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Resin Major LyondellBasell Pondering Sale of Refining Business
September 08, 2021

LyondellBasell said today it is weighing strategic options for its Gulf Coast-based Refining Segment, including a potential sale. The company added that it cannot provide assurances regarding the outcome or timing of this process and does not intend to make further announcements regarding this review unless and until it is required or appropriate.

Bank of America is acting as financial advisor and Vinson & Elkins is legal counsel to the Company for this process.

"While the Houston Refinery is a valuable, well-performing asset, we have long held the belief that it may be even more valuable as part of a larger refining system," said LyondellBasell's CEO Bob Patel. "To that end, we are actively gauging market interest in this business with the goal of delivering the greatest value to all our stakeholders."

The company's Houston refinery 268,000 bbl/day refinery is located on the Houston Ship Channel and produces clean refined products such as reformulated gasoline, jet fuel, ultra-low sulfur diesel and aromatics. Other products include conventional gasoline, lube oils, carbon black oil, refinery-grade propylene, sulfur, residual fuel and petroleum coke.

The announcement comes just weeks after Patel said he would retire as company CEO at the end of the year.

Should LyondellBasell divest its Houston refinery, it would join other integrated refiners that have made similar announcements this year in an effort to reduce their carbon footprint, or due to weakened demand for gasoline and jet fuel brought on by the COVID-19 pandemic.

Shell announced back in May it was selling off its refineries in Anacortes, Washington, and Mobil, Alabama, as well as controlling interest in its joint-venture Deer Park, Texas, refinery.

Phillips 66 said in late August it was putting its 225,600 bbl/day Alliance refinery in Belle Chasse, Louisiana up for sale.

Although a sale of LyondellBasell's refinery may be imminent, the company has invested in its petrochemical and polymers businesses this year. The company acquired Malaysian-based PolyPacific Polymers in June, which includes a 25,000 mt/yr manufacturing facility that produces reinforced and modified polyolefin compounds.

LyondellBasell also began a June startup of its Ulsan PP 400,000 mt/yr Polypropylene production facility in South Korea, which is a 50-50 joint venture between PolyMirae Company.

By Brian Balboa for The Plastics Exchange.

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