Covestro to close MDI plant in Spain; facility to be retained

Covestro (formerly Bayer MaterialScience)plans to close its 170,000 metric tonnes per annum-MDI production facility in Tarragona, Spain by the end of 2017. The Covestro Supervisory Board approved this plan at its meeting on December 4.

The reason for the planned closure, which could affect about 120 jobs, is the non-competitive production cost. However, other activities at the site, which comprise a local polyurethane systems house, hydrochloric acid logistics and infrastructure facilities, are to be retained. The current infrastructure facilities will continue to be available to other companies at the chemical park.

The Supervisory Board resolution follows a detailed site analysis, which concluded that in the long term, the facility in Tarragona can no longer remain competitive as an MDI production facility in Europe. A competitive future supply of the site with chlorine, which is an essential element of the MDI production process, played a role in the context of these considerations.

To ensure the long-term competitiveness of MDI production in Europe, the company intensively considered different options before deciding to invest directly in its strategic core products, isocyanates, and to most likely expand production at another existing European site where there is already a modern and reliable supply of chlorine.

Dr Joachim Wolff, Head of the Covestro Polyurethanes Business Unit said that the chemical park will have new opportunities for development as a hydrochloric acid logistics centre for Spain.

Covestro believes that the planned establishment of an HCl hub – a hydrochloric acid logistics centre – presents good opportunities to continue its business on the Spanish market for hydrochloric acid. Hydrochloric acid is used for various activities such as the treatment of ores, the processing of metals and water treatment.

Jesus Loma-Ossorio, Head of Covestro in Iberia, is also focused on the potential new prospects. “The Tarragona site will be retained and is open to new external investments. With our two sites in Tarragona and Barcelona, Covestro will remain an important company in the Spanish chemical Industry.

MDI is an important component for the production of rigid polyurethane foam. This is used for the efficient thermal insulation of buildings and throughout the entire cold chain. The energy savings achieved help to reduce CO2 emissions. In addition, applications in modern vehicle construction provide for enhanced safety.