Reliance to buy BP's Malaysian petrochemicals plant for $230 million

Reliance Industries has agreed to purchase BP's 100 per cent stake in BP Chemicals (Malaysia) Sdn Bhd (BPCM), for $230 million in cash, and both parties expect to complete the transaction this year itself.

BP today announced that it has agreed to sell all its interests in purified terephthalic acid (PTA) production in Malaysia to Reliance Global Holdings Pte Ltd, the Malaysian arm of India's Reliance Industries.

BP Chemicals (Malaysia) Sdn Bhd is located at Kuantan on the east coast of Malaysia. BPCM's PTA plant, commissioned in 1996, has nameplate production capacity of 610,000 tonnes per year.

''This is an efficient plant with a good market position in the region. RECRON Malaysia, part of the Reliance Group, is already our largest customer in Malaysia and Reliance Industries is a significant feedstock supplier at Kuantan, so Reliance is a natural owner of this plant,'' James Yim, head of BP's aromatics business in Asia, said.

''BP has a major, global PTA business, with around one fifth of global PTA production capacity and a track record of leading technology. We will continue to concentrate our PTA strategy on deploying new technologies into high growth markets like China where we are in the middle of a considerable expansion programme, and in OECD markets where our technology gives us an advantage and high utilisation rates,'' Nick Elmslie, chief executive of BP Petrochemicals, said.

''We are also building new revenue streams by licensing our PTA and paraxylene technologies,'' he added