APLA ’11: Mexichem in talks to partner on US cracker

07 November 2011 20:20  [Source: ICIS news]

BUENOS AIRES (ICIS)--Mexico-based polyvinyl chloride (PVC) producer Mexichem is in discussions to take an ownership stake in a new US ethylene cracker, a senior executive said on Monday.

“We are in the very preliminary stages of discussions to partner on a condo cracker in the US,” said Juan Francisco Sanchez Kramer, strategic procurement manager at Mexichem.

Sanchez Kramer spoke to ICIS on the sidelines of the 31st annual meeting of the Latin American Petrochemical Association (APLA).

“We are talking to three potential partners on this,” he added.

Two of the potential partners have announced firm plans to proceed with crackers in the US based on greater shale gas availability, while the third has announced its intention to build a cracker, noted Sanchez Kramer.

“The cracker would have to be on the Gulf Coast, so it is close to our VCM [vinyl chloride monomer] and PVC plants in Mexico,” he said.

Companies that have announced firm plans to build a cracker in the US include Netherlands-based LyondellBasell, US-based Dow Chemical, and Anglo-Dutch company Shell.

However, Shell announced its intention to build its cracker near the Marcellus shale gas formation in the northeast US.

Many others, including US-based Chevron Phillips Chemical and Brazil’s Braskem have announced they are studying a new US cracker.

Mexichem is interested in obtaining a share in the cracker that would allow it to take 500,000-600,000 tonnes/year of ethylene to produce ethylene dichloride (EDC), which would be used to make vinyl chloride monomer (VCM) and then PVC.

“We would take the ethylene by pipeline to Mexico,” said Sanchez Kramer.

The APLA annual meeting lasts through Tuesday in Buenos Aires.

By: Joseph Chang
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