Covestro Continues Production at Tarragona Site

Materials producer Covestro announced it will continue production in Tarragona, Spain, beyond the end of 2020. The company will invest approximately EUR 200 million to enhance cost competitiveness at the site through various measures. As a first step, it aims to build its own chlorine supply, thereby securing high-efficiency, sustainable and independent sourcing of this critical raw material. Covestro will also increase efficiency at its local MDI facility by raising production capacity by 50,000 metric tons, bringing annual output to 220,000 metric tons. MDI is a rigid foam precursor – for example, an excellent insulation material used in buildings and refrigerators. CEO Patrick Thomas said: "We are fully confident in the MDI market in Tarragona and in our complex here. With the efficiency improvements we will make and the establishment of our own chlorine supply, this complex will become a more efficient and competitive facility within our network." The efficiency improvements will continue until 2022, with chlorine production scheduled to begin by the end of 2020. Until 2020, external sources will be used. For the new chlorine production, Covestro wants to use the latest energy-efficient technology, thereby making the production of this critical raw material and subsequently overall production more efficient. Chief Commercial Officer Dr. Markus Steilemann said: "This investment is another step in our long-term investment strategy already announced, following our smart investment approach to expand our capacity. This is one of the cornerstones of our global growth strategy." He added: "We anticipate that demand for MDI will continue to increase. This investment will therefore enable us to meet additional growth from our customers and also support our own organic growth." This investment will further develop the company's existing global production network and strengthen its existing MDI commitment. Covestro is already doubling its capacity in Brunsbuettel, Germany, with the aim of producing 400,000 metric tons of MDI annually by the end of 2018.