13-03-2012

Air Products wins long-term supply contract for Xinlianxin in China

Air Products today announced it has signed a long-term contract with Henan Xinlianxin Fertilizer (Xinlianxin) and will build, own and operate an air separation unit (ASU) and integrated gas liquefier in Henan Province, China. The ASU will produce approximately 2,000 tons per day (TPD) of gaseous oxygen for Xinlianxin’s expanding fertilizer plant in Xinxiang. The liquefier will produce over 250 TPD of liquid products, namely oxygen, nitrogen, and argon, for the region’s growing merchant gases market. The Air Products ASU and liquefier are to be onstream in 2013.

“We are pleased to be supplying Xinlianxin’s tonnage industrial gas needs for its fertilizer plant expansion. Our ASU product offering of this specific size was the right solution for the customer’s needs. This is the first time Xinlianxin has contracted with a third-party to supply industrial gases, and we are honored by that trust,” said Steve Jones, Air Products’ China president. “From a merchant gases opportunity, this location meets Air Products’ strategic goals in two ways. First, the facility’s liquefier piggybacks on the ASU location to provide for integrated and efficient production of liquid gas products. Secondly, it will make Air Products the first global industrial gas producer in this market. The location is within a key region that Air Products believes will grow in industry segments we already serve globally including chemicals, electronics, fabrication and glass.”

“Air Products’ investment in Xinxiang brings a long-term and strategic partnership with Xinlianxin,” said Liu Xingxu, chairman and general manager of Xinlianxin. “The collaboration will help Xinlianxin to improve efficiency, reduce cost and sharpen its competitiveness. It is a win-win deal for both companies.”

The ASU train will include design enhancements to minimize operating costs through energy efficiency. Technology advancements and other productivity improvements support Air Products’ overall sustainability goals of reducing energy consumption and emissions. “Our goal is always to provide our worldwide customers with the lowest cost and newest advanced technology ASU facilities which offer energy efficiencies that benefit their production operations and the environment,” said Jones, a member of the company’s Corporate Executive Committee who is based in Shanghai as part of Air Products’ corporate strategy to support significant growth opportunities and accelerate the company’s development in emerging markets.

Air Products will also locate a liquid bulk terminal facility at this location to serve the varied liquid gas merchant customers in the region.

Xinlianxin is the largest fertilizer producer in Henan Province and the fourth largest coal based urea producer in China. Xinlianxin is a producer of urea, methanol and compound fertilizer using coal as a feedstock. It is a wholly owned subsidiary of China XLX Fertilizer Ltd., a Singapore-registered company listed on both the Singapore Stock Exchange (stock code: B9R.SI) and the main board of the Stock Exchange of Hong Kong (stock code: 01866.HK).

Today’s China contract award news follows Air Products’ December 2011 announcement of a long-term contract for the largest single on-site ASU ever awarded to an industrial gas company. The facility, to be built, owned and operated by Air Products for Shaanxi Future Energy Chemical Co., Ltd., will be located in Yulin, Shaanxi Province, China. It will include multiple ASU trains and produce 12,000 TPD of oxygen and significant tonnage volumes of nitrogen and compressed dry air for Shaanxi’s coal chemical plant. The Air Products ASUs are to be commercial in 2014.

Air Products has been operating in China since 1987 and was one of the first multinational industrial gas corporations to invest in the country. With over 40 operating entities, 50 production facilities and 2,200 employees, the company has already established a strong market position in China, serving a broad range of industries.