The Linde Group revealed that it had been selected to supply air gases to chemicals producer Dahua Group on Songmu Island in Dalian, Northeast China.

Linde will be investing around €70 million ($91 million approx.) in the project, and describes the deal as further strengthening its position in the high-growth China market.

An agreement outlining the terms of the deal was recently signed by both parties.

Dahua Group belongs to the country’s leading top 10 soda ash producers and Sanjiv Lamba, member of the Executive Board of Linde AG responsible for the Asia region, said in a statement, “We are delighted to further expand our long-term business relationship with our partner Dahua in Dalian.”

“This move strengthens our position as a leading gases and engineering company in the dynamic Chinese market.”

Under the terms of the onsite agreement, Linde acquires the customer’s two existing air separation units (ASUs) in Dalian and will operate both, while in addition the group’s Engineering Division will build a new ASU onsite with a production capacity of 38,000 normal cubic metres of oxygen per hour (Nm3/h).

Scheduled to go on stream in 2014, the new ASU will replace the two older plants, also meeting the rising demand for gaseous oxygen at Dahua’s operations. The new ASU will also produce surplus liquid gases for the regional market.

As part of the contract agreement, the upgraded gas production facility will be jointly managed by a newly formed 50:50 joint venture gases company between Linde and Dahua.