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Air Products and Lu’An Clean Energy Company to form $1.3 Billion Joint Venture for Coal-to-Syngas Project in China’s Shanxi Province

Air Products to Hold Investor Call on Monday, September 11 @ 8:30 a.m. USET

Air Products (NYSE:APD) today announced it has signed an agreement to form a $1.3 billion joint venture (JV) with Lu’An Clean Energy Company, which will significantly expand Air Products’ scope of supply serving Lu’An Mining (Group) Co., Ltd.’s syngas-to-liquids production in Changzhi City, Shanxi Province, China.

Air Products has already invested $300 million to build, own and operate four large air separation units (ASUs) to supply the Changzhi City site. Under the new agreement, Air Products will contribute the ASUs and invest a further $500 million for a 60 percent ownership in the new JV. With this majority position, Air Products will fully consolidate the JV financial results. Lu’An will contribute the gasification and syngas clean-up system, will receive $500 million of cash and will have a 40 percent ownership in the new JV. 

The new joint venture, to be called Air Products Lu’an (Changzhi) Co., Ltd., will own and operate the ASUs and gasification and syngas clean-up system. The JV will receive coal, steam and power from Lu’An and will supply syngas to Lu’An under a long-term, onsite contract. Closing is expected as soon as possible, pending initial operational start-up and government and regulatory approvals. 

Seifi Ghasemi, chairman, president and chief executive officer of Air Products said, “We are delighted to have Lu’An, a leading clean energy company in China, as our joint venture partner. The creation of this world-class JV is perfectly in line with our stated strategy of deploying our significant cash to grow by acquiring existing assets and expanding our scope of supply to include syngas.” 

“Extending our strong partnership/relationship with Air Products through this new joint venture enables us to take advantage of world-leading project management and operational expertise to deliver syngas for this landmark energy project,” said Mr. Li Jinping, Chairman of Lu’An.

Air Products reminds shareholders that the agreement announced today is subject to government and regulatory approval.

Investor Call Details
The Company will hold a conference call on Monday, September 11, 2017 at 8:30 a.m. USET to discuss the joint venture. The teleconference will be open to the public and the media in listen-only mode by telephone and Internet broadcast.

Live teleconference: 323-701-0225
Passcode: 5208381
Internet broadcast/slides: Available on the Event Details page on Air Products’ Investor Relations website. 

Telephone replay: 888-203-1112 (domestic) or 719-457-0820 (international) 
Passcode: 5208381
Available from 12:30 p.m. ET on September 11 through 12:30 p.m. ET on September 18, 2017. 
Internet replay: Available on the Event Details page on Air Products’ Investor Relations website.

Air Products has been helping manufacturers in China improve productivity, efficiency, quality and environmental performance through its strong local position, as well as innovative and sustainable solutions for 30 years.