Alpek and ContourGlobal to build CO2 liquefaction plant

Alpek announced on Monday that it formed a new joint venture with ContourGlobal for the construction of a CO2 capture and liquefaction plant.

The plant would be integrated into ContourGlobal’s cogeneration facilities in Altamira, Mexico (CGA).

Each company would hold a 50% stake in the alliance.

Overall, the alliance was created to meet the growing demand for food grade CO2 from the Mexican food and beverage industry.

This industry has a shortage of 80,000 tons per year, according to Alpek.

The input is used in the carbonation of soft drinks, beer, and mineral water, among others.

Alpek

This initiative is fully aligned with the three pillars of Alpek’s long-term growth strategy:

Promote a Circular Economy:

• Sustainable Products Portfolio: Alpek intends to continue expanding the proportion of its products that have a lower carbon footprint and are duly aligned with promoting a circular economy. The proposed CO2 recovery plant would constitute an asset with a negative balance of CO2 emissions and would help Alpek reduce its carbon footprint, as the company moves towards carbon neutrality.

Strategic and Focused Growth:

• Product Innovation: When Alpek began negotiating the sale of CGA to ContourGlobal in 2019, both companies were already contemplating the construction of a CO2 recovery plant. In this sense, this JV is the fruit of a proactive vision of both teams. The Innovation team will continue to actively seek new products that contribute to Alpek’s growth, leveraging its main strengths.

Strengthen the Main Businesses:

• Value Added Products: This JV diversifies Alpek’s portfolio with a new product that can be marketed to its current PET clients, allowing the company to enter new, attractive and growing markets.

«This project is very attractive from an ESG and financial perspective,» said José de Jesús Valdez, CEO of Alpek.

«It combines the operational excellence of both partners, along with ContourGlobal’s expertise in carbon capture and Alpek’s ability to leverage its long-term relationships with its clients, in an effort to better serve their diverse needs,» added Valdez.

Production and Alpek

The planned project would have a nominal capacity of 70,000 tons per year and is anticipated to be completed by the end of 2022.

Detailed engineering studies and business research will be carried out as quickly as possible in order to reach a final investment decision (“FID”) by the end of 3Q21.