Get familiar with some of the types of chemical reactors with Gregg Epstein from Perry Videx LLC. #BlackbirdTV
About this segment of Blackbird TV
Guest: Gregg Epstein, President / CEO, Perry Videx LLC. To learn more about our guest, visit PerryVidex.com, or call 609-267-1600.
Recorded: September 10, 2020
Published: February 23, 2021
Segment transcript
I’d like to introduce Gregg Epstein from Perry Videx LLC. Our companies had a transaction many years ago many I think eight years ago now, and we ended up with a bunch of glass-lined reactors. I think they were all stainless steel. Can you educate our collective audience what is a chemical reactor, what do they do? It’s actually quite simple if you picture a chemical plant as your kitchen in your house, then the chemical reactors are the pots and pans on the stove to which you add various ingredients. You heat or cool, depending on the process, you stir, you mix, you can create inside the pot a pressure cooker, and so all of these all of the the attributes that I’m going to describe about a glass-lined reactor if in your mind while you’re thinking think about a pot on your stovetop cooking a recipe, that at the end you put in four chemicals and you take out one. Look at the bolts on top, this is like a pressure cooker these are scary all those bolts on the top, does that hold it all together, so it doesn’t take the whole building out? What’s that about? Well yes it is a short answer generally what you’ll see there is not bolted like that all the time, only bolted like that when it’s super high pressure, or when you need the ability to take off the lid to clean it. Right. Most of the time you’re going to see a reactor like this will be welded on both ends, it would be welded in a disk shape which is the physics of how you are able to contain pressure. Every vessel is going to be rated for a certain pressure in the US, rated by by psi (pounds per square inch) if you consider the air is 15 psi, most of the reactors that have value are rated internally to withstand roughly 90 psi or six atmospheres, in europe you would call them six bar, which is 15 psi and that’s in most chemical reactions, not all but in most chemical reactions, and if you think back to chemistry class in high school there was pressure, there was temperature, but the pressure is an important element to being able to affect certain chemical reactions. So internal pressure is one of the first things that we look at, if it’s rated for 90 psi or better that’s pretty standard, that’s pretty good. All chemical reactions don’t need a reactor though, to do this, you can mix them in a simple tank. This is only when there’s there’s some kind of a reaction that creates a change in atmosphere or temperature or you need to control it. If you had to give someone who was buying a reactor obviously size is a big difference you got little small ones that you use pilot plants and to test things, and then there’s huge production size reactors, but not withstanding the size requirements what’s the most important thing for somebody to understand and to look for when they’re buying a used chemical reactor? What’s really important? Number one is the material it’s going to either be built out of stainless steel which is pretty common, it’s going to be built of steel lined with glass, which is funnily enough known as a glass lined reactor, or it’s going to be an exotic metal like hastelloy or titanium or zircon, but those are the exceptions, generally they’re going to be stainless steel or glass lined. The reason you use stainless steel or glass lining is to fight corrosion so that’s the first differentiation you’re going to have is what’s the material. The reason they line reactors with glass is for applications where the chemicals that are being mixed are particularly corrosive and so the glass is inert, and will withstand any kind of corrosion. How long does that glass lining last? I remember you and I, one of the things we did was we had to spark test these. Can you explain what spark testing is? So there’s uniform when it comes out of the factory the glass is lined with a uniform thickness inside imagine the inside of a steel tank that’s coated with glass and then baked on literally baked on in a huge furnace and the technology is such that they’re pretty good at keeping uniform thickness but when you use a reactor sometimes certain areas of glass wears a little bit thin so what a spark test does is is is allows you to determine where the glass is thin and where you need to you want to be careful or you may want to actually get it repaired prophylactically before it fails. They can reline them? They could put new glass? Actually there is a pretty robust market for re-glassed reactors, actually we’re big participants in that, there’s only a few places in the country you can get your reactor glass lined, one happens to be in Rochester not far from you, the other’s down in Corpus Christi Texas and so they actually it’s quite a scene to see one of these reactors come out of the furnace glowing red, it’s pretty wild as they bake the glass onto the inside. So it’s almost like a glazing process, then? It is an internal glazing. Right. Okay all right. So the other thing—the next thing that you’re going to want to know in terms of as a buyer, what’s important to a buyer, which then I guess would be important to a lender that wants to see what the residual value of this is, how is this vessel heated. Generally there’ll be a second wall around the original vessel. That’s called a jacket, right? A jacket creates an empty space that you can circulate steam you circulate hot, high-temperature, hot oil, for the cooling process you can circulate coolant and what that does is it heats or pulls the vessel through the walls of the reactor, pretty standard and then the third component will be the mixer, and the mixer typically will enter from the top on a vertical axis at the bottom will be a turbine or a propeller or some type of mixing blade depending on the application that will keep the product in moving or in suspension that allows the reaction to take place so you want to know what the material is you want to know what the heating or cooling situation is what the jacket is you want to know what the mixing situation is and then last you really want to know what the age of the of the equipment is glass-lined reactors don’t age as well as stainless steel reactors, so you know a 30 year old stainless steel reactor still has some life in it potentially, but a 20 year old glass iron reactor is getting close to the end, so that’s unless you want to get it re-glassed, so the age would be the other thing that I would I wouldn’t want to know as a lender but as a lender you the reactors are ubiquitous in the chemical world. So almost like a used car, that depreciation curve is going to be fairly steep at the front-end of that if they’re if they’re financing new equipment, and then will it level out similarly and hold value? It will. The assumption I’m making is proper use and maintenance, but there’s not a lot of residual difference in residual value between a five-year-old and a 15-year-old. In that example okay? There’s not there’s there’s a big drop off from from year one you know from a one-year-old to a five or six-year-old but from a six-year-old to a 15 year old the curve flattens. The downward value curve flattens out so it becomes… that was an inartful way of agreeing with you. Fantastic. Gregg Epstein, CEO / President of Perry Videx. Thanks for sharing your thoughts with us. Thanks David, good to be here.