Navigating Mexico's Petrochemical Transformation: Braskem Idesa

Q: Considering the current dynamics in Mexico's energy sector, how would you describe your company's overarching business strategy for the country, and where do you see your most significant opportunities for growth?

A: Braskem Idesa is a proud Mexican company with a solid foundation and a forward looking strategy. We see substantial opportunities to support our clients and contribute meaningfully to Mexico’s industrial development. Our approach is anchored in long-term resilience, operational excellence, and sustainable growth. 

Despite global challenges, including market volatility and resin oversupply, we remain focused on strengthening domestic production, reducing import dependency, and enhancing supply chain reliability. Mexico offers a uniquely favorable environment for growth, supported by rising demand, confident customers, and new entrants reshaping the competitive landscape. Our strategic location in the Gulf of Mexico, competitive energy costs, and integration with the Interoceanic Corridor further reinforce our long-term potential.

Q: The new ethane import terminal is a massive achievement. What does this infrastructure, which is now fully operational, mean for Braskem Idesa's strategy in the country?

A: The commissioning of the Terminal Química Puerto México (TQPM), representing a US$500 million joint venture with Advario, represents a transformative milestone for Braskem Idesa and the Mexican petrochemical sector. With two cryogenic tanks capable of storing 54,000t of ethane and a delivery capacity of 80Mb/d, the terminal will ensure a stable and uninterrupted feedstock supply. 

This infrastructure will enable us to operate our polymerization units at full capacity, producing up to 1.05Mt of polyethylene annually, while supporting future expansion. TQPM will strengthen our role in import substitution, will empower domestic converters, and reinforce a more integrated value chain, allowing us to meet rising demand in key sectors such as  packaging, agriculture, and construction, and contribute to Mexico’s broader industrial transformation.

Q: Your company has successfully overcome years of ethane supply challenges. What is the most significant lesson you have learned from that experience about managing a critical supply chain in Mexico?

A: The key lesson has been the value of close and constructive collaboration with federal authorities and PEMEX, combined with strategic foresight. Our investment in TQPM and the deployment of dedicated ethane carriers, Brilliant Future and Brave Future, equipped with dual-fuel engines and StarTrilobe tanks that reduce CO2 emissions by 40%, exemplifies our commitment to building a sustainable and resilient supply chain. 

By closing the logistical loop between Texas and Coatzacoalcos, we have established a robust system that ensures operational continuity and significantly enhances our competitiveness in both domestic and global markets.

Q: With the import terminal now providing a stable supply, how does Braskem Idesa plan to increase its production capacity and capture a greater share of the Mexican polyethylene market?

A: According to the Statistical Yearbook of the Chemical Industry published by ANIQ this year,  Mexico’s polyethylene market remains significantly import-dependent, with imports over 2,0 million tons per year considering all PE Considering this market dynamics, our strategy is to grow our presence in Mexico to substitute imports  focuses on maximizing plant utilization, expanding our portfolio of post-consumer recycled (PCR) and biobased resins and strengthening partnerships with domestic converters. 

We have developed a robust PCR resin portfolio, including FDA-certified grades for food contact, allowing us to serve demanding markets and broaden our offering of environmentally responsible solutions. In 2024, PCR (post-consumption resin) total sales grew by 35% compared to the previous year, reflecting the success of our collaborations with customers and recyclers, and reinforcing our role as a key driver of sustainable industrial growth in Mexico.

Q: The Mexican petrochemicals market is growing, driven by a surge in demand from the automotive, construction, and packaging sectors. How is Braskem Idesa capitalizing on this domestic demand?

A: We are capitalizing on our diversified product portfolio and strategic location to serve Mexico’s most dynamic sectors. Our polyethylene resins play a critical role in applications ranging from automotive components and food packaging to agricultural films and infrastructure materials. In addition, our I’m Green biobased and PCR resins offer sustainable alternatives that align with our customers’ environmental goals.  

We continue to invest in innovation and technical support to ensure our products meet the highest standards of performance, quality, and sustainability, reinforcing our position as a trusted partner in Mexico’s industrial transformation.

