Japanese chemical producer, Ube Corporation, announced plans to increase its silicon nitride plant at its site in Ube City, Japan.

The basics:

We make silicon di-imide by reacting ammonia (from natural gas and air by way of the Haber-Bosch process) with silicon tetrachloride (a chlorosilane produced by adding chlorine, from sea water, to silicon, from sand), and then they heat up that stuff to convert it into silicon nitride. The resulting ceramic is sold as a powder for applications in vehicles (engine parts), space (rocket thrusters), and electronics (a layer in semiconductors), among plenty of other things.

Okay, so an expansion?

The plan is to increase their current production at this site by 50%, and to have that capacity ready in the second half of 2025. It’s not a huge boost on a per ton basis within the perspective of the global chemicals and materials industries (we process just 9 million tons of silicon per year, which is roughly 5% of ethylene production), but it is a big boost for a small (but growing!) market.

Looking at the bigger picture:

Ube cites growth in electric vehicles (EVs) as the key driver here. It’s not that regular internal combustion engines don’t use bearings for other components, it’s just that EVs have electric motors, and the bearings used in electric motors have particularly demanding material constraints. That doesn’t mean we’re going to see an explosion in growth in silicon nitride—for all we know, this 50% expansion could be plenty for the whole world for the next 5 years.

US-based petroleum company, ExxonMobil, reached an agreement to acquire oil extraction and production (E&P) company, Denbury, for $4.9 billion.

Some context:

Denbury isn’t your average E&P—the company is well known for its focus on enhanced oil recovery via CO2 injection, and has been running that business for the last two decades. In doing so, Denbury has also come to own and operate the US’s largest CO2 pipeline network, and is responsible for injecting some 15 million tons of CO2 per year (something like 80-90% of which is sequestered).

Getting you up to speed:

Exxon has recently been a proponent of legislation that incentivizes the capture and sequestration of CO2. Back in 2021, Exxon's PR team released a statement that basically (1) asked the US government for financial incentives to capture and store CO2, (2) proposed that Houston should build a $100 billion large-scale carbon capture hub, and (3) suggested to their Houston industry neighbors that they should also support (1) and (2). The thinking is pretty simple: if there are tax incentives for capturing CO2, then it’d be wise to leverage their expertise and capital in what could be a growing market.

Connecting the dots:

Some 70% of Denbury’s 1,300 miles of CO2 pipeline are laid along the US Gulf Coast—in other words, the pipeline provides Exxon with premier access to the US’s largest concentrated source of CO2 emissions (the US Midwest also has a large cluster, but the potential scale here is orders of magnitude larger, assuming that the CO2 is captured). All of this really just comes back to the IRA passed at the end of last year, which drastically increased the tax incentives for CO2 capture, making acquisitions like this justifiable (otherwise they’re just buying Denbury for $100k/boepd—which makes no sense).