Good morning! I was surprised to see that Koch subsidiary and chemicals producer, Invista, decided to shut down its adiponitrile (ADN) and hexamethylene diamine (HMD) plants at its site in Orange, Texas late last week.

First, a little context:
Back in 2003, DuPont decided to rename its textile division to Invista, and then decided sell it to Koch Industries for $4.4 billion shortly after. The resulting Koch subsidiary operated plants in Orange and Victoria, Texas that produced ADN, HMD, and their core derivative: nylon 6,6.

Wait, what were they making?
At the time of the acquisition, Invista was making ADN by chlorinating butadiene, reacting it with sodium cyanide, and then hydrogenating the product. But then Invista deployed a new process (pioneered by William Drinkard while he was at DuPont) at those plants that could produce ADN with a) less energy, and b) less by-products. That process reacts butadiene with hydrogen cyanide, and competes with Ascend’s process, which gets to ADN via the electrodimerization of acrylonitrile. Either way, this stuff gets converted into HMD and paired up with adipic acid to make nylon 6,6—a polymer initially used to make fibers for carpets, but increasingly used as a high performance polymer (for things like hydraulic brake lines and radiator housings).

Okay, so they are shutting down?
The site in Orange, which is set to lay off around 300 people, is going to immediately shut down ADN production and will halt HMD production sometime next year. The reason Invista provided? Lower than anticipated growth and an increase in global supply. This is typical of any industry that increases supply with large increments, but usually companies just hold out during the downturn. The shut down tells us that they were probably anticipating losses for multiple years, and that’s something that even a well integrated producer can’t bear. Maybe they’ll sell the site and someone will start it back up in a few years, or maybe the market for nylon 6,6 just isn’t what we thought it would be.

What else is going on:

• DuPont invested in a 3D printing startup looking to commercialize a vat polymerization process that cures liquid polymers with UV light (DuPont actually led the Series A round). The technology doesn’t sound particularly revolutionary (it sounds pretty similar to what we’ve seen companies like Carbon do), so DuPont’s interest is probably a hint that this 3D printing startup is using polymers DuPont can make.

• Fluor landed an EPC contract with 8 Rivers Capital to design a new blue ammonia plant based on 8 Rivers’ new process. That process is pretty similar to the blue ammonia we see elsewhere (it’s just normal ammonia plus carbon capture), except 8 Rivers wants to capture the carbon cryogenically.

• A plastics recycler just broke ground on a new recycled PET plant in Georgia. They are using glycolysis like these other chemical recyclers. One thing to note: the plant is rated for 100,000 tons per year, which is roughly the same size as the largest pyrolysis plants we’ve seen.

• SK Capital acquired a company in the CO2 pipeline and sequestration business. I’m curious to see what they do here—if a PE firm is snagging up assets in the CCUS space they must be reasonably confident about its future.