Air Liquide SA · EURONEXT:AI
Air Liquide SA — Investor Day (December 2009)
35 slides from Air Liquide SA's investor day presentation, Dec 7, 2009
Slide 1: Investor Day: Air Liquide, Energy & the Environment
Investor Day Air Liquide, Energy & the Environment Market Back Drop and Energy efficiency December 7, 2009 Air Liquide, world leader in gases for industry, health and the environment
Slide 2: Market Back Drop
Market Back Drop Ron LaBarre Group Vice-President, Large Industries World Business Line
Slide 3: Ron LaBarre
Ron LaBarre Group Vice President - Large Industries - World Business Line Ron LaBarre has a Master of Science degree in Chemical Engineering from the University of Pittsburg (USA) and a Bachelor of Science degree (ChE) from the University of Massachusetts (USA). He worked for Diamond Shamrock from 1
Slide 4: Agenda
Agenda Energy market drivers Air Liquide skills and expertise to develop efficient and competitive solutions: Efficiency Renewables Clean Energy Conversion Large business opportunities for Air Liquide 4 Air Liquide, world leader in gases for industry, health and the environment Investor Day – Paris,
Slide 5: Energy Market Drivers
Energy Market Drivers Energy prices will increase Energy consumption will grow Coal usage will increase Greenhouse Gases* are an issue *Greenhouse Gases: carbon dioxide, methane, nitrous oxide, etc. 5 Air Liquide, world leader in gases for industry, health and the environment Investor Day – Paris, D
Slide 6: Global Oil Prices
Global Oil Prices Oil prices have been increasing during the last 10 years 140 US Dollars per barrel * 120 100 80 60 40 20 0 1980 1985 1990 1995 2000 2005 2010 Increasing exploration investments Encouraging alternate energy development Source: IEA * Weekly all countries spot price FOB weighted by es
Slide 7: Global Energy Demand Growth driven by emerging economies
Global Energy Demand Growth driven by emerging economies Global energy demand is set to grow 40% between 2007 and 2030, +1.6% pa 91% of the growth is anticipated to be from non-OECD countries Global Energy Demand Growth by Region (2000-2030) 18000 16000 Energy Demand (Mtoe) 14000 12000 10000 8000 60
Slide 8: Carbon Based Fuels will continue to dominate
Carbon Based Fuels will continue to dominate World Energy Supply Other +6.8% p.y. Renewables 18000 +1.5% p.y. Biomass 16000 +2.0% p.y. Hydro 14000 +1.2% p.y. Nuclear Mtoe 12000 10000 Carbon-based resources 8000 +2.6% p.y. Coal 6000 +1.9% p.y. Gas 4000 2000 +1.1% p.y. Oil 0 2000 2007 2015 2030 Oil ba
Slide 9: Coal is the largest fuel source for electricity production in the world
Coal is the largest fuel source for electricity production in the world Oil Gas Coal R/P* = 42 yrs R/P* = 60 yrs R/P* = 122 yrs Others Oil 2% 6% Nuclear 15% Hydro 16% Coal/peat 41% Gas 20% Source: IEA 2008 (2006 data) *R/P: Reserves/Production 9 Air Liquide, world leader in gases for industry, healt
Slide 10: Primary Energy Reserves
Primary Energy Reserves Coal will remain a key energy source, especially in the US and China, the 2 largest energy consuming countries in the world Energy security is an issue Europe CIS countries North America 120 80 Middle East 40 0 South America Africa Asia-Pacific World reserves of fossil energi
Slide 11: Climate change is leading to increased regulations and government funding
Climate change is leading to increased regulations and government funding CO2 emissions and the temperature of the atmosphere have increased significantly Need to Reduce CO2 GHG* t° Reduce CH4 Regulations + Financing are being developed *Greenhouse Gases: carbon dioxide, methane, nitrous oxide, etc.
