LyondellBasell and Covestro announce permanent closure of PO11 unit at Maasvlakte
LyondellBasell (LYB) and Covestro have announced the permanent closure of their joint Propylene Oxide Styrene and Monomer (POSM) production unit (PO11) at the Maasvlakte site in the Netherlands. The decision follows mounting challenges including:
- Global overcapacity issues
- Increased imports from Asia
- High European production costs
The facility, operational since 2003, will undergo a safe shutdown process through the end of 2026. This closure aligns with LYB's strategic portfolio review of European assets in their Olefins & Polyolefins and Intermediates & Derivatives business units. The company is currently evaluating alternative ownership options for O&P sites, though no final decisions have been made.
LyondellBasell (LYB) e Covestro hanno annunciato la chiusura permanente della loro unità di produzione congiunta di Ossido di Propilene Stirene e Monomero (POSM) (PO11) presso il sito di Maasvlakte nei Paesi Bassi. La decisione è stata presa a seguito di crescenti sfide, tra cui:
- Problemi di sovraccapacità globale
- Aumento delle importazioni dall'Asia
- Alti costi di produzione in Europa
La struttura, operativa dal 2003, subirà un processo di spegnimento sicuro fino alla fine del 2026. Questa chiusura è in linea con la revisione strategica del portafoglio di attivi europei di LYB nelle unità di business Olefins & Polyolefins e Intermediates & Derivatives. L'azienda sta attualmente valutando opzioni di proprietà alternative per i siti O&P, anche se non sono state prese decisioni finali.
LyondellBasell (LYB) y Covestro han anunciado el cierre permanente de su unidad de producción conjunta de Óxido de Propileno Estireno y Monómero (POSM) (PO11) en el sitio de Maasvlakte en los Países Bajos. La decisión se toma tras enfrentar crecientes desafíos, incluyendo:
- Problemas de sobrecapacidad global
- Aumento de las importaciones desde Asia
- Altos costos de producción en Europa
La instalación, que ha estado operativa desde 2003, pasará por un proceso de cierre seguro hasta finales de 2026. Este cierre se alinea con la revisión estratégica del portafolio de activos europeos de LYB en sus unidades de negocio de Olefinas & Poliolefinas e Intermediarios & Derivados. La empresa actualmente está evaluando opciones de propiedad alternativas para los sitios O&P, aunque no se han tomado decisiones finales.
리온델바젤 (LYB)와 코베스트로는 네덜란드 마스블락트 지역에 있는 공동 프로필렌 산화 스티렌 및 모노머 (POSM) 생산 단위 (PO11)의 영구 폐쇄를 발표했습니다. 이 결정은 다음과 같은 증가하는 도전 과제에 따른 것입니다:
- 전 세계 과잉 생산 문제
- 아시아에서의 수입 증가
- 유럽의 높은 생산 비용
2003년부터 운영된 이 시설은 2026년 말까지 안전한 폐쇄 과정을 거칠 것입니다. 이 폐쇄는 LYB의 올레핀 & 폴리올레핀 및 중간체 & 파생상품 사업부의 유럽 자산에 대한 전략적 포트폴리오 검토와 일치합니다. 회사는 현재 O&P 사이트에 대한 대체 소유권 옵션을 평가하고 있지만, 최종 결정은 내려지지 않았습니다.
LyondellBasell (LYB) et Covestro ont annoncé la fermeture permanente de leur unité de production conjointe d'Oxyde de Propylène Styrène et Monomère (POSM) (PO11) sur le site de Maasvlakte aux Pays-Bas. Cette décision fait suite à des défis croissants, notamment :
- Problèmes de surcapacité mondiale
- Augmentation des importations en provenance d'Asie
- Coûts de production élevés en Europe
Cette installation, opérationnelle depuis 2003, subira un processus d'arrêt sécurisé jusqu'à la fin de 2026. Cette fermeture s'inscrit dans le cadre de la révision stratégique du portefeuille d'actifs européens de LYB dans ses unités commerciales Olefins & Polyolefins et Intermediates & Derivatives. L'entreprise évalue actuellement des options de propriété alternatives pour les sites O&P, bien qu'aucune décision finale n'ait encore été prise.
