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Released September 27, 2019 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Enterprise Products Partners L.P. (NYSE:EPD) (Houston, Texas) and LyondellBasell Industries NV (NYSE:LYB) (Houston) said Thursday they've executed long-term contracts supporting construction of Enterprise's second propane dehydrogenation (PDH) plant at its Mont Belvieu complex in Texas, as demand continues for polymer-grade propylene (PGP).
Industrial Info is tracking more than $47 billion worth of PDH-related capital projects worldwide.
Click on the image at right for a graph showing PDH project activity by world region.
Industrial Info has tracked the Enterprise project since August 2018. Enterprise said it will process LyondellBasell-provided propane into PGP for a fixed fee. Enterprise's PDH 2 will be able to consume as much as 35,000 barrels per day (BBL/d) of propane to produce up to 1.65 billion pounds per year of PGP.
Enterprise said the unit would begin service in 2023. For more information, see Industrial Info's project report.
"As we aim to meet the growing demand for our products, ensuring a long-term supply of feedstock is critical," LyondellBasell Chief Executive Officer Bob Patel said in a press release.
LyondellBasell has no plans to proceed with its own 1.6 billion-pound-per-year Gulf Coast PDH project, as it practices capital discipline, Patel said during the company's investor day conference on Tuesday. "That, I can take off the table," Patel said, adding that it was more economical to buy propylene from a partner and focus instead on derivatives investments. Industrial Info already has assessed the LyondellBasell project as having a low probability of moving forward as planned. For more information, see Industrial Info's project report.
Enterprise also said it plans to complete construction of a second isobutene dehydrogenation (IBDH) unit by the end of this year at the Mont Belvieu site. Using Honeywell International (NYSE:HON) (Morris Plains, New Jersey) UOP C4 Oleflex technology, the plant will produce 425,000 metric tons per year of isobutylene. Optimized Process Designs LLC (Katy, Texas) is providing engineering, procurement and construction (EPC) for the IBDH unit. For more information, see Industrial Info's project report. For related information on Enterprise, see August 1, 2019, article - With New Export Terminal, Enterprise Products Makes Key Move in U.S. Crude Oil Export Market.
Industrial Info is tracking seven PDH-related projects in the U.S., ranging in value from $1 billion to $6.4 billion. During Industrial Info's July 18 2019-2020 Global Chemical Processing Outlook, Trey Hamblet, Industrial Info's vice president of Chemical Processing Industry research, noted that PDH production in the U.S. was nearly non-existent 15 years ago.
"That tide has changed quite significantly and it has changed for a number of reasons," Hamblet said. "Here in North America, it has changed because we stopped yielding polymer-grade propylene in our ethylene crackers when we moved to lighter feedstock. It was no longer available and it necessitated the construction of these (PDH) plants so that we could continue production of polypropylene and other commodities that require the same grade of propylene."
Also, Hamblet said, changes in the refining industry led to less production of polymer-grade propylene, leading to the need for more PDH units to fill the demand gap.
"So that really created the trend for PDH," Hamblet said. "It's similar even in East Asia and those regions of the world, as their feedstock mix changed and demand for certain commodities required a rich polymer-grade propylene that has created an opportunity for these PDH units."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
Industrial Info is tracking more than $47 billion worth of PDH-related capital projects worldwide.
Industrial Info has tracked the Enterprise project since August 2018. Enterprise said it will process LyondellBasell-provided propane into PGP for a fixed fee. Enterprise's PDH 2 will be able to consume as much as 35,000 barrels per day (BBL/d) of propane to produce up to 1.65 billion pounds per year of PGP.
Enterprise said the unit would begin service in 2023. For more information, see Industrial Info's project report.
"As we aim to meet the growing demand for our products, ensuring a long-term supply of feedstock is critical," LyondellBasell Chief Executive Officer Bob Patel said in a press release.
LyondellBasell has no plans to proceed with its own 1.6 billion-pound-per-year Gulf Coast PDH project, as it practices capital discipline, Patel said during the company's investor day conference on Tuesday. "That, I can take off the table," Patel said, adding that it was more economical to buy propylene from a partner and focus instead on derivatives investments. Industrial Info already has assessed the LyondellBasell project as having a low probability of moving forward as planned. For more information, see Industrial Info's project report.
Enterprise also said it plans to complete construction of a second isobutene dehydrogenation (IBDH) unit by the end of this year at the Mont Belvieu site. Using Honeywell International (NYSE:HON) (Morris Plains, New Jersey) UOP C4 Oleflex technology, the plant will produce 425,000 metric tons per year of isobutylene. Optimized Process Designs LLC (Katy, Texas) is providing engineering, procurement and construction (EPC) for the IBDH unit. For more information, see Industrial Info's project report. For related information on Enterprise, see August 1, 2019, article - With New Export Terminal, Enterprise Products Makes Key Move in U.S. Crude Oil Export Market.
Industrial Info is tracking seven PDH-related projects in the U.S., ranging in value from $1 billion to $6.4 billion. During Industrial Info's July 18 2019-2020 Global Chemical Processing Outlook, Trey Hamblet, Industrial Info's vice president of Chemical Processing Industry research, noted that PDH production in the U.S. was nearly non-existent 15 years ago.
"That tide has changed quite significantly and it has changed for a number of reasons," Hamblet said. "Here in North America, it has changed because we stopped yielding polymer-grade propylene in our ethylene crackers when we moved to lighter feedstock. It was no longer available and it necessitated the construction of these (PDH) plants so that we could continue production of polypropylene and other commodities that require the same grade of propylene."
Also, Hamblet said, changes in the refining industry led to less production of polymer-grade propylene, leading to the need for more PDH units to fill the demand gap.
"So that really created the trend for PDH," Hamblet said. "It's similar even in East Asia and those regions of the world, as their feedstock mix changed and demand for certain commodities required a rich polymer-grade propylene that has created an opportunity for these PDH units."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
