The Spring 2009 issue of Cold Facts featured interviews from leaders in the industrial gases industry. Below you will find the interviews in their entirety, which includes information about each company’s background and additional comments provided during the interview.
Rick Kowey, Executive Vice President, Chief Marketing Officer and General Manager, Matheson Tri-Gas, Inc.
Can you give us a brief history of Matheson Tri-Gas?
Matheson Gas Products was founded in 1927 and was the first company to offer a reliable source of high quality scientific gases and equipment. Some of Matheson’s more notable accomplishments include the development of the lecture bottle, and the world’s first commercially produced silane, an accomplishment that earned the Company the prestigious “SEMMY” award.
In 1999 Matheson Gas Products merged with Tri-Gas, Inc. to form Matheson Tri-Gas. In 2004 Matheson Tri-Gas purchased six air separation plants from Air Liquide and since that time has acquired several industrial gas companies, which has given Matheson Tri-Gas a true national footprint.
In 2008 Matheson Tri-Gas and IBM entered into a unique, four-year agreement to jointly develop new manufacturing materials and processes that will enable the next generation of semiconductor technology for 32nm and beyond.
Matheson Tri-Gas, Inc. is the largest subsidiary of the Taiyo Nippon Sanso Corporation, one of the top five suppliers of industrial, specialty, and electronics gases in the world.
How long have you been with the company?
I have been with the company twelve years. Prior to Matheson Tri-Gas, I was employed by Scott Specialty Gases, Inc. for fourteen years.
What accomplishments have been made at Matheson Tri-Gas recently?
In 2008 Matheson Tri-Gas acquired the assets and business of Aeris, Inc. of Northern California and Nevada, and Five Star Gas & Gear of Southern California. These purchases added nineteen new locations to the Matheson Tri-Gas network. On March 30, 2009, Matheson Tri-Gas announced that they have signed a definitive agreement under which Matheson Tri-Gas will acquire Valley National Gases, the largest privately-held distributor of industrial and medical gases and welding supplies in the United States. Once this acquisition is complete, another 90+ locations will be added to the Matheson Tri-Gas network.
Matheson Tri-Gas is also near completion on the construction of two new air separation plants in Raccoon River, Iowa, and San Antonio, Texas. The Raccoon River ASU is on target to be completed in July 2009, and San Antonio is scheduled for completion in September or October 2009.
Have there been any recent additions to the Matheson Tri-Gas product line?
As part of its overall growth strategy, Matheson Tri-Gas is investing in developing cutting-edge molecule technology and delivery systems for advanced semiconductor manufacturing. Matheson’s recently patented PICO-TRAP™ Ultra-Purification System removes volatile metal and moisture impurities in hydrogen chloride to levels unsurpassed on the market today. Matheson engineers have also created another PICO-TRAP system that is gaining wide acceptance to tackle acetylene purification. Used in the PECVD market, this system controls the impurities in acetylene to produce very stable and consistent amorphous carbon films.
A new series of Nano-Bubbler™ systems delivers multiple liquid precursors for research and developmental films. This bubbler technology is a miniaturized version of Matheson’s Micro-Bubbler™ that is used in liquid precursor delivery systems. The VaporStation™ Central Delivery System is used by large-scale solar and LED manufacturers around the world to increase productivity and reduce the overall cost of ownership. The VaporStation system uses Inverted Micro-Bubbler technology to provide a continuous and constant vapor concentration to the process. The results are continuous tool uptime and process consistencies that are unmatched in operation today. A single VaporStation provides enough material for up to ten metal-organic CVD tools.
Do you think the current economic crisis will have a negative effect on business?
While we have seen some slowdown in the heavy manufacturing and electronics sides of our business, our bulk, packaged gas and specialty gas businesses are growing as a result of aggressive efforts to improve market share. In addition, we are implementing significant cost reduction and War on Waste programs to effect optimization in the areas of raw material costs, supply chain, customer-facing activities and back office functions. We believe that the combination of all of these efforts will more than offset negative economic impacts.
Do you expect to see any changes in the industrial gas industry due to the spending outlined in the economic stimulus package?