LyondellBasell (LYB) und Covestro haben die dauerhafte Schließung ihrer gemeinsamen Produktionsanlage für Propylenoxid-Styrol und Monomer (POSM) (PO11) am Standort Maasvlakte in den Niederlanden bekannt gegeben. Die Entscheidung folgt auf zunehmende Herausforderungen, darunter:
- Globale Überkapazitätsprobleme
- Gestiegene Importe aus Asien
- Hohe Produktionskosten in Europa
Die Anlage, die seit 2003 in Betrieb ist, wird bis Ende 2026 einen sicheren Stilllegungsprozess durchlaufen. Diese Schließung steht im Einklang mit der strategischen Portfolioüberprüfung von LYB hinsichtlich europäischer Vermögenswerte in den Geschäftseinheiten Olefins & Polyolefins sowie Intermediates & Derivatives. Das Unternehmen prüft derzeit alternative Eigentumsoptionen für O&P-Standorte, jedoch wurden noch keine endgültigen Entscheidungen getroffen.
- Strategic portfolio optimization to focus on core assets with better returns
- Planned orderly shutdown process through 2026 minimizing operational disruption
- Permanent closure of major POSM production facility due to unprofitable operations
- Loss of European production capacity amid challenging market conditions
- Continued pressure on profitability due to global overcapacity and Asian competition
Insights
LyondellBasell's decision to permanently close the PO11 unit at Maasvlakte represents a significant strategic pivot in response to persistent market challenges. The closure reflects structural issues facing European chemical producers: global overcapacity, surging Asian imports, and high regional production costs creating an untenable competitive position.
This move aligns with LYB's broader portfolio optimization strategy of divesting non-core assets that fail to deliver returns above capital costs or advance strategic priorities like circularity. The extended timeline (through 2026) suggests a methodical approach to winding down operations while minimizing supply chain disruptions.
The joint venture's closure signals deeper industry-wide pressures affecting European petrochemical production. Most concerning is LYB's disclosure that they're exploring alternative ownership for additional Olefins & Polyolefins sites in Europe, indicating potential for more significant restructuring beyond this single facility.
For context, propylene oxide is a important intermediate chemical used in polyurethanes, propylene glycols, and glycol ethers - essential components in construction materials, automotive parts, and consumer goods. This rationalization reflects LYB's realistic assessment that European production economics for these products have fundamentally deteriorated with recovery prospects.
This facility closure represents a necessary but difficult rationalization of LyondellBasell's European manufacturing footprint. While specific financial impacts aren't quantified, shuttering underperforming assets is consistent with management's commitment to portfolio optimization and capital discipline.
The lengthy decommissioning timeline (through end of 2026) suggests measured implementation with deferred financial benefits but also managed transition costs. Investors should focus on several key implications:
- Potential for improved margin profile as unprofitable capacity exits the system
- One-time restructuring and demolition charges likely to impact earnings over the next 1-2 years
- Signal of potential further European asset rationalization, particularly with management actively exploring "alternative ownership" options for Olefins & Polyolefins sites
- Defensive positioning against persistent structural challenges in European chemicals
This move aligns with broader industry trends as chemical manufacturers reassess their European footprint amid high energy costs and intensifying global competition. The decision indicates management's willingness to make difficult but necessary structural adjustments rather than hoping for market recovery. While potentially dilutive to revenue in isolation, pruning underperforming assets should ultimately strengthen LYB's competitive positioning and returns profile.
MAASSVLAKTE, Netherlands, March 18, 2025 (GLOBE NEWSWIRE) -- LyondellBasell (LYB) and Covestro have jointly decided to permanently close the Propylene Oxide Styrene and Monomer (POSM) production unit (PO11) at the Maasvlakte site in the Netherlands. This decision comes after thorough and careful consideration and is driven by the continued pressure on Maasvlakte's profitability due to global overcapacities, a strong increase of imports from Asia and high costs of European production. Unfortunately, this situation is expected to continue, so longer-term profitable production is not anticipated.
“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, executive vice-president, I&D and Supply Chain. “We are prioritizing 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.”
