BP Chemicals (Malaysia) sells its interest in PTA to Reliance

BP Chemicals (Malaysia) or BPCM announced its agreement to sell all its interests in purified terephthalic acid (PTA) production in Malaysia to Reliance Global Holdings Pte Ltd., the Malaysian arm of India’s Reliance Industries. The price agreed upon is US$230 million in cash, which includes the net value of working capital and cash. The transaction is expected to be completed within the year. BPCM’s 16-year-old PTA plant, located at Kuantan on the east coast of Malaysia, has a production capacity of 610,000 tons per year.
“This is an efficient plant with a good market position in the region. RECRON Malaysia, part of the Reliance Group, is already our largest customer in Malaysia and Reliance Industries is a significant feedstock supplier at Kuantan, so Reliance is a natural owner of this plant,” said James Yim, head of BP’s aromatics business in Asia.
“BP has a major, global PTA business, with around one-fifth of global PTA production capacity and a track record of leading technology. We will continue to concentrate our PTA strategy on deploying new technologies into high growth markets like China where we are in the middle of a considerable expansion program, and in OECD markets where our technology gives us an advantage and high utilization rates,” Nick Elmslie, chief executive of BP Petrochemicals, said.
“We are also building new revenue streams by licensing our PTA and paraxylene technologies,” he added.
BP’s acetic acid manufacturing and marketing business in Malaysia is unaffected by this sale, a BP press release said. Also cited was “BP’s current net global PTA capacity of 7.5 million tons per year from eight sites: two each in the U.S. and Taiwan and one each in Belgium, China, Indonesia and Malaysia. The largest is at Zhuhai, China where expansion of its current capacity of 1.5 million tons per annum (MTPA) is expected to add a further 1.25 MTPA by 2014, making it one of the world’s largest PTA manufacturing sites. (September 29, 2012)