PQU to announce US$160mn expansion details

Brazilian petrochemical company PQU will announce in the next few days the details and schedule of a US$160mn capacity expansion at its Mauá plant in Sao Paulo state, a PQU spokesperson told BNamericas. The announcement will be made after PQU signs contracts with federal energy company Petrobras (NYSE: PBR) for the refinery gas supply needed for the project. "The gas supply details have been agreed in principle," the spokesperson said, confirming local press reports. Petrobras will supply 1.1 million cubic meters a day (mcm/d) of refinery waste gases from the Revap refinery, 100km away from the Mauá plant. PQU will use the gases to increase ethylene production capacity to 640,000 tonnes a year (t/y) from 500,000t/y, and will also increase output of other liquid petrochemicals by 60,000t/y, the spokesperson said. Details of the agreement, including the price at which the gas will be supplied, were not announced. Most of the ethylene produced at PQU will be used by its sister company Polietilenos União to increase its polyethylene output by 150,000 tonnes a year. The Unipar petrochemical group controls both PQU and Polietilenos União. PQU's expansion plans date back to 1998. The conclusion of negotiations comes at a time when the petrochemical sector's output is expected to rise 8% this year following rising demand for plastic resins in Brazil as the economy recovers.