2017CHE003 FinalPaper Draft 8 1

MAPUA INSTITUTE OF TECHNOLOGY AT LAGUNA
Academic Year 2017 2018 (1st Term)
SIMULATION AND ECONOMIC FEASIBILITY STUDY OF METHYL

ISOBUTYL KETONE (MIBK) MANUFACTURING PLANT IN THE
PHILIPPINES
Submitted to: Engr. Jesunio Aquino
Submitted by:
Ashraf Dizon HELMY MOHAMED YEHIA
Russel Marc Legacion PEPITO
Yves Robin Cuevas PINES
Date
August 30, 2017

Table of Contents
1. INTRODUCTION
1.1 Background of the Study
1.2 Objectives
1.2.1 General Objective
1.2.2 Specific Objectives
1.3 Significance of the Study
1.4 Scope and Limitations of the Study
1.5 Statement of the Problem
1.6 Company Profile
1.6.1 Description of the Company
1.6.2 Vision
1.6.3 Mission
1.6.4 Core Values
1.6.5 Company Logo
1.7 Review of Related Literature
1.8 Methodology
2. MARKET STUDY
2.1 Situational Analysis
2.1.1 Situational Environs
2.1.1.1 Global Consumption and Production.
2.1.1.2 Demand based on import in the Philippines
2.1.1.3 Demand based on import in Asia
2.1.1.4 Availability of Raw Material
2.1.1.5 Project Location
2.1.1.5.1 Proposed Location
2.1.1.5.2 Plant Location Criteria
2.1.1.5.3 Selected Plant Location
2.1.2 Competitor Environs
2.2 Target Market
2.2.1 Local Market of Methyl Isobutyl Ketone
2.2.1.1 Local Market of Methyl Isobutyl Ketone
2.2.2 Export Market for Methyl Isobutyl Ketone & Isopropyl Alcohol
2.2.2.1 Export Market Based on Location
2.2.2.2 Export Market Based on Organizational Partnership
2.2.2.3 Export Market Based on Demand
2.3 SWOT Analysis
2.4 MARKETING OBJECTIVES AND GOALS
2.4.1 Market Share
2.4.2 Market Volume
2.5 Marketing Strategy
2.5.1 Logistics
2.5.1.1 Packaging
2.5.1.2 Transportation
2.6 Marketing Tactics
CHAPTER 1: INTRODUCTION
1.1 Background of the Study
Methyl Isobutyl Ketone (MIBK) is a chemical known for its high solvency. Due to this property,
it has long been used in the manufacturing of paints, rubbers, pharmaceuticals, industrial cleaners,
germicides, fungicides, and electroplating solutions. MIBK is also considered to be non-toxic enough to
be considered as a Food and Drug Administration (FDA) Approved indirect food additive for paper,
adhesives, and polymers (American Chemistry Council, nd). It is also considered as an active solvent for
various synthetic resins including cellulosics, vinyl copolymers, acrylics, alkyds, polyesters, and epoxies.
MIBK is also has a low density. With this property, together with its high solvent power, it has been
found to be very useful in developing high-solids coatings. MIBK is also used as an extracting agent in
the dewaxing and deoiling of petroleum products (Eastman Solvents, nd). Afshar of TransTech
Consultants Inc. stated that in 2014 18% of international MIBK is exhausted as a solvent in
transportation, refurnishing and marine coatings, 9.2% in construction coatings, 8.5% in wood coatings
and 8.1% in metal coatings. Globally, 59% of total MIBK output is consumed as a solvent, 16% as an
extraction solvent, 13% as rubber processing chemicals and 4% as surfactants.
World supply stood at about 485,000 ton/year in 2013, having 170,000 ton/year from Asia
Pacific, followed by 85,000 ton/year from Western Europe, 65,000 ton/year from Japan, 50,000 from
Mexico and 45,000 ton/year from the US. Global demand for MIBK in 2013 was found to be 383,000
ton/year (TransTech Consultants Inc., 2014).

Figure 1.1 Global MIBK Supply in 2013
On parallel with being the largest supplier of MIBK, Asia Pacific is also the largest consumer with
demand of 167,000 ton/year, which is then followed by the US with 60,000 ton/year, then Western
Europe with 55,400 ton/year. These data shows that Asia Pacific market will need an additional capacity
of 75,000 ton by 2018 (TransTech Consultants Inc., 2014).
The IHS Markit stated in May 2015 that the global consumption of MIBK gave an annual rate
increase of almost 7% at years 2011 to 2014. It was also stated that the increase in consumption, driven
by Chinas increased tire production, resulted in MIBKs use in rubber antiozonants has developed over
the last three years, from approximately 25% of total MIBK consumption in 2011 to 32% in 2014 in the
major exhausting countries/regions (TransTech Consultants Inc., 2014).

Figure 1.2 Global MIBK consumption in 2014
The process chosen by the TOPSIS from the three alternatives was the first alternative which is
the Method and Apparatus for Producing Purified Methyl Isobutyl Ketone (MIBK). In this process
diacetone alcohol (DAA) is produced from the condensation of two acetone molecules. Then, the DAA is
dehydrated to produce mesityl oxide (MSO) which would then be hydrogenated to produce the MIBK.
An acidic catalyst is needed in the condensation and dehydration reaction, and the presence of a
hydrogenation catalyst such as a noble gas is required in the hydrogenation of MSO (Hahn,T.E , et al,
2010).
In producing the MIBK, comprises a reactor, a hydrogen separator, a liquid-liquid separator, a
first distillation column, a second distillation column, and a third distillation column. The MIBK reactor
is preferred to have a single process step and it should comprise a tubular reactor. The preferred reactor is
a tubular trickled bed reactor. It is preferred that the hydrogen separator drum is located before the first
distillation column. Then the hydrogen may be recycled from the hydrogen separator to the hydrogen
feedline before the MIBK reactor. The liquid-liquid separator should be located at the second distillation
column and it may comprise a decanter and a take-off line for removing the aqueous phase (Hahn,T.E., et
al, 2010).
In this process, the yield of MIBK is 99.8% wherein the 2% is acetone and other compounds.
This process also yields other compounds such as Acetone, 2 Methyl Pentane, Di-isobutyl Ketone, and
water and this will later be recycled or reacted. The hydrogenation catalyst used is mainly a palladium
based resin catalyst (Hahn,T.E., et al, 2010).
1.2 Objectives
1.2.1 General Objective
The goal of this study is to design and simulate a MIBK manufacturing plant in the Philippines
that utilizes the Integrated Dual Process and assess its economic feasibility.
1.2.2 Specific Objectives
To conduct a market study that covers the supply and demand analysis, plant capacity, market
share, and target market.
To use Decision Support Systems with to help select the optimal MIBK process and Plant
Location
To simulate detailed operational procedures, control schemes and reactions in the production of
MIBK via ASPEN HYSYS V8.8.
To provide design work such as process design and description, heat and material balance, piping
and a 3D model of the plant using AutoCAD 3D Modeling.
To assess the economic feasibility of the overall project by analyzing cost of the design and
operation.
1.3 Significance of the Study
The importance of this study is to provide information on the production and profitability of a
MIBK manufacturing plant that utilizes the Integrated Dual Process. The study of the production of
MIBK can later be used by students, researches, plant designers and other interested people in the
scientific community.
1.4 Scope and Limitations of the Study
The prices of the equipment that will be used in the estimation of the manufacturing plant will
solely be based on the calculations in the book Chemical Engineering Design by Towler and
Sinnott.
The simulation of the reactions and unit operations involved in the manufacturing process will be
limited to the capability of ASPEN HYSYS V8.8.
The market study will only focus on the Philippines and some countries in Asia that have
significant demand for MIBK.
The market study on the supply and demand analysis will only be based on the data that are
available for public viewing, mainly the import and export data of the different countries.
1.5 Statement of the problem
Throughout the years, the MIBK demand had been steadily increasing, especially in the Asia
Pacific. The current manufacturing plants that provide the supply in Asia does not satisfy the incredible
increase in the demand. The top suppliers of MIBK up to this day are still mainly from African and
European countries. This is the reason to establish a manufacturing plant in Asia, specifically the
Philippines which is somewhat in the middle of the largest demanding countries for MIBK and has a
great number of ports that provide easy transport of the product in neighboring countries.
1.6 Company Profile
1.6.1 Description of the company
MiKCo is a company that manufactures Methyl Isobutyl Ketone (MIBK) for the demand of the
Philippines and other Asian countries. The companys aim is to be a world class manufacturer of MIBK
that satisfies the increasing demand of MIBK in the Market, especially in the Asia Pacific countries. The
company name MiKCo. means Methyl Isobutyl Ketone Corporation.
1.6.2 Vision
MiKCo will be the leading provider of quality MIBK locally and internationally.
1.6.3 Mission
To provide premium quality MIBK in the Philippines and in the Asia Pacific
To dominate the MIBK Market locally and internationally
1.6.4 Core Values
Leadership
Integrity
Communication
Quality
Team
1.6.5 Company Logo
The name of the company MiKCo was derived from the combination of an alternative name for
the product it wants to produce, Methyl Isobutyl Ketone (MIK), and the word Corporation. The
Hexagon at the back of the logo is also a word play from an alternative name of MIBK, Hexanone. The
Erlenmeyer flask in the logo represents that the company is an industrial chemical manufacturer. The
color yellow of the name of the company represents mind and intellect while the turquoise background
represents communication and clarity. Overall the logo tells that the company uses intellect that is backed
up by communication to make its way to the top of the market.
1.7 Review of Related Literature
Manufacturing of MIBK
In the practical preparation of Methyl Isobutyl Ketone by stepwise Isopropylation reaction of
acetone, fine Methyl Isobutyl Ketone (MIBK) will generate no H2 and wastes since green and practical
procedures are used. Isopropanol will also be used instead of H2 in the process to provide a safe hydrogen
source and the solvent, by-product and catalyst will be recyclable and reusable. The process will start
through acetone conversion and a recoverable Pt/C-catalyzed transfer hydrogenation of Mesityl Oxide
(MO) with isopropyl alcohol (IPA). Almost 99.9% MO will be converted and there will be 99.3%
selectivity of Methyl Isobutyl Ketone (Fang Wang, 2017).
A gas phase process will be used in the one-step Methyl Isobutyl Ketone synthesis from two
propanol. This process will be an alternative from the traditional procedure in producing MIBK from
acetone. The catalysts are bifunctional copper/acid-base catalysts since these catalysts are able to operate
at mild temperature and at atmospheric temperatures. Cu-Mg-Al mixed oxide catalysts are found to have
a high yield of MIBK (G. Torres, 2007).

