trucks/year Handling Costs: Hudson Tank Contract * $66.QM/year X-Rail .25/cwt x 6MM lbs.. $15.0M Recirculation: Included in handling costs $15.00/hour/car x 4 hrs./week x 52 weeks/year x 2 car inventory $6.2M Track Storage: None, if less than 7 days $4.00/day/car x 14 days avg. hold time x 32 cars = $1.8M Sample Taking: $5 x 165 samples * $.8M $10 x 165 samples == $1-7M Sample Del 1 very: $1*1,50 .x 1$5 samples * $2.4m No change - $2.4M Sample Analyses: $25.00 x 165 samples $4.1M No change - $4.1M Preparation of bills of lading, weighing. Inventory control and reports: $l2.0M/year for clerical time (not currently done) $5/truck x 133 trucks = $.7M Rail Car Costs: Terminal Costs m 32 days turnaround = *f cars x $4M/car/year - $16.0 $101.3M 46 days turnaround * 6 cars x $4M/car/year * $24.0 $ 55.9M Rail Freight Costs = Truck Freight Costs * $151.8M $ 70.7M $151.8m $ 70.7M TOTAL COSTS $323.2M $278.4M Direct Truck ex New Johnsonvi1le Customer Truck Rate ($/cwt) EAR (Commodity Lbs. r Freight Costs (M$) California Products M.A. Bruder 6 Sons Paragon Paints 6.27 4.65 5-20 1 ..OHM 3-0MM 2.0MM $71.5 $133.9 $103,0 $306.4M DU P050144852 N 25764.01