By: Frank Esposito
January 8, 2013
MIDLAND, MICH. (Jan. 8, 10:30 a.m. ET) — It was a Merry Christmas for Dow Chemical Co., as the firm re-started production of plastic feedstock ethylene at a plant in Louisiana on Dec. 25.
Dow’s St. Charles plant in Hahnville, La., had not made ethylene for almost four years after being taken offline in January 2009. The start-up “represents the first major milestone within our U.S. Gulf Coast investment strategy,” Dow’s Brian Ames said in a Jan. 7 news release. Ames serves as president of olefins, aromatics and alternatives for Midland, Mich.-based Dow.
Company officials added in the release that resuming production also is part of Dow’s investment plan to further connect its U.S. operations with cost-advantaged feedstocks from increasing supplies of U.S. shale gas.
In addition to the St. Charles restart, Dow has announced plans to build a new ethylene cracker in Freeport, Texas, and to enhance existing feedstock plants there and in Plaquemine, La.
To date, officials have not announced plans to increase polyethylene capacity, although other North American competitors are doing so. Dow also plans to build a plant making on-purpose supplies of plastic feedstock propylene in Freeport.
When the St. Charles restart was announced in late 2011, officials said restarting ethylene and propylene production there would cost $250 million and would create 35 full-time jobs and several hundred temporary construction jobs. A propylene restart was not mentioned in the Jan. 7 release.
The announced restart is expected to add $150 million to Dow’s pretax profit in 2013, officials said.
Dow ranks as one of the world’s largest makers of polyethylene and also makes a variety of specialty plastics. The firm generated sales of almost $43 billion in the first nine months of 2012. Almost half of that amount coming from its plastics-related businesses.