Mitsubishi Chemical (MCC, Tokyo / Japan; www.m-kagaku.co.jp) and Asahi Kasei (Tokyo / Japan; www.asahi-kasei.co.jp) have signed a memorandum of understanding to merge their cracker operations in the Mizushima industrial zone of Kurashiki, Okayama / Japan, where both companies currently have facilities – see Plasteurope.com of 12.06.2009. A 50:50 joint venture, for which details are now being worked out, is to be established on 1 April 2011. Downstream lines and their products would not be affected by a cracker merger, the companies said last year.

Explaining their decision, the future partners said the Japanese petrochemical industry will be increasingly negatively impacted by declining domestic demand, the creation of world-scale facilities in the Middle East and expanding capacity in China – see Plasteurope.com of 29.03.2010.

In reaction to the downsizing of the Japanese industry, Mitsubishi and Asahi Kasei plan to consolidate their crackers at Mizushima into a single unit and cut ethylene capacity by 30% up to 2012. Currently, each company has nameplate capacity to produce 500,000 t/y of ethylene at the site. They also hope to exploit synergies by cooperating with refineries and jointly procuring tight feedstocks such as C3. Other targets are optimisation of energy consumption and efficiency improvement through the mutual utilisation of infrastructure.