Exxon Mobil Chemical Co.'s big plans to add polyethylene resin capacity on the U.S. Gulf Coast just got even bigger.
Houston-based ExxonMobil on Nov. 14 announced plans to add more than 1.4 billion pounds of annual PE capacity at its Beaumont, Texas, location. That amounts to a 65 percent capacity increase for PE production there.
Officials said in a news release that the new capacity is needed to meet growing demand for high performance plastics. Construction of the new unit has begun, with startup expected in 2019.
Already in 2017, ExxonMobil will open two new PE production lines in Mont Belvieu, Texas, with total annual production capacities of almost 3 billion pounds. The firm also is considering a new steam cracker and derivative units on the Gulf Coast through a partnership with industrial conglomerate Saudi Basic Industries Corp. of Riyadh, Saudi Arabia.
Officials added that ExxonMobil's Gulf Coast investments will not only expand existing refining and chemical capacity, but also stimulate economic growth and create jobs. Current projects could create more than 1,200 permanent jobs and more than 28,000 temporary jobs in construction.
“The availability of vast new supplies of U.S. shale gas and associated liquids for feedstock and energy is a significant advantage that enables expansion to meet strong global demand growth in polyethylene,” said Cindy Shulman, vice president of ExxonMobil's plastics and resins business.
The Beaumont project builds on supply advantages created by ExxonMobil's Mont Belvieu expansion. Combined, this multi-billion dollar investment will increase the company's U.S. PE production by 40 percent, or nearly 4.5 billion pounds per year, making Texas the largest PE supply point for ExxonMobil.
“We combine our state-of-the-art production expertise with a first-class technology organization, which enables us to offer innovative polyethylene products for applications such as flexible food packaging that increases product shelf life and safety,” Shulman added.
The Beaumont expansion project will employ 1,400 construction workers and create 40 permanent jobs upon completion. It's expected to generate $20 billion in economic activity in the first 13 years of operation, officials said.
“We're part of the growth in an area that is primed for new business,” Beaumont PE plant manager Jason Duncan said in the release. “The expansion of the polyethylene plant is now ExxonMobil's third significant investment in the Beaumont area over the past 18 months, the impact of which will benefit the local economy in the years to come.”
Along with many other North American firms, ExxonMobil is adding PE capacity because of newfound supplies of low-priced natural gas feedstock in the region. In addition to ExxonMobil's Mont Belvieu expansion, Dow Chemical and Chevron Phillps Chemical each are bringing on large amounts of PE capacity on the Gulf Coast next year.
At the recent K Show in Germany, ExxonMobil PE marketing manager Thomas Deman said he was confident the new PE output would find a home, either in North America or elsewhere around the world.
“It's a big industry that's growing fast,” he said in an interview with Plastics News. “It adds [almost 9 billion pounds] of demand every year. That's six world-scale [PE] plants.”
ExxonMobil “will serve its customers where the growth is, no matter where in the world that might be,” Deman added.