Celanese has signed a Letter of Intent (LOI) with Chengzhi Shareholding to further develop its acetic acid-based ethanol as a clean energy source in China.

The LOI is subject to both parties reaching definitive agreements. However, under current plans, Celanese will sell its ethanol plant at Nanjing to Chengzhi, along with all related assets, including equipment, storage tanks and pipelines as well as all necessary land rights and permits.

In addition, Celanese will contribute its patented TCX ethanol process technology, along with all associated patents, know-how and trade secrets into a newly formed joint venture with Chengzhi. Through the jv, the companies will work together to further strengthen the TCX technology and promote additional opportunities for its use within China.

“By combining Celanese’s process technology expertise with Chengzhi’s strong resources in China coupled with its rich experiences in manufacturing and marketing, we believe the joint venture can play a big role in addressing clean energy needs while creating new demand for acetic acid,” said Todd Elliott, senior vice president of the US company’s acetyls business.

Celanese said it and its partner are committed to working together to implement a smooth transition leading to a restart of the Nanjing ethanol plant as soon as possible, likely in 2019. The company operated the 275,000 t/y industrial ethanol facility at the Nanjing Chemical Industrial Park in Jiangsu from 2014 to 2017, sourcing feedstock from its adjacent acetic acid plant. It has not disclosed why the acetic acid plant stopped operating in 2017.

The Dallas-based chemical producer’s plans to cooperate with Pertamina on other fuel ethanol projects in Indonesia using TCX appear to have made no headway. Celanese signed a Memorandum of Understanding with the state-owned energy group in 2013.