Sichuan urea firm to build JV in Bolivia
By Liu Jie (China Daily)
Updated: 2004-09-10 09:55

Sichuan-based Lutianhua Group (LTH Group), the largest urea producer in China, will co-operate with China Chengda Chemical Engineering Corporation and Bolivia Iisa-Tum Par Group to build an urea project in Bolivia.

According to a statement released by the Shenzhen-listed LTH Group yesterday, the total investment of the urea project in Bolivia is US$16 million. Fifteen per cent of the capital needed will be funded by the three partners and the remaining is to be raised on the market.

LTH Group, Chengda and Iisa-Tum Par are to take 60 per cent, 30 per cent and 10 per cent of the project respectively.

The annual production capacity of the project will be 180,000 tons synthetic ammonia and 300,000 tons of urea.

The three partners will set up a joint venture, using a BOO (building-own-operation) model to build the project.

The decision-making for the project is based on the rich natural resources necessary for urea production in Bolivia and the huge market potential there.

Located in the centre of the South America, Bolivia is famous for its natural gas resources, one of the key materials in urea manufacturing.

And Bolivia's neighboring countries, such as Brazil and Peru, export a large amount of urea from foreign nations every year, which provides huge market potential for the new urea project.

"The three co-operators may play complementary roles in the joint venture," said Yin Xiaodong, ananalyst in the chemical industry of CITIC.

Founded in 1959, the annual production capacity of LTH Group reaches 40 billion tons, with an annual sales volume at 2 billion yuan (US$240 million).

With total assets of 4 billion yuan (US$481 million), LTH has been listed among the top 18 chemical bases in China and is ranked among China's 500 largest enterprises.

"LTH is experienced in urea facilities building, operation and maintenance," said Yin.

Chengda is one of the professional international project contractors in China, which has expertise in chemical project designing.

Close