Celanese wins US lawsuit over Southern Chemical methanol supply dispute

By Ben DuBose
Online Editor

HOUSTON -- US-based chemicals company Celanese said Friday that a jury ruled in its favor in litigation filed by Southern Chemical relating to the terms of a multi-year methanol supply contract.

The jury said the contract, under which Celanese has paid Southern Chemical about $130 million/year, should continue until its expiration, adding that Celanese did not violate the terms of the agreement.

“We are pleased with the jury’s verdict and expect Southern to continue to supply methanol under the terms of our contract,” said Gjon N. Nivica, Jr., senior vice president, general counsel and corporate secretary for Celanese.

The contract, which expires in 2015, is valid for Celanese operations in the US and Mexico.

Celanese is the largest methanol consumer in the US, while Southern Chemical is the second-largest supplier (after Methanex). Under the contract, Celanese received about 800,000 tpy of methanol from Southern Chemical.

Southern Chemical alleged that Celanese was not using the purchased methanol solely for internal use, instead shipping it to other chemical companies for more than the contract price.

Celanese officials, however, said they were selling the material as methyl acetate and had been given clearance to do so by Southern Chemical president Jan Spin.

Celanese plans to build a 1.3 million tpy methanol plant in Clear Lake, Texas, which would presumably replace the Southern Chemical supply once the contract expires in 2015.

Celanese uses methanol as feedstock for its acetyls complex in Clear Lake.

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