Dow Signed Raw Materials Supply Contracts with Huasheng     

On October 15th, 2008 Dow Epoxy, a business unit of The Dow Chemical Company, signed long term raw materials supply contracts with Shanghai Tian Yuan Huasheng Chemical Co., Ltd. (Huasheng), a wholly-owned subsidiary of Shanghai Chlor-Alkali Chemical Co., Ltd. (SH: 600618), for its 100 000 t/a liquid epoxy resin (LER) and 150 000 t/a glycerine-to-epichlorohydrin (GTE) plants that are schedule for startup in 2010 and 2011 respectively at Shanghai Chemical Industry Park.
    The total contract value over 10 years exceeds US$400 million. Dow will receive caustic soda and anhydrous hydrogen chloride from Huasheng for its LER and GTE plants and supply recycled brine for chlor-alkali production in Huasheng.
    Around 40% of epichlorohydrin from the 150 000 t/a GTE plant will be consumed in the 100 000 t/a LER device, the rest 60% is mainly for the sale in Asia-Pacific market.
     "The world class LER and GTE plants in Shanghai will further strengthen our ability to meet growing customer needs in China, particularly in the core markets of coatings, electrical laminates and civil engineering." said Patrick Ho, Business Group President, Epoxy & Specialty Chemicals, The Dow Chemical Company.
    "With our proprietary GTE technology, we will cut chlorine consumption in half and produce 10 times less waste water, while also improving process efficiency and product quality," added Walsh. "This technology is a prime example of Dow's commitment to significantly reduce and conserve energy as part of its 2015 Sustainability Goals." This technology can cut production cost for Dow Epoxy as it adopts low-cost glycerine - a byproduct from bio-diesel production, instead of propylene as raw material in the production and simplifies GTE and LER devices.
   "We have made tremendous progress since we announced the site location at SCIP last year. The projects are moving full steam ahead and we expect to break ground in the first quarter of next year," said Noelle Walsh.  Dow Epoxy announced the plan in March 2007 (CCR2007 No.10), and received approvals for the environmental impact assessments on these two projects from the Ministry of Environmental Protection of China.