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Sasol exits Gemini HDPE JV in La Porte, Texas

January 11/2021

MOSCOW (MRC) -- Sasol has completed the USD$404-million sale to Ineos of its 50% equity stake in the companies Gemini high-density polyethylene (HDPE) manufacturing joint venture (JV) at La Porte, Texas, said Chemweek.

The planned divestment, first announced by Sasol in November 2020, was successfully closed on 31 December.

The sale total was satisfied through a combination of cash and release from debt obligations, Sasol says in an announcement to the Johannesburg stock exchange. The relevant debt facilities and security package have now been successfully restructured, releasing Sasol and its subsidiaries from any obligation to provide further security, it says. The cash proceeds from the transaction were received on 31 December and will be used by Sasol to repay near-term debt obligations, it says. No value for the final cash amount received was given.

Ineos Olefins and Polymers (O&P) USA, a wholly-owned subsidiary of Ineos, is now the sole owner of the 470,000-metric tons/year Gemini HDPE unit. Ineos has operated the plant, located within the companys Battleground manufacturing complex, since its start-up in 2017. Ineos said at the time of the announcement in November that the purchase would allow it to further expand its reach in the rapidly growing specialty PE markets for pressure-pipe and high-molecular-weight film.

Ineos has four other HDPE production plants with 767,000 metric tons/year of total capacity at Deer Park, Texas, according to IHS Markit data.

Sasol closed a USD2-billion transaction with LyondellBasell in December that saw the two companies formally set up an integrated polyethylene (PE) joint venture (JV) at Lake Charles, Louisiana, with LyondellBasell acquiring 50% ownership of Sasols new 1.5-million metric tons/year steam cracker, and low-density polyethylene (LDPE) and linear low-density polyethylene (LLDPE) plants.

As MRC informed earlier, in September 2020, Air Liquide finalised an agreement with Sasol to acquire the biggest oxygen production site in the world with a plan to reduce its carbon dioxide (CO2) emissions by 30%. After the announcement on July 29, the international major industry gas company has now entered into a business purchase agreement with Sasol to acquire the oxygen production site in Secunda, South Africa.

We remind that Sasol's world-scale US ethane cracker with the capacity of 1.5 mln tonnes per year reached beneficial operation on 27 August 2019. Sasol's new cracker, the heart of LCCP, is the third and most significant of the seven LCCP facilities that came online and will provide feedstock to the company's six new derivative units at Sasol's Lake Charles multi-asset site.

According to MRC's ScanPlast report, Russia's estimated polyethylene (PE) consumption totalled 1,990,280 tonnes in the first eleven months of 2020, up by 1% year on year. Only high density polyethylene (HDPE) shipments increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 090,900 tonnes in the first eleven months of 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.


mrcplast.com
Author:Anna Larionova
Tags:PP, PE, LLDPE, LDPE, HDPE, Sasol.
Category:General News
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