Exxon-Mitsui production deal

01 September 1999 00:00  [Source: APC]

Exxon Chemical has signed an agreement with Japan's Mitsui Engineering & Shipbuilding which will allow its high pressure tubular polyethylene technology to be used for the production of low density polyethylene (ldPE) in China.

The Exxon ldPE technology will be sublet by Mitsui to China Petrochemical International Company (Sinopec) for use by Yanshan Petrochemical at a new 200 000 tonne/year plant to be built in Beijing for its Yanhua subsidiary. Due to be completed by the end of 2001, the plant will produce ldPE homopolymer and products containing up to 10% of vinyl acetate. Exxon will start engin- eering work on the plant immediately.

Engineering, procurement and construction work has been contracted to Mitsui Engineering and Itochu Corp. Last month, Mitsui said around Yen2bn ($17m) of the approximately Yen10bn in plant construction costs will go on design and technology, including licensing fees for the production process. However, no financial details of the licensing agreement were disclosed. Exxon, which is one of the world's largest ldPE producers, has been licensing its ldPE process since 1994.

Beijing Yanhua recently signed contracts to boost its ethylene capacity to 660 000 tonne/year from 450 000 tonne/year. The new ldPE plant will use the additional ethylene.

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