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Hengli Petrochemical invests USD1.6 billion to build PTA units at Huizhou, China

October 06/2020

MOSCOW (MRC) -- Hengli Petrochemical (Dalian, China) will invest 11.5 billion renminbi (USD1.6 billion) to build two purified terephthalic acid (PTA) units at the Daya Bay petrochemical park at Huizhou, Guangdong Province, China, according to Chemweek.

Each PTA unit will have a production capacity of 2.5 million metric tons/year (MMt/y). Operations are planned to commence by the end of 2021. The companys current production capacity for PTA is 11.6 MMt/y following the start-up of new plants at Dalian.

Hengli says that after the project is complete, it expects annual sales to reach 21.2 billion renminbi and profit to rise to 1.2 billion renminbi.

Hengli says that the Daya Bay petrochemical park at Huizhou is one of the seven key petchem industrial bases in China. It says that the project will fill gaps in the middle and lower reaches of the petrochemical industry chain at Huizhou and in Guangdong. The investment will also improve the park's industrial structure as it develops into an energy, petrochemical, and materials cluster. Multinational companies building world-scale petrochemical complexes at Daya Bay include ExxonMobil and Shell.

Guangdong Province in southern China is one of the key regional economies in the country. It has the largest automotive and electronics industries in China and is a big manufacturer of consumer goods. Guangdong is also the largest consumer market in China, partly because it is the countrys most populous province with more than 110 million residents. Annual growth of household consumption has averaged 8% there in the last five years, according to estimates.

IHS Markit says that China is the worlds largest producer of PTA and downstream consumer of polyethylene terephthalate (PET). China's reliance on imported PTA has dramatically declined with the ramp-up of domestic production capacity, including Hengli adding large capacity at Dalian. Chinese PTA imports declined at an average of 19.5%/year over the last decade to just 676,000 metric tons in 2018, says IHS Markit.

In 201823, China is expected to add 22.5 MMt/y of PTA capacity. By 2023, total Chinese capacity is expected to be in excess of 66 MMt/y, according to data from IHS Markit.

As MRC wrote oreviously, Hengli Petrochemical Co Ltd ramped up the operation rate of its new No. 5 purified terephthalic acid (PTA) line at Dalian to around 85% on 11-12 July, 2020. The company managed to produce prime grade PTA cargoes at its new PTA line in China on 30 June. This line was successfully launched on 28 June, 2020. Based in Dalian, China, the company has 5 PTA plants with combined production capacity of 11.6 million tons/year,  making Hengli Group the world's largest PTA producer, as each PTA plant has production capacity of 2.5 million tons/year.

PTA is one of the main feedstocks for the production of PET.

As per MRC's ScanPlast report, Russia's estimated PET consumption reached 55,220 tonnes in August, 2020, down by 27% year on year. Overall estimated PET consumption in Russia decreased in the first eight months of 2020 by 21% year on year to 476,940 tonnes.

Hengli Petrochemical Co., Ltd. manufactures chemical fibers. The Company researches, produces, and sells polyester filament and chips for consumer and industry products. Hengli Petrochemical markets it products worldwide.
Author:Margaret Volkova
Tags:PET-granulate, terephthalic acid, packaging, Exxon Mobil, Hengli Petrochemical, Shell.
Category:General News
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