The former Flint Hills Resources LLC resin plant in Odessa, Texas, has received a new lease on life from investors who plan to restart some production there later this year.
Rextac LLC in July bought the site's polypropylene assets from Wichita, Kan.-based Flint Hills, and at the same time purchased intellectual and property rights to Rextac-brand amorphous polyalphaolefin (APAO) a specialty PP from Huntsman Corp. of The Woodlands, Texas.
No purchase price was disclosed in either deal.
Rextac plans to restart production of 80 million pounds of APAO capacity Oct. 15 in Odessa and is in the process of adding 100 jobs at the site, which closed in April.
Our primary objective is to get up and running, Rextac business director Blake Batte said Aug. 24 in a phone interview.
Rextac consists of Odessa-based toll processor Orion Pacific Inc. and several other investors. Orion Pacific had worked with the Odessa site which previously was owned by Huntsman and Rexene Inc. as a toll processor for 25 years, taking molten APAO from the plant to Orion Pacific's nearby facility, converting the material into large pellets, then returning it for further processing.
APAO often is sold as an adhesive spray and used in asphalt, roofing, diapers, medical products and other applications. Batte said the only other APAO producers in North America are Eastman Chemical Co. and Degussa. It's a niche market, and when the site shut down, the other producers couldn't meet demand, he said.
At its peak, the Odessa plant employed 395 and operated annual capacities of 440 million pounds of low density polyethylene, 350 million pounds of linear LDPE and 120 million pounds of PP. Flint Hills bought the site and other related assets from Huntsman for more than $750 million in 2007.
When the plant closing was announced in 2008, Flint Hills officials said that investments needed to make the 52-year-old facility more competitive were too high.
Rextac also will invest in equipment needed to deliver propylene monomer to the Odessa factory. Propylene used to make APAO there formerly was supplied by an olefins plant on the same property, but Flint Hills is demolishing that operation.
Copyright 2009 Crain Communications Inc. All Rights Reserved.