June's top stories: Sipchem and Sahara merger on hold, CADE’s competition concerns
Saudi International Petrochemical (Sipchem) and Sahara Petrochemical have shelved their plans to merge operations, The General Superintendence of Administrative Council for Economic Defense (CADE) of Brazil has recommended blocking petrochemical firm Braskem's planned purchase of 70.59% stake in Solvay Indupa over potential anti-competitive effects. Chemicals Technology wraps-up the top stories from June 2014.
Saudi International Petrochemical (Sipchem) and Sahara Petrochemical shelved their plans to merge operations, which would have created a chemical company with $5.7bn market value.
In December 2013, Sipchem and Sahara signed a memorandum of understanding (MoU) for the proposed share-swap merger and expected to sign a deal in the first half of 2014.
The companies said in a statement that although the proposed transaction is in the interest of shareholders, it would not proceed under the current regulatory regime and both companies will continue to exist whilst achieving operational integration.
Turkmenistan secured loans of $2.5bn from Japanese and South Korean export credit banks to finance the construction of a petrochemical complex in Turkmenbashi near the Caspian Sea.
A government official was quoted by Reuters as saying: "The State Bank of Foreign Economic Affairs of Turkmenistan has struck a credit agreement for $700m with Japan Bank for International Cooperation and another one worth $1.8bn with Korea Eximbank for ten years to finance construction of the plant in the Balkan region of the country."
Turkmengas, the national gas company of Turkmenistan, will provide the remaining funding for the proposed project.
Saudi Methacrylates, a 50/50 joint-venture (JV) of Saudi Basic Industries (SABIC) and Mitsubishi Rayon (MRC), awarded a SAR4.5bn ($1.2bn) contract to Taiwan's CTCI Corporation to build MMA monomer and poly methyl methacrylate (PMMA) plants in Jubail Industrial City, Saudi Arabia.
Work on the facilities is underway with commercial operations expected to commence in mid-2017.
The MMA monomer plant will produce 250,000t per annum (tpa), while the PMMA plant will produce 40,000tpa.
Mitsubishi Heavy Industries America (MHIA), a wholly owned subsidiary of Mitsubishi Heavy Industries (MHI), was awarded a contract by ExxonMobil Chemical to build two polyethylene (PE) plants near Houston, Texas, US.
As part of the contract, MHIA will build the PE plants at a site adjacent to ExxonMobil's complex, as well as construct utility facilities for water, air and steam.
The PE plants will have a combined production capacity of 1.3 million tonnes per annum and will feature reaction equipment, as well as finishing, packaging and shipping equipment.
ExxonMobil Chemical commenced construction of ethane cracker at its complex in Baytown, Texas, US.
The company plans to use shale-derived natural gas to produce plastics and other materials.
The steam cracker will be able to produce 1.5 million tonnes of ethylene per annum and provide ethylene feedstock for downstream chemical processing at the company's Mont Belvieu plastics plant.
ExxonMobil is also expanding its Mont Belvieu plant with two high-performance polyethylene lines, which will have capacity of 650,000t.
A Danish consortium led by Brass Fertilizer and Haldor Topsøe agreed to design and construct a $3.5bn urea, methanol and gas processing complex on Brass Island, Bayelsa, Nigeria.
The proposed project is expected to be the single largest private sector investment in the Niger Delta.
It will support the region with 15,000 jobs during the construction phase and more than 5,000 permanent roles after completion.
The facility will produce 3,850tpd of urea and 5,000tpd of methanol, as well as 500 million standard cubic feet of natural gas. Shell's OML 33 field will supply gas feedstock to the plant.
Brazilian petrochemical firm Braskem revealed plans to establish an ultra-high molecular weight polyethylene (UHMWPE) manufacturing facility in La Porte, Texas, US.
Scheduled to commence in the third quarter of 2014, work on the project is expected to be completed in the first half of 2016.
The new facility will complement the company's existing UHMWPE production in Brazil under the UTEC brand.
The General Superintendence of Administrative Council for Economic Defense (CADE) recommended blocking petrochemical firm Braskem's planned purchase of 70.59% stake in Solvay Indupa over potential anti-competitive effects.
CADE said that the deal will increase Braskem's stake in Solvay Indupa Brasil to 99.99%, which would create a monopoly of Braskem in the PVC-S and PVC-E markets.
Additionally, the transaction would lead to the division of caustic soda among only three competitors in the country, the regulator said.