On December 24, Luxi Chemical announced that the company plans to further extend, supplement, and strengthen the chain, and continue to develop high-precision, high-value-added, high-tech, and low-energy-consuming products, relying on the integration, intensification, and With the advantages of industrialization, intelligence and engineering, it is planned to invest in the construction of a 600,000 tons/year caprolactam nylon 6 project, a 1.2 million tons/year bisphenol A project, and a 240,000 tons/year ethylene downstream integration project, which will be implemented in phases. Continue to improve the industrial layout of the park.
600,000 tons/year caprolactam·nylon 6 project
600,000 tons/year caprolactam·nylon 6 project Mainly including: caprolactam, nylon 6 and supporting production facilities and public works and other auxiliary facilities. The total investment is expected to be 6.461 billion yuan, which will be implemented step by step. The monetary funds used for construction are mainly raised by the company itself, bank loans and other financing methods to ensure the smooth implementation of project construction. After the project is completed and put into operation, it will be able to add 600,000 tons/year of caprolactam, 600,000 tons/year of nylon 6 and supporting products.
The company’s existing caprolactam and nylon 6 production equipment has maintained safe and stable operation since it was put into operation. The unit product consumption and product quality have reached the domestic advanced level. The technology is mature and reliable. The company continues to optimize based on the operation of the existing equipment. and improvements to expand the scale of advantageous products, and plans to continue investing in and constructing this project.
1.2 million tons/year bisphenol A project
1.2 million tons/year bisphenol A project, with an estimated total investment of 6.387 billion yuan, will be implemented step by step. The monetary funds used for project construction are mainly raised through the company’s self-raising, bank loans and other financing methods to ensure the smooth implementation of project construction. After the project is completed and put into production, it can provide stable raw materials for the company’s existing polycarbonate equipment, reduce the amount of outsourcing, reduce the transportation costs and safety risks of outsourcing raw materials, and improve profitability.
240,000 tons/year ethylene downstream integrated project
The 240,000 tons/year ethylene downstream integrated project is expected to have a total investment of 1.186 billion yuan and will be implemented step by step. Monetary funds used for project construction are mainly through company self-raising, bank loans and other financing methods to ensure the smooth implementation of project construction. This project is a downstream extension project of the company’s existing ethylene products. After the project is completed and put into operation, high value-added propanol, propionic acid, propionaldehyde and other products can be added to further enrich the industrial chain of the park.
Luxi Chemical’s current production capacity involves three major fields: new chemical materials, basic chemical products, and fertilizer products. Mainly including new chemical materials (200,000 tons of caprolactam, 200,000 tons of nylon 6, 200,000 tons of polycarbonate), basic chemical products (400,000 tons of caustic soda, 750,000 tons of butyl octanol, 220,000 tons of methane chloride, 400,000 tons of tons of formic acid, 100,000 tons of sodium formate, etc.), fertilizer products (900,000 tons of urea, 1.7 million tons of compound fertilizer).
With the commissioning of new material projects such as Luxi Chemical’s polycarbonate and nylon 6, the overall revenue and profitability of Luxi Chemical’s new chemical materials segment continued to grow. The Luxi Chemical and Chemical New Materials segment’s revenue accounted for 69% and 71% respectively from 2018 to 2019, and its gross profit accounted for approximately 81% and 79%. It is the most important component of the company’s operating income and profitability.
In October 2019, Sinochem Investment, a subsidiary of Sinochem Group, acquired 39% of the equity of Luxi Group held by the company’s original shareholders CDH Jiahe and CDH Chemical; in December 2019, Liaocheng State-owned Assets Supervision and Administration Commission 6.01% of the equity of Luxi Group was transferred to Sinochem Liaocheng for free. Sinochem Investment held a total of 55.01% of the equity of Luxi Group through Sinochem Liaocheng and its concerted parties, Huhe Investment, and became the controlling shareholder of Luxi Group. The actual controller of the company was changed from Liaocheng State-owned Assets Supervision and Administration Commission to Sinochem Group, and the ultimate controller was changed to the State-owned Assets Supervision and Administration Commission of the State Council. Sinochem Group plans to invest 12 billion yuan in the next three years to build Luxi Chemical into a high-end new chemical materials and chemical equipment production base. </p
