Russia's UPC, Mexico's Alpek to form JV to build PTA-PET plant in Ufa
MOSCOW. Sept 27 (Interfax) - United Petrochemical Company (UPC), a subsidiary of AFK Sistema , has signed a joint venture agreement with Mexican company Grupo Petrotemex, a subsidiary of Alpek, for the construction of an integrated purified terephthalic acid (PTA) and polyethylene terephthalate (PET) plant in Ufa, the companies said in a press release.
Under the agreement, Alpek and UPC will elaborate a detailed business plan to determine the project's feasibility. Alpek and UPC will each invest US$10 million in the completion of the plant's evaluation stage. Construction is subject to both companies approving the business plan.
The new facility is expected to be an IntegRex PTA - PET site dedicated to serve the Russian market with a maximum installed capacity of 600,000 tonnes PTA and 600,000 tonnes PET. The parties are negotiating the supply of the required material - Paraxylene - with oil company Bashneft , which is also part of the Sistema group.
The European Commission has approved the establishment of the JV, but the implementation of the project will be subject to additional approvals from governmental authorities.
The companies plan to conclude a licensing agreement to use IntegRex technology after obtaining final approval for the JV from all relevant authorities.
"We are very excited by the prospect of Alpek's first venture outside of the Americas, entering the Russian PET market with a world-class partner such as UPC/Sistema. This agreement reaffirms Alpek's commitment to the PET value chain and demonstrates the great potential of our IntegRex technology as an effective vehicle for international expansion. We are convinced that this partnership will create an unparalleled value offer in the Russian PET market by combining Alpek's IntegRex technology and polyester value chain expertise with UPC's unique domestic sourcing capabilities and local market knowledge," Alpek CEO Jose de Jesus Valdez said.
"We are pleased to have signed the agreement with Alpek on the PET project, our first joint venture. The project will give us access to the unique IntegRex technology and new opportunities to supply our PET products to the fast growing Russian and international petrochemical markets. UPC is looking forward to a long and successful business partnership with Alpek, one of the largest petrochemical companies in Latin America, as well as to the perspective to increase PTA/PET production in the nearest future and deepen our footprint in Russia," UPC president Kirill Tyurdenev said.
UPC is a vertically integrated petrochemical group which owns four enterprises located in Bashkortostan: Ufaorgsintez ; Tuimazinkoye and Shkapovskoye gas processing plants, which produce liquid petroleum gas and stable natural gasoline (SNG) from associated petroleum gas (APG) and natural gas liquids (NGL); and Bisphenol-A plant. In 2012 UPC generated a combined revenue of 17.9 billion rubles.
Alpek is the largest petrochemical company in Mexico and the second largest in Latin America. The company operates two business segments: polyester (PTA, PET and polyester fibers), and plastics and chemicals (PP, EPS, caprolactam, polyurethanes and other specialty and industrial chemicals). In 2012, Alpek reported revenues of $7.277 billion and EBITDA of $728 million. The company operates 19 plants in Mexico, the United States and Argentina. Alpek is a publicly traded company listed on the Mexican Stock Exchange.
