INEOS to buy out TotalEnergies’ interest in joint Lavéra petrochemical, logistics assets

July 5, 2023
TotalEnergies SE and INEOS Group have entered a deal to realign ownership interest in their jointly held petrochemical production assets and logistics infrastructure located at the 650-acre Lavéra platform in southeastern France.

TotalEnergies SE and INEOS Group have entered a deal to realign ownership interest in their jointly held petrochemical production assets and logistics infrastructure located at the 650-acre Lavéra platform along the Mediterranean coast in southeastern France, 30 miles west of Marseille.

As part of the proposed transaction, INEOS Olefins & Polymers Europe has agreed to purchase TotalEnergies’ 50% interest in the companies’ existing Naphtachimie, Gexaro, and Appryl joint-venture (JV) chemical production businesses and other infrastructure assets, including part of TotalEnergies ethylene pipeline network in France, TotalEnergies and INEOS said in separate releases on July 5.

If finalized, the deal would transfer INEOS Olefins & Polymers South 100% ownership of the following JV operations:

  • Naphtachimie, which operates a naphtha steam cracker—one of the largest in Europe—equipped to produce 720,000 tonnes/year (tpy) of ethylene, as well as propylene, butadiene, butenes, and pyrolysis gasoline.
  • Gexaro, which currently produces 270,000 tpy of aromatics—including benzene and gasoline—at and for the INEOS (50%) and China National Petroleum Corp. (50%) jointly held Petroineos Manufacturing France SAS’ 210,000-b/d Lavéra refinery.
  • Appryl, which operates a unit equipped to produce 300,000 tpy of polypropylene.
  • 3TC, which stores naphtha feedstock for the Naphtachimie steam cracker.

As part of the agreement, INEOS also would acquire the southern sections of TotalEnergies’ ethylene pipeline network running from Lavéra to France’s Lyon region. The pipeline system’s central and northern sections—from the Lyon to Lorraine regions—would be held equally by both INEOS and TotalEnergies, the companies said.

Still subject to consultation and necessary regulatory approvals, the deal is anticipated for completion by yearend 2023, according to the operators.

For INEOS, the proposed acquisition of chemical and infrastructure assets comes as part of a strategy to further integrate and enhance competitiveness of its French and southern European businesses, as well help reduce carbon dioxide emissions meet internal climate abatement targets in line with the company’s Net Zero 2050 commitment, said Xavi Cros, chief executive officer of INEOS Olefins & Polymers South.

Realignment of its stake in the petrochemical and logistics similarly complements TotalEnergies’ integration and balance of its production and internal use of ethylene in eastern France, the operator said.

While the jointly held sites that produce and use ethylene in eastern France via a pipeline-and-storage network that begins at Lavéra in southeastern France and passes through Feyzin to Carling in the northeast, TotalEnergies said it does not currently use its share of production from the Lavéra steam cracker but instead sells most of it to INEOS.

TotalEnergies, which will continue to act as operator of the ethylene logistics network, said the asset divestment plan specifically will support integration between its 109,000-b/d Feyzin integrated refining and petrochemical platform, near Lyon, and the company’s Carling polymer production site in eastern France.

"This [proposed deal] allows us to strengthen the links between our Feyzin and Carling petrochemical sites, with Feyzin becoming Carling’s integrated ethylene supplier, in line with our strategy to focus on our integrated platforms," said Jean-Marc Durand, senior-vice president of TotalEnergies Refining Base Chemicals Europe.

If approved, the proposed divestments will have no operational impact on TotalEnergies’ refining and petrochemical sites, the company said.