In a striking move prompted by North America's polypropylene glut, British Petroleum plc will rid itself of about a billion pounds of PP capacity by closing its Cedar Bayou plant in Baytown, Texas, and permanently idling a line at its Chocolate Bayou plant in Alvin, Texas.
London-based BP announced the moves March 28, with BP Polymers Americas President Mike Graff citing the firm's desire to restructure assets ``during a difficult business cycle.''
BP's recent acquisition of 850 million pounds of PP capacity from Solvay SA in Deer Park, Texas, also affected the shutdown decision, as did the age of the 26-year-old Cedar Bayou site, according to BP spokesman Scott Dean.
Production at the 575 million-pound-capacity Cedar Bayou site will end in June. The plant's 68 employees will be transferred to other BP sites in Texas, the company said.
In Alvin, a 450 million-pound, 29-year-old line closed in November will not reopen. About 20 employees were reassigned.
U.S./Canadian PP sales grew 4 percent in 2001, according to the American Plastics Council in Arlington, Va. But nonexport growth was only 1 percent, with much of that resulting from lower prices caused by oversupply that industry contacts said could be as much as 2 billion pounds.
BP, one of the world's largest oil firms, announced late last year that it was cutting 1,000 jobs worldwide. The firm also is eliminating 320 million pounds of polyethylene capacity in Grangemouth, Scotland.