US Petrologistics IPO filing shows details of propylene business

21 June 2011 21:09  [Source: ICIS news]

HOUSTON (ICIS)--US on-purpose propylene producer Petrologistics identified customers and touched on expansion plans in a regulatory filing made on Tuesday. 

Petrologistics revealed the information in its registration statement, which it filed as part of a plan to raise $600m (€420m) in an initial public offering.

Petrologistics's runs the sole propane dehydrogenation (PDH) plant in the US, capable of producing 544,000 tonnes/year of propylene.

A PDH plant relies on propane as a feedstock. In contrast, the majority of propylene produced in the US relies on oil-based feedstock.

Petrologistics started propylene production in October 2010, but it did not achieve nameplate capacity until April, the statement said.

Petrologistics has contracts to sell its propylene to Dow Chemical, Total Petrochemicals and INEOS Olefins, it said. Purchases by the three companies account for 73-97% of Petrologistics's nameplate capacity.

Dow uses the propylene to produce primarily acrylic acid, Petrologistics said. Total uses it primarily for polypropylene (PP), and INEOS uses it primarily for acrylonitrile (ACN).

Petrologistics sells its remaining propylene on the spot market.

In addition, Petrologistics has a 10-year contract to sell hydrogen to Praxair. Praxair buys at least 93% of the hydrogen that Petrologistics produces as a by-product.

Looking forward, Petrologistics is already considering expansion plans, and it is pursuing engineering studies to significantly expand its capacity, the company said.

Petrologistics also plans to find low-cost ways to increase production beyond the plant's initial nameplate capacity, Petrologistics said.

Meanwhile, the company intends to evaluate and pursue acquisitions that it said "could enhance our operating platform".

($1 = €0.70)

For more on propylene visit ICIS chemical intelligence

By: Al Greenwood
+1 713 525 2645

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