Defining Americas Styrenics -- A Venture Focused on Polystyrene Expansion

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Researched by Industrial Info Resources (Sugar Land, Texas)--The Dow Chemical Company (NYSE:DOW) (Midland, Michigan) and Chevron Phillips Chemical Company LP (CPChem) (The Woodlands, Texas), in a recent joint venture, formed Americas Styrenics LLC. The 50:50 joint venture between two chemical manufacturing monoliths represents the largest consolidation of polystyrene production capacity in the Western Hemisphere to date. In combining resources, the joint venture positions itself to focus on its inherent strengths, thereby further expanding market presence and commanding a greater market share.

Americas Styrenics consists of combined assets from both parent companies. CPChem contributed assets in St. James, Louisiana, and Marietta, Ohio. Dow Chemical contributed domestic assets in Gales Ferry, Connecticut; Joliet, Illinois; Ironton, Ohio; and Torrance, California. Additionally, Dow contributed international assets from Cartagena, Colombia, and Guaruja, Brazil. Americas Styrenics is headquartered in The Woodlands with a staff of approximately 60 employees gleaned from parent companies.

October 2008 will prove to be an eventful month for the new company. In addition to getting organized into new positions and assignments, the headquarters, as well as the Americas Styrenics assets, will be segregated and become more clearly defined as separate plants. In many cases, this involves separating physical utilities, logistics and accounting from units still wholly owned by parent companies at the same site.

In separating physical units and plants from others on the same site, Americas Styrenics must also separate energy and utility supply lines from those of its parents and other companies in some cases. In plants with comingled utility and power supply sources, separation of energy and utilities becomes imperative. These utilities include electricity, steam, fuel gas/oil, process water, waste water, plant air and nitrogen. Equipment such as storage tanks, gas/air compressors/dryers, waste water treatment provisions, receivers, electrical substations, and switchgear rooms will need to be built, as well as, piping modifications and additions, instrumentations and meters. New power lines will be needed in multiple projects to accomplish this goal within the various facilities falling under the umbrella of the new company. In some instances, considerations are being given to additional projects to further move the assets of the new Americas Styrenics joint venture toward energy self-sufficiency.

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