We believe that there are many aspects of the stimulus package which will encourage and motivate investment by the industrial gas industry to support government and industry programs in the areas of energy, power, green technologies and infrastructure. Matheson Tri-Gas intends to intensify its emphasis in this area by working with government and industry to leverage existing technologies and develop new ones.
What measures are being taken by Matheson Tri-Gas to combat climate change?
Between 1998 and 2009 Matheson Tri-Gas has retired over 28 Megawatts per day of inefficient and obsolete production equipment. As of 2006, Matheson Tri-Gas is one of the largest purchasers of wind-generated power in West Texas. Matheson Tri-Gas has reduced chemical usage and water discharges from our cooling water systems by an average of 10% in the past three years. By the end of 2009 Matheson Tri-Gas will have three Air Separation Unit facilities with industry leading specific power. This is in addition to several ongoing Six Sigma projects aimed at energy conservation.
Update on helium shortage. Has this affected the company? How are you dealing with it?
The helium shortage, which began around April 2006, had pretty much wound down by the end of 2007. Helium supplies remained tight through the first three quarters of 2008. During the fourth quarter of 2008, market tightness was relieved as demand, particularly from the electronics industry, fell off due to the global recession. As of April 2009, helium supply and demand are in balance and are expected to be sufficient to meet demand during the remainder of 2009 and 2010. Matheson Tri-Gas, in a joint venture with Air Products, will bring on 200 MMCF of new capacity in January 2011 from a new plant that is under construction in Big Piney WY.
Additional comments:
As shown by the investments made by Matheson Tri-Gas and our parent company, Taiyo Nippon Sanso Corporation, we are committed to expanding our worldwide presence through expansion of our air separation plant infrastructure, proliferation of open innovation and collaboration in the areas of commercial development and R&D, and extension of our product lines in the industrial, electronics, and specialty gas segments. In doing this, Matheson Tri-Gas is preparing itself to meet and exceed the current and future expectations and requirements of our customers.
Pat Murphy, President of Linde North America
Can you give us a brief history of Linde North America?
Linde has a long history of growth and innovation around the world that is characteristic of the company’s founding father, Carl von Linde – a German-born engineer and scientist who was among the first in the world to produce large volumes of liquid air. In 1902, von Linde began constructing his first air separation unit (ASU), of which Linde has constructed over 2,700 to date worldwide.
In 1907, von Linde founded Linde Air Products in the US with the support of a few American business partners. In doing so he set the stage for the industrial gases market in this country. Throughout the 20th Century the company saw many ups and downs in the U.S. Spectacular successes were tempered by patent disputes, shareholder conflicts of interest and setbacks caused by the loss of brand name and patent rights following two World Wars.
Linde has grown dramatically worldwide in recent years, both organically and via acquisition. At the end of the 20th Century, Linde acquired AGA — the Swedish industrial gases company – and in 2006 it acquired The BOC Group, which was based in London. As a result, the company now has gases and engineering sales of approximately $16 billion and more than 52,000 employees working in around 100 countries throughout the world. In the US, Linde employs some 4,000 employees in its gases and engineering divisions.
How long have you been President?
I have been president of Linde North America since it acquired AGA in 1999. Prior to that, I served as president of AGA North America since 1987. In addition, during the last 20 years, I have served the industrial gas industry globally as president of the International Oxygen Manufacturers Association (IOMA) and in North America as chairman of the Compressed Gas Association during three separate terms.
What accomplishments have been made at Linde recently?
Among our more significant accomplishments was the integration of the Linde and BOC organizations in North America. In most parts of the world, the two organizations did not overlap and for the most part we complemented one another geographically. This was not the case in the US where regulators required us to divest a significant part of the business. So, we had the dual challenge of putting together our new organization—selecting from highly qualified BOC and Linde candidates—while managing a very complicated divestiture.
I have to say, this was a very trying period for everyone involved, but all performed admirably. We are now working with the best of both companies in terms of people talent and technology. We are also benefiting from an interesting mix of perspectives and cultures—US, Canadian, Caribbean and Mexican. I am proud of the organization we have in place today, and we are constantly striving to be the safest, most customer-focused and most efficient company in the business.
Has the economic stimulus package provided new opportunities and have there been any recent additions to Linde North America’s product line?
