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Less than two months after Hurricane Harvey knocked offline refinery and chemical production in the Gulf Coast, ExxonMobil started on Tuesday production on the first of two new 650,000 tons-per-year polyethylene lines at its plastics plant in Mont Belvieu, Texas.
The new polyethylene lines will raise the Mont Belvieu plant polyethylene capacity by around 1.3 million tons per year, to total upwards of 2.5 million tons annually, which will make it one of the largest polyethylene plants in the world, Exxon said.
A large amount of Mont Belvieu’s polyethylene production will be exported from the Port of Houston, and at peak, the site is expected to ship more than 200 containers daily.
The new units are part of Exxon’s Growing the Gulf expansion drive, under which the U.S. oil and gas supermajor is planning to invest more than US$20 billion over 10 years to build and expand manufacturing facilities in the U.S. Gulf region in 11 major chemical, refining, lubricant, and LNG projects along the Texas and Louisiana coasts.
“The expansion of our Mont Belvieu facility further enhances our ability to meet growing global demand for high-performance polyethylene products around the world,” Neil Chapman, president of ExxonMobil Chemical Company, said in the company’s press release.
Hurricane Harvey knocked offline around 60 percent of U.S. basic plastics production capacity, and analyst feared a supply crunch throughout America and the world in the wake of the storm.
Analysts at IHS Markit said last week that after Harvey shut down more than 50 percent of the U.S. linear alpha olefins (LAOs) production, major chemical producers relying on the Houston-area LAOs “are scrambling to secure supply, and impacts will be felt down the supply chain.”
Not only Exxon is investing in chemical projects on the Gulf Coast.
Last month, Chevron Phillips Chemical—a 50/50 company of Chevron and Phillips 66—began start-up of its new polyethylene units at Old Ocean, Texas, as part of a US$6-billion petrochemical project. Chevron Phillips Chemical currently expects to complete construction and begin the commissioning of a new ethane cracker at its existing facilities in Baytown, Texas, by the first quarter of 2018, and ramp up to full production during the second quarter of 2018.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.