JURONG AROMATICS
New Singapore complex remains closed amid debt restructuring talks
Jurong Aromatics (Singapore; www.jurongaromatics.com), which started up a major new aromatics complex in Singapore last year, is reportedly negotiating a debt restructuring with bankers. Production at the complex, including an 800,000 t/y PX unit, has been stalled since December because of poor market conditions. The complex started up in August/September, at a time when Asian and global PX markets were already oversupplied – see Plasteurope.com of 01.10.2014.
The company is unable to service its interest payments and is in talks with lenders including BNP Paribas SA and Standard Chartered Plc, as well as suppliers Glencore Plc, BP Plc and SK Energy Co, sources familiar with the situation told Bloomberg. A Jurong Aromatics spokeswoman said company officials were not available to comment, the Bloomberg report said.
Jurong Aromatics, which is owned 30% by SK International Investment, 25% by China’s Jiangsu Sanfanxiang Group and 10% by Glencore, ran out of working capital in December, according to the sources. Other shareholders include EDB Investments Pte, a unit of Singapore’s Economic Development Board.
Damian Chan, executive director for energy and chemicals at the Economic Development Board, told Bloomberg that because Jurong Aromatics is not “integrated with other plants on Jurong Island, the impact to the rest of the energy and chemicals cluster is expected to be limited.” He added: “Unfortunately the aromatics market is currently in a down cycle and aromatics producers are finding it more difficult to deliver returns.”
PX primarily used as a raw material for PTA for the manufacture of polyester. Significant additions to condensate splitting capacity in recent years have pushed PX into oversupply, at a time when polyester demand in China, the world’s largest polyester producer, is weak. Other companies hit by the weak polyester demand include PTA producer Shaoxing Yuandong Petrochemical (Shaoxing, Zhejiang / China), which has reportedly filed for insolvency and switched off all its production lines – see Plasteurope.com of 28.07.2015.
The company is unable to service its interest payments and is in talks with lenders including BNP Paribas SA and Standard Chartered Plc, as well as suppliers Glencore Plc, BP Plc and SK Energy Co, sources familiar with the situation told Bloomberg. A Jurong Aromatics spokeswoman said company officials were not available to comment, the Bloomberg report said.
Jurong Aromatics, which is owned 30% by SK International Investment, 25% by China’s Jiangsu Sanfanxiang Group and 10% by Glencore, ran out of working capital in December, according to the sources. Other shareholders include EDB Investments Pte, a unit of Singapore’s Economic Development Board.
Damian Chan, executive director for energy and chemicals at the Economic Development Board, told Bloomberg that because Jurong Aromatics is not “integrated with other plants on Jurong Island, the impact to the rest of the energy and chemicals cluster is expected to be limited.” He added: “Unfortunately the aromatics market is currently in a down cycle and aromatics producers are finding it more difficult to deliver returns.”
PX primarily used as a raw material for PTA for the manufacture of polyester. Significant additions to condensate splitting capacity in recent years have pushed PX into oversupply, at a time when polyester demand in China, the world’s largest polyester producer, is weak. Other companies hit by the weak polyester demand include PTA producer Shaoxing Yuandong Petrochemical (Shaoxing, Zhejiang / China), which has reportedly filed for insolvency and switched off all its production lines – see Plasteurope.com of 28.07.2015.
24.08.2015 Plasteurope.com [232025-0]
Published on 24.08.2015
German version of this article...