Braskem Idesa Sells 50% Stake in Ethane Import Terminal in Mexico

Braskem Idesa Signed Agreement with Advario B.V and Aims to Secure Ethane Imports from the Terminal

Braskem announced on Tuesday (the 14th) that Braskem Idesa (BI), its indirect subsidiary in Mexico, has reached an agreement with Advario B.V, a Dutch storage company, for the transfer of 50% of its shareholding in the Terminal Química Puerto México (TQPM), a BI subsidiary responsible for the development and operation of the ethane import terminal project in Mexico.

The petrochemical company reports that the operation is still subject to applicable approvals and that, when approved, Braskem Idesa and Advario will be responsible, each for 50% of the capital of TQPM. The transaction values have not been disclosed.

According to a statement sent to the Securities and Exchange Commission (CVM) by Braskem, Advario, a global leader in the storage sector based in the Netherlands, has expertise in designing, building, and operating storage and logistics infrastructure for liquid bulk products, such as petrochemicals and cryogenic gases, with a presence currently worldwide.

Terminal Operated by TQPM Will Have a Capacity of 80,000 Barrels Daily of Ethane

The terminal for ethane imports operated by TQPM will have a capacity of 80,000 barrels daily of ethane, ensuring that Braskem Idesa can meet all its raw material import needs.

In addition, Advario and Braskem Idesa are expected to invest 400 million dollars in the establishment of the import terminal, which will be located in the state of Veracruz, Mexico.

The construction of this project, which is crucial for ensuring the competitiveness of Braskem Idesa’s petrochemical complex, as it secures the supply of raw materials for the company, is set to begin in July, with an expected completion date at the end of 2024. The ethane import terminal will be linked to the BI complex through an 11-kilometer pipeline.

Project Will Enable Increased Availability of Ethane and Competitiveness of the Entire Petrochemical Industry in Mexico

In a statement, the companies declared that the project will provide the additional raw material that Braskem Idesa needs to operate at full capacity, increasing the availability of ethane and the competitiveness of the entire petrochemical and plastics industry in Mexico.

The agreement is being signed after a long period of uncertainty regarding the future of the petrochemical complex, in light of difficulties in the raw material supply.

Braskem Idesa began operations of what it calls “the largest petrochemical complex in Latin America,” focused on the production of ethylene and high and low-density polyethylene, in 2016, having invested the equivalent of 5.2 billion dollars.

At the time the agreement for the complex was signed, the selected raw material was natural gas supplied by the Mexican state-owned oil company Pemex; however, the company eventually faced conflicts with the joint venture due to the gas supply contract, which was resolved in September of last year.

About Braskem Idesa

Braskem Idesa is an association created in 2010, formed by Braskem, a leading petrochemical company in the Americas, which holds a 75% share in the agreement, and Grupo Idesa, one of the main business companies in Mexico, with a 25% share.

The partnership has led the development and implementation of a petrochemical complex in Mexico, aimed at producing polyethylene and located in the city of Coatzacoalcos, in the state of Veracruz.