(Yicai) May 22 -- Chinese fine chemical products supplier Capchem Technology intends to invest USD350 million to build a plant in the United States to meet the demand from the North American market and deepen cooperation with long-term strategic clients.

The new plant, located in Ascension Parish in the US state of Louisiana, will have an annual production capacity of 200,000 tons of carbonate ester solvent and 100,000 tons of lithium-ion battery electrolyte materials, the Shenzhen-based company announced yesterday, without disclosing the construction schedule and other details about the project.

Capchem will use its own funds or raise part of the money from third-party investors to finance the plant, the firm added.

The local government in the US has greed to provide Capchem with USD71.3 million in tax exemptions or reductions for up to 10 years if the project satisfies certain employment indicators, Capchem said, citing a deal it recently signed with the Louisiana State Government.

In yesterday’s statement, Capchem also noted that it will terminate the deal with the US unit of Thailand’s Indorama Ventures it announced in August 2022 for the establishment of a joint venture responsible for the construction of a USD245 million lithium-ion battery electrolyte materials plant in the coastal area of the Gulf of Mexico.

Negotiations with potential new partners over the project in the Gulf of Mexico are ongoing, the Chinese firm pointed out.

Capchem has been actively investing in overseas production bases in recent years. The company built a lithium-ion battery electrolyte plant in Poland that came on stream last year. Moreover, it announced that it was preparing to build another European factory in the Netherlands.

Last June, Capchem also unveiled a USD120 million investment plant to build a battery chemical material production base in Ohio. Construction is expected to last three years.

Capchem’s shares [SHE: 300037] were trading up 0.5 percent at CNY31.19 (USD4.40) as of lunch break in Shenzhen today.

Editor: Futura Costaglione