MOSCOW (MRC) -- Axiall Corp. and Lotte Chemical Corp. will make a combined USD3 billion capital investment in two new chemical manufacturing plants in Lake Charles, Louisiana, said the companies in their press-releases.
LACC LLC, a subsidiary of Axiall and Lotte Chemical USA Corp.’s 50–50 joint venture Eagle US 2 LLC, will invest USD1.9 billion to build the steam cracker adjacent to Axiall’s Lake Charles chlor-alkali manufacturing plants to take advantage of existing infrastructure, competitive US shale feedstock resources, and ethylene distribution infrastructure, according to a series of releases from the JV and Louisiana Economic Development (LED).
Adjacent to the new steam cracker, Lotte separately will invest an additional USD1.1 billion to build and operate the US’ largest MEG plant, from which 600,000 tpy of MEG will be exported to customers in Europe and Asia, according to Soo Young Huh, Lotte Chemical’s president and chief executive.
To secure the combined projects, the state of Louisiana offered the companies a competitive incentive package that includes a USD4.55-million modernization tax credit for the ethane cracker, as well as economic development award program incentives of USD700,000 for the cracker and USD1.47 million for the MEG plant, which will pay for site infrastructure improvements, LED said.
With site preparation already under way and full construction due to begin during second-quarter 2016, the grassroots cracker and MEG plant are scheduled for startup in early 2019.
LACC also confirmed it has let an additional contract to CB&I, Houston, to provide engineering, procurement, fabrication, and construction (EPC) for the ethane cracker, which will use the service company’s proprietary highly selective SRT cracking heaters as well as its recovery section design.
CB&I's scope of work under the USD1.3 billion EPC contract also includes supply of spheres and fabricated pipe spools.
LACC previously let a contract to CB&I to deliver detailed engineering and early procurement services for the project following the service provider’s previous delivery of front-end engineering and design and other early-stage engineering works for the cracker.
In November, Samsung Engineering has been awarded an early works contract from Lotte Chemical for a 700,000-t/y monoethylene glycol (MEG) project at Lake Charles, La.
Lotte Chemical is a member of the Lotte Group in Korea, which has been listed on the Korean Stock Exchange since 1991. Lotte Chemical is a leading manufacturer of petrochemical products, such as ethylene, propylene, butadiene, polyethylene, polypropylene, ethylene oxide/glycol, compound resin, polyethylene terephthalate, polycarbonate, methyl methacrylate, ethylene oxide derivatives, benzene, toluene, mixed xylene, purified terephthalic acid and purified isophthalic acid among others. Lotte Chemical, headquartered in Seoul, South Korea, has manufacturing facilities located throughout South Korea, China, Malaysia, Indonesia, Pakistan, UK and the USA.
Axiall Corporation is a leading integrated chemicals and building products company. Headquartered in Atlanta, Axiall has manufacturing facilities located throughout North America and in Asia to provide industry-leading materials and services to customers.