media release

Akzo Nobel Announces Powder Coatings Expansion in China

Akzo Nobel is investing in a new manufacturing plant in China for pipe powder coatings.

Beijing Manufacturing Plant for Pipe Powder Coatings - A "First" for the Region

Arnhem, the Netherlands, September 25, 2001 – Akzo Nobel is investing in a new powder coatings plant in China to serve the growing market for steel pipe protection. The facility will be installed at its joint venture operation Akzo Nobel Chang Cheng Coatings (Beijing) Co. Ltd. and will manufacture Akzo Nobel's Resicoat® range of specialty fusion bonded epoxy (FBE) powders for anti-corrosion protection of steel pipes for the oil and gas industry.

“This is the first investment in FBE manufacture in the region, anticipating the growing demand for pipeline protection as China invests heavily in its infra-structure”, said Rudy van der Meer, Member of the Akzo Nobel Board of Management responsible for Coatings. “The move reflects our strategy to focus on expanding in growth areas, and will put us into an excellent position to serve the Chinese market.“

Bill McPherson, General Manager of Akzo Nobel’s Powder Coatings business unit, said: "We have been present in the powder coatings market in China for over 10 years serving almost all the market segments. This next step will position us in all segments. It remains our global strategy to have a significant presence in every region and in every market segment, so that we may best serve our powder customers - whether they are local, regional or global. This is an important step in that process."

Ron Koel, Global Market Manager for Functional Powder Coatings added: "We estimate the global market for pipeline powders to be USD 120 million - and China represents an increasing share, currently about 20%. Our Resicoat technology has proven itself worldwide in many projects. By bringing part of our production to the fastest growing market in this segment, we make sure of servicing our customers in both the most flexible and most efficient way.” One of the largest forthcoming projects in China will be the West-East pipeline. In addition, the Chinese government is already planning several other big projects including the Russia-China-Korea, the Zhong-Wu and the Hainan circle pipelines.

A specialist team from the Resicoat technical and marketing center in Reutlingen, Germany, will assist in setting up the operations. Production is planned to start in the last quarter of this year. The move follows the completion of a restructuring in Asia whereby the various joint venture companies of Akzo Nobel in Taiwan and China have been consolidated into a single JV with Chang Cheng Chemicals. It was announced on June 28 that plans had been approved for a new powder coatings manufacturing facility in Vietnam, due to open early 2002.