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Material Insights: Ineos-Sinopec dispute, Housewares highlights

Lawsuits are flying between materials firm Ineos Group and state-owned Chinese oil and petrochemicals maker Sinopec. We cover that, plus highlights from last week's housewares show in Chicago, in today's Material Insights.

Published: March 24, 2014 1:07 pm ET
Updated: March 24, 2014 1:32 pm ET

Lawsuits are flying between materials firm Ineos Group and state-owned Chinese oil and petrochemicals maker Sinopec. Wel cover that, plus highlights from last week’s housewares show in Chicago, in today’s Material Insights.

Sinopec is accused of violating Ineos’ intellectual property and misusing trade secrets to build new acrylonitrile factories.

In a strongly-worded March 21 statement, Switzerland-based Ineos says it fears Sinopec’s plans threaten major harm to Ineos’ global $3 billion acrylonitrile business. That unit generates $500 million in profit a year and supports 5,000 jobs.

Ineos said its technology provides the basis for more than 90 percent of world production of acrylonitrile, which is a building block of ABS plastic as well as for the carbon fiber, like the raw material used to make the new Boeing 787 Dreamliner.

Ineos Chairman Jim Ratcliffe says the prolific building of acrylonitrile plants in China will destroy Ineos’ acrylonitrile business, and that the firm wants to take its best technology to China but needs to know that it will be protected.

Ineos has filed suit against Sinopec in the Beijing High Court and is pursuing a parallel arbitration case in Sweden.

Sinopec has had a license to use Ineos acrylonitrile technology since 1984, but the issues in the lawsuit stem from a 2007 agreement between Ineos and Sinopec Ningbo Engineering Co.

Sinopec says it has developed its own acrylonitrile catalyst and related technology at its research labs in Shanghai over the last 50 years.

One chemical industry consultant with experience with both Chinese and Western firms said it can be common for companies like Sinopec to feel they have made improvements in the technology that fall outside the original license. That could be a key issue to be debated in court, the consultant said.

Capacity expansion

Outside of the legal arena, Eastman Chemical and AOC each announced capacity expansions for plastic-related materials.

For AOC, the new capacity comes in the form of a new reactor for making thermoset vinyl ester resins at its plant in Lakeland, Fla. The company says it’s serving the growing market for corrosion-resistant composites.

Eastman will add more than 40 million pounds of annual capacity for 2-EH, a feedstock used to make non-phthalate plasticizers. The capacity, at an existing plant in Longview, Texas, will come online by the end of the year.

Housewares report

Eastman also was in the news this week at the International Home + Housewares Show in Chicago, where it met with companies using its materials. Staff reporter Kerri Jansen filed a report from the show.

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