One-synthesis of MIBK from acetone and hydrogen was investigated using a Pd/Nb2O5.nH2O
catalyst. Compared to Pd/y-Al2O3, Pd/Nb2O5.nH2O showed higher selectivity and catalytic reactivity.
Since, isopropanol was barely formed in the Pd/Nb 2O5.nH2O catalyst. This is due to the fact that
Palladium metal, supported on niobic acid, seems to inhibit hydrogenation of C=O. Pd/Nb 2O5.nH2O
catalyst also showed good resilience in the MIBK formation. (Yasuhiko Higashio, 1996).
Isopropyl Alcohol
Isopropyl Alcohol is commonly known as rubbing alcohol is a common ingredient in chemicals
such as detergents and antiseptics. Due to its properties, it offers a lot of household applications such as
removing hairspray residue from windows and mirrors. It can also remove fingerprints from delicate
plastic of the discs such as DVDs and CDs, counter tops, and other commonly touched surfaces. Like
MIBK, IPA also have uses in the automotive industry since it is used to remove brake fluid traces from
the hydraulic braking system to prevent contaminating the brake pads.
According to the Food and Drug Administration, Isopropyl Alcohol (IPA) may be present in
spice oleoresins as a residue from the extraction of spice but it should not exceed 50 ppm, in lemon oil as
a residue in the production of oil but it should not exceed 6 ppm, in hops extract as a residue from the
extraction of the hops but it should not exceed 2.0 wt% providing that the hops extract is added to the
wort before the hops is manufactured as a beer.
1.8 Methodology
The market trend of MIBK was determined by analyzing the import and export of
Indonesia, Thailand, China, Vietnam and Philippines. Then the available market share was
determined by calculating the growth of the total import forecasted until 2027. In order to have a
realistic market share, 51% of the available market was assumed to be the market share
according to Towler and Sinnot. Using SMART Decision support system, the plant location was
chosen among the three alternatives.
The TOPSIS decision support system was used to select the best process among the
three alternatives. There was a criterion set in order to maintain objectiveness among the three
processes. The third process which is the "Integrated Dual Process for the production of MIBK
and IPA" was chosen via DSS. In this process pure acetone and hydrogen feed enters the
reactor where it is converted to MIBK, IPA, Mesityl Oxide (MO), Diisobutyl Ketone (DIBK), and
Diacetone (DA). Before the vapor stream from the reactor enters the distillation column, it
passes through a series of heat exchangers in order to achieve the target temperature which is
35 C. Then, the MIBK is purified by three distillation columns up to 99.67%. In the second
reactor, recycled hydrogen and acetone, and pure hydrogen and acetone is fed. Hydrogen,
Acetone, Diacetone, IPA, Mesitylene, and water is produced from the second reactor before it
enters the distillation column, it passes through a series of heat exchangers to reach the target
temperature which is 35 C. Then acetone is separated from the stream which is then recycled.
Then, IPA is purified up to 99.89%. Exothermic reactions occur in both of the tubular reactors
that contain palladium for the first reactor and rubidium catalyst for the second reactor. ASPEN
HYSYS V8.8 was used to simulate the chosen process using the required operating conditions
and parameters. The heat and material balance is then presented along with the process flow
diagram and the necessary calculations were also presented.

CHAPTER 2: MARKET STUDY
2.1 SITUATIONAL ANALYSIS
2.1.1 Situational Environs
The process that has been chosen for production has two main products, Methyl Isobutyl Ketone
(MIBK) and Isopropyl Alcohol (IPA). This part of the study shows the current state of the MIBK & IPA
global market. This part contains the demand and supply in the Philippines, Asia, and the world.
2.1.1.1 Global Consumption and Production.
Methyl Isobutyl Ketone
The global market of methyl isobutyl ketone was found to be worth 827.4 M US dollars in the
year 2015. It has also been predicted to have a compound annual growth rate (CAGR) of 7.5% over the
periods between 2016 and 2024. The value of the MIBK market is predicted to become 1,572.3 M US
dollars by the year 2024 due to the steady increase in its market price. Most of this CAGR is due to the
increase in demand of MIBK that is used in the consumption of solvents for surface coatings and rubber
processing chemicals mainly in the global automotive industry (Transparency Market Research, 2015).
The major global use of MIBK is known to be as a solvent that accounts for 59% of its total
consumption, 16% of that is used as an extraction solvent, 13% as rubber processing chemicals, and 4%
as surfactants. Furthermore, 18% of global MIBK is used as a solvent in transportation, refurnishing and
marine coatings; 9.2% in construction coatings; 8.5% in wood coatings and 8.1% in metal coatings. The
world production stood at about 485,000 ton/year in 2013, having 170,000 ton/year from Asia Pacific,
followed by 85,000 ton/year from Western Europe, 65,000 ton/year from Japan, 50,000 from Mexico and
45,000 ton/year from the US. Global demand for MIBK in 2013 was found to be 383,000 ton/year. The
(TransTech Consultants Inc., 2014).

Figure 2.1 Global MIBK Supply in 2013
In the year 2015, the largest global producer and consumer of MIBK have been found to still be
the Asia Pacific. It is also accounted, in terms of revenue, for having the leading share in the MIBK
market of over 42% that year (Transparency Market Research, 2015).
Figure 2.2 Global MIBK consumption in 2014

The IHS Markit stated in May 2015 that the global consumption of MIBK gave an annual rate
increase of almost 7% at years 2011 to 2014. It was also stated that the increase in consumption, driven
by Chinas increased tire production, resulted in MIBKs use in rubber antiozonants has developed over
the last three years, from approximately 25% of total MIBK consumption in 2011 to 32% in 2014 in the
major exhausting countries/regions (TransTech Consultants Inc., 2014).
Isopropyl Alcohol
According to Product Complexity Index (PCI) isopropyl alcohol is 1744 th most traded product
and the 789th most complex product.
Asia Europe North America South America Africa
1%
8%
29%
32%
30%
Figure 2.3 Global IPA Exports
According to OEC the top Exporter of IPA is North America wherein it is exporting ($ 369M),
followed by Europe ($ 351M), Asia ($ 337M), Africa ($ 93.7M), and South America ($ 12.7M). The
companies operating the market are the Shell Chemicals, Mitsui Chemicals Inc., Sasol Olefins, DOW
Chemicals, Exxon Mobil Chemical Company, and CNPC Jinzhou Petrochemical Corp (IMARC Group,
n.d.).
Asia Europe North America South America Africa Oceana
2% 1%
5%
19% 39%
34%
Figure 2.4 Global IPA Demand in 2016
According to OEC the top importer of IPA is Asia wherein it is importing ($ 455M), followed by
Europe ($ 395M), North America ($ 224M), South America ($ 62.9M), Africa ($19.4M), and Oceana ($
7.86M). It was reported that Europe and North America were the leading consumers of IPA, but Asia
Pacific shown high growth rates and became the largest consumer of IPA (Merchant Research and
Consulting, 2017). It was also reported that the IPA has grown at a CAGR of 2.5% from 2008 to 2015
wherein it reached a sales volume of 2 M Tons as of 2015. The leading factors that affected the market
growth of IPA are the various industries such as chemicals and materials, pharmaceuticals, industrial, and
cosmetics (IMARC group, n.d.).

2.1.1.2 Demand based on import in the Philippines
Table 2.1 Yearly MIBK import in the Philippines
Year Quantity (Kg) Value (USD) Estimated Price

(USD/kg)
2011 1,261,816 2,447,462 0.886602
2012 1,708,434 2,903,879 0.965153
2013 2,919,128 1,607,542 0.779055
2014 542,303 303,289 1.20645
2015 1,460,969 1,210,504 0.953671
2016 1,815,099 1,937,572 0.89161
The following data are obtained from the United Nations Commodity Trade Statistics Database.
These numbers are validated using the values in the website of Department of Trade and Industries of the
Philippines, Tradeline Philippines.
3,500
3,000
2,500
Import (MT)
2,000
1,500
1,000
500
0
2011 2012 2013 2014 2015
Year
Figure 2.5 Data of Import in the Philippines

Using the Trend Analysis via Linear Regression in Figure 2.5, it can be seen that the Demand in
the imports for the Methyl Isobutyl Ketone (MIBK) from 2011 to 2016 is slowly depleting since there are
already existing companies in the Philippines that is producing MIBK such as Chemisol Inc., Coastal Bay
Chemicals, California Chemical Corp., and SBS Philippines Corp. The Demand for the import of MIBK
by 2027 will be 1,481,878 Kg. The aim of the company is to first meet some of the remaining demand in
the Philippines for the next couple of years and then start exporting on nearby countries with high demand
of MIBK.
Table 2.2 Yearly MIBK Value in the Philippines
Year Estimated Price (Dollar/kg)

2002 0.68
2003 0.8
2004 1.08
2005 1.47
2006 1.09
2007 0.61
2008 1.03
2009 0.76
2010 1.26
2011 1.94
2012 1.7
2013 0.55
2014 0.56
2015 0.83
2016 1.067
The data provided by the United Nations Commodity Trade Statistics Database on the demand
and trade value of MIBK import in the Philippines.

