Dow signed a memorandum of understanding Thursday to build a specialty chemicals hub in Zhanjiang, China. The $250 million project will make chemicals for a range of applications, including lubricants.
The facility will include specialty polyurethane and alkoxylate production facilities and will initially have total capacity to make approximately 250,000 metric tons per year of materials.
The company did not specify products that the facility will produce, but Dow supplies a large portfolio of materials to the lubricants industry, including polyalkylene glycol synthetic base stocks, coolants based on glycols and other base stocks and finished lubricants for applications such as industrial gears, food processing, compressors and hydraulic equipment.
The co-signer for the memorandum is the Economic and Technological Development Zone Administrative Committee of Zhanjiang, a city in Guangdong province along China’s southernmost coast. Dow did not indicate when it expects to open the facility but said it will take multiple years to construct.
Officials of Dow, which is based in Midland, Michigan, United States, said the facility will supply China and the broader region and that the company is building it to cater to
“Asia-Pacific is the world’s largest chemicals market,” Jon Penrice, Dow’s president for Asia-Pacific, said in the news release. “Demands in the region are evolving towards high-value, specialty chemicals that help customers meet rapidly-developing megatrends in mobility, urbanization and sustainability.”
Dow operates five chemical plants that supply PAGs to the lubricants industry, but all are located in the Americas or Europe.
In addition to lubricants, the facility will supply materials for the automotive, pharmaceuticals, cleaning chemicals, apparel and adhesives industries.