Sunoco, Equistar strike PP agreement

Sunoco, Inc. has signed an agreement with Equistar Chemicals Inc. to form a limited partnership concerning the operation of Equistar’s La Porte, TX ethylene cracker facility. Equistar, a joint venture between Lyondell Chemical Co. and Millennium Chemicals Inc., has agreed to a 700 million lb./yr., 15-year propylene supply contract with Sunoco.
Under the contract, the majority of Sunoco’s purchases will be priced on a cost-based formula that includes a fixed price discount. Equistar will continue to manage and operate the La Porte facility.
Additionally, Sunoco will be purchasing Equistar’s Bayport polypropylene facility at Pasadena, TX. This facility has an annual capacity of 400 million lb. Sunoco will pay US$190 plus the value of the inventory to purchase the Bayport facility.