In a move to grow its North American and Asia Pacific chemicals capacity by almost half, ExxonMobil has begun detailed engineering studies on a project to expand its US Gulf polypropylene (PP) capacity by up to 450,000 tonnes/year.

Plastics and polymer composites, which can replace steel in many applications, typically comprise about 50% of a new car’s volume but only 10% of its weight.

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ExxonMobil's announced PP investment is one of 13 new facilities planned to grow the company's chemical manufacturing capacity in North America and Asia Pacific by about 40% by 2025.

“We’ve got the best portfolio of high-quality, high-return investment opportunities that we’ve seen in two decades,” Darren W. Woods, chairman and chief executive officer, said at the company’s annual meeting of investment analysts at the New York Stock Exchange.

A final decision on the investment, anticipated to be several hundred million dollars, is expected later this year.

Facility startup could come as early as 2021, ExxonMobil said.

The project would create more than 600 jobs during peak construction and more than 60 permanent jobs when production starts.

Plastics demand

The new facility will can produce advanced PP products which can be used in high performance automotive, appliance, and packaging applications.

These advanced PP materials are key to reducing vehicle weight, which helps improve fuel efficiency and reduces carbon emissions.

Modern plastics and polymer composites, which can replace steel in many applications, typically comprise about 50% of a new car’s volume but only 10% of its weight.

“Polypropylene is a versatile material providing high impact resistance and high stiffness to lightweight applications,” Cindy Shulman, ExxonMobil’s vice president of plastics and resins said. It is safe, can be recycled and requires less energy to produce when compared with other plastics.”

Banking on Asia

US ethylene capacity is set to rise by nearly 9 million tonnes by the end of 2019 and PE capacity will rise by at least 6 million tonnes, a 40% increase, according to Petrochemical Update’s US Polyethylene Export report.

PE production will exceed domestic demand, adding up to 6-9 billion pounds of excess inventory for export through 2020, assuming projects start up on time.

The added supply will create opportunities over the next decade for North American companies to export their excess supply to regions like China, Africa and India.

Most of the planned investment in the U.S. Gulf Coast is focused on supplying emerging markets like Asia with high-demand products, which ultimately will spur new economic growth locally, ExxonMobil said.

“ExxonMobil is well positioned to take advantage of the growing global demand for higher-value products, in both North America and the high-growth Asia Pacific region,” John Verity, president of ExxonMobil Chemical Company, said in a statement.

Major ExxonMobil chemical investments include a 1.5-million tonne/year cracker at Baytown, Texas, that will start in mid-2018; a 1.8-MM tonne/year joint venture with SABIC that is expected to be given final approval later this year; and a new Asia cracker.

Polypropylene projects

ExxonMobil is not the only owner turning its focus to PP resins.

Braskem is developing a 450,000 tonne/year PP plant in La Porte, Texas, with a scheduled 2020 start.

The $675 million PP line, called Delta, is its sixth US PP plant and its first to be built from the ground up.

In North America, two projects are in the works in Canada.

Inter Pipeline has begun construction on its propane dehydrogenation (PDH) and PP complex in Alberta, and expects the project to be completed by the end of 2021.

The company authorized construction in December for Canada’s first integrated PDH/PP complex.

The facilities, collectively referred to as the Heartland Petrochemical Complex, are estimated to cost $3.5 billion in aggregate.

The Heartland Petrochemical Complex will be designed to convert 22,000 barrels/day of locally sourced, low-cost propane into 525,000 tonnes/year of PP.

Canada Kuwait Petrochemical, a joint venture between Canada’s Pembina and Kuwait's PIC, is in the front-end engineering design phase of its proposed integrated propylene and PP facility in Sturgeon County near Edmonton.

The 550,000 tonne/year propane dehydrogenation unit would feed the 550,000 tonne/year PP plant, with the offtake to be exported to North America and global markets.

Construction is slated to start in 2019, with an in-service target of 2021.

Ethane and PE projects

The arrival of shale-based ethylene and polyethylene (PE) expansions is also upon the U.S. Gulf.

A new 1.5 million tonne/year ethylene unit started up in March at the Chevron Phillips Chemical Cedar Bayou complex in Baytown, Texas.

This follows the start-up of a 1.5 million tonne/year ethylene unit at Dow Chemical's complex in Freeport, Texas in September.

U.S. Phillips 66 is also considering a second ethane cracker in the U.S. for its joint venture Chevron Phillips Chemical (CP Chem), a joint venture with Chevron. A decision is not likely until next year, Phillips 66 executives said.

The 1 million tonne/year ethane cracker in Port Arthur, Texas – as part of the Total, Borealis, and NOVA Chemicals joint venture— is under construction, the companies said in a statement, also confirming that they have signed agreements to form their JV.

The $1.7 billion ethane steam cracker is being built alongside Total’s Port Arthur refinery and Total/BASF existing steam cracker. The project is scheduled to start up in 2020.

A decision on the new 625,000 tonne/year Borstar PE unit at Total’s Bayport, Texas, site, is pending a decision on the outcome of an acceptable EPC contract, the company said in a statement.

By Heather Doyle