23 November 2012 06:02 [Source: ICIS news]
MEDELLIN, Colombia (ICIS)--Mexican chemical conglomerate Mexichem said late on Thursday it was scrapping plans for a petrochemical joint venture with Petroleos Mexicanos (Pemex) due to continued delays by the state-run oil company.
Mexichem would concentrate on investment opportunities outside of Mexico, it said in a filing with the Mexican stock exchange.
The proposed joint venture, first announced in June 2011, had been waiting for Pemex board backing since it got antitrust approval in October this year.
The project would have increased the vinyl chloride monomer (VCM) capacity at Pemex's Pajaritos plant from 200,000 tonnes/year to around 450,000 tonnes/year.
Pemex recently canceled two proposed board meetings to discuss the signing of the joint venture.
Mexichem said in an October conference call that Pemex’s delay in signing the agreement was ‘probably political’.
Mexico’s incoming president Enrique Pena Nieto takes office on 1 December.
Mexichem said in July that it hoped to secure the long-term supply of VCM it needed for its polyvinyl chloride (PVC) operations.
Mexichem is the largest producer of PVC resin in Latin America.
The company is currently mulling a joint venture with Occidental Chemical (OxyChem), under which the US-based company would build an ethane cracker in Texas and use the ethylene to produce VCM. OxyChem would then ship the VCM to Mexichem.
If the joint venture goes ahead, the 500,000 tonne/year facility could begin operations in 2016.
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