Formosa to build 800,000 tonne/year olefins cracker in Texas

27 February 2012 19:00  [Source: ICIS news]

Formosa Plastics Point Comfort siteHOUSTON (ICIS)--Formosa Plastics plans to build an 800,000 tonne/year olefins cracker, a propane dehydrogenation (PDH) unit and a low density polyethylene (LDPE) unit at its Point Comfort, Texas, facility as part of $1.7bn (€1.3bn) in capital investments, the company said on Monday.

The PDH unit will have a capacity of 600,000 tonnes/year, while the LDPE unit will have a capacity of 300,000 tonnes/year, Formosa said.

Construction on the three projects is expected to be completed in 2016, with start-up of those units also occurring in 2016, said Randy Smith, vice president and general manager of the site.

The olefins cracker will use low-cost domestic natural gas and will supply feedstock to both existing production units and the new LDPE unit, while the PDH unit will produce additional propylene, the company said.

Details on the cost and specific start-up dates for the units were not released.

During construction, the project is estimated to create 1,800 construction jobs and, once completed, an additional 225 long-term operating and maintenance jobs, the company said.

With the announcement, Formosa joins three other producers who say they are committed to building crackers, including Chevron Phillips (CP Chem) Chemical, Shell Chemicals and Dow Chemicals.

CP Chem will build its 1.5m tonne/year cracker in Cedar Bayou, Texas, while Shell will select a location in the northeast US and Dow on the US Gulf coast.  All are expected to come on line between 2016-2017.

In addition to the new crackers, three companies are planning expansions or debottlenecks at existing sites, including Westlake Chemical, LyondellBasell and INEOS.

Other companies who have said they are evaluating new crackers include Saudi Arabia's SABIC, Brazil's Braskem, as well as US-based start-up Aither Chemicals.

($1 = €0.74)

By: Michelle Klump
+1 713 525 2653

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