Pemex Petroquímica SA, Mexico's state-run petrochemical company, has downscaled the size and cost of its long-discussed Phoenix project.
Rather than build a petrochemcials complex, Pemex has opted to expand two plants in Morelos and Cangrejera, according to a Sept. 7 story on Dow Jones Newswires. Work at the Morelos plant is expected to begin in November, according to the story.
Pemex officials could not be reached for comment. The project would expand total annual ethylene production from 1.3 billion pounds to about 2 billion pounds and increase polyethylene and polypropylene production by an undisclosed amount.
The estimated cost of the project would drop from $2.7 billion to $840 million, according to the Dow Jones story.
Last month, Mexican plastics leader Horacio Lobo said a cancellation or delay of Phoenix would have a ``negative and irreversible effect on Mexico's plastics industry. Lobo is president of Mexico's National Association of Plastics Industries (Anipac) trade group.
The Phoenix Project is designed to make use of existing Mexican national resources and reduce the country's reliance on imported material. Pemex's partners in the project are Grupo Idesa SA de CV of Mexico City, Indelpro SA de CV of Monterrey, Mexico, and Nova Chemicals Corp. of Pittsburgh. Indelpro is a joint venture between PP giant Basell NV and Mexican conglomerate Alfa Group.
Nova spokeswoman Stephanie Franken said her firm is working with its partners to evaluate and respond to the revised proposal.