Figure 2.6 Data of MIBK Estimated Market Value based on Philippine Import
By analyzing the data provided by the United Nations Commodity Trade Statistics Database for
the import data and trade value then using the Trend Analysis via Linear Regression, it can be seen that
despite the decrease in net weight demand there is an Increase in the value of MIBK in dollars per
kilogram in the Philippines from 2002 to 2016. If the trend continues the value of the MIBK per Kg will
increase up to 1.11 Dollars per Kg by 2017.
Currently there are no data for the Philippines export of MIBK. This is based on the data
provided by the United Nations Commodity Trade Statistics Database and validated by the website of
Department of Trade and Industries of the Philippines, Tradeline Philippines.
Isopropyl Alcohol
Table 2.3 Demand quantity and value of IPA in the Philippines based on Import
Year Quantity (kg) Value (USD) Estimated Price

(USD/kg)
2011 15,196,332 13,473,096 0.887
2012 15,796,376 15,245,919 0.965

2013 18,443,946 14,368,844 0.779
2014 16,581,009 20,004,157 1.206
2015 15,732,835 15,003,949 0.954
2016 24,465,956 21,814,084 0.892
The following import data on amount in kilograms and value in US Dollars of Isopropyl Alcohol
are provided by the United Nations Commodity Trade Statistics Database. These numbers are validated
by the website of Department of Trade and Industries of the Philippines, Tradeline Philippines.
30,000.00
25,000.00
20,000.00
Quantity (kg)
15,000.00
10,000.00
5,000.00
-
2011 2012 2013 2014 2015 2016
Year
Figure 2.7 IPA Demand based on Philippine Import
Using Linear Regression, the trend analysis can be seen as the red line in the graph. It can be
perceived that the Demand in the imports for the Isopropyl Alcohol (IPA) from 2011 to 2016 has a
positive slope because of the constant increase in the compounds everyday usage, both in the domestic
and industrial fields. The demand for the Philippines is estimated to be 35 M kg.
Table 2.4 Export of IPA in the Philippines
Year Export (kg)
2011 11,750
2012 8,019
2013 65,251
2014 345
2016 35,155
2011 11,750
30,000.00 70
25,000.00 60
50
Import Qty (MT)
Export Qty (MT)

20,000.00
40
15,000.00
30
10,000.00
20
5,000.00 10
- 0
2011 2012 2013 2014 2015 2016
Import Export
Figure 2.8 IPA Visual representation of Import and Export
The graph shows the visual representation of the import and export of IPA in the Philippines. It
can be seen that the export value of IPA in the Philippines is almost negligible when compared to the
Import value.
1.4
1.2
Estimated Price (Dollar/Kg)

1
0.8
0.6
0.4
0.2
0
2011 2012 2013 2014 2015 2016
Year
Figure 2.9 IPA Estimated Price based on Philippine Import
The figure above shows that the estimated price per kilogram of IPA is slowly increasing over the
years 2011-2016. The trend analysis of the price, represented by the red line, was obtained by the use of
linear regression. The estimated price of IPA in the Philippines can be estimated to be 1.1083 US Dollar
per kilogram by the year 2017.

2.1.1.3 Demand based on import in Asia
1.40% 2.70%
4.10% China
2.70% 1.80% India
3.40% South Korea
Singapore
4.20%
39% United Arab emirates
4.50% Thailand
4.80% Vietnam
Indonesia
5.40% Israel
Philippines
26% Malaysia
Others
Figure 2.10 Percentage of MIBK imports in Asia in 2015
As previously stated in the Transparency Market Research in 2015, Asia Pacific was the largest
producer and consumer of MIBK in the world, making it the focused continent of this study. The data
above is from The Observatory of Economic Complexity tool by Alexander Simoes from the MIT Media
Lab. It can be seen in the pie chart that china is the greatest importer in Asia at 39% followed by Thailand
at 26%. All of the other countries in Asia are below 10% in the import data, including the Philippines that
sit at 1.4% of the imports in Asia. For this reason, the study will be focusing only on the demand of the
top importing countries.

China
Table 2.5 Demand of MIBK based on import and export in China
Import
Year Trade Value (Dollar) Net Weight (kg)
2011 36,729,312 20,602,674
2012 47,945,026 26,725,783
2013 93,298,603 51,659,242
2014 93,835,120 54,259,065
2015 53,621,783 48,556,640
2016 48,499,681 53,340,091
Export
2011 1,167,701 2,523,642
2012 10,185 277,041
2013 2,110 13,654
2014 2,244 19,566
2015 537,105 679,616
2016 62,920 56,103

60,000 1,400
50,000 1,200
1,000
Import Qty (MT)
Export Qty (MT)

40,000
800
30,000
600
20,000
400
10,000 200
- -
2011 2012 2013 2014 2015 2016
Import Export
Figure 2.11 Comparison of MIBK Import and Export in China
The data of above gives the MIBK demand of China based on their latest yearly imports. Figure
2.6 provides the visual representation of the growth of the demand in China. By assuming that the growth
of the demand is linear, the growth gives a positive growth. The demand for 2017 can be extrapolated to
be about 62 M kg. Figure 2.11 also shows that the export of MIBK in China is relatively low. This means
that the country does not have enough supply and needs more MIBK
India
Table 2.6 Demand of MIBK based on import and export in India
Import
2011
8,907,506 4,292,341
2012
34,712,857 17,676,038
2013
39,964,418 19,517,991
2014
40,325,276 20,159,740
2015
39,287,944 28,048,008
2016
24,871,125 23,556,818
Export
2011 1,186,782 586,107
2012 61,297 9,185
2013 65,019 40,716
2014 856,184 394,719
2015 154,924 133,417
2016 144,441 7,179
30,000 700
25,000 600
500
Import Qty (MT)
Export Qty (MT)

20,000
400
15,000
300
10,000
200
5,000 100
0 -
2011 2012 2013 2014 2015 2016
Import Export
Figure 2.12 Comparison of MIBK Import and Export in India
Figure 3.0 can be used to analyze the growth of demand of MIBK for India. Assuming that the
growth is linear, the graph shows a positive slope implying a positive growth in demand. The demand for
2017 can be extrapolated to be about 28 M kg. The graph shows a trend of export that has a negative
slope, this means that the country still lacks manufacturing plants of MIBK.
Thailand
Table 2.7 Demand of MIBK based on import and export in Thailand
Import
2011 8,907,506 4,292,341
2012 9,602,417 5,174,444
2013 8,717,966 4,577,527
2014 7,431,050 3,911,549
2015 5,949,633 4,503,514
Export
2011 47602 25640
2012 0 0
2013 1212 19
2014 0 0
2015 38002 28341
2016 0 0
6,000 30
5,000 25
Import Qty (MT)
Export Qty (MT)

4,000 20
3,000 15
2,000 10
1,000 5
0 0
2011 2012 2013 2014 2015 2016
Import Export
Figure 2.13 Comparison of MIBK Import and Export in Thailand
By analyzing Figure 2.13, it can be concluded that Thailands MIBK demand based on import
shows a positive growth and also gives an estimated value of 4.2 M kg by means of extrapolation. The
export data in Thailand is very low and is zero in some years, this makes the export data almost negligible
when compared to the import data.
Vietnam
Table 2.8 Demand of MIBK based on import and export in Vietnam
Import
2011 2,875,347 1,657,817
2012 3,088,296 1,780,595
2013 4,029,363 1,956,517
2014 4,625,642 2,325,059
2015 5,188,926 2,630,271
Export
2011 47602 25640
2012 0 0
2013 1212 19
2014 0 0
2015 38002 28341
2016 0 0
3,000 140
2,500 120
100
Import Qty (MT)
Export Qty (MT)

2,000
80
1,500
60
1,000
40
500 20
- 0
2011 2012 2013 2014 2015
Import Export
Figure 2.13 Comparison of MIBK Import and Export in Vietnam
Table 2.8 and Figure 2.13 shows the available data on the import MIBK in Vietnam. The values
from the previous years provide a positive slope of growth in demand based on imports. By the method of
extrapolating, the demand for 2017 gives a value of about 3.3 M kg. The graph of the export of MIBK in
Vietnam is greatly decreasing and has already reached zero. This implies the lack of manufacturing plants
in the country.
60,000
50,000
40,000
Demand (Kg)
China
30,000 India
Thailand
20,000 Vietnam
Philippines
10,000
-
2011 2012 2013 2014 2015 2016
Year
Figure 2.14 Import Trend 2011-2016
Figure 2.14 shows the visual representation of the import trends in the chosen target countries of
the company. It can be seen that both China and India have a significant growth in the demand of MIBK
On the other hand, Thailand, Vietnam, and the Philippines show very little growth relative to China and
Indias growth. This reason makes the three countries have an almost stagnant demand line.
2.1.1.4 Availability of Raw Material
Table 2.9 Import and Export data of Raw Materials in the Philippines
Acetone Hydrogen
Year Import (kg) Export (kg) Import (kg) Export (kg)
2012 5,523,250 - - -
2013 4,704,023 23 - -
2014 3,554,968 - 27 -
2015 2,837,296 1 361 -
2016 5,464,916 12 916 -
Table 2.9 shows that acetone is not readily available in the Philippines because of the high import
data. This also implies that there are no acetone manufacturers in the Philippines. The data for hydrogen
import is present in the table but it is small enough to be considered as insignificant. The lack of import
and export data in hydrogen implies that there are manufacturers of the compound present in the country.
Figure 2.15 Percentages of Importers of Acetone in the Philippines
The figure above helped the company to decide the primary country to consider when obtaining
the raw material acetone. The data that was obtained from the Observatory of Economic Complexity tool
showed that the main sources of the raw material Acetone will be coming from Singapore, Japan, and
Malaysia. It was also found that the existing Acetone distributor in the Philippines is the company A.P.C.
Chemimcal Industries, Inc. in Pasig City.
The company has found that there are three possible providers of the raw material Hydrogen gas.
The companies and their addresses are stated below:
Table 2.10 Companies that manufacture Hydrogen Gas
Industrial Gases Manufacturers Address
Linde Laguna
Air Liquide Metro Manila
INGASCO, INC. Batangas
2.1.1.5 Project Location
In establishing a manufacturing plant, it is crucialthat the proposed location is located in an
Industrial area and the development should be taken into consideration to avoid inconvenience to the
manufacturing company and to the community as well. It should be near seaports, roads, and airports for
faster transportation of the product to the manufacturers. It should also satisfy the assigned criterion.
2.1.1.5.1 Proposed Location
The three proposed locations for the MIBK manufacturing plant are (1) Light Industry and
Science Park 4 (LISP IV), (2) SuntrustEcotownTanza (SET), and (3) Hermosa Ecozone Industrial Park
(HEIP).
Light Industry and Science Park 4 (LISP IV):

