Africa - April 07, 2008
In an interview with Reuters, Dow President for Europe Markus Wildi said, “we are very optimistic, business has started well in Europe.” After a strong 2007 in which Dow Europe saw sales grow 17 percent to $20 billion, the Company hopes to use that momentum to fuel an even more impressive 2008.
Dow’s emphatic 2007 was boosted by acquisitions including Wolff Walsrode from Bayer–. Europe, Dow's second-biggest market after North America, played its part by contributing more than a third of group sales last year. Germany is Dow’s most important European manufacturing base and national market with 15 manufacturing locations and more than 6,000 employees.
Wildi confirmed that some of the German facilities would go into the planned plastics joint venture with Kuwait Petroleum Corp (KPC) to link the Middle East company's vast energy supplies with Dow's assets and technologies.
"The polyethylene, polypropylene, polycarbonate facilities will go into the joint venture," he said.
KPC's Petrochemical Industries Co will pay Dow $9.5 billion to contribute five of the U.S. company's businesses, worth about $19 billion, to the 50-50 joint venture. These units contributed approximately a quarter of Dow's 2006 revenues.
The deal forms part of Dow's long term strategy to reduce its exposure to commodity chemicals that rely on oil and natural gas and shift into higher-margin specialty chemicals.
Asked about the company's planned gas-processing project with Russia's Gazprom, Wildi said only after the completion of a feasibility study, would a decision be made.
"This may take up to one year," he added.
The companies said in November they were exploring various cooperation projects, including a joint venture at Dow's petrochemical capacities in Germany and joint refining of natural gas from deposits in the Yamalo-Nenets region in Russia.
Gazprom, Russia's state owned gas export monopoly, produces around a fifth of global gas output in the form of dry gas or methane and extracts sour gas, gas condensate and crude oil as by-products from its massive fields in West Siberia.
Gazprom is seeking to produce more value-added products, which can be achieved via deeper processing of raw materials.
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