Mitsui Chemicals and Sinopec have formed a joint venture (JV) company named Shanghai Sinopec Mitsui Elastomers in Shanghai, China.
The CNY2bn ($315m) JV will have a capacity to manufacture 75,000t per annum of ethylene-propylene-diene terpolymer (EPT).
The companies signed a JV agreement in December 2011, following the signing of a letter of intent for the EPT project in December 2009.
Both the companies have conducted joint feasibility studies and received approval from the Chinese government to establish the JV company.
The JV will use metallocene catalyst technology to manufacture EPT, which is used in automotive parts, electric cables, and in other industrial materials.
The two companies will have equal stakes in the new venture, and the plant is expected to start commercial production in the first quarter of 2014.
The expansion of China's automobile industry and its social infrastructure are expected to increase demand for EPT, and the JV aims to meet these needs.
Image: Mitsui Chemicals' headquarters are located at the Shiodome City Center in Tokyo, Japan.