Indorama Ventures Limited (IVL), Thailand based producer of intermediate petrochemicals, has signed an agreement to purchase the purified isopthalic acid (PIA), polyethylene terephthalate (PET) and purified terephthalic acid (PTA) business of Compañía Española de Petróleos S.A.U. (Cepsa Spain) in Guadarranque-San Roque, Cadiz, Spain.
The new acquisition in Spain with 220,000 tonnes of PIA, 325,000 tonnes of PTA and 175,000 tonnes of PET capacity is subject to necessary legal approvals, the company said on its website. Earlier in June 2015, IVL had acquired Cepsa’s 600,000 tonnes Canadian PTA assets.
The Guadarranque-San Roque site is one of the few integrated sites worldwide that integrates PTA, PIA and PET where a third party refinery is located at the same site to supply raw materials. The acquisition of this site is in line with IVL’s successful strategy of vertical integration, portfolio expansion and geographic diversification.
Cepsa Spain is the only producer of PIA in Europe and is the world’s 2nd largest producer. The company owns its own advanced and patented technology, thereby providing a strong barrier to entry. Spain’s PTA technology is also proprietary and IVL has been operating its sister plant in Montreal, Canada which it acquired earlier in 2015.
Spain’s 175,000 tonnes per annum PET plant is technically a sister plant of the IVL-owned Rotterdam plant, which is currently operating at 220,000 tonnes per annum and therefore there exists an established low cost de-bottlenecking opportunity.
“Integrated PIA, PTA and PET in Spain is an attractive and complementary business that fits our existing exposure in Larger Europe. Europe is presently going through a challenging period with fragmented capacities and un-restrained imports from Asia and the US. Spanish assets will complement IVL’s existing portfolio in Europe with consolidation of PTA and PET assets and with addition of PIA, a high value add business,” said Aloke Lohia, Group CEO of Indorama Ventures.
Cepsa, fully owned by the International Petroleum Investment Company (IPIC), employs more than 10,000 people and operates at every stage of the hydrocarbon value chain. It has a prominent position in Spain and it also operates in 15 countries, marketing its products all over the world. (RKS)