Westlake Chemical Corp. plans to expand its capacity for plastic feedstock ethylene made from natural gas-based ethane at its plant in Lake Charles, La.
It's the third time in less than a month that a North American plastics and chemicals maker has announced an expansion project based on newfound supplies of natural gas in the region. Previously, Chevron Phillips Chemical Co. LLC and a joint project between Nova Chemicals Corp. and Williams Cos. Inc. announced similar moves.
Houston-based Westlake will increase ethane-based ethylene output at both of its crackers in Lake Charles. The first expansion will increase capacity by about 240 million pounds and will be completed by the end of 2012. The second expansion should be on line by the end of 2014.
New technical developments in the natural gas industry make expansion in North America attractive, President and CEO Albert Chao said in an April 5 news release. We are accelerating engineering and feedstock sourcing efforts in order to reduce our external purchases of ethylene and provide for attractive future Westlake growth.
These projects provide an exciting opportunity to capitalize on advantaged feed sources expected from shale gas reserves at two of our core production sites, Chao added.
Westlake officials added in the release that they're also considering converting from propane to ethane feedstock use at its ethylene plant in Calvert City, Ky., also because of increasing availability of natural gas liquids. Additional expansions are being considered in Calvert City as well.
Westlake uses ethylene in its production of both low density polyethylene and PVC and also sells the material on the merchant market.
Both previous expansions were announced March 28. Houston-based Chevron Phillips confirmed a feasibility study for a new ethane cracker and ethylene derivatives unit at one of its sites on the U.S. Gulf Coast. Officials again cited abundant natural gas supplies as a reason for the move.
On that same date, Tulsa, Okla.-based Williams announced a long-term ethane/ ethylene supply deal with Pittsburgh-based Nova, a sizable PE maker. Williams plans to supply Nova plants in western Canada by accessing natural gas from oil sands in that region.
Numerous speakers at recent petrochemical conferences in Houston said recent increases in confirmed reserves of natural gas in North America should greatly enhance and extend the competitiveness of the region's ethylene-based products, including PE and PVC.