Ineos Signs Billion-Dollar Deals with Sinopec

Three Significant Agreements Ineos Signs Billion-Dollar Deals with Sinopec

2022-07-29 Source: Press release MA Alexander Stark

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By signing three agreements with a total value equivalent to around seven billion dollars, Inoes aims to establish itself on the Chinese market. The deals signed with Sinopec generate a total annual capacity of seven million metric tons and generate sales of around ten billion dollars.

China is an important growth region for Ineos: Three agreements with Sinopec now significantly expand the company's petrochemicals business.(Source: Ineos) — China is an important growth region for Ineos: Three agreements with Sinopec now significantly expand the company's petrochemicals business.
(Source: Ineos)

Specialty chemicals group Ineos and Sinopec have signed three back-to-back agreements worth a total of seven billion dollars. The company expects these landmark agreements to bring in total sales of around ten billion euros at a capacity of seven million tons. The three agreements significantly change Ineos' petrochemical production and technology in China.

Firstly, the Group has agreed to acquire 50 % of Shanghai Secco Petrochemical Company, a subsidiary of Sinopec.

Secco currently has a production capacity of 4.2 million tons of petrochemical products, including ethylene, propylene, polyethylene, polypropylene, styrene, polystyrene, acrylonitrile, butadiene, benzene and toluene. It is a 200 hectare plant located within the Shanghai Chemical Industry Park.

Furthermore, Ineos has agreed to establish a new 50:50 joint venture with Sinopec to build a production capacity of up to 1.2 million tons of ABS to meet growing demand in China. The 600 ktpa ABS plant in Ningbo, currently being built by Ineos Styrolution and scheduled to come on stream by the end of 2023, will be part of the joint venture. The partners also plan to collaborate on two additional 300 ktpa ABS plants, also to be built by the joint venture based on Ineos' world-leading Terluran ABS technology. One of these 300-kt plants will be located in Tianjin, while the location of the third plant is still open.

The third agreement calls for the formation of a 50:50 joint venture, to build a new 500 ktpa HDPE plant in Tianjin. In addition to the Tianjin plant, the two companies will build at least two other 500 ktpa capacity HDPE plants to produce licensed Ineos pipe. The Tianjin plant is scheduled to come on stream in late 2023.

The specialty chemicals group already has joint ventures in operation with Sinopec following its acquisition of BP's Acetyls and Aromatics business in January 2021. The two companies already know each other well through two decades of business interfaces at different levels and see closer cooperation as a logical conclusion. This close relationship will give the Chinese partner access to some of the best downstream technologies in the world, achieving a significant presence in China, the fastest growing market in the world.

(ID:48502528)

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