Figure 2.16 Light Industry and Science Park 4 (LISP IV) Location
Light Industry and Science Park IV includes a 200- hectare industrial area, and a 40 hectare
residential area. It is strategically located near the Southern Luzon expressway to provide a convenient
access for the transportation of products. It is also 35 Kilometers away from the Batangas International
seaport, 59 Kilometers from the Ninoy Aquino International Airport, and 44 Kilometers from Alabang,
Muntinlupa and 65 Kilometers from Makati city where the foreign expats and the central business resides.
The location of the Light Industry and Science Park IV was able to withstand the worst floods in
the area for a hundred years and is readily available for development. It already has a reliable electricity
supply, steady water supply, and In-house security and firefighting capabilities, Transportation system. It
also provides a people and business environmental haven since it is located in the grassy plains of Malvar,
Batangas. It is also registered by the Philippine Economic Zone Authority (PEZA) as a Special Economic
Zone.
Table 2.11 General Information of Malvar, Batangas
Country Philippines
Region Calabarzon (Region IV-A)
Province Batangas
District 3rd District
Barangays 15
Area 3300 hectares
Population 43,937
ZIP Code 4233
Dialing Code 43
Income Class 2nd Class
Source: Malvarbatangas.gov.ph
Malvar Batangas is surrounded by the City of Tanauan on the north, the Municipality of Sto.
Tomas on the east, the City of Lipa on the south, and the Municipality of Balete on the west. It is located
in the northeastern part of the Batangas Province. The municipality is mainly used for Residential (447.56
hectares), Industrial (499.50 hectares), Agricultural (1655.07 hectares), and solid waste facility (0.58
hectares) area.
The power supply of Malvarbatangas is supplied by BATELEC II Electrical Cooperative, Inc. It
was National Electrification Administration (NEA) registered on August 12, 1977. It is one of the two
suppliers of electricity in the Batangas province.
Table 2.12 Electric Charge for BATELEC II
RATE CHARGE Residential Commercial Industrial

(perKwH)
Small Large
scale scale
Average Rate 8.6322 7.2768 7.2768 6.1318
The water supply in MalvarBatangas is supplied by the Metro Lipa Water District (MLWD).
MLWD chlorinates the water supplied to the consumers by using electromagnetic dosing pumps. For
areas with high iron content, they are treated with a two-stage iron filtration system. MLWD also conduct
regular water sampling in the pipes to ensure the quality of their water supply. MLWD is a DOH-
accredited laboratory.
SuntrustEcotownTanza (SET):
Figure 2.17 SuntrustEcotownTanza (SET) Location
SuntrustEcotownTanza is a 160-hectare property in Tanza, Cavite but it is intended to extend up
to 350 hectares of total land area. The industrial area will initially cover 111 hectares and will be
Philippine Economic Zone Authority (PEZA) registered. The SET will be environmental friendly for
commercial, residential, industrial, and institutional development.
It is 29, and 43 kilometers away from Makati Central Business District and Ortigas Central
Business District, Respectively. It is also 36 kilometers away from the Manila port, and 28 kilometers
away from the Ninoy Aquino International Airport (NAIA). SET will give an advantage in transporting
the product via Air and Sea transportation.
Table 2.13 General Information of Tanza Cavite
Country Philippines
Region Calabarzon (Region IV-A)
Province Cavite
District 6th
Barangays 41
Area 9559.65 hectares
Population 226,188
ZIP Code 4108
Dialing Code 46
Income Class 1st
The municipality of Tanza is located 33 kilometers from the south of Metro Manila. It is also
bounded by Rosario on the north, General Trias on the east, and TreceMartires City on the southeast.
While the Manila Bay and the Naic lies on the western and southwest of Tanza, respectively.
The power supply of the municipality of Tanza is supplied by MERALCO, the largest distributor
of electricity in the Philippines. MERALCO also supplies 36 cities and 75 municipalities here in the
Philippines. It already distributed electricity for 114 years.

Table 2.14 Rate of Charge of MERALCO in Cavite

(per KwH)
Average Rate 8.4433 7.9221 6.4152
The water Supplier for Tanza, Cavite is Tanza Water District. It provides sufficient supply of
water for the community and deliver effective and efficient public service. It provides eight pump stations
with ranging 40 60 hp and 220V 460V. The pump used are vertical turbine and submersible.
Hermosa Ecozone Industrial Park (HEIP):
Figure 2.18 Hermosa Ecozone Industrial Park (HEIP):
Hermosa Ecozone Industrial Park (HEIP) is located in the province of Bataan wherein it is a 478-
hectare with a 162-has provided for the Industrial estate. HEIP is a Philippine Economic Zone Authority
(PEZA) registered as special economic zone (Ecozone). HEIP is a township project of the Hermosa
Municipality, which is managed by the Science Park of the Philippines, Inc.
It is 20 and 96 kilometers away from the Subic Seaport and Manila South Harbor, respectively. It
is also 99 kilometers and 35 kilometers away from the Ninoy Aquino International Airport (NAIA) and
DiosdadoMacapagal International Airport (Clark), respectively. HEIP is strategically located in the
growth corridor of Subic Bay Freeport Zone and Clark Special Economic Zone. HEIP is accessible
through Subic-Clark-Tarlac Expressway (SCTEX).
Table 2.15 General Information of Bataan
Country Philippines
Region Central Luzon (Region III)
Province Bataan
District 1st
Barangays 23
Area 15700 has
Population 65862
ZIP code 2111
Dialing Code 47
Income Class 1st
Sources: Hermosa.gov.ph
Hermosa, Bataan is 21 kilometers from the capital of Bataan which is Balanga City and it is 105
kilometers away from Manila. It is mostly flat and gently rolling. The highest peak of the municipality is
400 meters above sea level which is located in the southwest of Barangay Mabiga and Tipo.
The Electricity distributor of the Hermosa Bataan is the Peninsula Electric Cooperative
(PENELCO) and Manila Electric Company (MERALCO) but the power supplier of the HEIP is
PENELCO since it provides a lower cost.
Table 2.16 Rate of Charge of MERALCO in Bataan
Average Rate 7.665 6.663 5.52
The water supply in Hermosa, Bataan is being supplied by the Hermosa Water District Services.
The HWDS supplies HEIP from a water recycling facility through a dual piping system. The piping
system has a total capacity 18,000 m3 per day. HEIP also has a centralized waste water treatment facility
having a capacity of 12,000 m3 daily.
2.1.1.5.2 Plant Location Criteria:
Table 2.17 Plant Location Criteria with description
Criteria Description
Availability of Saleable Area The available saleable area should be
considered in determining the plant location.
since the size of the plant is yet to be
determined, the alternative with the largest
saleable area will be chosen.
Price of Area per sq. meter The Price of Area should be considered to
determine whether the area per sq. meter is too
expensive.
Environmental Safety The proposed plant should also not impose
risks to the local communities. Nearby disposal
location for the waste material should be
considered
Consideration to nearby Communities The proposed plant should be accepted by the
local communities to avoid inconvenience in
the operation of the plant.
Accessibility to Utilities The proposed plant should be near the body of
water suitable for its disposal. Cooling water
can be taken from the river, sea, and lake.
Transportation of Raw Materials The suppliers of the raw materials should be
close to the proposed plant for
Transportation of Product The convenience in transporting the product to
the manufacturers is a factor to be considered.
Faster delivery of products to the costumers is
important.
Availability of Qualified Workers Availability of Qualified Workers is a factor to
be considered since they are needed for the
construction and the operation of the plant.
Climate The temperature, relative humidity and dry
seasons should be considered in choosing a
plant location
2.1.1.5.3 Selected Plant Location
Decision Makers:
Member 1: Yves Robin Pines
Member 2: Ashraf Helmy Mohamed Yehia
Member 3: Russel Marc Pepito
Alternatives:
Light Industry and Science Park 4 (MalvarBatangas) 100 has.
Price per sq. area: Php 5,500.00

SuntrustEcotownTanza (Tanza, Cavite) 90 has.
Hermosa Ecozone Industrial Park (Hermosa, Bataan) 85 has.
Table 2.18 Rating of criteria
Criteria Member 1 Member 2 Member 3

Availability of Saleable 7 9 10
Area
Price of Area per sq. 7 8 8
meter
Environmental Safety 8 8 9
Consideration to 8 8 7
nearby Communities
Accessibility to utilities 7 9 8
Transportation of Raw 7 9 9
materials
Transportation of 7 9 9
Product
Availability of 6 8 8
Qualified Workers
Climate 7 7 6
Table 2.19 Weights for the Criteria
Criteria Member Weight Member Weight Member Weight Average

1 1 2 2 3 3 Weight
Availability of 7/64 0.109375 9/75 0.12 10/74 0.1351 0.1215
Saleable Area
Price of Area per sq. 7/64 0.109375 8/75 0.1067 8/74 0.1081 0.1081
meter
Environmental Safety 8/64 0.125 8/75 0.1067 9/74 0.1216 0.1178
Consideration to 8/64 0.125 8/75 0.1067 7/74 0.0946 0.1088
nearby Communities
Accessibility to 7/64 0.109375 9/75 0.12 8/74 0.1081 0.1125
utilities
Transportation of Raw 7/64 0.109375 9/75 0.12 9/74 0.1216 0.1170
materials
Transportation of 7/64 0.109375 9/75 0.12 9/74 0.1216 0.1170
Product
Availability of 6/64 0.09375 8/75 0.1067 8/74 0.1081 0.1029
Qualified Workers
Climate 7/64 0.109375 7/75 0.0933 6/74 0.0811 0.0946
Table 2.20 Rubric Scale
Criteria Poor (0.00) Fair (0.40) Good (0.60) Excellent (1.00)

