The end of an era now has a definite date, though in Italy’s plastics sector, definite is not always definite. In any case, state-controlled energy group Eni (Rome; www.eni.com) now seems to have firm plans to shut down its domestic cracker at Porto Marghera, operated by its plastics subsidiary Versalis (Milan / Italy; www.versalis.eni.com). Eni has made no official announcement, but Italian news reports say CEO Claudio Descalzi has informed the workforce and the city of Venice, to which Porto Marghera belongs, that decommissioning will take place in spring 2022. The trade unions Filctem Cgil, Femca Cisl and Uiltec Uil have already signalled that they are prepared to mobilise in protest of the shutdown for the sake of the plant’s 400 direct employees and a similar number in downstream industries.

With the cracker’s shutdown, aromatics production at Porto Marghera will also end. According to Plasteurope.com’s Polyglobe database (www.polyglobe.net), the cracker has nameplate capacity to produce 490,000 t/y of ethylene, 245,000 t/y of propylene, 95,000 t/y of benzene and 110,000 t/y of toluene. Earlier plans had called for a reduction of capacity by around 30% across the board, with output of ethylene scheduled to fall by 190,000 t/y, propylene by 95,000 t/y, benzene by 45,000 t/y, and toluene by 30,000 t/y.

The writing has been on the wall for Porto Marghera for some time as Italy’s petrochemicals industry continues its long-term decline, and the national chemicals strategy seems irreversibly focused on renewables. In late June 2019, it was revealed that Eni and Versalis were talking to the trade unions about reorganisation of production and creation of a new biotech corporate segment, which would see capital spending of more than EUR 1.5 bn (see Plasteurope.com of 23.07.2019). Among other things, management said funds had been earmarked for integration of the M&G activities acquired earlier that year. The unions were wary, complaining that the proposed investments were “completely inadequate” and a continuation of the Eni group’s traditional “carrot and stick” approach, which has been clearly visible in its recent history.

Five years earlier in 2014, Eni converted a fossil-fuel based refinery to create what at that time was touted as the world’s the first bio-refinery. Shortly before the naphtha-based cracker was to be decommissioned, then, Versalis signed an agreement to toll manufacture ethylene and propylene for Shell Chemicals for 12 to 18 months from mid-January 2015, while its Moerdijk cracker in the Netherlands was offstream. For a brief period, the move offered a respite for the workforce, which had feared the cracker’s closure would be the death knell for downstream sites in Mantua and Ferrara.

When the Shell contract ended, Versalis seemed one step away from being sold to US private equity investor SK Capital Partners (New York, New York; www.skcapitalpartners.com), which, it was suggested, would keep the cracker going. However, the talks were broken off without an agreement (see Plasteurope.com of 23.06.2016), due mainly to Eni’s requiring a long-term commitment. Since then, the company has continued to struggle with profitability, and apart from minor deals, no sustainable biochemical hub has taken visible shape.

An interim aside to this ongoing story is the news that former Versalis CEO Daniel Ferrari, who was also president of PlasticsEurope (Brussels / Belgium; www.plasticseurope.org) from 2017 to 2018, was named senior director at SK Capital at the beginning of 2021 (see Plasteurope.com of 05.01.2021). Whether this indicates that SK is still interested in investing in Italy is anyone’s guess.