The newly signed stimulus bill places a heavy emphasis on alternative fuels. We see this as an opportunity to accelerate our development and commercialization activities in hydrogen, LNG and other areas.
As one of the earliest entrants into the hydrogen energy arena, Linde is a world leader in the safe production, storage and distribution of both liquid hydrogen and high-pressure gaseous hydrogen. In March, we unveiled next-generation technology at the National Hydrogen Association’s annual conference in South Carolina. The technology—called the Ionic Compressor—provides a safe, fast and efficient way to fuel hydrogen. This technology has been used extensively in Europe for cars and buses, and is now being introduced to North America for forklift trucks.
Linde is focused on finding ways to reduce our dependence on fossil fuels and greenhouse gas emissions. Expanding our vehicle fueling capabilities in North America gives customers greater access to our strong hydrogen network and world-class engineering. In fact, Linde has equipped over 70 hydrogen fueling stations in 15 countries, supplying hydrogen for projects large and small.
Do you think the current economic crisis will have a negative effect on business?
The extent of the impact that the economic crisis will have on our business depends largely on how long and how deep the crisis becomes. Like all companies, we are working on many fronts to reduce our operating expenses and control our costs. Fortunately, as our CEO Prof. Dr. Wolfgang Reitzle says, our business model as a gas and engineering company still is a robust one—so we will not suffer as much as those companies that operate in highly cyclical market segments.
What measures are being taken by Linde North America to combat climate change?
Linde is focused on finding ways to reduce our dependence on fossil fuels and greenhouse gas emissions. Expanding our vehicle fueling capabilities in North America gives customers greater access to our strong hydrogen network and world-class engineering.
In addition, Linde and Waste Management are joining together to clean up our environment by capturing and reusing landfill gas for vehicle fueling, and reducing greenhouse gas emissions by more than 30,000 tons per year. Linde North America has partnered with Waste Management to create the world’s largest facility to convert landfill gas into clean vehicle fuel. We are in the final stages now of constructing a liquefied natural gas (LNG) facility, located at the Altamont Landfill near Livermore, California. The LNG plant will convert landfill gas into a clean vehicle fuel, providing a unique opportunity to “close the loop” by fueling hundreds of collection trucks with clean fuel produced from garbage. When the facility begins operating later this year it is expected to produce up to 13,000 gallons a day of LNG. Linde is using its expertise in designing and developing LNG plants around the world to create a clean and sustainable energy solution.
Update on helium shortage. How are you dealing with it?
The economic downturn has reduced the overall demand for helium in most parts of the world, including the US. As a result, we are currently able to provide our customers with adequate supply of product, which is so crucial to applications ranging from cooling magnetic resonance imaging (MRI) machines to welding to diving. In addition, we are preparing for the future by developing new international sources of helium as well as technology to help recycle the helium used by customers in certain applications.
Additional comments:
I believe the industrial gases industry has a lot to offer – whether it’s opportunities for engineers coming out of school, innovative applications for companies seeking solutions to production challenges, or breakthrough new product developments in healthcare or environmental applications that improve our quality of life with cleaner air and water. This is truly an exciting business, with great people and a promising future. I am very proud to be a part of it.
Etienne Lepoutre, chief operating officer responsible for Air Liquide’s industrial merchant businesses in the US.
Can you give us a brief history of Air Liquide?
Air Liquide was founded in 1902. We are the world leader in gases for industry, health and the environment. We have a long history of technical innovation and cryogenics. One of our founders was Georges Claude, a visionary scientist who developed an industrial scale process to liquefy air and separate oxygen and nitrogen through cryogenic distillation. Along with the other Air Liquide founder, Paul Delorme, they transformed that innovation into a successful business which now operates in more than 75 countries with 43,000 employees.
The history of Air Liquide has been a history of technical innovation. We’re a company with many engineers. Our leaders had a vision about the conquest of space and the whole industry around that very early on. As a result, we developed and built the cryogenic tanks for space launchers and their associated cryogenic fluid supply.
How long have you been with the company?
I’ve been with Air Liquide for 23 years.
What accomplishments have been made at Air Liquide recently?
