Sinopec in talks to buy USD3 billion chemical plant shut over safety

MOSCOW (MRC) -- Chinese state energy giant Sinopec Corp is in advanced talks on taking a controlling stake in petrochemical firm Dragon Aromatics, which operates one of the country's biggest chemical plants, said Reuters, citing three sources with knowledge of the matter.

The discussions come after the independent petrochemical firm suffered a second major fire in less than two years at the USD3 billion plant in Fujian and sources said local authorities want Sinopec to participate before allowing the plant to reopen.

The tough line shows how Beijing is putting pressure on provinces to ensure better industrial safety standards and protect the environment after a series of accidents has stirred protests from residents opposed to plants in their backyard. Dragon Aromatics, owned by Taiwan's Xianglu Group, was forced to shut the plant with a capacity to produce 1.6 million tonnes a year of paraxylene (PX), a chemical used to make polyester fiber and plastics, after the fire in April.

Sinopec could take up to 80 percent of the stake, the source added. Sinopec spokesman Lu Dapeng declined to comment.

The PX plant is located on a peninsular called Gulei, part of Zhangzhou city and a site where state firms including Sinopec and China National Offshore Oil Corporation (CNOOC) had previously tried to build petrochemical plants.

To supply the PX plant, Dragon Aromatics also runs a 100,000 barrels per day condensate splitter and a 3.2 million tonnes per year hydrocracker at the site.

Dragon Aromatics has been one of the biggest buyers of Iranian condensate, a very light crude oil, and the plant shutdown has forced the Middle Eastern producer to store more of its oil.

Dragon Aromatics, owned by Xianglu Group, a Taiwanese petrochemical group, is one of the largest independently-run PX producers in China.

Sinopec Corp. is one of the largest integrated energy and chemical companies in China. Its principal operations include the exploration and production, pipeline transportation and sale of petroleum and natural gas; the sale, storage and transportation of petroleum products, petrochemical products, coal chemical products, synthetic fibre, fertiliser and other chemical products; the import and export, including an import and export agency business, of petroleum, natural gas, petroleum products, petrochemical and chemical products, and other commodities and technologies; and research, development and application of technologies and information.
MRC

MOSCOW (MRC) -- Turkish plastics processor and mold maker MTN Kalip Sanayi Ltd. Sirketi is building a second factory to expand its injection molding business, targeting exports to Europe, said Plasticsnews.

The Istanbul-based firm will open the second facility in Turkey early next year with 16 injection molding machines, serving its existing end markets in automotive and appliance manufacturing, said Kadir Yavuz, sales and marketing supervisor.

"MTN has decided to grow strategically in plastic parts manufacturing," he said. "We’re very well known for molds. We are working with all well known automotive and white goods brands. That is why we would like to grow in plastic parts production."

Yavuz was interviewed at the Fakuma 2015 fair, held Oct. 13-17 in Friedrichshafen. The small company builds molds and manufactures plastic parts as a Tier 1 and Tier 2 supplier for global car brands, and in the appliance sector for Whirlpool, BSH Hausgerate GmbH, Turkey’s Arcelik A.S. and others.

MTN started as a mold manufacturing company 20 years ago and in 2011 launched its injection molding business, and sees good possibilities for growth there, Yavuz said.

In a corporate sales presentation provided to Plastics News, MTN said the new factory would eventually grow to 45 injection molding machines in its second phase. No time frame was specified. Its plastics parts business - which has 12 injection molding machines — currently is focused on Turkey’s domestic market. But it would like to grow exports to a level closer to that of its mold making unit, which exports 60 percent of molds it produces, Yavuz said.

The company also wants to pursue what it calls "localization projects," or more generally replacing imported injection molded parts that currently are not manufactured in Turkey. While the country’s economy has been hurt by the wars in neighboring Iraq and Syria and ensuing refugee crisis, Yavuz said Turkey’s plastics sector continues to grow.

MTN carries out production of moulds with professional management attitude based on the approach of Mould Innovation. MTN have experienced team, software, machinery and other equipment with latest technology. MTN can do Co-Design and FSS (Full Service Supplier) for the customers. MTN is a solution partner for customers in various projects.
MRC

MOSCOW (MRC) -- LG Chem Co., South Korea's top chemical company, said that it had decided to hand over its organic light-emitting diode (OLED) business to its affiliate as part of efforts to focus on its flagship business, as per Yonhap News Agency.

