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Oil & Gas

Mexichem, Occidental to form ethane cracker joint venture

August 20, 2012
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MEXICO CITY — Mexican chemicals company Mexichem SAB has signed a memorandum of understanding with Oxychem, a unit of Occidental Chemical Corp., to form a joint venture for the construction of an ethane-based cracker that will produce an estimated 500 million tons of ethylene annually, according to MarketWatch.

A feasibility study for the new cracker is expected to be ready in the second quarter of 2013, and if the project goes ahead, the plant would go into operation in 2016.

Most of the ethylene would be used by Oxychem at its Ingleside, Texas, plant to produce 1 million metric tons a year of vinyl chloride monomer, or VCM, a raw material used in the production of PVC plastic, which it then would sell to Mexichem under a long-term supply contract.

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