Q: ANIQ has warned that a new Hydrocarbons Law could impose "unnecessary regulatory burden." What is your perspective on these potential new regulations, and how are you engaging with ANIQ to provide your input?

A: We share ANIQ’s concerns regarding the proposed Regulations on the Hydrocarbon Sector Law, which could introduce non-scientific controls and excessive permits affecting over 2,300 tariff fractions and 10,000 chemical products. Braskem Idesa is actively participating in ANIQ’s dialogue with authorities to advocate for a clear, science-based definition of petrochemical products and a regulatory framework that fosters investment, competitiveness, and alignment with international trade standards.

Q: Braskem Idesa has an ambitious plan to reduce its GHG emissions by 15% by 2028 and reach carbon neutrality by 2050. What specific technologies and initiatives are you implementing to meet these targets?

A: Our roadmap includes targeted actions across three pillars: reduction, capture, and compensation. We are implementing energy efficiency upgrades, deploying advanced systems to monitor and reduce emissions, preparing our electrical system to be able to use green electricity. All actions will work in the direction to offset our environmental footprint. The introduction of dual-fuel ethane carriers and the recycling of 11% of our water consumption are tangible steps toward our climate goals. We also prioritize material reuse and align our operations with the UN Sustainable Development Goals (SDGs). Our ESG strategy is externally verified under GRI, SASB, and TCFD standards, ensuring transparency, accountability, and continuous improvement across our sustainability agenda.

Q: The company is actively promoting the circular economy through initiatives like "Plastianguis" and producing PCR resin. What are the biggest challenges in scaling up the circular economy for plastics in Mexico?

A: The main challenges are collection infrastructure, consumer awareness, and regulatory incentives. Through platforms like Wenew, and partnerships with Vida Circular and Alcamare, we are addressing these gaps with education, innovation, and community engagement. In 2024, we collected 150t of post-consumer plastic waste and benefited over 40,000 people through our social programs. Scaling up requires continued collaboration across the value chain and supportive public policies.

Q: A recent report suggests that Braskem Idesa may be facing a debt restructuring due to its capital structure. How is the company planning to manage its liquidity and debt?

A: We are navigating a complex global environment with discipline, strategic focus, and a forward-looking mindset. Braskem Idesa continues to prioritize financial prudence, operational efficiency, and long-term value creation. In response to evolving industry conditions, we have engaged Lazard Inc. as financial advisors, Cleary Gottlieb Steen & Hamilton LLP as international legal counsel, and Sainz Abogados as local counsel to conduct a comprehensive review of our capital structure and liquidity position. 

This proactive decision reflects our commitment to strengthening our financial resilience and optimizing performance amid macroeconomic headwinds such as commodity price volatility, elevated input costs, and softer-than-expected demand in key markets. We remain confident in the fundamentals of our business and expect to share further details on our strategic review in the near future.

Q: How has the company's new ethane import terminal changed its operational strategy, particularly in terms of production stability and efficiency?

A: TQPM is set to transform our operations by enabling predictable and reliable feedstock supply, higher plant utilization, and reduced logistical risks. With construction now complete, we expect the startup process in the coming weeks. For Braskem Idesa, it is essential to carry out this phase under the highest standards of safety and environmental protection, while maintaining close communication with the relevant authorities. 

This new level of operational stability will allow us to optimize production planning, minimize downtime, and better serve our customers. It also supports our ambition to expand capacity and diversify our product portfolio in alignment with market needs.

Q: What are Braskem Idesa's key strategic objectives for the remainder of 2025 and into 2026?

A: We remain committed to innovation, sustainability and growth, building trust and value in the Mexican market. Our priorities are clear: 

• Better serve our customers – qualified, competitive and reliable partner,

• Maximize operational capacity through stable ethane supply,

• Expand our PCR and biobased resin portfolio,

• Strengthen ESG performance, with verified progress under GRI and SASB,

• Deepen community engagement through education and social programs; and

• Capture greater market share in Mexico by replacing imports with domestic production.

Braskem Idesa is a joint venture between the Brazilian company Braskem  and the Mexican company Grupo Idesa. Its primary business in Mexico is the operation of the Etileno XXI Petrochemical Complex located in Coatzacoalcos, Veracruz.