MOSCOW (MRC) -- Hanwha Solutions (Seoul), formerly Hanwha Chemical Corp., has submitted a bid to acquire a 50% stake in Sasol’s USD12.8 billion Lake Charles, Louisiana petrochemical complex, according to Chemweek with reference to several reports in the Korean press.
Sasol announced a few months ago that it is seeking partners for the nearly completed project as part of the company’s asset disposal plan to reduce debt. The stake would raise USD1.7-3.4 billion, according to The Korea Herald.
Business Korea says Hanwha Solutions participated in a tender for the Lake Charles stake on 24 July. Hanwha took part in the tender by forming a consortium with Daishin Private Equity.The lead manager of the sale is the Bank of America. Other Korean companies, including LG Chem, have also shown an interest in acquiring a stake in the project, Business Korea says. According to reports in June, several international companies expressed an interest in acquiring a stake. They include, Ineos, CP Chem, LyondellBasell and ExxonMobil. Sasol said at the time that its “expanded asset-disposal process has yielded good interest from strong contenders.”
Sasol announced in March that it was reviewing a variety of actions to address the challenges created by the impact of COVID-19 and the recent decline in oil and chemical prices. “A package of measures have been developed that are intended to reposition the company over the following 24 months. One of these measures will be our existing asset-disposal program… This includes the potential for exploring partnering options at Sasol’s…US-based chemicals business,” Sasol said.
The Lake Charles complex is based on a 1.54-million metric tons/year ethane cracker that started production last year. The ethylene will be used in six downstream plants on site to produce ethylene oxide, ethylene glycol, ethoxylates, and low-density and linear low-density polyethylene, as well as Ziegler and Guerbet alcohols. About 10% of the ethylene will be surplus to requirement and sold on the merchant market as well as supply Sasol’s share of its high-density polyethylene joint venture (JV) with Ineos in Texas. The 50/50 JV is designed to produce 470,000 metric tons/year.
Sasol says that the last remaining production unit to come online at the Lake Charles complex is a low-density polyethylene (LDPE) plant, which is now scheduled to start production in October this year. The 420,000-metric tons/year LDPE plant was damaged during a fire in January 2020.
As MRC reported earlier, Sasol's world-scale US ethane cracker with the capacity of 1.5 mln tonnes per year reached beneficial operation on 27 August 2019. SasolпїЅs new cracker, the heart of LCCP, is the third and most significant of the seven LCCP facilities to come online and will provide feedstock to our six new derivative units at the company"s Lake Charles multi-asset site.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
Sasol is an international integrated chemicals and energy company that leverages technologies and the expertise of our 31 270 people working in 32 countries. The company develops and commercialises technologies, and builds and operates world-scale facilities to produce a range of high-value product stream, including liquid fuels, petrochemicals and low-carbon electricity.
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