Germany's PCC in DME joint venture with Russia's Shchekinoazot

22 June 2012 12:49  [Source: ICIS news]

LONDON (ICIS)--Germany's chemicals, energy and logistics group PCC and Russian firm United Chemical Company Shchekinoazot have agreed a joint venture to produce “aerosol-quality” dimethyl ether (DME) in Russia, the two companies said on Friday.

Production is slated to begin in 2014 at the 20,000 tonne/year production plant to be constructed on the grounds of Shchekinoazot's headquarters in Pervomayskiy near Shchekino, in the Tula region, around 180km (112 miles) south of Moscow, it added.

The Russian firm's 450,000 tonne/year methanol facility, opened last year, meant there would be a steady supply of raw materials to produce DME, used in the cosmetics industry as a blowing agent for hairsprays as well as in the manufacture of polyurethane (PU) insulating foams, Duisburg-based PCC said.

"We are looking forward to working with a company as highly regarded as Shchekinoazot, who will be rounding out their product portfolio with the establishment of the DME plant," said Waldemar Preussner, chairman of PCC's executive board, at the contract signing.

"PCC brings to the joint venture knowledge about the production of DME and relevant market insights. What we're seeing here is cutting-edge technology and expertise combined with existing production capacity and location-related synergies for the new DME plant to form a strong foundation for the success of our joint venture," he added.

Boris Sokol, president of Shchekinoazot, which also produces caprolactam (capro) and sulphuric acid, added: "For us it's of great importance that we succeeded in acquiring a major European holding as a joint venture partner to ensure consistent improvement of the new technologies. Once the new production plant is successfully brought online, the DME aerosol joint venture will be able to offer consumers a high quality product. Russia also has extensive natural resources and is counted among the most dynamically growing markets in the world."

Good transportation infrastructure in the Tula region and the relative proximity of the region to the key markets of eastern Europe provide an optimal basis for the joint venture to achieve success, PCC and Shchekinoazot noted.

As well as eastern Europe, Russia and the Commonwealth of Independent States (CIS) states would be target markets for DME sales, Preussner added.

Exports currently represent approximately 70% of Shchekinoazot's sales, the Russian producer said.

PCC said its group turnover amounted to €614.8m ($768.5m) in 2011. Its subsidiaries include Polish polyols and surfactants producer PCC Rokita.

No financial details of the joint venture were disclosed by the companies.

$1 = €0.80

By: Will Conroy
+44 20 8652 3214

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