Satellite Plans Another PAO Plant in China


The march of China companies stepping into the polyalphaolefin business continues, as acrylic acid producer Satellite Chemical recently disclosed plans to expand into linear alpha olefins along with PAO.

In a June 19 filing on the Shenzhen Stock Exchange, Satellite said its board of directors voted in favor of a ¥25.7 billion (U.S. $3.6 billion) plan to build the facility in the port city of Lianyungang, on the Yellow Sea. It would have capacity to produce 500,000 metric tons per year of alpha olefins along with polyethylene, polyvinyl chloride and polyolefin elastomers. The project would also construct a PAO plant that would use some of the linear alpha olefins as feedstock and have capacity of 15,000 t/y.

The filing said Satellite expects construction to begin before the end of 2024, but it did not mention a target date for the project to open.

Satellite would join a number of other domestic companies that have opened or are now building small PAO plants. Coal giant Lu’an Group operates 23,000 t/y plant in Changzhi and has a separate 15,000 t/y joint venture there with Dowpol. State-owned oil giant PetroChina has a new 10,000 t/y plant in Lanzhou, and start-up Apalene is building a 10,000 t/y plant in Hangzhou that it aims to open by the end of this year.

China National Offshore Oil Co. and Shell have said they will build a PAO plant at a petrochemical joint venture in Huizhou, but that have not yet disclosed the capacity.

Chevron Phillips Chemical, ExxonMobil Chemical and Ineos are the world’s leading PAO producers, operating significantly larger plants in North America and Europe.

PAOs are among a group of products for which China’s central government wants to develop domestic production capacity so that the country can reduce dependency on foreign suppliers.

Satellite is headquartered in Jiaxing, Zhejiang province and claims to be the world’s largest producer of acrylic acid.