LyondellBasell, Sinopec sign deal to create Chinese JV for PO and SM

Dutch chemicals company LyondellBasell has signed an agreement to create a 50:50 joint venture (JV) with the China Petroleum & Chemical Corporation (Sinopec) for producing propylene oxide (PO) and styrene monomer (SM) in the Chinese domestic market.

First announced in December 2019, the joint venture will operate as Ningbo ZRCC LyondellBasell New Material Company.

It will build a new propylene oxide and styrene monomer unit in Zhenhai Ningbo in China. The new unit, which is expected to begin operation at the end of this year, will have a capacity of producing 275 kilotons per annum (KTA) of propylene oxide and 600 KTA of styrene monomer.

LyondellBasell will be contributing its PO / SM technology to the new unit.

Yu Baocai – Senior Vice President of Sinopec said: “Built on the remarkable success of our first Joint Venture, we are very delighted to continue to enhance the important partnership with LyondellBasell for future achievements. The establishment of the new Joint Venture is not only in line with the national drive for further opening-up, but also a vital step for Sinopec to deepen and expand our international operations.

“We have great expectations on the new Joint Venture for propelling the economic development of the city of Ningbo to a new level.”

LyondellBasell, Sinopec sign deal to create Chinese JV for PO and SM. Photo courtesy of LyondellBasell.

Products produced by the joint venture will be equally marketed by the two partners, thereby considerably growing their respective participation in the Chinese market for propylene oxide and styrene monomer.

Torkel Rhenman – LyondellBasell Executive Vice President, Intermediates and Derivatives, and Refining said: “As China’s economy continues to grow, so will demand for propylene oxide and styrene monomer.

“We are excited to expand our relationship with Sinopec through this joint venture in order to better serve China’s domestic market. Sinopec’s outstanding operational capabilities combined with LyondellBasell’s leading technology is a win-win.”

The joint venture’s formation is subject to approvals from relevant government authorities, which includes antitrust review by the State Administration for Market Regulation.

LyondellBasell anticipates making its equity contribution to the joint venture during Q1 2021.