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ExxonMobil Chemical to build ethylene plant in Texas

June 05, 2012
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ExxonMobil Chemical plans to build a world-scale ethylene plant at its Baytown, Texas, olefins complex and two polyethylene units nearby as it takes advantage of low-cost feedstocks resulting from the shale gas boom, a spokeswoman confirmed Friday, according to reports from Platts and other media sources.

"The multi-billion dollar project would include a new ethane cracker and premium product facilities at ExxonMobil''s integrated Baytown complex in Texas to capitalize on abundant supplies of American natural gas," a spokeswoman, Margaret Ross, says in an email, Platts reports. ExxonMobil has already filed permit applications for the expansion, she said.

Plans call for construction to begin by next March on a 1.5 million mt/year ethylene-capacity steam cracker at the Baytown complex, some 30 miles east of Houston, an area that is the heart of the US petrochemical industry. Start-up could come as early as 2016, ExxonMobil Chemical said in filings with the US Environmental Protection Agency and the Texas Commission on Environmental Quality.

In addition, Houston-based ExxonMobil Chemical plans to build two polyethylene plants, each with a capacity of 650,000 mt/year, at its plastics plant in Mont Belvieu, 10 miles east of Baytown.

The new polyethylene plants would use the ethylene feedstock provided by the new steam cracker. "This proposed expansion would enable ExxonMobil Chemical to economically supply the rapidly growing demand for high-value polyethylene products which are used in a wide range of consumer and industrial applications," Ross says. "ExxonMobil Chemical estimates exports could increase significantly as a result of the expansion."

ExxonMobil Chemical did not disclose a price tag on the proposed investment, describing it only as a multi-billion dollar project.

The company expects required governmental reviews and approvals to take about a year. ExxonMobil Chemical will then make a final decision on the project, Ross says.

ExxonMobil, the largest natural gas producer in North America, is counting on low-cost natural gas liquids -- ethane in particular -- as it seeks to cash in on the feedstock advantage the US chemical industry is expected to enjoy as a result of plentiful supply from shale gas drilling, Platts says.

"We believe the North American natural gas resource is abundant and can support both domestic energy needs as well as exports to the global market," Ross says.

The company joins other chemical majors, including Dow Chemical, Shell Chemicals, Chevron Phillips Chemical and Formosa Plastics USA, in pursuing greenfield projects to expand ethylene and polymers production in the US, says Platts.

Other companies, including Ineos, LyondellBasell, Williams, Westlake Chemicals and Nova Chemicals of Canada, plan brownfield expansions, debottlenecks or retrofits to add ethane consumption capacity and increase ethylene production, says Platts.

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