Sinopec joint venture plans Chinese chemical plant

Sinopec Zhenhai Refinery & Chemical has established a 4.44 billion yuan venture with Lyondell Chemical Co. to construct a propylene oxide-styrene monomer (POSM) manufacturing facility in Ningbo, China, across Hangzhou Bay from Shanghai.

Eric Watkins
Senior Correspondent

LOS ANGELES, Apr. 23 -- Sinopec Zhenhai Refinery & Chemical has established a 4.44 billion yuan venture with Lyondell Chemical Co. to construct a propylene oxide-styrene monomer (POSM) manufacturing facility in Ningbo, China, across Hangzhou Bay from Shanghai.

The plant will produce 274,000 tonnes/year of propylene oxide and 602,000 tpy of styrene under an agreement that also will allow SZRC to tap into Lyondell's POSM technology.

Feedstock will come from an SZRC plant now under construction that will be capable of producing 1 million tpy of ethylene. A Sinopec spokesman said the project is 75% owned by SZRC and 25% by Lyondell.

Lyondell said it will contribute POSM technology and overall operating and technical experience in exchange for a share of the propylene oxide (PO) profitability from the plant. It said the two partners will jointly market all PO manufactured by the new facility, which is due for completion in 2009.

China's National Development and Reform Commission wants to more than double the country's ethylene output capacity. It plans a 4.38 million-tonne increase by upgrading existing plants and a further 6.2 million-tonne increase through construction of new facilities.

China produced 7.55 million tonnes of ethylene in 2005.

Contact Eric Watkins at hippalus@yahoo.com.

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