Oxiranchem decides to use the surplus fund it raised, i.e., RMB 94.67 million and combine the joint contribution of the aforementioned companies to increase the capital of its wholy-owned subsidiary, Yangzhou Oxiran Petrochemical Storage Co., Ltd. Oxiran Storage shall carry out 50,000m3 cryogenic ethylene tank project. Upon completion of Oxiran Storage’s capital increase, Oxiranchem shall hold 52% of Oxiran Storage.

The project is planned in Yanzhou Chemical Industry Park, west of Xupu River, north of Yantz River Dike, about 90 km from Nanjing Port, Xinshengwei Port, about 30 km from Yangzhou Port. The tank pit is about 1.5 km away from berth No. 608 and 609. When the project is put into operation, the estimated annual turnover is RMB 132 million yuan, annual average cost is RMB 76.75 million yuan, annual profit after tax RMB 37.61 million. According to financial analysis, the internal rate of return after income tax is 13.33%, the investment recovery  period is 8.11 years (inluding 2 years of construction period).

The project’s total investment is RMB 392 million. The project will make use of Oxiran Storage’s own fund, RMB 222 million, which is 56.75% of the total investment. The remaining gap will be filled up by bank loans.
Oxiranchem explains that the project shall provide sufficient ethylene storage capability required for the company’s 200,000 ton ethylene oxide project and 300,000 ton low carbon epoxy derivative project.