German specialty chemicals group Lanxess said Wednesday it will build a Eur200 million ($288 million) neodymium polybutadiene rubber plant in Singapore.
The plant, the largest of its kind in the world, will have a capacity of 140,000 mt/year and is expected to be on stream in the first half of 2015.
"It is only one year since we broke ground for our butyl plant in Singapore. Now we are ready to move forward with the second-largest investment project in our history," said Chief Executive Axel Heitmann.
"The dynamic Asia region is a key cornerstone of our mid-term growth strategy," he added.
Lanxess said it signed a memorandum of understanding with Petrochemical Corp. of Singapore (PCS) to secure the long-term supply of raw materials for the project.
Under the MoU, PCS will supply butadiene to Lanxess, which in turn will supply raffinate II to PCS. Butadiene is the raw material Lanxess needs to produce neodymium polybutadiene rubber and raffinate II will be a product stream from Lanxess' future butyl rubber plant in Singapore.
The new plant will be located at the Jurong Island Chemical Park next to Lanxess' Eur400 million butyl rubber plant, which is currently under construction and is expected to start operations in the first quarter of 2013.
Lanxess said the new plant will support its production of high performance "green tires," which it described as the fastest growing segment in the tire industry with an annual global growth of around 9%.
"Growth is even more pronounced in Asia at 14% per year. The world's leading tire manufacturers, who are supplied by Lanxess, are responding to this demand by expanding production in Asia," it said.