This past year was a strong year for Air Liquide despite a difficult economic environment. Air Liquide achieved 11% growth in revenue and 10.8% growth in net profit. That growth was driven by both emerging countries and innovation and new markets in the fields of energy, high tech and healthcare. For example, we experienced strong growth in hydrogen for the oil and gas industry.
Have there been any recent additions to the Air Liquide product line?
For Air Liquide, new products usually mean new applications or new markets. Oxygen will always be oxygen. As an example, one market that has been growing fast is the photovoltaic industry. The production of photovoltaic cells requires a lot of our products: hydrogen, argon and nitrogen. This creates new markets. In the US in late 2007, we acquired Scott Specialty Gases, specialists in calibration gases for a variety of industries, including the energy industry. In Europe, in the medical gas sector we developed a new therapeutic gas using the rare gas Xenon. It is called LENOXe™ and is used as an anesthetic that is more efficient and has fewer side effects.
Do you think the current economic crisis will have a negative effect on business?
While the current economic crisis does have a negative effect on most businesses, Air Liquide’s business has actually been quite resilient. If you look at the last quarter of 2008, our gas and services sales grew more than 7% on a comparable basis. We are seeing some of the effects of the economic crisis in 2009, but I would say, relatively speaking, that we are probably a lot less affected than most industries.
Do you expect to see any changes in the industrial gas industry due to the spending outlined in the economic stimulus package?
With the economic stimulus package, we’re starting to see a few inquiries into some of our businesses. It’s a little too early to tell, but we think it’s going to have a positive effect on our business. We are seeing activity in the space and defense industries in the US. For R&D markets, where we sell pure gases and calibration gases, sales are growing. We recently invested in an R&D facility in Delaware which opened in 2007. It’s a state-of-the-art high-tech facility that’s designed to work closely with emerging technologies, whether they are in the fields of environment, energy or climate change technologies. So hopefully we can capture those new markets by positioning ourselves. We believe very much in the US’s ability to innovate and develop new markets.
What measures are being taken by Air Liquide to combat climate change?
Our R&D group is active in the area of carbon capture and storage. Many utilities produce carbon dioxide and release it into the air. New technologies can produce electricity from coal using pure oxygen. This method concentrates the carbon dioxide so that it can be captured and stored underground or used to enhance oil recovery in oil fields.
We’re working with a number of well-known partners across the world—in Europe, in America and also Australia. We consider ourselves fortunate because the climate change solutions are driving new markets for us. Photovoltaic is a good example, but there are many others. Many applications of our gases help prevent emissions. We’re also working on the energy efficiency of our own operations, although we are not a large emitter of any pollutants relatively speaking.
Update on helium shortage. Has this affected the company? How are you dealing with it?
We are developing new sources of helium around the world. We opened a source in Qatar recently. So we have been working on both conserving and generating more helium from new sources. There are opportunities for more across the world, because helium is a side-product of natural gas. It is found in natural gas fields and is extracted through a cryogenic process. The natural gas industry is developing rapidly. This creates an opportunity for us to develop new helium sources such as the one in Qatar. The current economic crisis ended the shortage. But this is a temporary situation and we’re going to see a shortage as soon as the economy recovers. So we are already anticipating that.
Additional comments:
We’re very active in cryogenic markets. We have a history of being at the cutting edge of cryogenic technologies from both a technical and a commercial standpoint—we make a business of it. For example, last year, the world’s longest and most powerful superconductor power transmission cable was connected in the state of New York by the Long Island Power Authority and a company called American Superconductor. This is a high-voltage superconductor cable in an urban, commercial power grid, and this is a good example of where cryogenic technology is going. This cable was cryogenically cooled by Air Liquide. Our subsidiary Air Liquide Advanced Technologies US specializes in advanced cryogenics among other things.
Another example is Air Liquide’s participation in CERN. In 2008, CERN officially opened the largest and most complex scientific instrument in the world (the Large Hadron Collider). Air Liquide supplied the cryogenic system designed to distribute superfluid liquid helium in the ring to cool the magnets to a temperature of 1.8K, very close to absolute zero. It’s a very, very difficult technical performance.
In closing, there are a lot new technologies and markets associated with climate changes that use industrial gases and that is very promising for Air Liquide in the future.
