Befar Group and The Dow Chemical have signed a memorandum of understanding for establishment of a new 50:50 joint venture to manufacture perchloroethylene (PCE), a major building block substance for non-ozone depleting refrigerants utilized in construction, commercial, industrial, consumer and automotive applications.
As per the terms of the agreement, the two firms will construct a new large-scale PCE production plant in Binzhou, Shandong Province, China. The initial annual production capacity of the new plant will be 40,000 metric tons. The firms have plans to increase the production capacity of the plant to two fold to 80,000 metric tons in the future. The plant will begin production in 2014.
Carol Williams, President of Chemicals & Energy at Dow Chemical, stated that as part of its business strategy, the company has established the new joint venture with Befar Group. The Chairman of Befar Group, Zhang Zhongzheng is also expressed his happiness about the proposed joint venture.
Worldwide requirement for PCE as a raw material is augmenting the production of non-ozone-depleting fluorocarbon refrigerants. Especially in China, the PCE market is expanding aggressively. However, there is a shortage in local production. Both firms are planning to use this opportunity through the new joint venture operation.