Canada’s Petromont to shutter operations

12 February 2008 23:49  [Source: ICIS news]

HOUSTON (ICIS news)--Canadian olefins and polyolefins maker Petromont said on Tuesday it will suspend operations on 30 April, citing the strong Canadian dollar and costly feedstocks.

Petromont, a limited partnership between Dow Chemical and an arm of the Quebec government, said it will mothball its plants in Varennes and Montreal, Quebec. Dow had earlier said it planned to write down its Petromont plants as part of a global plan to cut costs.

Company general counsel Louis Rail said the company has annual sales of Canadian dollars 750m ($749m) and employs 300 people.

The rise in recent months of the Canadian dollar against the US dollar and the inability of the company to gain access to less expensive feedstocks led to the decision to shutter the plants, Rail said.

“We don’t see any reversal or change that would bring us back to profitability,” Rail said.

“We will wind down operations to April 30,” he continued. “We won’t dismantle our assets – but will mothball it until there is a change in economic conditions.”

“We have not excluded a potential purchase of Petromont by a third party,” Rail added. He noted that the plant sites include an extensive pipeline network between Varennes and Montreal and are located on the St. Lawrence River.

($1 = C$1.002)

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By: Brian Ford
+1 713 525 2653

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