Versalis, petrochemicals subsidiary of Italian energy giant Eni, has signed a memorandum of understanding with U.S. biochemical company Elevance Renewable Sciences to assess the feasibility of a vegetable oil-to-ethylene plant at Porto Marghera, Italy, until recently a production site for PVC.

The methathesis facility, based on Elevance's technology and leveraging Versalis' catalysis knowhow, would be Italy's first such unit. Porto Marghera, formerly an important center of PVC production in Italy, has become virtually moribund after the collapse of Vinyls Italia, the erstwhile Eni and later Ineos business. The plans are part of a restructuring scheme announced last year to reduce Versalis' output of base chemicals while increasing the share of specialties and green chemistry. This, CEO Daniele Ferrari said at the time, would inevitably lead to closure or conversion of commodity plastics units.

To facilitate the renewal process, the company said it had reached agreement with its trade unions to carry out a €200 million revamp of Porto Marghera operations, which would involve suspending production of olefins and aromatics for six months. This, the Eni subsidiary added, would "help to absorb the current downturn in the market and optimize its material balance." It stressed at the same time that the suspension would be "without any impact on downstream production at its sites in Mantova, Ferrara and Ravenna, Italy.

In an unusual twist for Italy, Versalis said the pact with the unions "demonstrates how a collaborative model of industrial relations is key to managing the project efficiently." It said the agreement "activates solutions outlined within the national collective bargaining agreement for employees of the chemical industry from September 2012."