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| September 2, 1999 |
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| Acqusition of Capacity Right of Styrene Monomer
(SM) in Singapore |
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| Mitsubishi Chemical Corporation |
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Mitsubishi Chemical Corporation (President: Kanji Shono, headquartered in Chiyoda-Ku,
Tokyo) conducted a capacity right agreement of styrene monomer (SM) produced in
Seraya Island of Singapore with Shell Eastern Petroleum (Pte) Ltd. on August 27.
In addition to the capacity right of 100,000 tons/year of SM produced by the existing
plant, Mitsubishi Chemical obtained additional capacity right of 280,000 tons/year
(380,000 tons/year as total) starting from the second half of the year 2002. It
is believed that this new agreement strengthens the market position of Mitsubishi
Chemical in styrene monomer in Asia.
In Seraya Island, Singapore, Mitsubishi Chemical and Shell Eastern Petroleum has
been operating Seraya Chemicals Singapore (Pte) Ltd., a joint venture between
the two companies, and producing 315,000 tons/year of SM and 140,000 tons/year
of propylene oxide (PO) as the first phase plant of the company. At this time,
Shell Eastern Petroleum and BASF South East Asia agreed to jointly construct second
plant which will produce 550,000 tons/year of SM and 250,000 tons/year of PO with
the scheduling start-up in the second half of the year 2002. Mitsubishi Chemical
deposits a part of the construction cost equal to the volume of 380,000 tons of
SM to secure the capacity right. As far as the raw materials for the SM, ethylene
and benzene, Mitsubishi Chemical guarantees to supply them from Exxon Singapore
and other sources to Shell Eastern Petroleum.
Relating to the agreement, the operation of the first phase plant had been reinvestigated
and decided that Mitsubishi Chemical sells all stock holdings of Seraya Chemicals
(30% of total stocks) to Shell Eastern Petroleum. At the same time, the capacity
right of PO is transfered to Shell Eastern Petroleum and Mitsubishi Chemical decided
to withdraw from PO business some time at the end of this year.
Mitsubishi Chemical plans to discontinue the SM plant operation in Yokkaichi Works
in October 1999. However, Mitsubishi Chemical determines to establish proper supply
system concentrating in Kashima in Japan and Seraya Chemicals abroad to meet the
global market conditions and strengthen competitive power as announced.
| For further information, please contact |
| Public Relations Office; |
| Mitsubishi Chemical |
| Tel: [+81] 3-3283-6254 |
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