In a regulatory filing, LG Chem said it plans to sell its OLED business unit to LG Display Co. on Dec. 15, for 160 billion won (USD142 million).

"LG Chem will focus on its material business, while LG Display will develop OLED-based products," said a LG Chem official.

LG Display, which counts Apple Inc. as one of its major clients, has shored up production of its flagship OLED, as well as quantum dot-based panels known for their high color reproduction. The move is to vie with its bigger rival Samsung, which has been pushing its quantum dot TVs.

LG Chem, the country's leading maker of car battery packs, is making efforts to focus on developing high-end chemicals and electric vehicle-related battery packs.

As MRC wrote before, last week, LG Chem shut its polyvinyl chloride (PVC) plant for a maintenance . It is expected to remain shut till end-October 2015. Located in Daesan, South Korea, the PVC plant has a production capacity of 240,000 mt/year.

LG Chem Ltd., often referred to as LG Chemical, is the largest Korean chemical company and is headquartered in Seoul, South Korea. According to ICIS report, it is 15th biggest chemical company in the world in 2011. It has eight domestic factories and global network of 29 business locations in 15 countries. LG Chem is a manufacturer, supplier, and exporter of petrochemical goods, IT&E Materials and Energy Solutions.
MRC

MOSCOW (MRC) -- India’s largest flexible packaging company UFlex Ltd has targetted an April 2017 start up of its aseptic packaging plant, at Sanand in Gujarat, said Plasticsnews.

The company, which already has manufacturing facilities at Noida, Jammu and Malanpur, will spend Rs 580 crores in the first phase and employ around 250 people, as per Business Standard.

Uflex is planning multi-phase expansion at the new site and estimates a total investment of about Rs 1500 crores in all the phases of the project. About 90% of the output from this factory will cater to the domestic demand. Starting with initial capacity of around 3.5 bln packs, the plant will finally produce up to seven billion packs over time.

As MRC informed earlier, Reliance Industries Ltd. (RIL) has successfully put into operation two plants in Dahej, Gujarat, India. The first is a polyethylene terephthalate (PET) resin plant, which consists of two lines with a combined manufacturing capacity of 650 KTA. The plant has been built with Invista technology for continuous polymerization and Buhler AG technology for solid state polymerization.

Uflex is one of the major players in the flexible packaging industry world over with clients like P&G, PepsiCo, Tata Global, Mondelez, L’Oreal, Britannia, Haldiram, Amul, Ferro Rocher, Perfetti, GSK, Nestle, etc.

MRC

MOSCOW (MRC) -- Bemis Co. Inc. saw net profit increase during the third quarter compared to last year, said Plasticsnews.

The Neenah, Wis.-based packaging company said net profit was USD62.5 million, or 64 cents per diluted share, on sales of USD1.02 billion for the quarter. That compares with net profit of USD17 million, or 17 cents per diluted share, on sales of USD1.1 billion for last year’s third quarter.

Net profits from last year were impacted by a loss of USD44.5 million, or 44 cents per diluted share, from discontinued operations.

"Our third quarter results demonstrate continued progress in the implementation of our long-term strategy, as we again delivered increased margins, return on invested capital, and cash from operations," said CEO William F. Austen said in a statement.

Bemis breaks out financial details for its U.S. packaging and global packaging operations.

Global packaging had net sales of USD328.1 million for the quarter, down 14 percent from the year before. Currency impacts decreased net sales by 22.1 percent. Increased unit volumes and “positive sales price and mix” helped offset currency issues.

U.S. packaging had net sales of USD690.2 million for the third quarter, down 3.7 percent from the third quarter of 2014. About 3 percent of the drop was from unit volumes and the remaining decrease was from a pass through of lower raw material costs, the company said.

Bemis Co. closed a plant in St. Louis Park and will close one in Minneapolis. Both facilities make flexible packaging for food under the Curwood brand, a division of Bemis.

Bemis, based in Neenah, Wis., is one of the country's largest packaging firms and is North America's largest film and sheet manufacturer with annual sales of USD5.3 billion.
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