Mexichem Tumbles With ICA After Deadly Blast at Mexico Plant

  • ICA was upgrading Mexichem facility with U.S. partner Fluor
  • Death toll is at least 27 in accident at Pajaritos complex

Mexichem SAB and Empresas ICA SAB fell the most on Mexico’s benchmark index after a deadly blast at a petrochemical plant where both companies had operations.

Mexichem dropped 3.4 percent, capping a two-day decline of 8.4 percent after the Wednesday explosion at a facility the company co-owns about 370 miles (600 kilometers) from Mexico City. ICA, which was upgrading the plant with partner Fluor Corp., posted its worst week since February. The death toll stood at 27 as of Friday afternoon, according to Reforma newspaper.

A majority of those who died were ICA Fluor contractors, Mexichem CEO Antonio Carrillo said in an interview Friday. The joint venture was working on the plant overhaul at the time of the deadly accident, according to Jose Antonio Gonzalez Anaya, chief executive officer of Petroleos Mexicanos. The state-owned oil company known as Pemex holds a minority stake in the plant.

Two ICA Fluor employees died and a third is unaccounted for, Fluor said in an e-mailed statement. “The deceased employees’ family, friends and colleagues are in our thoughts and prayers during this extremely difficult time,” the Irving, Texas-based company said.

Gabriela Orozco, head of investor relations at Mexico City-based ICA, said, “We’re deeply saddened by the accident and the priority at the moment is our employees.”

Assessing Damage

Mexichem will release updated information on the dead and missing today as it continues assessing damage at its ethylene plant, Carillo said. The chlorine plant in the Pajaritos complex is operating normally, he said.

There are no estimates for damages from the explosion yet, and recovery efforts will probably take months, Gonzalez Anaya said. Mexichem Chairman Juan Pablo del Valle said the company would probably release details on losses from the accident in its next quarterly report. Both executives confirmed the ICA Fluor joint venture was working near the source of the blast.

About $138 million of the $210 million budgeted for the upgrade had been spent as of the time of the accident, Carillo said.

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