The Linde Group and refining and chemical company SINOPEC have signed a €145m ($162m) joint venture to strengthen air gases supply in China’s Ningbo Chemical Industrial Zone.
Both Linde and SINOPEC Zhenhai Refining & Chemical Company (ZRCC) will each hold a 50% stake in the newly-formed partnership under the name Ningbo Linde-ZRCC Gases Company Ltd (Linde-ZRCC).
The long-term collaboration will see Linde-ZRCC acquire two existing air separation units (ASUs) from ZRCC and construct a third, providing a combined 150,000 m3 per hour of oxygen capacity.
These three additional ASUs will double Linde’s production capacity of air gases in the Ningbo cluster. All three will be connected to Linde’s pipeline supply network in the eastern Chinese region.
The agreement will provide vital industrial gases to local customers from key industries such as petrochemical, steel and electronics. It is the sixth consecutive joint venture between the parties.
“Linde’s approach is well aligned with the Chinese government’s plans to develop Ningbo into a modern petrochemical hub”
Steven Fang, Regional Business Unit Head, Linde East Asia
Linde’s Engineering Division will design and construct the new plant.
Sanjiv Lamba, Member of the Executive Board, Linde AG and Chief Operating Officer, Asia Pacific, said, “Linde is excited about the growth opportunities in China and further strengthening of our partnership with SINOPEC.”
“This year alone, we have signed multiple projects for major investments across China, which represents a significant part of Linde’s strategy for growth in Asia.”
Steven Fang, Regional Business Unit Head, Linde East Asia, added, “Leveraging Linde’s gas and engineering expertise and innovations, we are able to consolidate our plant operations which enables our cluster customers to benefit from economies of scale. Linde’s approach is well aligned with the Chinese government’s plans to develop Ningbo into a modern petrochemical hub.”
Linde operates more than 200 production facilities across the North Pacific rim country. According to gasworld Business Intelligence, the Chinese industrial gases market was valued at around $9.4bn in 2016, with Linde occupying a market share of approximately 12%.
As Senior Business Analyst James Barr explained, “There have been ASUs at this site since the mid-1980s. The first such unit was commissioned in 1984 and produced 960 tonnes per day of oxygen.”