Covestro and LyondellBasell (LYB) are to permanently close their joint venture propylene oxide styrene and monomer (POSM) production unit (PO11) at Maasvlakte in the Netherlands. Reports of the plant’s potential closure surfaced earlier this year, with Dutch trade unions negotiating to secure compensation for affected workers.
Covestro and LYB refused to comment until today. “Due to global overcapacities, persistently weak demand, and high costs in Europe, we have jointly decided with LYB to close the PO11 plant,” said Hermann-Josef Dörholt, Covestro’s head of performance materials. “At the same time, we remain committed to the European market and will continue to supply customers with our polyether polyols portfolio.”
Covestro announced cost cutting measures in the run up to its acquisition by Adnoc, as part of its “Strong” global transformation programme. It aims to make the company more efficient and drive digitalisation forward amid a “rapidly changing market environment”. Covestro said doing so requires “making production, administrative units and other areas as efficient as possible and continuously expanding the innovation pipeline”.
Last year, LYB announced it was conducting a strategic review of its European assets of its olefins, polyolefins, and chemical intermediates and derivatives business units. Its CEO Peter Vanacker said that the review would encompass a potential retreat from Europe, with options including selling assets, investing in plant improvements, restructuring, and closing facilities.
“While the decision to shut down the PO11 unit is difficult, we must ensure all assets within our portfolio are a long-term strategic fit,” said Aaron Ledet, EVP for I&D and supply chain at LYB. “We are prioritising our core assets which play a key role in our technology differentiation and circularity or provide attractive returns over the cost of capital.
“We take our obligations toward our employees, European employee reps, councils and unions seriously. We have engaged with them in line with these obligations and will continue to do so. We would like to thank them for the constructive dialogue. We are also in communication with customers, suppliers and other parties across the value chain and will continue to do business as usual. There is no change to our working relationship, and we continue to focus on providing an exceptional customer and supplier experience.”
The Federation of Dutch Trade Unions (FNV) announced a majority of union members at the Maasvlakte site backed a deal on severance pay and outplacement on 5 March. The union did not comment on how many workers will be made redundant or retained at the site, which employs approximately 160 people.
A FNV representative said the site will close on 1 October, 2025. LYB said it will carry out a process to safely shut down and prepare for the demolition of the plant unit between now and end of 2026.
The 50/50 joint venture Maasvlakte site has been operational since 2003. The plant produced propylene oxide and styrene monomer at one of the largest scales in the world. Production was based on LYB’s propylene oxide and styrene monomer technology, and the design follows a similar LYB plant in Channelview, Texas. The chemicals produced at the Maasvlakte plant form the building blocks for basic products like clothing, household products and construction materials.
In 2018, the partners said they were investing in a circular steam project at the production plant, with the aim of reducing carbon dioxide emissions by up to 140 kT/year. A new bio plant and incinerator was to be built on the site, enabling the treatment of production waste to generate steam as an energy source.
Just over two years ago, Covestro introduced polyether polyols made using bio-circular'feedstock, with the precursor propylene oxide coming from the Massvlakte site.