Availability of The available area of The available area of The available area of The available area of
Saleable Area has Is below 30 has Is between 31- has Is between 61- has Is above 91
60 90
Price of Area per The price of land is The price of land is The price of land is The price of land is
sq. meter overpriced high compared to affordable and fair very affordable and
other prices
reasonable
Environmental The location has no The location has a The location has a The location has a
Safety facility for waste facility for waste facility for waste facility for waste
water water water; Parameters
water; Parameters for
for discharging
waste water are discharging waste
controlled; programs water are controlled;
for environment
Excellent programs
protection are
considered for environment
protection are
considered
Consideration to The plant is not Only Few people of Most of people of The plant is accepted
nearby accepted by the local the local community the local community by the local
Communities community; The accepted the project accepted the project
plant is not safe for in their community; plan in their community; The
the local community ; The plant is safe for community; The plant is safe for the
Not considered as a the local plant is safe for the
local community;
source of new jobs community; local community;
and economic Considered as a Considered as a Considered as a
opulence source of new jobs source of new jobs source of new jobs
for few and and economic
for many and
economic opulence opulence
economic opulence
Accessibility to The Airports, Some of the The Airports, The Airports,
utilities Bridges, Ports, Rail, Airports, Bridges, Bridges, Ports, Rail, Bridges, Ports, Rail,
Roads are not Ports, Rail, Roads Roads are accessible
Roads are easily and
accesible are accessible and with a few hours
too far from the instantly accessible
location
Transportation of Raw materials
Transportation of The location of The location of The location of The location of
Product manufacturer is too manufacturer is far manufacturer is near supplier of raw
far from the location; from the location; from the location;
material is too near
Airplane or ship is Fuel cost for vehicle Fuel cost is fair
required as a mean is quietly high from the location;
for transportation Fuel cost is relatively
low
Availability of Few skilled and Considerable A lot of skilled and Many skilled and
Qualified Workers unskilled workers are number of skilled unskilled workers unskilled workers are
available in the area and unskilled are available in the
available in the area
workers are area
available in the area
Climate The location of the The location of plant The location of plant Factors affecting the
plant cause a may occur a few has no problem plant such as
hindrance in the problems regarding regarding
precipitation,
production because of precipitation, precipitation,
the climate humidity, humidity, humidity,
temperature and dry temperature and dry temperature and dry
season. season.
season are beneficial
Rating:
Table 2.21 Member 1 Rating
Criteria Light Industry and SuntrustEcotownTanza Hermosa Ecozone

Science Park 4 Industrial Park
Availability of 0.7 0.6 0.7
Saleable Area
Price of Area per sq. 0.6 0.5 0.5
meter
Environmental Safety 0.8 0.7 0.8
Consideration to 0.4 0.4 0.5
nearby Communities
Accessibility to 0.6 0.7 0.6
utilities
Transportation of Raw 0.6 0.7 0.6
materials
Transportation of 0.6 0.6 0.6
Product
Qualified Workers
Climate 0.7 0.7 0.7

Saleable Area
meter
Environmental Safety 0.8 0.7 0.8
nearby Communities
utilities
Transportation of Raw 0.6 0.7 0.6
materials
Product
Qualified Workers
Climate 0.7 0.8 0.6

Saleable Area
meter
Environmental 0.70 0.90 0.80
Safety
nearby Communities
utilities
Raw materials
Product
Qualified Workers
Climate 0.90 0.90 0.90
Table 2.24 Average Scores
Criteria Average Light Industry and SuntrustEcotownTan Hermosa Ecozone

Weight Science Park 4 za Industrial Park
(Average Rating) (Average Rating) (Average Rating)
Availability of 0.1215 0.8333 0.7667 0.7333
Saleable Area
Price of Area 0.1081 0.7 0.7333 0.7
per sq. meter
Environmental 0.1178 0.7667 0.7667 0.8
Safety
Consideration to 0.1088 0.7333 0.6 0.6
nearby
Communities
Accessibility to 0.1125 0.6667 0.7333 0.6667
utilities
Transportation 0.1170 0.6333 0.7 0.6667
of Raw
materials
Transportation 0.1170 0.7 0.7 0.6333
of Product
Availability of 0.1029 0.6667 0.7 0.7
Qualified
Workers
Climate 0.0946 0.7667 0.8 0.7333
Sensitivity 0.7191 0.7220 0.6928
Analysis
Sample Calculations:
Sensitivity Analysis =0.1215(0.8333) + 0.1081(0.7) + 0.1178(0.7667) + 0.1088(0.7333) +
0.1125(0.6667) + 0.1170(0.6333) + 0.1170(0.7) + 0.1029(0.6667) + 0.0946(0.7667)
= 0.7191
Conclusion:
Since the SuntrustEcotown Plaza has the highest sensitivity analysis, its the best option for the
plant location of the Methyl Isobutyl Ketone Plant.

Land Area (Class 5 Estimate)
Land Area estimation is based on a ratio-and-proportion calculation from MIBK and IPA plants that
already exists in other countries.
MIBK
Carboclor Company is located at Campana, Argentina. 2.56 has is the total land area (for MIBK plant
only).
The capacity of their production is 8000 metric tons per year of MIBK
IPA
Dow Chemical Company is located at Texas, USA. 25.84 has is the total land area (for IPA plant only).
The capacity of their production is 473,000 metric tons per year of IPA.
Summarized data for the capacity and land area
The calculated Class 5 estimate for land area is 4.88 has.
2.1.2 Competitor Environs

In order for the proposed Manufacturing plant to be competitive in the ASEAN market, the companies
from the neighboring countries were included in the analysis. These are:
Table 2.25 ASEAN Manufacturers
Country Company Location

20, Tuas Street, Singapore
Singapore 638457
Go Dau Industrial Zone

Viet Nam Long Thanh District, Dong
Nai Province
No.29, Jalan PJU 3/49

Malaysia Sunway Damansara
Technology Park
47810 Petaling Jaya
Selangor Darul Ehsan.
Local Competitors:
Figure 2.19: Logo of Coastal Bay Chemicals, Inc.

Coastal Bay Chemicals, Inc. is located in the coastline of Bauan,Batangas Philippines. It
specializes in the Importation bulk chemical raw materials, manufacturing of latex products, handling and
storage of various chemicals, and delivery service of chemicals to its consumers.
Figure 2.20 Logo of California Chemicals Corporation
California Chemical Corporation islocated in Facility Center 548 A Shaw Boulevard 1550
Mandaluyong, Philippines. This company is a major supplier of solvents and industrial chemicals. This
company established in 1977 and now serving and evolving in various industries such as Paint and Ink
Manufacturing, Flexible Packaging Converters, Automotive and Auto Parts Manufacturers, Plastic
MouldingIndustries ,Personal Care and Household Products,Offset and Flexographic Printers.The
company takes pride in supplying products from trustworthy principals to guarantee high quality
products.
Figure 2.21 Logo of Chemisol Incorporated

Chemisol Inc. is a major chemical supplier of solvents and chemicals in the Philippines.Chemisol
serves the paint, ink, adhesive, resin, pharmaceutical, chemical, food, cosmetics, agricultural, and other
industries. In 1995, it started out as Quebros Enterprise by four brothers. The business was firstly engaged
in food oil blends, plastic colorants and snack food seasoning materials. The business eventually
developed to include other chemical products to serve the textile industry, paint industry, and other
chemical industry. The company has a highly regarded for the value it was offering for its client. The
company gained the trust and confidence of the chemical industry because of always giving the best
quality product with personalized service and the most competent technical service. In 2008, Chemisol
Inc. was formed to focus on distributing Shell chemical products. Being its high-class distributor in the
Philippines, Chemisol Inc. aims to give the Philippine chemical industry the best conceivable
combination of world class Shell chemical products and services.
Figure 2.22 Logo of SBS Philippines Corporation
One of the leading chemical trader-distributor in the Philippines is SBS Philippines Corporation,
providing a various customer base of more than 1,800 customers nationwide with 3000 chemical products
sourced from more than 500 suppliers. The Company was newly admitted on the Main Board of the
Philippines Stock Exchange with its shares traded under the ticker symbol SBS.
Isopropyl Alcohol
Manufacturing plants of Isopropyl Alcohol in neighbouring countries were included in the
analysis. These are:

Table 2.26 ASEAN Manufacturers
Country Company Location
Singapore The Metropolis Tower 1. 9
North Buona Vista Drive,
#06-01.Singapore 138588.
Malaysia No.23, Jalan 3/3C Sri Utara,
Off Jalan Ipoh Mukim Batu
68100 Kuala Lumpur
Malaysia.
Go Dau Industrial Zone Long

Viet Nam Thanh District, Dong Nai
Province
Local competitors:
Figure 2.23 Philusa Corporation

Philusa Corporation is dedicated to providing high quality and competitive products and services to
customers by exceeding their expectations on time. The company strive for continuous quality
improvements in all, through team work, for the benefit of the customers, employees and other interested
parties. The employees, take ownership and responsibility for the quality of our products, services and
processes.
Figure 2.24 Century Chemical Corporation
Century Chemical Corporation (CCC) was established in 1962 by a group of Filipino businesspersons to
answer the rising demand for quality paint products in the market. Hudson was launched to deliver
premium paints for households and industries. The success of HUDSON firmed up CCC's status as a
provider of superb paint and related products. CCC, is an innovative company. It was the first in
introducing polyurethane paint in the Philippines through HUDSON wood varnish. In automotive
refinishing industry, ANZAHL paint was accountable for commercializing the polyurethane paint system.
CCC's ever commitment to quality, customer fulfilment, continuous product research and innovation,
concern for the environment, as well as its employees, allow the company to reach the status as one of the
leading chemical companies that it is today.
Figure 2.25 Cosmetique Asia

In 2001, Cosmetique Asia was established. With the overview of its flagship brand, Silka Papaya, the
company decided to venture into the rising growth of cosmetic industry in the Philippines. Cosmetique
Asia is directed by its founder Mr. Alexander S. Co, who has over 40 years of experience in cosmetic
retailing. After a worthy market acceptance of the Silka Papaya product line, Cosmetique Asia launched
another brand, Juicy Cologne, the companys first foray in the perfume industry. Currently, Cosmetique
Asia is continuously growing and adding variation of cosmetic products for the benefit of its consumers.
2.2 TARGET MARKET
Methyl Isobutyl Ketone is a chemical known for many uses such as:
Solvent: MIBK is mainly used as a solvent in cellulose-based and resin-based coatings and adhesives. It
is also used as a solvent in:
Metal extraction. MIBK is used as a solvent for metal separation.
Pharmaceutical. Solvents used for extracting the pharmaceutical products and antibiotics.
Agrochemical. MIBK is being used extensively with agrochemical areas such as germicide,
fungicide and pesticides.
Rubber: MIBK is used as a raw material in the manufacture of rubber antiozonants and protects diene
rubbers such as natural rubber, styrene-butadiene rubber and nitrile-butadiene rubber. Diene rubbers have
high percentage of unsaturation and are susceptible to ozone attack which leads to surface cracking.
Cleaner: MIBK is used as a industrial cleaner. It acts as a degreaser or deoiler of petroleum product.
Isopropyl Alcohol is a chemical known for many uses such as:
Solvent: IPA is used widely as a solvent and as a cleaning fluid, especially for dissolving oils.
Intermediate: This compound may serve as a chemical reagent in itself, by acting as a dihydrogen donor
in transfer hydrogenation.
Medical: Rubbing alcohol, hand sanitizer, and disinfecting pads typically contain a 6070% solution of
isopropyl alcohol in water.
Automotive: IPA is a major ingredient in "gas dryer" fuel additives.
Laboratory: IPA provides a comparatively non-toxic alternative to formaldehyde and other synthetic
preservatives. It is used in DNA extraction. It is added to a DNA solution in order to precipitate the DNA
which then forms a pellet after centrifugation.
2.2.1 Local Market of Methyl Isobutyl Ketone
Listed below are the local manufacturing companies that can be a conceivable buyer or consumer of
MIBK with address and contact detail.
Table 2.27.Philippine Manufacturers that use solvent in manufacturing
Company name Address Telephone number

