Solvay Soda Ash to install new boiler in Bulgaria plant on cost-cutting drive

By Siobhan Lismore-Scott
Published: Wednesday, 29 October 2014

Boiler will cut costs making Solvay more competitive in the synthetic soda ash market

Solvay Soda Ash & Derivatives has made a “significant” investment in a new steam boiler at its Bulgarian Devnya synthetic soda ash plant.

The boiler will significantly improve the company’s energy efficiency, leading to a reduction of energy costs of between 6-7%, president Christophe Clemente told IM.

Synthetic soda ash production at the company’s plant stands at 1.5m tpa and is distributed domestically and exported to global markets. Output will remain the same and will not be interrupted, Clemente emphasised, as the two old boilers will run alongside the new one. It will be operational from 1 January 2017.

The new plant will be able to use up to 20% biomass energy, which means that Solvay could participate in the Energy Emissions Trading Scheme. The previous boiler used coal as a fuel, whereas the new boiler will use coal or pet coke as a feedstock.

Pointing to the many shutdowns that have taken place in the industry over the last 12 months - Penrice’s plant in Australia, Tata’s Magadi in Kenya and Winnington in the UK, as well as the company’s own Povoa plant in Portugal Ñ Clemente said that these were all due to high energy costs.

“The high cost of energy is what killed these,” he said.

“The name of the game is very simple for us. We have a long term view for this business. We have to recover a little bit of profitability first before we look to expanding capacities or addressing demand rises,” he added.

The measure to improve the company’s energy efficiency forms part of the company’s €100m ($127.3m*) cost-improvement target by 2015.

Soda ash demand

Clemente said that Solvay expected soda ash demand to rise in the near term, but added that Solvay was “more bearish” than its contempories when it came to forecasting demand for the near future.

“There has been a total restructuring in the market of around 2m tonnes,” he said. “Demand has been stable in parts but we do see slight growth for 2015.”

“Supply in 2015 will be lower than 2014 and this year, at times, we were tight,” he said. “In 2015 we see a tight market.”

Regions expected to see the highest growth were South East Asia - in particular in Indonesia - and East Africa, Clemente said. North America is expected to be better, while Europe will be flat, he added.

*Conversion made October 2014