It looks as though the relationship between Dow Chemical and Kuwait is going to expand further.
It was reported today Kuwait Petroleum Corp (KPC) is considering Royal Dutch Shell (RDS.A) and Dow Chemical (DOW) as possible partners in a 250,000-300,000 bpd refinery planned as a joint venture with Sinopec in Guangdong.
Sinopec (SHI) will hold about 50-51% stake of the Nansha refinery to be located in Southern China. The refinery will include a petrochemical plant with annual ethylene output of 1 mln tons.
KPC awaits final approval from China’s main economic planning agency- National Development and Reform Commission and from the environment ministry. State-owned KPC and Sinopec, Asia’s top refiner, received preliminary government approval for the Guangdong plant in 2006.
This one is simple, gaining access to the one of the world’s largest and fastest growing economy’s and deepening a partnership with Kuwait really has virtually no downside.
It does look as though Dow is becoming the “partner of choice” for these nations looking to expand their petrochemical complexes.
Disclosure (“none” means no position):Long DOW, None
