LyondellBasell, Sinopec forming PO/SM joint venture in China

LyondellBasell and China Petroleum & Chemical Corp. (Sinopec) have signed a memorandum of understanding to form a 50/50 joint venture in China to significantly expand their presence in the local plastics industry.
 
Under the non-binding agreement, the JV will construct a new propylene oxide (PO) and styrene monomer (SM) unit in Zhenhai, Ningbo, China, said Rotterdam and Houston-based LyondellBasell on Dec. 23.
 
Using LyondellBasell’s PO/SM technology, the facility is expected to produce 300 kilotons per annum (ktpa) of PO and 600 ktpa of SM, according to the company statement.
 
The proposed JV builds on the existing LyondellBasell-Sinopec PO/SM joint venture currently operating at the same location, under the name Ningbo ZRCC Lyondell Chemical Co Ltd.
 
"This cooperation on the second PO/SM unit between Sinopec and LyondellBasell is based on the successful partnership of the first unit," said Dai Houliang, Chairman of Sinopec. "It is in line with China's further opening-up policy, and is another achievement of international cooperation of Sinopec."
 
Targeting the local Chinese market, the project is part of LyondellBasell’s policy to set up JVs in strategic regions, explained Bob Patel, CEO of LyondellBasell.
 
"As demand for construction materials, packaging and furnishings continues to grow, we see an opportunity to bring together our leading technology with Sinopec's operational capabilities to further serve the Chinese market," he said.
 
According to IHS Markit, China makes up more than 60 percent of the Asian chemicals market demand and represents 40 percent of global chemicals growth over the next decade.
 
LyondellBasell operates five wholly owned facilities in China in Guangzhou, Suzhou, Dalian, Dongguan and Changshu.