SDK Group to found new liquefied CO2 gas plant in Oita Petrochemical Complex
Thursday, Aug 31, 2017
Showa Denko Gas Products Co., Ltd. (SGP), a consolidated subsidiary of Showa Denko ("SDK"; TSE:4004) headquartered in Kawasaki City, Kanagawa Prefecture, has decided to found a new plant to produce liquefied carbon dioxide (CO2) gas in Showa Denko's Oita Petrochemical Complex located in Oita City, Oita Prefecture. SDK and SGP plan to make the new plant utilize stable CO2 gas sources in the chemical plant of the Complex. The new plant is scheduled to be completed and start operation in August 2018, and will have annual production capacity of 15,000 tons. Foundation of the new plant will make SGP's liquefied CO2 gas production system to have two production bases in Kyushu region.

CO2 gas and dry ice (solidified CO2) are used in many fields including beverage, food, and other manufacturing industries. Liquefied CO2 gas is made of CO2 gas generated as a by-product of oil-refining, steel-making and ammonia production processes. However, the scaling back of oil-refining and ammonia production processes in Japan has been resulting in reduction in sources of raw CO2 gas to produce liquefied CO2 gas. Thus a tight supply-demand situation for liquefied CO2 gas and dry ice is chronic.

The Showa Denko Group produces and provides liquefied CO2 gas and dry ice at many production bases including Kawasaki Plant, which functions as the main base. To solve tight supply-demand situation and regional supply-demand imbalances concerning liquefied CO2 gas and dry ice, and to maintain stable supply of these products to our customers throughout the country, the Showa Denko Group has been increasing production of them at Kawasaki Plant, supplying them through long distance transportation, and importing dry ice even in off-peak seasons other than summer until now. However, substantial rises in transportation and raw material costs are problems to be solved as soon as possible.

Since further reduction in sources of raw CO2 gas is foreseen, the supply-demand situation for liquefied CO2 gas and dry ice is expected to be even tighter in the future. To cope with these problems and maintain stable supply of liquefied CO2 gas and dry ice to our customers in Kyushu, Chugoku, and Shikoku regions, SDK and SGP decided to found the new base to produce liquefied CO2 gas in the Showa Denko Group's Oita Petrochemical Complex. Taking advantage of the strengthened supply system, SDK and SGP will cope with changes in the supply-demand balances of liquefied CO2 gas and dry ice in a flexible and timely manner, while having due regard to further expansion of the Group's capacity to produce these products in the future.

In our ongoing medium-term business plan, "Project 2020+," we position our industrial gases business including CO2 gas and dry ice business as "Base-shaping" business. The Showa Denko Group will further strengthen the basis of our industrial gases business through various measures including development of new uses in the fields of foods, agriculture, and civil engineering.

About Showa Denko K.K.

Showa Denko K.K. ("SDK"; TSE:4004, US:SHWDF) is a major manufacturer and marketer of chemical products serving a wide range of fields ranging from heavy industry to the electronic and computer industries. The Petrochemicals Sector provides cracker products such as ethylene and propylene, the Chemicals Sector provides industrial and high-performance gases and chemicals and high-purity gases and chemicals for the semiconductor industry, and the Inorganics Sector provides ceramics products such as alumina, abrasive, refractory and graphite electrodes and fine carbon products. Today, the Aluminum Sector provides aluminum materials and high-value-added fabricated aluminum, the Electronics Sector provides HD media, compound semiconductors such as ultra high-bright LEDs and rare earth magnetic alloys, and the Advanced Battery Materials Department (ABM) provides lithium-ion battery components.

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