LyondellBasell (LYB) and Covestro have officially announced the permanent closure of the propylene oxide styrene and monomer (POSM) production unit (PO11) at the Maasvlakte site in the Netherlands.
Reports of the plant’s potential closure surfaced earlier this year, with Dutch trade unions negotiating to secure compensation for affected workers.
LYB and Covestro refused to comment until today.
The owners of the 50-50 joint venture said in a statement the decision was driven by lack of profitability due to global overcapacities, a strong increase of imports from Asia, and high costs of European production.
“While the decision to shut down the PO11 unit is difficult, we must ensure all assets within our portfolio are a long-term strategic fit,” said Aaron Ledet, executive vice-president, I&D and supply chain. “We are prioritising our core assets which play a key role in our technology differentiation and circularity or provide attractive returns over the cost of capital.”
“We take our obligations toward our employees, European employee reps, councils and unions seriously,” Ledet continued. “We have engaged with them in line with these obligations and will continue to do so. We would like to thank them for the constructive dialogue. We are also in communication with customers, suppliers and other parties across the value chain and will continue to do business as usual. There is no change to our working relationship, and we continue to focus on providing an exceptional customer and supplier experience.”
The Federation of Dutch Trade Unions (FNV) announced a majority of union members at the Maasvlakte site backed a deal on severance pay and outplacement on March 5. The union did not comment on how many workers will be made redundant or retained at the site, which employs approximately 160 people. A FNV representative said the site will close on Oct. 1, 2025.
LYB said it will carry out a process to safely shut down and prepare for the demolition of the plant unit between now and end of 2026.
The US-based chemicals giant has been operating the Maasvlakte site since 2003. The plant produced propylene oxide and styrene monomer at one the largest scales in the world. Production was based on LYB’s propylene oxide and styrene monomer technology and the design follows a similar LYB plant in Channelview, Texas. The chemicals produced at the Maasvlakte plant form the building blocks for basic products like clothing, household products, and construction materials.
Last year, LYB announced it was conducting a strategic review of its European assets of its olefins, polyolefins, and chemical intermediates and derivatives business units.
Its CEO Peter Vanacker said in May 2024 that the review would encompass a potential retreat from Europe, with options including selling assets, investing in plant improvements, restructuring, and closing facilities.
Today LYB said it has taken ‘the next step’ in evaluating the option to seek alternative ownership for its European Olefins & Polyolefins sites as part of its strategic review.
“At this time no decisions have been made and various outcomes remain possible,” the company said.
Covestro, the other owner of the Maasvlakte site, has also announced cost cutting measures in the run up to its acquisition by ADNOC. The plans were announced as part of a new ‘global transformation programme’ called Strong. It aims to make the company more efficient and drive digitalisation forward amid a ‘rapidly changing market environment’. Covestro said doing so requires ‘making production, administrative units and other areas as efficient as possible and continuously expanding the innovation pipeline’.
“As part of our Sustainable Future Strategy, we’re continuously working to optimally position Covestro to be a reliable partner for our customers and to operate competitively in a challenging market environment,” said Hermann-Josef Dörholt, head of the performance materials business entity at Covestro. “Due to global overcapacities, persistently weak demand, and high costs in Europe, we have jointly decided with LYB to close the PO11 plant. We will support LYB in implementing this change as socially responsibly as possible. At the same time, we remain committed to the European market and will continue to supply customers with our renowned polyether polyols portfolio,” he concluded.