Oxy to sell its stake in Enoxy Chemical In a fundamental policy reversal, Occidental Petroleum has decided to pull out of its 50% partnership in Enoxy Chemical just one year after Enoxy began doing business. Mean while, Zurich-based Enoxy Chemi cal, now to become wholly owned by the other partner, Ente Nazionale Idrocarburi (ENI)—Italy's stateowned chemicals and hydrocarbons concern—is committed to buy the major part of the commercial ther moplastics operations of Montedison. The two developments are inter related. Armand Hammer, Occiden tal's chairman, has voiced concern about the drain on the company's financial resources that petrochemi cals have become of late. Not sur prisingly, therefore, he balked at the sizable outlay that acquisition of Montedison's plants will incur, despite Enoxy Chemical's having signed a letter of intent last July outlining the broad areas of discus sion on the plant transfers. The Italian government, through
ENI, now will bear the full $314 million cost of the acquisition. It also will pay Occidental almost $263 million for its half share of Enoxy Chemical. However, the amount will be closer to $200 million after deducting for estimated losses. Enoxy Inc. was established as a holding company late in 1981 with some fanfare and a capitalization of $1.05 billion contributed equally by the two partners. Its aim was two fold. One was to establish an inter national petrochemicals enterprise, Enoxy Chemical, hinged largely on the revamping of the Italian chemi cal industry. The other was to pro vide ENI with direct access to coal through Enoxy Coal (C&EN, April 19, 1982, page 18). Enoxy Coal will continue as a joint partnership. For Enoxy Chemical under ENI ownership, it will be business as usual, with the same management structure headed by Alex Crossan as president and chief executive officer. D
Burlington Northern bids for control of El Paso The long wave of large-scale merg ers and divestments in the U.S. chemical world isn't over yet. In a flurry at year's end, Tenneco finally sold its chemical operations after a year of rumors, Gulf Oil shed its Millmaster Onyx chemicals unit af ter a year of writeoffs, and Olin agreed to buy majority stock owner ship of Philip A. Hunt Chemical (see page 17). In the largest new move, Burling ton Northern, the big Seattle-based railroad and timber company, an nounced a bid of more than $600 million for slightly more than half the stock of El Paso Co., a natural gas-based company headquartered in Houston with a large and re cently fast-growing chemical op eration. El Paso's board of directors rejected the offer and promptly started a series of financial and le gal moves to block it. Burlington Northern wants El Paso not for chemicals but for an increased base in natural resources. Burlington Northern says that it will pay $24 per share cash for up
to 25 million shares of El Paso stock. The offer is about 30% higher than the value of El Paso stock before the offer. After Burlington Nor thern's announcement, El Paso's stock price jumped to about $25 per share or more than the offer, indi-
El Paso's chemical sales jumped 700% in 10 years $ Millions 600 I
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eating that Wall Streeters expect the bidding could go higher. The company's chemical sales in 1981 totaled more than $576 million, or 15% of total company sales of $3.21 billion. Chemical sales have been growing rapidly, having risen about 23% in 1981 from 1980. Much of this growth is accounted for by El Paso's acquisition of Dart & Kraft's interest in a joint venture, Rexene Polyolefins operations. The jump in chemical sales moved El Paso up to 55th place on C&EN's list of top 100 chemical producers from 64th place in 1980. α
Nuclear waste storage bill passes Congress After many years of failed attempts, Congress finally has passed a nucle ar waste storage bill. The Nuclear Waste Policy Act of 1982, passed by the Senate in April, was approved by a wide margin in the House late in the lame duck session recently ended. President Reagan is expected to sign the bill soon. The law sets up provisions to eval uate ways to store spent nuclear fuel and wastes. It also provides for test ing of sites for the first permanent underground storage facility. Being considered for this first facility are a salt formation in Utah, a volcanic rock structure in Nevada, a basalt formation near Hanford, Wash., and salt sites in Louisiana and Missis sippi. A second permanent site will be considered later, most likely in granite formations in Wisconsin or New England. One of the stickier problems with the bill was in deciding just how much a voice the states would have in where a storage site could be built. The final version allows states to veto any Department of Energy decision to build a site in that state. In the face of such a veto, DOE cannot go ahead unless both Houses of Congress overturn it. Other provisions of the bill allow the government to store spent fuel from utilities in the next decade in existing federal storage facilities, most likely military installations. But utilities would be required to pay for this storage. D January 3, 1983 C&EN
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