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NEWS OF THE WEEK
BUSINESS
April 1, 2002
Volume 80, Number 13
CENEAR 80 13 p. 12
ISSN 0009-2347
[Previous Story] [Next Story]

PEMEX OUTLINES STRATEGY
Bold expansion plans may put Mexican petrochemicals back on track

ALEX TULLO

Speaking at the national Petrochemical & Refiners Association's petrochemical conference in San Antonio last week, Rafael Beverido Lomelín, president of Pemex Petroquímica, detailed a $1 billion expansion program that is expected to eventually cut Mexico's $6 billion chemical trade deficit in half.

In addition, Beverido pledged that Pemex, which maintains a monopoly in petrochemical feedstocks in Mexico, would reform its feedstock pricing to allow long-term contracts in line with global norms.

Beverido, who was tapped by Mexican President Vicente Fox Quesada to lead a transformation in the Mexican petrochemical industry, admitted to being horrified by Pemex's failure to invest adequately. "When I looked for the result of the last 10 years," he said, "I found nothing at all."

New projects will help Pemex recover lost ground, Beverido maintained. An ethylene cracker and a styrene unit will be the first in a series of planned expansions that he wants to get under way within two years.

Through the investment program, Pemex intends to strengthen its two key petrochemical complexes at Morelos and Cangrejera. Pemex will build one of two new polyethylene units at Morelos, where it will also expand ethylene and ethylene oxide output.

A second new polyethylene plant will be built at Cangrejera, where the company is also expanding ethylene and ethylene oxide capacity. An existing low-density polyethylene plant is already being expanded to 315,000 metric tons. The company is also planning to expand aromatics reforming there to 60,000 barrels per day.

To help pay for the program, Pemex plans to allow private-sector partners to buy up to 49% of its existing complexes, a formula that investors have not found attractive. However, there will be no restrictions on investment in the new plants.

BIG PLANS
Mexico's Pemex is considering a building spree
LOCATION PRODUCT CAPACITY
(METRIC TONS)
Cangrejera Polyethylene 300,000
Styrene 500,000
Morelos Polyethylene 300,000
Not yet set Benzene 140,000
Ethylene 1,200,000
p-Xylene 400,000
Polypropylene 300,000



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