CPChem Nears Completion of Major Expansion in Texas

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Researched by Industrial Info Resources (Sugar Land, Texas)--Chevron Phillips Chemical Company LLC (CPChem), a joint venture of Chevron Corporation (NYSE:CVX) (San Ramon, California) and ConocoPhillips (NYSE:COP) (Houston, Texas), began construction for a major new production unit addition in late 2007 at its Borger, Texas, plant site. The company expects to be complete with the estimated $250 million project this spring. This project marks the end of major spending of this size in the North America region by CPChem for the foreseeable future, considering the current economic climate.

This new unit will produce an estimated 22 million pounds per year of polyphenylene sulfide resins, marketed under the Ryton product name. Jacobs Engineering Group Incorporated (NYSE:JEC) (Pasadena, California) served as the project's engineering and procurement firm, and general construction trades where provided by Zachry Construction Corporation (San Antonio, Texas). Originally planned to be complete in the first quarter of this year, startup is expected by May of 2009 and represents a relatively small deviation from the original schedule considering the hurdles put in the project's path during recent economic struggles.

Looking further into the rest of this year and even into 2010, it appears that spending plans for CPChem will adopt maintenance as the focus for a majority of investments in the near future. An estimated $52 million in planned maintenance turnarounds have been identified so far as part of Industrial Info's North American Project Database. These planned turnarounds are expected to take place in the next 18 to 20 months.

Last year, CPChem formed a joint venture with Dow Chemical (NYSE:DOW) to consolidate styrene resources across North American and South America. This venture currently operates under the name American Styrenics LLC. Prior to the formation of this new venture, CPChem had begun an expansion of its ethylbenzene unit located in Saint James, Louisiana. This project should be nearing completion during the summer months of this year with some of the tie-ins being completed during a plant-wide turnaround this spring.

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