MOSCOW (MRC) -- Axiall and Korean firm Lotte Chemical have decided to defer a final investment decision on a USD2 billion ethane cracker in Westlake, La. Via the American Press, Axiall CEO Paul Carrico said uncertainty in U.S. energy, feedstock and labor markets drove the decision, said Bicmagazine.
Carrico did not say when an investment decision would be made. The firms recently completed a front-end engineering and design study for the project.
It is the second major U.S. downstream project to be put on hold since oil prices began to tumble last year. Last month, Sasol said it would delay a decision on a USD14 billion gas-to-liquids facility in Lake Charles, La., due to low oil prices.
Last February, Axiall and Lotte Chemical signed a preliminary agreement to build a USD2 billion ethane cracker on land bordered by Prater and Pete Manena roads. If the project is approved by state and federal officials, Lotte Chemical has agreed to build and operate a monoethylene glycol facility adjacent to the ethylene plant. The total estimated cost of both facilities is USD3 billion.
Axiall is a chemical company formed in 2012 from the chemical assets of PPG and Georgia Gulf. The PPG products are primarily chlor-alkali. The combined companies will be the third largest producer of chlor-alkali in the US after Dow Chemical and Occidental. PPG will own 50.5% of the combined companies. The company is headquartered in Atlanta, GA.
The Lotte Group currently has a presence in Indonesia via its subsidiary, Honam Petrochemicals, which acquired Malaysia’s polyolefin major Titan Chemicals in July 2010. Included in the acquisition was Titan’s Indonesian subsidiary - PT Titan Petrokimia Nusantara (TPN), which has a polyethylene (PE) production capacity of 450,000 tonnes/year.
MRC