Benquin Triple 8 Chemicals, Inc. Blk 110 Lot 5 Villa Vienna 63--4613084
NeopolitanSubd.,Regalado Ave.,
cor. Mindanao Ave.Brgy. Greater
Lagro, Quezon City
TOPLINECHEM Marketing 022 Rose Road, Sea Breeze +63 46 431-1392
Corporation Subdivision, Sta. Cruz, Cavite
City, Cavite
Obetech Pacific Philippines Ph8 VgpCenter +639089553253
6772 Ayala Avenue 1226 Makati
City,Philippines
AIK MOH Paints and Chemicals Unit 1809, Medical Plaza Ortigas +63 2 637 8532
Building, San Miguel Avenue,
OrtigasCenter, 1605, Pasig City
Alkemia Industrial Supply Unit 10-01 One Global Place 5th 09176358979
Avenue corner 25th St.,
Bonifacio Global City, Metro
Manila
Nextlube 18B Basilio Street Brgy Acacia 09272957316
Malabon City Philippines,
Malabon, Metro Manila
LjsIntracs Corp 8481 Sandoval Ave. Greenwoods +63(2)6425608
Subdivision Phase IV, +63(921)4331980
Pinagbuhatan Pasig City, Pasig +63(2)7383865
City, Metro Manila +63(2)6643864
Emtec Philippines Inc. 72 Mayor Ignacio S. Diaz Street, (+63-7239121 and 7268368)
Brgy. San Martin De Porres,
Cubao, Quezon City, Metro
Manila
Benquin Triple 8 Chemicals, Inc. Block 110 Lot 5, Villa Vienna 02-4613084
Neopolitan Subdivision, 02-4613113
Regalado Ave., Brgy. Greater 02-4613115
Lagro, Quezon City, Metro
Manila
CHEMREZ Incorporated L B L Building 65 Industria 6350680
Road Bagumbayan 1100, Quezon
City
NIPPON Paint Philippines Inc. #4 Hologram St. Lisp Brgy. (049)543-0763 / 845-1176
DiezmoCabuyao Laguna
Crystal Resins Incorporated 141 Cabrera Road, SitioBurol 022863011

San Juan Taytay Rizal 022863011
Pacific Paint (Boysen) 292 D. Tuazon St. Quezon City, 364-3505; 365-0561 to 64
Philippines, Inc. NCR - Second District 1115 361-7164; 367-8881
Table.2.28 Rubber manufacturers in the Philippines

Manila Rubber Corporation 50 JP Ramoy Road 0917 5000096
TalipapaNovaliches , Caloocan
City, Metro Manila, Philippines
Precision Seals & Rubber Rimas Street, 09152334934
Products, Inc. BrgyWilfredoAquino, Agdao, 09209699262
Davao City, 8000 Philippines,
Region 11, Davao City, Davao
del Sur
Manhattan Rubber & Plastic 1422 Gov. I. Santiago St., 294-60-56
Manufacturing Corporation Malinta Valenzuela Metro
Manila
Kings Rubber International, Inc. Main Road cor. 4th St., FCIE (63-46) 402-1201; (632) 928-
Governors Drive, Dasmarias, 6791
4114 Cavite Cavite Region 4
Fukai Rubber Phils. Inc. # 6 (049)5314

BatallonesWhouseBanaybanay , (049)520
Cabuyao, Laguna
Orion Rubber Manufacturing Raminel Road., T. Santiago St. 294-1370

Corporation Valenzuela, Metro Manila
Table 2.29 Industrial cleaner Manufacturers in the Philippines

Chemlux, Incorporated Building 4A, CCMC Compound +63(2)8392380
+63(2)8370259
Veterans Center, Western
Bicutan. P.C. 1631, Taguig City,
Metro Manila.
Super Sphere Inc. UG14 Cityland Pioneer Building, 63-9157927588

128 Pioneer, Metro Manila,
Philippines
2.2.1.1 Local Market of Methyl Isobutyl Ketone
Listed below are the local manufacturing companies that can be a conceivable buyer or consumer of IPA
with address and contact detail. Both MIBK and IPA acts as a solvent. Manufacturers of solvents are
included in the MIBK section.
Table. 2.30 Intermediate Manufacturers in the Philippines
JG summit Petrochemicals Barangay Simlong, Batangas +63 43 740 5600
City, Philippines 4200
Table. 2.31 Automotive Manufacturers in the Philippines.
TOYOTA MOTOR Toyota Special Economic Zone +632 819-2912
PHILIPPINES CORP. (TSEZ), Santa Rosa City,
Laguna
ISUZU PHILIPPINES 114 Technology Avenue, +6349 541-0224 (Laguna), +632
CORPORATION Laguna Technopark, Phase II, 584-4081 to 06 (Manila)
Bian, Laguna
HONDA CARS PHILIPPINES, 105 South Main Avenue, +632 857-7200
INC. Laguna Technopark, Sta. Rosa,

Laguna
2.2.2 Export Market for Methyl Isobutyl Ketone & Isopropyl Alcohol
According to the Product Complexity Index (PCI), Methyl Isobutyl Ketone is the 3444th most
traded product and the 1234th most complex product. Asia dominates the demand for Methyl Isobutyl
Ketone. The company does not only focus on the demand in the Philippines but also focus on other
countries that have high demand on MIBK. Asia countries that have high demand of MIBK are China,
India, Vietnam and Thailand. The companys purpose in selecting these countries as its market is based
on the following criteria: location, based on organizational partnership and demand. The company will
not be exporting IPA because the available market on the Philippines is already too large compared to the
amount that the plant will be producing.
2.2.2.1 Export Market Based on Location
India and Thailand are the countries that have high demand of Methyl Isobutyl Ketone (MIBK).
Mumbai, India distance from Tanza, Cavite, Philippines is about 5125.40 kilometers and it takes 6.88
hours. Bangkok, Thailand distance from Tanza, Cavite, Philippines is about 2196.40 kilometers and it
takes 3.25 hours to travel.

Figure 2.26 Tanza, Cavite, Philippines to Mumbai, India travel distance
Figure 2.27 Tanza, Cavite, Philippines to Bangkok, Thailand travel distance
Photos and data retrieved from distancefromto (2017).
China is one of the top importer of MIBK. Tanza, Cavite, Philippines is 2877.13 kilometers
away from Beijing, China, the time of arrival is about 4.08 hours. Vietnam is a country that has a high
demand of MIBK. Hanoi, Viet Nam is 1756.47 kilometers away from Manila, Philippines and it takes
2.48 hours to travel.

Figure 2.28 Tanza, Cavite, Philippines to Beijing, China travel distance
Figure 2.29 Tanza, Cavite, Philippines to Hanoi, Viet Nam travel distance
Photos and data retrieved from distancefromto (2017).

2.2.2.2 Export Market Based on Organizational Partnership
Since Vietnam, Indonesia and Thailand are part of Association of South East Asian Nation
(ASEAN) which also includes Brunei, Cambodia, Singapore, Lao, Malaysia, Myanmar and Philippines.
In spite of the fact that, there would be still import tariffs in some products, being part of this organization
will be a great advantage for the company since there are still other goals of this organization like the
mutual support and active cooperation of mutual interest in the cultural, scientific, technical, social,
administrative and economic fields.
2.2.2.3 Export Market Based on Demand
Based on the data of import in the past 6 years, the five countries below are the one that are
considered to have a steadily increasing demand growth. This makes them the primary target of the
company once the demand in the Philippines is satisfied.
China
China is the top importer of MIBK in the world. Based on the plot of the import, the growth is
positive which shows an increase in demand. It is projected that 62 kilograms of MIBK will be imported
in 2017.
India
India being the second importer of MIBK in the world. The projected demand for 2017 is 28 M
kg of MIBK.
Vietnam
Viet Nam being one of the neighboring countries in the Philippines has a high demand of MIBK.
Based on the graph of the import, the demand trend line is linear and positive. The projected demand in
2017 in Vietnam is 3.3 M kg.

Thailand
Thailand being one of the top importer of MIBK in the world. The growth in demand is positive
which means the slope is positive. Based on Figure 2.29, the projected demand for 2017 of MIBK is 4.2
M kg. The growth rate of IPA is increasing and the projected value in 2017 is 31 M kg.
2.3 SWOT ANALYSIS
Table 2.32 SWOT Analysis Matrix
Strengths Weaknesses
1. The country will depend 1. Brand name is not yet
less on the import of recognized
Methyl Isobutyl ketone 2. High Start-up Cost
and Isopropyl alcohol 3. Employees needs Training
2. The company will be a
domestic supplier of
and Isopropyl Alcohol
3. Raw materials are
readily available in the
country
Opportunities W-O strategy

1. Theres a growing demand 1-1 Aggressive Marketing
locally 1-2 build and maintain a good
2. Improving economy and relationship with suppliers to get the
employment of the country lowest price of raw materials in the
3. Decreasing imports market - this will give the company
the advantage of providing a
competitve price to attract customers.
Threats S-T strategy

1. There are already 1-1 build partnership with
established companies investors: business to business
locally and internationally dealings with customers and
suppliers
1-2 widen reach in the market:
set up an effective distribution
strategy to reach customers.
1-3 provide a competitive pricing
strategy in the market to attract
customers
2.4 MARKETING OBJECTIVES AND GOALS
This part of the study tackles the plans of the company for the years of its planning, building, and
starting capacity then up to the year of it achieving its full capacity.
2.4.1 Market Share
To obtain the estimated capacity of the plant, first a forecast of the demand must be done.
In this study, the forecasts are to be reflected in the next 10 years. To obtain the optimal forecast system,
three methods from the software POM-QM were considered, Moving averages method, Nave method
and the Trend Projection Method in the software POM-QM.
Figure 2.30 Sample Result in Moving Averages method forecast for 2027
Figure 2.31 Sample Result in Nave method forecast for 2027
Figure 2.32 Sample Result of Trend Projection Method forecast for 2016 - 2030
Looking at the standard error of the results of each method, it can be seen that Trend Projection
Method has the lowest value, making it the ideal method for the forecast of demand in the following
years. The company envisions achieving its full manufacturing capacity after a year of its opening which
will be on year 2022.

