Braskem Idesa Seeks Independence From PEMEX

The Brazilian-Mexican petrochemicals giant Braskem Idesa is pursuing a strategy to become independent from Mexico’s state oil company, PEMEX. Now that a feud between the companies has been resolved, Braskem is constructing a new ethane terminal, of which engineering works are about 40 percent completed.

The new terminal, equipped for ethane storage and imports, will be in Coatzacoalcos, Veracruz and requires a total investment of US$400 million. The terminal will also provide ethane to other petrochemical complexes and will have an ethane capacity of 65Mb/d, enough to supply the plant’s needs. Braskem furthermore invested US$150 million to expand production at its Ethylene XXI plant by 20 percent.

“From this terminal, we will be able to supply several petrochemical complexes. In a country with an ethane deficit due to insufficient production, it will be possible to complement national production and access this raw material so that all ethane-dependent petrochemical plants can operate fully,” said Cleantho Leite, New Businesses Director, Braskem.

Leite furthermore explained that the import terminal will not alter the 15-year contracts between Braskem and PEMEX regarding the purchase of ethane, although this procurement will depend on the scope of PEMEX’s production.

“We have established a new relationship with the government and PEMEX,” said Braskem CEO Stefan Lepecki. “Last year was a very important year for Braskem Idesa. We had an important dialog with PEMEX and finally solved the issue around the supply contract. We have a clear strategy based on this new agreement with PEMEX.”

The company’s idea is to have access to diverse raw material sources so that it can produce polyethylene at full capacity, supplying both the local and international markets. The revised agreement lowered PEMEX’s commitments in minimum volume supply to 30Mb/d of ethane, half of what was originally considered, until the import terminal begins operations.

Braskem expects to have construction permits in hand by April 2022. The construction will then last 2.5 years. Nonetheless, engineering works are already at 40 percent. The ethane procured will mostly be used by the Ethylene XXI complex and will help complement PEMEX’s production if needed. The terminal is estimated to start operating during 2H24. Its construction would generate 2,000 temporary jobs during construction, 60 direct jobs and 120 indirect jobs, once operations start. The terminal’s ethane will be brought from Texas in liquid form, transported first to terminals in Manzanillo and Altamira.

Braskem Idesa, a Brazilian-Mexican partnership, is one of the most important subsidiaries of Brazilian petrochemicals leader Braskem. Braskem was created in 2002 by integrating six companies from the Odebrecht Group and the Marini Group. As of today, it is the largest petrochemical company in the Americas and the world’s leading biopolymer producer. The company produces polyethylene, polypropylene and polyvinyl chloride resins, as well as basic petrochemicals such as ethylene, propylene, butadiene, chlorine, benzene and toluene, among others.