Ukrainian PVC and PE producer Karpatneftekhim suspends production

06-Mar-14

Karpetneftekhim, Ukraine’s only PVC and polyethylene producer, has suspended production at its site in Kalush amid the current political unrest. The loss making petrochemical company, part of Russia’s Lukoil oil and chemicals group, was forced to halt talks with state officials on tax and customs concessions. In April 2013, the oil group reached agreement to restart the plant, idled for more than six months after disagreement over Ukraine’s new tax and customs policy. The parties signed a deal allowing Lukoil to operate the unit at a cost-efficient production level. Last September, Karpatneftekhim resumed PE output and restarted the PVC plant in November 2013, while in December, the group was due to commission Karpatneftekhim’s ethylene production unit. The whole site was due to resume operation by this April.