07 August 2009 15:18 [Source: ICIS news]
PRAGUE (ICIS news)--A shareholder in Romanian chemical company Oltchim is protesting against a possible move by the firm to radically widen its survival and development plan to acquire the Arpechim refinery, it said on Friday.
Germany's Petro Carbo Chem (PCC) - which earlier disclosed it had complained to the European Commission over an Oltchim loan guarantee - said such an "over-investment" in the 1960s facility was "funamentally flawed".
In a statement, PCC said the acquisition posed an "immediate threat" to the company survival since Oltchim would not be in a position to service the large debt involved.
Buying the Arpechim refinery from Romania's Petrom group would cost at least €1.3bn ($1.9bn) on top of the approximate €400m needed to purchase the petrochemical unit, revamp it and increase its ethylene steam cracker's capacity, estimated Adam Lamentowicz, project development manager for PCC.
PCC noted that if the refinery was closed the petrochemical facility's ethylene cracker, the output of which is supplied to state-controlled Oltchim by local pipeline, would have no ready supply of naphtha.
"But that does not mean Oltchim should jump into buying this old refinery even if it can raise the money," said Lamentowicz.
"Arpechim's ethylene supplies could for instance be replaced with ethylene dichloride (EDC) shipments from the middle east," he added.
Oltchim spokesman Silviu Pandrea said that any possible move for the refinery was "only at an idea stage".
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