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Ube Industries to Establish Joint Venture for Dimethyl Carbonate in China

April 9, 2012

TOKYO, April 9, 2012_ Ube Industries, Ltd. today announced that it has reached agreement with Henan Zhongyuan Dahua Group Co., Ltd. and HighChem Co., Ltd. to establish a joint venture in China for the manufacturing of dimethyl carbonate (DMC).

Henan Zhongyuan Dahua Group will take a 51% stake in the joint venture, which is to be headquartered in Puyang City in Henang Province, with HighChem and Ube Industries each taking a 24.5% stake. Henan Zhongyuan Dahua Group is a chemicals subsidiary of Henan Coal & Chemical Industry Group, which is China’s second largest coal company and the largest coal gasification company in Asia. HighChem will bring its knowledge of the chemicals business in China to the joint venture, which will manufacture DMC using technology licensed from Ube Industries. The joint venture will construct production facilities adjacent to the plant of Henan Zhongyuan Dahua Group in Puyang City. Production will go online in 2013 with an annual production capacity of 100,000 tonnes.

DMC is used in plastics and in pharmaceutical and agricultural chemicals, and lately as a Non-toxic solvent for paint. There is growing demand in China for DMC used as a non-polluting additive for gasoline and notably diesel oil. In addition, demand for DMC used as an electrolyte solvent for lithium-ion rechargeable batteries is expected grow rapidly, with global demand for eco-cars such as hybrid and electric vehicles increasing to significant levels.

China possesses vast coal resources, and its government is pursuing a national strategy that encourages the use of coal as a chemical raw material rather than for fuel use, to raise added value and achieve environmental objectives. This has increased the number of gasification facilities in China from which to secure generous supplies of carbon monoxide.

Ube Industries is a global leader in the segment of C1 chemicals that are manufactured using carbon monoxide as a raw material. Ube Industries is pursuing technology that expands the range of uses for coal and natural gas, while contributing to the reduction of greenhouse gases and waste emissions.

The technology that Ube Industries is licensing to the joint venture covers a proprietary gas phase nitrite process for DMC manufacturing, using carbon monoxide as a raw material. The clean process is highly safe and productive while having a low environmental impact.
Ube Industries will procure DMC from the joint venture, for processing into high-purity DMC used in its own electrolyte manufacturing and for supply to external customers. Ube Industries is a leading manufacturer of electrolyte solvents for lithium-ion batteries, and the joint venture will facilitate the steady procurement of DMC raw material, positioning Ube Industries to meet expected growth in demand for electrolyte solvents.

Ube Industries established its DMC production facilities at the Ube Chemical Factory (Ube City, Yamaguchi Prefecture) in 1992. From an initial annual production capacity of 3,000 tonnes, the facilities have been expanded to a present capacity of 15,000 tonnes annually. Ube Industries will draw on two decades of DMC manufacturing expertise to provide technical advice to the joint venture.

Ube Industries is a global leader in the segment of electrolytes for lithium-ion batteries, recently establishing a joint venture for electrolytes with The Dow Chemical Company in December 2011. The joint venture with Dow plans to build manufacturing facilities in the US, China and Europe, and is moving forward with plans to build a global framework for manufacturing and sales of electrolytes.

The establishment of the joint venture for DMC manufacturing aligns with Ube Industries’ plans to build a global framework for the supply of high-purity DMC for use as an electrolyte solvent, positioning the company to meet growing demand.

Ube Industries, Henan Zhongyuan Dahua Group and HighChem have not released details about the joint venture agreement.

Data for Joint Venture

Company Name Henan Tanyi New Energy Co., Ltd.
Location Puyang City, Henan Province, China
Capital Stock 288 million Chinese Yuan
Shareholders Henan Zhongyuan Dahua Group(51%), UBE Industries(24.5%), HighChem(24.5%)
To Be Established Undecided
President Undecided

Data for Henan Zhongyuan Dahua Group

Company Name Zhongyuan Dahua Group Co., Ltd of Henan Province
Location Puyang City, Henan Province, China
President Chen Guoping
Capital Stock 1,380 million Chinese Yuan (Fiscal Year ended Dec.31 2011)
Net Sales 4,900 million Chinese Yuan (Fiscal Year ended Dec.31 2011)

Data for HighChem

Company Name HighChem Co., Ltd.
Location Chiyoda ward, Tokyo, Japan
President Ushio Taka
Capital Stock 99.8 million Yen  (Fiscal Year ended Mar.31 2012)
Net Sales 27,800 million Yen (Fiscal Year ended Mar.31 2012)

Data for Ube Industries

Company Name Ube Industries, Ltd.
Location Ube City, Yamaguchi, Japan
President Michio Takeshita
Capital Stock 58,400 million Yen  (Fiscal Year ended Mar.31 2011, Consolidated)
Net Sales 616,000 million Yen  (Fiscal Year ended Mar.31 2011, Consolidated)

Contact

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  • Investor Relations & Public Relations Department
  • Corporate Planning & Administration Office
  • Seavans North Building, 1-2-1 Shibaura, Minato-ku, Tokyo 105-8449
  • Phone : +81-3-5419-6110
  • Contact us by Internet.