Building starts on Total-Borealis-Nova, Inter Pipeline projects; Westlake to expand; Exxon Beaumont refinery decision near

Our pick of the latest petrochemical news you need to know

Ethylene is used to make plastics. With plastics demand growing, the U.S. is seeing more cracker investments.

Total, Borealis and Nova JV Texas cracker under construction, PE unit planned

The 1 million tonne/year ethane cracker in Port Arthur, Texas – as part of the Total, Borealis, and NOVA Chemicals joint venture— is under construction, the companies said in a statement, also confirming that they have signed agreements to form their JV.

The $1.7 billion ethane steam cracker is being built alongside Total’s Port Arthur refinery and Total/BASF existing steam cracker. The project, which is scheduled to start up in 2020, will create around 1,500 jobs during peak engineering and construction activity.

A decision on the new 625,000 tonne/year Borstar polyethylene (PE) unit at Total’s Bayport, Texas, site, is pending a decision on the outcome of an acceptable EPC contract, the company said in a statement.

The three companies signed definitive agreements to form a joint venture in petrochemicals on the U.S. Gulf Coast in February.

The joint venture – in which Total will own 50% and Novealis Holdings LLC, a joint venture between Borealis and NOVA Chemicals, will own the remaining 50% – will commence subject to customary closing conditions, including receipt of regulatory approvals, the company said.

“This agreement is a key milestone for this integrated petrochemicals project. This joint venture is aligned with Total’s strategy to strengthen our position by taking advantage of low-cost U.S. gas,” said Bernard Pinatel, President, Refining & Chemicals, Total.

The joint venture will include the under-construction 1 million tonne/year ethane steam cracker in Port Arthur, Texas; Total’s existing polyethylene 400,000 tonne/year facility in Bayport, Texas; and the 625,000 tonne/year Borstar PE unit, which is still pending a final decision.

“The JV with Total and NOVA Chemicals is a key project in advancing our global growth. Not only are we convinced of the excellent cost-economics of this integrated brownfield investment project, but we are also excited to bring our unique product grades based on our Borstar technology to the North American market,” said Borealis CEO Mark Garrett.

Inter Pipeline begins construction on Canada plastics project

Hearland Petrochemical Complex. Image: Inter Pipeline

Inter Pipeline has begun construction on its propane dehydrogenation (PDH) and polypropylene (PP) complex in Alberta province, and expects the project to be completed by the end of 2021, the Canadian midstream energy, pipeline and natural gas liquids (NGL) company said in a February webcast.

The company authorized construction in December for Canada’s first integrated PDH/PP complex.

The facilities, collectively referred to as the Heartland Petrochemical Complex, are estimated to cost $3.5 billion in aggregate and will be located in Strathcona County, Alberta near Inter Pipeline’s Redwater Olefinic Fractionator.

The Heartland Petrochemical Complex will be designed to convert 22,000 barrels/day of locally sourced, low-cost propane into 525,000 tonnes/year of polypropylene.

The facility design has $400 million invested to date in engineering, procurement and early civil works, the company said.

Westlake to expand PVC and VCM capacity; explore increasing ethylene capacity

Westlake will expand polyvinyl chloride (PVC) and vinyl chloride monomer (VCM) capacity at three of its chemical facilities in Germany and Louisiana, the company said in a statement.

Two of the plants are located in Germany (Burghausen, Gendorf) and one is located in Geismar, Louisiana. The expansions in Burghausen and Geismar are expected to be completed in 2019. The Gendorf expansions are expected to be completed in 2020 and 2021.

The expansion at Geismar, Louisiana is expected to cost $140 million, the company said.

Through a joint venture with Lotte Chemical, Westlake Chemical is building an ethane cracker in Lake Charles, Louisiana, with a combined $1.9 billion investment.

Adjacent to that project, Lotte Chemical is building a $1.1 billion monoethylene glycol (MEG) complex.

The Louisiana projects are currently supporting 3,000 construction jobs, while creating 265 new permanent jobs and resulting in more than 2,300 indirect jobs in southwest Louisiana, the Advocate reported.

The Westlake expansion projects are expected to add 750 million pounds annually of additional PVC and 200 million pounds annually of additional VCM to the company’s production.

In addition, chlor-alkali production will be expanded at the Gendorf facility, adding 55 million pounds annually of chlorine capacity and the associated 60 million pounds annually of membrane caustic soda capacity.

Westlake also plans to explore increasing its ethylene capacity via new builds, expansions, and acquisitions in addition to planned expansions of PVC and chlor-alkali capacity in Louisiana and Germany, the company said in its February earnings call.

Exxon nears approval of Beaumont refinery expansion-Reuters

Exxon's "Energy Lives Here," TV commercial

Exxon Mobil is nearing final approval of a major expansion to its Beaumont, Texas, refinery that could make it the largest crude processing plant in the United States, Reuters reported.

An expansion has been under consideration since at least 2014.

The company has been weighing putting in a third crude distillation unit (CDU) at the 362,300 barrel-per-day refinery. To top Motiva Enterprises’ Port Arthur, Texas, plant, now the largest, Exxon would have to add the capacity to process another 300,000 bpd and 400,000 bpd.

Motiva’s Port Arthur refinery can process as much as 635,000 bpd of crude oil, according to the US Energy Information Administration (EIA).

In 2016, Exxon added 20,000 bpd in light crude refining capacity at Beaumont.

Another expansion would take advantage of the growth in U.S. shale production, which is expected to about double the nation’s oil output to more than 11 million barrels/day by the end of 2018, from 5.6 million barrels/day, according to the EIA.

Exxon is considering investing $50 billion in the U.S. over the next five years, the company said in recent earnings calls.

By Heather Doyle