A joint venture for the construction and operation of
a world-scale production facility for polyurethane base products
has been set up by Bayer and the Lyondell Chemical Company of
Houston, Texas. The new facility, which is to be built in
Maasvlakte (Rotterdam), the Netherlands at a cost of over EUR 500
million, is scheduled to come on stream in 2003. Bayer and
Lyondell will each have a 50 percent share in the joint venture and
each company will off-take half of the annual production of 285,000
tons of propylene oxide and 640,000 tons of styrene. The boards of
the two companies have already given their approval to the project.
"For Bayer, this project represents another important step towards
safeguarding and optimizing our propylene oxide supplies," said
Dr. Hans-Joachim Kaiser, General Manager of Bayer's
Polyurethanes Business Group. "It also gives us long-term access to
supplies of propylene oxide – a base product for the production of
polyols – at low cost." Bayer's share of the styrene production
roughly corresponds to its requirements.
Polyols are a raw material for the production of polyurethanes,
whose manufacture also requires complementary components in the
form of MDI (diphenyl methylene diisocyanate) or TDI (toluene
diisocyanate). Bayer was already the world's leading manufacturer
of these diisocyanates when it acquired Lyondell's polyols business
on April 1, 2000, and thus became the largest producer of
polyurethane raw materials in the world. As part of the transaction,
Bayer also gained the long-term right to purchase supplies of
propylene oxide from Lyondell.
Global demand for polyurethanes is growing steadily at an annual
rate of between four and five percent. By virtue of the variety of
forms in which they can be produced, ranging from solid materials
to foams with widely varying properties, polyurethanes find a broad
spectrum of applications in the electrical industry, in high- and
low-temperature insulation, in the manufacture of engineering
components, in the furniture industry and in the sport and leisure
sectors.
Bayer's Polyurethanes Business Group currently has more than 20
production facilities situated in Europe, North America and Latin
America, and Asia. In 1999 the 4,700 employees in the Group
achieved sales totaling EUR 2,175 million. As a result of the
acquisition of Lyondell's polyols business, sales increased to some
EUR 3,000 million and the number of employees rose by 750.