US Eastman buys remaining stake of $1.6bn project

03 June 2008 15:13  [Source: ICIS news]

HOUSTON (ICIS news)--US producer Eastman Chemical has acquired the 50% stake that Green Rock Energy held in a $1.6bn (€1bn) industrial gasification project in Beaumont, Texas, the company said on Tuesday.

The acquisition makes Eastman the sole owner of the project, the company said. In addition Eastman remains the sole developer of the project.

When operational in 2011, the plant will turn petroleum coke into methanol, hydrogen and ammonia.

Eastman expects to complete the front-end engineering and design for the Beaumont project in the second half of 2008. The company should obtain project financing by the end of the year.

In other news, Eastman sold to Green Rock its remaining 25% stake in an industrial gasification project in St James Parish, Louisiana. As such, Eastman will no longer participate in the project.

That project would use petroleum coke and high-sulphur coal as feedstock to make anhydrous ammonia for agriculture, methanol, sulphur and industrial-grade carbon dioxide (CO2) after its start-up in 2010.

“We have confidence in the success of both the Texas and Louisiana industrial gasification projects, however, differences in strategic criteria led us to agree with Green Rock to end our joint investment,” according to a statement by Richard Lorraine, Eastman chief financial officer. “We are extremely pleased to become the sole owner and developer of the Beaumont industrial gasification project," he said.

"It remains on track with the previously announced development milestones and we expect it will contribute approximately $2 of corporate earnings per share," Lorraine said in the statement. "We also continue to pursue additional industrial gasification projects that meet our investment criteria.”

($1 = €0.64)

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By: Al Greenwood
+1 713 525 2653

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