Table 2.33 Total Demand based on Import of MIBK
Year Total Available Market (kg)

2011 32,106,989
2012 53,065,294
2013 80,630,405
2014 81,197,716
2015 85,199,402
Forecasted amount at target year

187,325,500
(2022)
200,000
180,000
160,000
140,000
Available (MT)
120,000
100,000
80,000
60,000
40,000
20,000
-
2016 2017 2018 2019 2020 2021 2022
Year
Figure 2.33 Forecasted Available Market for MIBK
Table 2.34 Total Demand based on Import of IPA
Total Available Market (kg)
2011 15,196,332
2012 15,796,376
2013 18,443,946
2014 16,581,009
2015 15,732,835
2016 24,465,956
Forecasted amount at target year 28,460,010

(2022)
30000
25000
20000
Available (MT)
15000
10000
5000
0
2017 2018 2019 2020 2021 2022
Year
Figure 2.34 Forecasted Available Market for IPA
The following calculations are based on the book Towler and Sinnott (2008). Since the
manufacturing plant to be constructed is only new, the estimated capacity was chosen to not exceed the
largest manufacturing plant of MIBK in the world, Celanese in La Cangrejera, Mexico which has
50,000MT capacity per year. The company decided to target an annual capacity that is about the same as
the average capacity of existing MIBK manufacturing plants, which is 30,000MT. The estimated market
share was obtained by dividing the estimated capacity by the total forecasted amount of MIBK. The
estimated capacity of the IPA part of the plant would be determined by using the 30,000MT capacity of
MIBK and using the ratio of IPA produced per MIBK stated in the manufacturing process to be used.
Estimated Market Share for MIBK:
30,000,000
= 0.1601
187,325,500
MIBK to IPA production ratio:

= 19.13

Estimated IPA Capacity:
30,000,000
= 1,568,217.46 kg
19.13
Estimated Market Share for IPA:
1,568,217.46
= 0.0551
28,460,010
The estimated capacity of the plant is to be approximately 30,000 MT of MIBK and 1,600 MT of
IPA. The market share of MIBK and IPA will be about 16% and 5.5% respectively.
2.4.2 Market Volume
The planning phase will start at 2018 and last for a year and the construction phase of the
manufacturing plant will last for two years, the company will be producing MIBK by the year 2021. For
its first year, the manufacturing plant will be producing 50% of its capacity. The plant will then its
capacity to reach the intended 30k MT of MIBK and 20k MT of IPA. The company will be in stable full
capacity by 2022.
2.5 MARKETING STRATEGY

Since the trend of MIBK imports here in the Philippines is decreasing and there are already
established companies producing MIBK such as California Chemicals Corporation, Chemisol Inc., and
SBS Philippines corporation, the company will be selling locally, in ASEAN countries, and countries in
the Asia Pacific since there is a growing demand in our neighboring countries. Also, the Philippines is
currently not exporting MIBK. The target market of the company in ASEAN countries are: Vietnam and
Singapore. As for the countries in the Asia Pacific, these are: China and India. With the increasing
demand of MIBK in Asia, the company will also expand to satisfy the growing demand in Asia and
provide a reasonable price with a premium quality to avoid bankruptcy. IPA import in the Philippines is
increasing. Since there are already companies that produce IPA such as Philusa, Century Chemical
Corporation and Cosmetique Asia, imports from other country will be lessen. The company will expand
as the demand of IPA is increasing in Asia to maximize profit..
2.5.1 LOGISTICS
This part of the study discusses handling of the products of the company. This includes the
packaging, storage, and transport of the products.
2.5.1.1 Packaging
Suitable packaging material for MIBK is stainless or mild steel drum. Since, mild steel is more
economical and cheap than stainless steel. Mild steel contains approximately 0.050.25% carbon making
it malleable and ductile. The container should be stored in a well-ventilated area in a fire resistant
container. The capacity of the mild steel drum is 210 liters and the thickness is 1mm. The weight of the
drum excluding the MIBK product is about 19 kilograms. The price range of the drum is Php 3600 to
3800. The storage temperature should be ambient condition to prevent explosion. Metal containers should
be bonded and grounded for transfers to avoid static sparks. Static electricity is generated by the contact
and separation of different material. Non-sparking tools and equipment should be used when opening or
closing metal container such as mild steel drum. The unsuitable material for packaging MIBK are plastic,
aluminum, natural neoprene and nitrile rubbers because MIBK can physically change the container by
absorption, resulting in softening and swelling of the plastic; permeation of MIBK through the plastic.
Isopropyl Alcohol
Suitable packaging material for IPA is plastic drum. Carbon steel drum can be used for the
storage of IPA but plastic drums are cheaper than metal containers. Plastic drums are made out of HDPE
(High Density Polyethylene), and most are UN Certified as well as FDA Approved. IPA should be kept in
a closed container in a cool, dry, well-ventilated area. Due to the chemicals extreme flammability, it must
be kept away from all possible ignition sources, including heat, sparks, and flames. The capacity of the
drum is 200 liters. The drum has a close top with two holes. The weight is about 8 to 9.2 kilograms. The
price ranges to Php 800 to 1000 depending on the suppliers price. The handling temperature should be
ambient. The thickness of the drum would range from 4 to 5 mm.
2.5.1.2 Transportation
The mode of transportation to be used for transporting tanks is isotrucks. This is suitable for land
transportation. For exporting MIBK and IPA products, cargo ships are used by sea. Retrailer trucks are
used for transporting drums.
Figure 2.35 An Isotruck

Figure 2.36 A Cargoship
Figure 2.37 A Trailer Truck
2.6 MARKETING TACTICS
Marketing tactics are done to promote MIBK product with the goal of increasing sales and
maintaining a competitive product. The purpose of this tactics is to return the capital money invested.
Several factors that must be considered for marketing tactics are:
Pricing
Price is a critical part of marketing. Selecting a good price for products will help the company to
make the most of profits. By pricing efficiently, severe financial consequences can be avoided that can
occur if you price too low (not sufficient profit) or too high (not sufficient sales).
Skilled Manpower
Skilled professionals are to be assigned evenly among the production staffs, accounting,
engineering,researchand management to ensure the quality of Methyl Isobutyl Ketone product. The
company will provide incentives to motivate workers working in the company (which includes salary, and
others benefits for the workers and the company capability on it).They must be qualified and trained so
that the quality of the operation, the maintenance and control for the unit operations and the product will
be ensured.
Market Partner
Having a market partner with target market can be a benefit for less transportation cost which
leads to higher profit. Partnership marketing brings bigger marketing exposure and shares in the strength
of partner's brand.
Plant Location
Plant location can be considered as a factor for marketing tactics. Target market that is near from
the plant location minimizes transportation cost and time. Time and cost considered as a big factor for
sales and production.

Preliminary Economic Evaluation: Class 5.
The following correlation is used for estimating the capital cost of a plant by using the
Cost of Plant Equipment (Towler, 2013):
= +
Where Ce =purchased equipment cost on a U.S. Gulf Coast basis, January 2006
a , b = cost constants
S = size parameter
n = exponent for that type of equipment
From the Table 6.6, Purchased Equipment Cost for Common Plant Equipment (Towler,
2013), the following values are for purchased equipment cost on a U.S. Gulf Coast basis. From
the summation of calculated purchased equipment, there will be an estimation for the capital cost
of the plant. The plant consists of eight U-tube Shell and tube Heat exchangers, two centrifugal
compressors, three distillation columns and three separators.
For U-tube shell and tube,
Slower = 10.0 m2 Supper = 1,000.0 m2 a = 10,000 b = 88 n= 1.0
From taking the value of S, there must be an average value of Slower and Supper,
( + )
=
2
By substituting the given values, value of S is obtained.
(10.0 + 1000.0)
= = 505.0 2
2
By using the equation 6.15 (Towler,2013), Cost of Equipment will be obtained.
= 10,000 + (88)(505)1.0 = $54,440
Since the plant has 8 shell and tube heat exchanger, the obtained value for the cost will be
multiplied by 8.
= ($54440)(4) = $ 217760
For Centrifugal compressors,
Assumptions considered: Centrifugal compressor. Supper is used.
Slower = 132.0 kW Supper = 29,000.0 kW a = 8,400 b = 3,100 n= 0.6
( + )
=
2
(132 + 29000)
= = 14566
2
= 8,400 + (3,100)(29,000)0.6 = $984211.38
= ($984211.38)(1) = $.
For distillation columns; Pressure vessels, Packing, and Trays are being considered on
calculation.
a. Pressure vessels
Assumptions considered: Vertical, 304 ss Pressure vessel used.
Slower = 90.0 kg Supper = 124,200.0 kg a = 10,000 b = 600 n= 0.6
( + )
=
2
(90 + 124200)
= = 62145
2
= 10,000 + (600)(62145)0.6 = $ 461019.10
Since the plant has 3 distillation columns used in the plant, the obtained value for
pressure vessel will be multiplied by 3.
= ($ 461019.10)(4) = $1844076.53
b. Packing
Assumptions considered: 304 ss Raschig rings
a=0 b = 3,700 n= 1.0

= (3700)1.0 = $3,700.00
Since the plant has 3 distillation columns used in the plant, the obtained value for packing
will be multiplied by 3.
= ($3700)(4) = $14,800
c. Trays
Slower = 0.5 m Supper = 5.0 m a = 100 b = 120 n= 2.0
( + )
=
2
(5 + 0.5)
= = 2.75
2
= 100 + (120)(2.75)2.0 = $1007.5
Since the estimated number of trays in the distillation column is 167. The obtained value
will be multiplied by 167.
= ($1007.5)(167) = $168252.50
= + +
= $1844076.53 + $14800 + $168252.5
= $.
For separators,
Slower = 100.0 m3 Supper = 10,000.0 m3 a = 53,000 b = 2,400 n= 0.6
( + )
=
2
(100 + 10000)
= = 5050
2
= 53,000 + (2,400)(5050)0.6 = $453116.1
Since the plant has 3 separators, the obtained value for the cost will be multiplied by 3.
= ($4,054,161.38)(2) = $ .
For Reactors
Assumptions: Jacketed and agitated reactor
Slower = 0.5 m3 Supper = 100 m3 a = 14000 b = 15400 n= 0.7
( + )
=
2
(100 + 0.5)
= = 50.25
2
= 53,000 + (2,400)(50.25)0.6 = $ 252954.91
= $ 252954.91
Since the cost of per equipment are already calculated, the capital cost for the plant can
be obtained through the summation of all equipment cost.
= +
= 4388287.6 + $ 4,880,000
For Land Area,
Estimated needed Plant Area= 4.88 has
Price per square meter = 5000
Assumption: 1 USD = Php 50
1 5000 1
= 4.88 ( )( )( ) = $4,880,000
0.0001 1 50
ISBL (Inside Battery Limit Investment) Plant Cost.
The total ISBL Plant Cost using the ISBL for MIBK is
= $ .
Offsite cost or OSBL.

