European plant closures: Indorama to divest PTA plant in Portugal; Eni shutters two Versalis crackers to curtail losses

 Thailand-based Indorama Ventures Ltd (IVL) says it is divesting from its indirect subsidiary in Portugal that makes purified terephthalic acid (PTA). Its entire stake on Indorama Ventures Portugal PTA (IVPPTA) will be pulled out, it said. The plant has a capacity of 700,000 tonnes/year if PTA and is located in Sines, Portugal. It was mothballed in October 2023.

The Portuguese company is a wholly owned subsidiary of Indorama Netherlands BV (INBV), IVL’s financial holding company registered in the Netherlands.

The company said it decided to implement its asset optimisation strategy by divesting its investment “after a thorough assessment of market conditions and economic pressures, including high raw material and energy costs, inflationary impacts, and competition from low-cost PTA imports.”

The divestment will not affect IVL’s operations or financial position, as IVPPTA’s assets were already impaired last year, IVL said.

Meanwhile, Italy’s Eni Group's CEO Claudio Descalzi has announced the closure of two steam cracker units operated by its chemical subsidiary, Versalis. This decision comes as Versalis faces significant losses in both the fourth quarter and the entire year of 2024, against the back of the ongoing downturn in the European petrochemical industry.

The 30% state-owned Eni is targeting to restore Versalis to financial balance by 2027, and the closure of the steam cracker units is part of this recovery strategy. The latest financial report highlights that Versalis incurred losses due to unfavourable market conditions, with adjusted loss for 2024 expected to reach EUR814 million, an increase from EUR614 million in 2023.To achieve profitability, Versalis is aiming for an adjusted EBITDA of EUR900 million by the end of 2028. To meet these goals, Eni plans to reduce Versalis's capital assets by EUR350 million.

Eni intends to shift Versalis’s focus towards composite materials, specialty polymers, and biochemical products while targeting a 65% specialty product share in its portfolio.

The closure of the two steam cracker units in Brindisi and Priolo, which have a combined annual capacity of 1 million tonnes, is likely to impact the naphtha market significantly, with consolidation expected in the European petrochemical sector.

The nameplate ethylene capacity at Brindisi is 410,000 tonnes/year and propylene capacity is 220,000 tonnes/year. The Priolo site has nameplate capacities of 430,000 tonnes/year of ethylene, 250,000 tonnes/year of propylene, and 790,000 tonnes/year of aromatics.

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