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Mexichem to vacate ethylene and VCM sectors as a result of 2016 Pajaritos blast

21 December 2017

Mexichem will not rebuild the damaged vinyl chloride monomer plant at its joint-venture PMV Pajaritos complex in Veracruz state, thus leaving the Mexican ethylene market, the state-owned petrochemical producer announced on December 21. PMV (Petroquimica Mexicana de Vinilo) is a joint venture between Mexichem and state-owned energy company Pemex. 

PMV's Pajaritos complex in Coatzacoalcos, Veracruz, suffered an explosion in April 2016 that left 32 dead and hundreds injured, resulting in a shutdown of the site's 184,000 mt/year steam cracker. While the blast did not damage the cracker, according to a company statement, it did damage a VCM plant and resulted in a force majeure declaration on supplies of several products.

PMV's chlorine and caustic soda production facilities are not located at Pajaritos and will continue to operate without impact from Mexichem's decision, the company said.

"This represents the exit of PMV from the VCM and ethylene businesses in Mexico, but not the chlorine-soda business, whose plant will continue to be operated by PMV," Mexichem said in a statement. "Therefore, the alliance between [Pemex] and Mexichem will remain in place."
Mexichem will also remain open to expanding the PMV partnership with Pemex, the company said.

"It is important to mention that Mexichem [and Pemex] will continue to evaluate the possibility of investing in the future, jointly or separately, through PMV or another vehicle, in businesses related to the existing ones or in other types of businesses," Mexichem said in the statement.

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