From Towler, et. al. 2008. Chemical Engineering Design, For typical petrochemical
projects, offsite costs are usually between 20% and 50% of ISBL cost, and 40% is usually used as
an initial estimate if no details of the site are known.
= (0.40)($ . )
= $ , , .
Engineering Costs.
From Towler, et. al. 2008. Chemical Engineering Design, A rule of thumb for
engineering costs is 30% of ISBL plus OSBL cost for smaller projects and 10% of ISBL plus
OSBL cost for larger projects.
For larger projects:
= (0.10)( + )
= (0.10) ($ . + $ 3707315.04)
= $ .
Contingency Charges.
From Towler, et. al. 2008. Chemical Engineering Design, A minimum contingency
charge of 10% of ISBL plus OSBL cost should be used on all projects. For this project a
contingency charge of 15% of ISBL plus OSBL cost is used to account uncertainties in the
technology.
= (0.15)( + )
= (0.15)($ . + $ 3707315.04)
= $.
Working Capital.
From Towler, et. al. 2008. Chemical Engineering Design, A typical figure for
petrochemical plants is 15% of the fixed capital (ISBL plus OSBL cost).
= (0.40)( + )
= (0.40)($ 9268287.6 + $ 3707315.04)
= $.
Variable Cost
Raw Materials
Hydrogen gas
The purchasing price of H2 is $0.99/kg. The gas will be supplied by Linde.
Acetone
The purchasing price of Acetone is $0.80/kg. This will be supplied by APC
Chemicals .
Catalyst
A nano-crystalline zinc chromite-supported nano-palladium (n-Pd/n-ZnCr2O4)
catalyst is used for the production of MIBK. The price of the catalyst is $3,000/kg which
will be supplied by Yurui(Shanghai) Chemical Co., Ltd, Ruiyuan Group.

Table 2.35 Summary of the prices and mass flows of the raw materials
Raw Materials Price per kg kg per year Amount per year
H2 $0.99 2619240 $ 2593048
Acetone $0.80 47470440 $ 37976352
n-Pd/n-ZnCr2O4 $3,000 - $ 184628400
*61,542.8 kilograms of catalyst is used in the MIBK reactor.
= $ 2593048 + $ 37976352 + $ 184628400
= $ , ,
Fixed Cost.
Operating Labor
From Towler, et. al. 2008, Chemical Engineering Design, For initial
estimates, an average USGC salary of $50,000 per shift position per year, not including
overhead, can be used.
= $,
Supervision
From Towler, et. al. 2008, Chemical Engineering Design, Supervision is usually
taken as 25% of operating labor.

= (0.25)($ 50,000)
= $,
Direct Salary Overhead
From Towler, et. al. 2008, Chemical Engineering Design, Direct Salary Overhead is
usually 40% to 60 % of operating labor plus supervision.
= (0.50)(50,000 + $12,500)
= $,
Maintenance
From Towler, et. al. 2008, Chemical Engineering Design, Maintenance is typically
estimated as 3 to 5% of ISBL investment.
= (0.05)($ 9268287.6 )
= $.
Property taxes and insurance
From Towler, et. al. 2008, Chemical Engineering Design, Property and taxes
insurance are typically 1 to 2% of ISBL fixed capital.

= (0.01)($ 9268287.6 )
= $ .
General plant overhead
From Towler, et. al. 2008, Chemical Engineering Design, General plant overhead,
charges to cover corporate overhead functions such as human resources, research and
development (R&D), information technology, finance, etc. Corporate overhead varies widely
depending on the industry sector. Oil refining companies that carry out minimal R&D have
much lower overhead than pharmaceuticals manufacturers. Plant overhead is typically taken
as 65% of total labor (including supervision and direct overhead) plus maintenance.
= (0.65)( + +
= (0.65)($12,500 + $31250 + $463414.4)
= $.
Allocated environmental charges to cover superfund payments
From Towler, et. al. 2008, Chemical Engineering Design, Allocated environmental
charges to cover superfund payments is typically 1% of ISBL plus OSBL cost.
= (0.01)( + )
= (0.01)($ 9268287.6 + $ 3707315.04)
= $

= $50,000 + $12,500 + $31,250 + $ 463414.4 + $ 92682.88 + $ 88681.37
+ $ 129756
= $ .
Total Investment.
= + +
= $225197800 + $ 868284.65 + $ 3892680.79
= $ , , .
SIMPLE PAYBACK TIME
Selling price of MIBK = $2.5 /kg (Retrieved from Jiangsu Tubang Technology Co., Ltd. as of
2017)
Capacity= 30,003,000 kg/year
$ 30,003,000
= (2.2 )( )

= $
Selling price of IPA = $ 2/kg (Retrieved from Qingdao HanHaiDa Import And Export Co., Ltd.as
of 2017)
Capacity= 1568040 kg/year

$ 1568040
= (2 )( )

= $
= $ + $
= $, ,
$ , , .
=
$, ,
= 3.33
4 years
RETURN OF INVESTMENT (ROI)

= 100%

$, ,
= 100%
$ , , .
= . %
Comparison with a Pure MIBK Production Plant
A class 5 feasibility study was also made in a manufacturing plant that only produces crude IPA
which is not really marketable. The layout of the equipment is similar with the process that distills the
crude IPA, the main difference is the absence of the two distillation columns. The reduction of the two
distillation column reduced the total investment to $ 229,176,328. The unmarketable crude IPA resulted
on a lower annual revenue flow of $ 66,006,600. The new total investment and annual revenue resulted to
a different simple payback time and ROI.
$ , ,
=
$, ,
= 3.48
$, ,
= 100%
$ , ,
= . %
It can be concluded that the process that has a distillation portion for the crude IPA has a higher
total investment but has a slightly lower simple payback time and a higher percent return of investment.
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MAPUA INSTITUTE OF TECHNOLOGY AT LAGUNA

Academic Year 2017 2018 (1st Term)

SIMULATION AND ECONOMIC FEASIBILITY STUDY OF METHYL

Submitted to: Engr. Jesunio Aquino

August 30, 2017

1.1 Background of the Study

extraction solvent, 13% as rubber processing chemicals and 4% as surfactants.

ton/year (TransTech Consultants Inc., 2014).

of 75,000 ton by 2018 (TransTech Consultants Inc., 2014).

major exhausting countries/regions (TransTech Consultants Inc., 2014).

In producing the MIBK, comprises a reactor, a hydrogen separator, a liquid-liquid separator, a

based resin catalyst (Hahn,T.E., et al, 2010).

1.2.1 General Objective

1.2.2 Specific Objectives

share, and target market.

MIBK via ASPEN HYSYS V8.8.

and a 3D model of the plant using AutoCAD 3D Modeling.

1.4 Scope and Limitations of the Study

limited to the capability of ASPEN HYSYS V8.8.

significant demand for MIBK.

1.5 Statement of the problem

1.6.1 Description of the company

company name MiKCo. means Methyl Isobutyl Ketone Corporation.

To dominate the MIBK Market locally and internationally

1.6.4 Core Values

up by communication to make its way to the top of the market.

1.7 Review of Related Literature

In the practical preparation of Methyl Isobutyl Ketone by stepwise Isopropylation reaction of

selectivity of Methyl Isobutyl Ketone (Fang Wang, 2017).

a high yield of MIBK (G. Torres, 2007).

Isopropyl Alcohol is commonly known as rubbing alcohol is a common ingredient in chemicals

the hydraulic braking system to prevent contaminating the brake pads.

wort before the hops is manufactured as a beer.

chosen among the three alternatives.

diagram and the necessary calculations were also presented.

2.1 SITUATIONAL ANALYSIS

2.1.1 Situational Environs

2.1.1.1 Global Consumption and Production.

Methyl Isobutyl Ketone

(TransTech Consultants Inc., 2014).

market of over 42% that year (Transparency Market Research, 2015).

Figure 2.2 Global MIBK consumption in 2014

major exhausting countries/regions (TransTech Consultants Inc., 2014).

and the 789th most complex product.

Asia Europe North America South America Africa

Figure 2.3 Global IPA Exports

Figure 2.4 Global IPA Demand in 2016

cosmetics (IMARC group, n.d.).

Methyl Isobutyl Ketone

Table 2.1 Yearly MIBK import in the Philippines

Year Quantity (Kg) Value (USD) Estimated Price

2012 1,708,434 2,903,879 0.965153

2013 2,919,128 1,607,542 0.779055

2014 542,303 303,289 1.20645

2015 1,460,969 1,210,504 0.953671

2016 1,815,099 1,937,572 0.89161

Philippines, Tradeline Philippines.

Figure 2.5 Data of Import in the Philippines

Table 2.2 Yearly MIBK Value in the Philippines

Year Estimated Price (Dollar/kg)

and trade value of MIBK import in the Philippines.

increase up to 1.11 Dollars per Kg by 2017.

Department of Trade and Industries of the Philippines, Tradeline Philippines.

Year Quantity (kg) Value (USD) Estimated Price