The phenomenon of corporate aggregations continues in the plastic production sector with the aim of finding strategies to cover the markets both from the point of view of production and distribution. LyondellBasell and Sinopec will produce polypropylene oxide and styrene monomer in China for a booming market despite global demand that remains critical due to the pandemic .
LyondellBasell , one of the largest plastics, chemicals and refining companies in the world and China Petroleum & Chemical Corporation (Sinopec) , one of the largest integrated energy companies in China, today announced the signing of an agreement to form a 50:50 joint venture that will produce propylene oxide (PO) and styrene monomer (SM) in the Chinese domestic market.
First announced on December 23, 2019, the JV will operate under the name Ningbo ZRCC LyondellBasell New Material Company Limited.
"As the Chinese economy continues to grow, so will the demand for propylene oxide and styrene monomer. We are excited to expand our our relationship with Sinopec through this joint venture to better serve the Chinese domestic market - a win-win, "said Torkel Rhenman , Executive Vice President, Intermediates and Derivatives and Refining.
"Built on the remarkable success of our first joint venture, we are very pleased to continue to strengthen the important partnership with LyondellBasell for future results.
The creation of the new joint venture is not only in line with the national push for further opening, but also a fundamental step for Sinopec to deepen and expand its our international operations, "said Yu Baocai, Senior Vice President of Sinopec Corp . "
We have high expectations on the new joint venture to push the economic development of the city of Ningbo to a new level. During the fourteenth period of the five-year plan (2021-2025), Sinopec will continue to promote green industrial upgrading and innovative transformation, contributing to the eternal economic growth of Zhejiang Province and East China, and even the development of the chemical industry in China. . "
The JV will build a new PO and SM unit in Zhenhai Ningbo , China. This new unit will have a capacity of 275 kilotons per year (KTA) of PO and 600 KTA of SM. The unit will use LyondellBasell's leading PO / SM technology.
The products produced by the JV will be marketed equally by both partners, significantly expanding their respective participation in the Chinese market for PO and SM. The launch is expected at the end of 2021.
The constitution of the JV is subject to the approval of the relevant government authorities, including antitrust review by the State Administration for Market Regulation. LyondellBasell expects to make its equity contribution to the JV during the first quarter of 2021.
According to IHS Markit, China accounts for over 60% of the chemical market demand in Asia and accounts for 40% of the growth of the global chemical market in the next decade. PO and SM are LyondellBasell's core products and are used in a variety of applications including packaging, building and construction, furniture and transportation.
LyondellBasell operates five wholly owned factories in China located in Guangzhou, Suzhou, Dalian, Dongguan and Changshu.
Info by LyondellBasell