Slide 12: CO2 emissions drastically increased during the last centuries
CO2 emissions drastically increased during the last 2 centuries accelerating since the 1950’s Source: www.Climatechangeconnection.org/emissions 12 Air Liquide, world leader in gases for industry, health and the environment Investor Day – Paris, December 7, 2009
Slide 13: Increase of average atmosphere temperature accelerated during the last 20 years
Increase of average atmosphere temperature accelerated during the last 20 years 13 Air Liquide, world leader in gases for industry, health and the environment Investor Day – Paris, December 7, 2009
Slide 14: World awareness of the Climate Change Issue
World awareness of the Climate Change Issue Status of regulatory framework: Current: Kyoto protocol 2012 European Directive: - 20 % / - 30 % CO2 in 2020 vs 1990 Regulations in some countries Under preparation: Copenhagen conference 2009 USA: GHG regulation likely in 2010 with CO2 cap & trade China:
Slide 15: CO2 emissions: electricity generation and transport are the main contributors
CO2 emissions: electricity generation and transport are the main contributors Breakdown by sector (excluding CO2 emissions from land use) Iron & steel 6% Chemical & petrochemicals Other Residential 4% Agriculture 4% 10% 2% 6% Non-metallic minerals (primarily cement) 6% Others Industry Electricity 22
Slide 16: Air Liquide's Carbon Footprint is relatively small
Air Liquide’s Carbon Footprint is relatively small Sector leaders CO2 emissions in m tons Utilities World Energy 29bn tons CO2* (2007) Materials Industrial * From fossil use, gases excluding deforestation 0 50 100 150 200 250 bn t = billion tons, Sources: IEA 2009, Carbon disclosure project, Air Liq
Slide 17: Strong positive Impact of GHG Reduction levers
Strong positive Impact of GHG Reduction levers Government GHG levers: Encourage/prove new technologies (subsidies / loans) R&D Pilot plants Demonstration plant Drive changes in behavior Taxes Quotas/Carbon Credit Funds for emerging economies Air Liquide is participating in both levers 17 Air Liquide
Slide 18: A Mix of Solutions Required to reduce CO2 emissions
A Mix of Solutions Required to reduce CO2 emissions Energy - Related CO2 emissions 42 40 Reference scenario 38 Efficiency Gt of CO2* 36 34 32 Renewables + Biofuels 30 28 Nuclear Stabilization scenario (450ppm) CCS clean conversion 26 2007 2015 2020 2025 2030 (From traditional industrial gas applicat
Slide 19: Efficiency: years of improving our own and customer processes
Efficiency: 107 years of improving our own and customer processes Iron, Steel & Non Ferrous Industry ASU Chemicals Glass 19 Air Liquide, world leader in gases for industry, health and the environment Investor Day – Paris, December 7, 2009
Slide 20: Renewables and H2 Energy
Renewables and H2 Energy Photovoltaic Biofuels Stationary and mobile H2 Energy 20 Air Liquide, world leader in gases for industry, health and the environment Investor Day – Paris, December 7, 2009
Slide 21: CCS Clean conversion
CCS Clean conversion Almost pure CO2 CO2 Coal Feed stock Syn gas O2 + Almost pure CO2 Water O2 CO2 Oxy-combustion Gasification Special burner developed for oxy-combustion, resistant to very high temperatures CCS: Carbon Capture and Storage 21 Air Liquide, world leader in gases for industry, health a
Slide 22: Clean Coal Power: huge oxygen potential for Air Liquide
Clean Coal Power: an example of huge oxygen potential for Air Liquide REMINDER O2 Total O2 capacity: 140,000 tpd Clean power from coal using oxy-combustion: 500 MW 10,000 tpd O2 using gasification: 500 MW 4,000 tpd O2 Equivalent: Conversion of each 1% of the power plant capacity would require: USA 3
Slide 23: Energy market: significant growth market for Air Liquide
Potential Market Fossil fuels will continue to dominate Coal remains key GHG constraints Alternate energies & new technologies Energy market: significant growth market for Air Liquide For Air Liquide Air Liquide has many Energy Market applicable products and technologies O2 H2 CO SiH4 E&C Efficiency
