Poland chem deficits 'point the way for Gdansk complex': Azoty, Lotos

06 December 2013 17:02 Source:ICIS News

LONDON (ICIS)—Details of Poland's chemical trade deficit illustrate  production opportunities that could be pursued through the development envisaged Gdansk petrochemical complex, project partners Grupa Lotos and Grupa Azoty said on Friday.

Annually, Poland is currently importing around 800,000 tonnes of linear low-density polyethylene (LLDPE); 35,000 tonnes of butadiene (BD); 400,000 tonnes of propylene; 26,000 tonnes of benzene; and 250,000 tonnes of acrylic acid derivatives, the companies said.

The Polish government, which through shareholdings held by the treasury ministry controls the two groups, is supporting the zloty (Zl) 12bn ($3.9bn, €2.9bn) petrochemical investment with a view to reducing Poland’s chemicals and primary plastics trade deficit, which officially stood at minus-Zl16.7bn in 2012.

However, Prague-based investment bank WOOD & Company has questioned the wisdom of going ahead with the 'mega-investment', arguing that if production is ethylene-based it could be too exposed to competition from rival petrochemical complexes in the US that utilise cheap shale gas-derived feedstocks.

The bank has warned equity investors that they should probably steer clear of Lotos and Azoty stock until more details are known about their Gdansk complex, to be constructed from 2016-2018 if the investment gets the green light.

($1 = €0.73, $1 = Zl3.06, €1 = Zl4.19)

By Will Conroy