(Yicai Global) Jan. 14 -- Royal Dutch Shell and China National Offshore Oil have penned an agreement to build the British-Dutch oil and gas giant's first commercial-scale polycarbonate factory.

Shell Nanhai and CNOOC Oil & Petrochemicals agreed to build the facility at their shared chemical base in Huizhou, Guangdong province, yesterday, the latter said on Weibo the same day. Polycarbonate is an engineering plastic whose transparency, impact strength and temperature resistance make it suitable for use in eyewear, electric components, car parts, medical equipment and the aerospace sector, among other fields.

The plant will also create alkyl carbonate products used in the production of lithium-ion batteries, which power a vast array of devices from smartphones to electric cars and form part of Shell's transition into new energy.

Shell and CNOOC opened their first plant at Huizhou in 2006 and the second in April 2018. The facility is the largest monomer ethylene plant in China and produces 2.2 million tons of the compound each year. The pair also inked an agreement in October 2018 to build a multi-billion-dollar facility to further their work in the South China Sea.

Editor: James Boynton