Slide 24: Energy Efficiency
Energy Efficiency Emmanuel Julien Vice-President, Engineering & Construction - Cryogenics 42 40 Reference scenario 38 Gt of CO2* 36 34 32 Efficiency 30 28 Stabilization scenario (450ppm) 26 2007 2015 2020 2025 2030
Slide 25: Emmanuel Julien
Emmanuel Julien Vice President, Engineering & Construction Cryogenics, Air Liquide Emmanuel Julien holds an engineering and master’s degree in chemical engineering from Ecole Nationale Supérieure des Industries Chimiques de Nancy (ENSIC). Emmanuel joined Air Liquide in 1988, as a research engineer i
Slide 26: Oxygen: the Energy Value Chain
Oxygen: the Energy Value Chain Energy is: 60% of air gases production costs 32% of Air Liquide total operating costs Energy Air Liquide Electricity Oxygen Customers Suppliers ASUs N2 78% Electricity + Air O2 21% Air Liquide has been working on energy consumption optimization for 100 years 26 Air Liq
Slide 27: Oxygen: optimizing the Energy Value Chain
Oxygen: optimizing the Energy Value Chain 2. Best practice spreading 3. New efficient ASUs on existing ASUs 1. Optimized 4. Reducing customers’ energy supply energy requirements Energy Air Liquide Electricity Oxygen Customers Suppliers ASUs 6. Emerging economies 5. Renewal of old ASUs 27 Air Liquide
Slide 28: 1. Optimizing energy supply
1. Optimizing energy supply 22 TWh* electricity supplied to the 260 largest Air Liquide ASUs in 2008 worldwide Average equivalent of 2 nuclear power plants Continuous 24/7 oxygen production optimization with a SCADA system Customer needs aggregation and scheduling Use of “oxygen energy buffers”: liq
Slide 29: 2. Spreading best practice in existing ASUs
2. Spreading best practice in existing ASUs : continuous energy consumption reduction through efficiency improvement efficiency programs: Dedicated human resources and capital allocation Rigorous Energy Evaluations driven by Key Process Performance Indicators Advanced Process Control Equipment Monit
Slide 30: 3. New efficient ASUs
3. New efficient ASUs Continuous development and innovation efforts: 130 people Technology: Distillation, Heat recovery, Adsorption Process Design Optimization: new Process Cycles Integration with customer process Process Control & Decision Support Systems 200% Power consumption Oxygen for oxy-combu
Slide 31: 4. Reducing customer energy requirements
4. Reducing customer energy requirements Switch from air to oxygen O2 Metals Oxygen in blast furnaces reduces coke consumption Oxygen in electric arc furnaces 10 new oxygen plants under construction Glass Reduces melting energy ASU for Oxycombustion project Chemicals and Petrochemicals Ethylene Oxid
Slide 32: 5. Renewal of old ASUs
5. Renewal of old ASUs Replacement of old customer assets Severstal (Russia, 2007): LI contract, new 3,000 tpd unit - 50 000 tpy of CO2 indirect emissions saved from lower electricity consumption Severstal ASU block 11 AL worldwide asset renewal program More than 10 on-going projects Mons (Belgium,
Slide 33: 6. Emerging economies
6. Emerging economies Strong development in emerging economies, especially China : Air Liquide standard ASUs designed and manufactured in China Capex: -40% compared to Western plants Energy consumption: -15% to -20% compared to local technologies Air Liquide Standard Plant Air Liquide Hangzhou desig
Slide 34: Potential Energy consumption reduction
Potential REMINDER Efficiency : €600m cost reduction over 3 years Energy consumption reduction: ~10 % Of efficiency every year 34 Air Liquide, world leader in gases for industry, health and the environment Investor Day – Paris, December 7, 2009
Slide 35: Investor Day: Air Liquide, Energy & the Environment
Investor Day Air Liquide, Energy & the Environment Market Back Drop and Energy efficiency December 7, 2009 Air Liquide, world leader in gases for industry, health and the environment