“As part of our Sustainable Future Strategy, we’re continuously working to optimally position Covestro to be a reliable partner for our customers and to operate competitively in a challenging market environment,” said Hermann-Josef Dörholt, head of the Performance Materials Business Entity at Covestro. “Due to global overcapacities, persistently weak demand, and high costs in Europe, we have jointly decided with LYB to close the PO11 plant. We will support LYB in implementing this change as socially responsibly as possible. At the same time, we remain committed to the European market and will continue to supply customers with our renowned polyether polyols portfolio.”
The Maasvlakte site, a joint venture between LYB and Covestro, has been operational in the Rotterdam region since 2003. Between now and the end of 2026, LYB will carry out a process to safely shut down and prepare for the demolition of the asset.
In 2024, LYB announced a strategic review of European assets of its Olefins & Polyolefins (O&P) and Intermediates & Derivatives (I&D) business units. LYB has taken the next step in evaluating the option to seek alternative ownership for the O&P sites in the strategic assessment. At this time no decisions have been made and various outcomes remain possible.
About LyondellBasell
We are LyondellBasell (NYSE: LYB) ― a leader in the global chemical industry creating solutions for everyday sustainable living. Through advanced technology and focused investments, we are enabling a circular and low carbon economy. Across all we do, we aim to unlock value for our customers, investors, and society. As one of the world's largest producers of polymers and a leader in polyolefin technologies, we develop, manufacture and market high-quality and innovative products for applications ranging from sustainable transportation and food safety to clean water and quality healthcare. For more information, please visit www.lyondellbasell.com or follow @LyondellBasell on LinkedIn.
About Covestro
Covestro is one of the world’s leading manufacturers of high-quality polymer materials and their components. With its innovative products, processes and methods, the company helps enhance sustainability and the quality of life in many areas. Covestro supplies customers around the world in key industries such as mobility, building and living, as well as the electrical and electronics sector. In addition, polymers from Covestro are also used in sectors such as sports and leisure, telecommunications and health, as well as in the chemical industry itself.
The company is geared completely to the circular economy. In addition, Covestro aims to achieve climate neutrality for its Scope 1 and Scope 2 emissions by 2035, and the Group’s Scope 3 emissions are also set to be climate neutral by 2050. Covestro generated sales of EUR 14.2 billion in fiscal year 2024. At the end of 2024, the company had 46 production sites worldwide and employed approximately 17,500 people (calculated as full-time equivalents).
Media Inquiries LYB Global
LyondellBasell Media Relations
Phone: +1-713-309-7575
Email: mediarelations@lyondellbasell.com
Or:
Media Inquiries LYB Europe
Robert Kleissen, External Affairs Europe
Phone: +31-6-273-573-98
Email: robert.kleissen@lyondellbasell.com
Media Inquiries Covestro
Markus Kleine-Beck, Corporate Trade Media Relations
Phone: +49-173-2320-686
Email: markus.kleine-beck@covestro.com
Svenja Paul, Corporate Media Relations
Phone: +49-214-6009-2814
Email: svenja.paul@covestro.com
Forward-Looking Statements LYB
The statements in this release relating to matters that are not historical facts are forward-looking statements. Actual results could differ materially based on factors including, but not limited to, our ability to align our asset base with our strategic goals; and our ability to safely shut the asset described down and conduct demolition. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the "Risk Factors" section of our Form 10-K for the year ended December 31, 2024, which can be found at www.LyondellBasell.com on the Investor Relations page and on the Securities and Exchange Commission’s website at www.sec.gov. There is no assurance that any of the actions, events or results of the forward-looking statements will occur, or if any of them do, what impact they will have on our results of operations or financial condition. Forward-looking statements speak only as of the date they were made and are based on the estimates and opinions of management of LyondellBasell at the time the statements are made. LyondellBasell does not assume any obligation to update forward-looking statements should circumstances or management's estimates or opinions change, except as required by law.
Forward-Looking Statements Covestro
This news release may contain forward-looking statements based on current assumptions and forecasts made by Covestro AG. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. These factors include those discussed in Covestro’s public reports, which are available at www.covestro.com. The company assumes no liability whatsoever to update these forward-looking statements or to conform them to future events or developments.
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FAQ
When will LYB's PO11 unit at Maasvlakte close permanently?
What are the main reasons for LYB closing the Maasvlakte POSM unit?
How long has the LYB-Covestro Maasvlakte joint venture been operating?
What other strategic changes is LYB considering for its European operations?
