12 September 2013 17:08 [Source: ICIS news]
MEDELLIN, Colombia (ICIS)--The joint venture (JV) for vinyl chloride monomer (VCM) production between Mexican petrochemical company Mexichem and Pemex's petrochemical business unit PPQ will secure the long-term supply of VCM needed for Mexichem’s polyvinyl chloride (PVC) operations, a source at Pemex said on Thursday.
Mexichem announced the creation of the long anticipated JV on 11 September.
The JV includes a cash investment and assets contribution of up to $518m (€389m), of which PEMEX will participate with $228m in assets.
Mexichem will contribute with $90m in assets and $200m in cash to modernise the Pajaritos petrochemical complex, according to Mexichem.
The resources to be invested in the Pajaritos complex and Mexichem will increase all products related to the chlorine-vinyl chain, Mexichem said.
In the first year, the Pajaritos complex is expected to produce 24,000 additional tonnes of VCM, 146,000 tonnes in the second year, and 217,000 tonnes in the third year, reaching a capacity of 400,000 tonnes/year,
Caustic soda and VCM imports will largely be eliminated, as the Mexichem supply chain will be integrated, the source said.
The deal was first announced in June 2011 and had been waiting for Pemex board backing since it secured antitrust approval in October 2012.
Mexichem is the largest producer of PVC resin in Latin America.
($1 = €0.75)
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